Document:

Execution Copy

 

CREDIT AGREEMENT

dated as of November 26, 2013,

 

among

 

INTERNAP NETWORK SERVICES CORPORATION,

as Borrower,

 

THE GUARANTORS PARTY HERETO,

as Guarantors,

 

THE LENDERS PARTY HERETO,

 

JEFFERIES FINANCE LLC,

as Administrative Agent and Collateral Agent,

 

JEFFERIES FINANCE LLC and PNC CAPITAL MARKETS LLC,

as Joint Lead Arrangers and Joint Book Managers,

 

PNC BANK, NATIONAL ASSOCIATION,

as Syndication Agent,

 

ING CAPITAL LLC,

as Documentation Agent,

and

 

JEFFERIES FINANCE LLC,

as Issuing Bank and Swingline Lender

	 

 

    	  

    	 

    
 

 

TABLE OF CONTENTS

	
Article I          DEFINITIONS

	
2

	 	 
	
Section 1.01

	
Defined Terms

	
2

	 	 	 
	
Section 1.02

	
Classification of Loans and Borrowings

	
54

	 	 	 
	
Section 1.03

	
Terms Generally

	
54

	 	 	 
	
Section 1.04

	
Accounting Terms; GAAP

	
55

	 	 	 
	
Section 1.05

	
Pro Forma Calculations

	
55

	 	 	 
	
Section 1.06

	
Resolution of Drafting Ambiguities

	
56

	 	 	 
	
Article II         THE CREDITS

	
56

	 	 
	
Section 2.01

	
Commitments

	
56

	 	 	 
	
Section 2.02

	
Loans

	
56

	 	 	 
	
Section 2.03

	
Borrowing Procedure

	
58

	 	 	 
	
Section 2.04

	
Evidence of Debt; Repayment of Loans

	
58

	 	 	 
	
Section 2.05

	
Fees

	
59

	 	 	 
	
Section 2.06

	
Interest on Loans

	
61

	 	 	 
	
Section 2.07

	
Termination and Reduction of Commitments

	
62

	 	 	 
	
Section 2.08

	
Interest Elections

	
62

	 	 	 
	
Section 2.09

	
Amortization of Term Borrowings

	
64

	 	 	 
	
Section 2.10

	
Optional and Mandatory Prepayments of Loans

	
64

	 	 	 
	
Section 2.11

	
Alternate Rate of Interest

	
68

	 	 	 
	
Section 2.12

	
Increased Costs; Change in Legality

	
68

	 	 	 
	
Section 2.13

	
Breakage Payments

	
71

	 	 	 
	
Section 2.14

	
Payments Generally; Pro Rata Treatment; Sharing of Setoffs

	
71

	 	 	 
	
Section 2.15

	
Taxes

	
73

	 	 	 
	
Section 2.16

	
Mitigation Obligations; Replacement of Lenders

	
76

	 	 	 
	
Section 2.17

	
Swingline Loans

	
80

	 	 	 
	
Section 2.18

	
Letters of Credit

	
82

	 	 	 
	
Section 2.19

	
Increases of the Term Loan and Revolving Commitments

	
89

	 	 	 
	
Section 2.20

	
Amend and Extend Transactions

	
92

	 	 	 
	
Article III        REPRESENTATIONS AND WARRANTIES

	
95

 

    	- i -

    	 

    
 

 

	
Section 3.01

	
Organization; Powers; Regulatory Licenses

	
95

	 	 	 
	
Section 3.02

	
Authorization; Enforceability

	
96

	 	 	 
	
Section 3.03

	
No Conflicts; No Default

	
96

	 	 	 
	
Section 3.04

	
Financial Statements; Projections

	
96

	 	 	 
	
Section 3.05

	
Properties

	
98

	 	 	 
	
Section 3.06

	
Intellectual Property

	
98

	 	 	 
	
Section 3.07

	
Equity Interests and Subsidiaries

	
99

	 	 	 
	
Section 3.08

	
Litigation; Compliance with Legal Requirements

	
100

	 	 	 
	
Section 3.09

	
Agreements

	
100

	 	 	 
	
Section 3.10

	
Federal Reserve Regulations

	
100

	 	 	 
	
Section 3.11

	
Investment Company Act, etc

	
101

	 	 	 
	
Section 3.12

	
Use of Proceeds

	
101

	 	 	 
	
Section 3.13

	
Taxes

	
101

	 	 	 
	
Section 3.14

	
No Material Misstatements

	
101

	 	 	 
	
Section 3.15

	
Labor Matters

	
102

	 	 	 
	
Section 3.16

	
Solvency

	
102

	 	 	 
	
Section 3.17

	
Employee Benefit Plans

	
102

	 	 	 
	
Section 3.18

	
Environmental Matters

	
103

	 	 	 
	
Section 3.19

	
Insurance

	
103

	 	 	 
	
Section 3.20

	
Mortgages

	
104

	 	 	 
	
Section 3.21

	
Anti-Terrorism Law; Foreign Corrupt Practices Act

	
104

	 	 	 
	
Section 3.22

	
Security Documents

	
105

	 	 	 
	
Section 3.23

	
Acquisition Documents; Status of Obligations as Senior Indebtedness, etc

	
105

	 	 	 
	
Section 3.24

	
License Subsidiaries

	
106

	  	  
	
Article IV        CONDITIONS TO CREDIT EXTENSIONS

	
106

	 	 
	
Section 4.01

	
Conditions to Initial Credit Extension

	
106

	 	 	 
	
Section 4.02

	
Conditions to All Credit Extensions

	
112

	  	  
	
Article V        AFFIRMATIVE COVENANTS

	
113

	 	 
	
Section 5.01

	
Financial Statements, Reports, etc

	
113

	 	 	 
	
Section 5.02

	
Litigation and Other Notices

	
116

 

    	- ii -

    	 

    
 

 

	
Section 5.03

	
Existence; Businesses and Properties

	
117

	 	 	 
	
Section 5.04

	
Insurance

	
117

	 	 	 
	
Section 5.05

	
Obligations and Taxes

	
119

	 	 	 
	
Section 5.06

	
Employee Benefits

	
119

	 	 	 
	
Section 5.07

	
Maintaining Records; Access to Properties and Inspections; Annual Meetings

	
119

	 	 	 
	
Section 5.08

	
Use of Proceeds

	
120

	 	 	 
	
Section 5.09

	
Compliance with Environmental Laws; Environmental Reports

	
120

	 	 	 
	
Section 5.10

	
Compliance Policy

	
120

	 	 	 
	
Section 5.11

	
Additional Collateral; Additional Guarantors

	
121

	 	 	 
	
Section 5.12

	
Security Interests; Further Assurances

	
123

	 	 	 
	
Section 5.13

	
Information Regarding Collateral

	
123

	 	 	 
	
Section 5.14

	
Maintenance of Ratings

	
123

	 	 	 
	
Section 5.15

	
Post Closing Matters

	
123

	  	  
	
Article VI        NEGATIVE COVENANTS

	
123

	  	  
	
Section 6.01

	
Indebtedness

	
123

	 	 	 
	
Section 6.02

	
Liens

	
125

	 	 	 
	
Section 6.03

	
Sale and Leaseback Transactions

	
128

	 	 	 
	
Section 6.04

	
Investments, Loans and Advances

	
128

	 	 	 
	
Section 6.05

	
Mergers and Consolidations

	
130

	 	 	 
	
Section 6.06

	
Asset Sales

	
131

	 	 	 
	
Section 6.07

	
Acquisitions

	
132

	 	 	 
	
Section 6.08

	
Dividends

	
133

	 	 	 
	
Section 6.09

	
Transactions with Affiliates

	
133

	 	 	 
	
Section 6.10

	
Financial Covenants

	
134

	 	 	 
	
Section 6.11

	
Prepayments of Other Indebtedness; Modifications of Organizational Documents, Acquisition and Certain Other Documents, etc

	
136

	 	 	 
	
Section 6.12

	
Limitation on Certain Restrictions on Subsidiaries

	
137

	 	 	 
	
Section 6.13

	
Limitation on Issuance of Capital Stock

	
137

	 	 	 
	
Section 6.14

	
Business

	
137

	 	 	 
	
Section 6.15

	
Limitation on Accounting Changes

	
138

 

    	- iii -

    	 

    
 

 

	
Section 6.16

	
Fiscal Periods

	
138

	 	 	 
	
Section 6.17

	
No Further Negative Pledge

	
138

	 	 	 
	
Section 6.18

	
Anti-Terrorism Law; Anti-Money Laundering

	
138

	 	 	 
	
Section 6.19

	
Embargoed Person

	
138

	 	 	 
	
Section 6.20

	
Compliance with Canadian Pension Plans

	
139

	 	 	 
	
Section 6.21

	
Permitted Activities of License Subsidiaries

	
139

	 	 	 
	
Section 6.22

	
Regulatory Licenses

	
139

	 	 
	
Article VII        GUARANTEE

	
140

	 	 
	
Section 7.01

	
The Guarantee

	
140

	 	 	 
	
Section 7.02

	
Obligations Unconditional

	
140

	 	 	 
	
Section 7.03

	
Reinstatement

	
141

	 	 	 
	
Section 7.04

	
Subrogation; Subordination

	
142

	 	 	 
	
Section 7.05

	
Remedies

	
142

	 	 	 
	
Section 7.06

	
Instrument for the Payment of Money

	
142

	 	 	 
	
Section 7.07

	
Continuing Guarantee

	
142

	 	 	 
	
Section 7.08

	
General Limitation on Guarantee Obligations

	
142

	 	 	 
	
Section 7.09

	
Release of Guarantors

	
143

	 	 	 
	
Section 7.10

	
Right of Contribution

	
143

	 	 	 
	
Section 7.11

	
Qualified ECP Guarantors

	
143

	 	 	 
	
Article VIII        EVENTS OF DEFAULT

	
144

	 	 
	
Section 8.01

	
Events of Default

	
144

	 	 	 
	
Section 8.02

	
Rescission

	
148

	 	 	 
	
Section 8.03

	
Borrower’s Right to Cure

	
148

	 	 	 
	
Section 8.04

	
Application of Proceeds

	
149

	 	 	 
	
Article IX        THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT

	
150

	 	 
	
Section 9.01

	
Appointment

	
150

	 	 	 
	
Section 9.02

	
Agent in Its Individual Capacity

	
151

	 	 	 
	
Section 9.03

	
Exculpatory Provisions

	
151

	 	 	 
	
Section 9.04

	
Reliance by Agent

	
152

	 	 	 
	
Section 9.05

	
Delegation of Duties

	
152

	 	 	 
	
Section 9.06

	
Successor Agent

	
153

 

    	- iv -

    	 

    
 

 

	
Section 9.07

	
Non-Reliance on Agent and Other Lenders

	
153

	  	  	  
	
Section 9.08

	
Name Agents

	
154

	  	  	  
	
Section 9.09

	
Indemnification

	
154

	  	  	  
	
Section 9.10

	
Reserved

	
154

	  	  	  
	
Section 9.11

	
Lender Action

	
154

	  	  	  
	
Section 9.12

	
Withholding Taxes

	
155

	  	  	  
	
Section 9.13

	
Lender’s Representations, Warranties and Acknowledgements

	
155

	  	  	  
	
Section 9.14

	
Security Documents and Guarantee

	
156

	  	  	  
	
Section 9.15

	
Administrative Agent May File Bankruptcy Disclosure and Proofs of Claim

	
158

	  	  
	
Article X       MISCELLANEOUS

	
158

	  	  
	
Section 10.01

	
Notices

	
158

	  	  	  
	
Section 10.02

	
Waivers; Amendment

	
161

	  	  	  
	
Section 10.03

	
Expenses; Indemnity; Damage Waiver

	
165

	  	  	  
	
Section 10.04

	
Successors and Assigns

	
167

	  	  	  
	
Section 10.05

	
Survival of Agreement

	
174

	  	  	  
	
Section 10.06

	
Counterparts; Integration; Effectiveness

	
174

	  	  	  
	
Section 10.07

	
Severability

	
175

	  	  	  
	
Section 10.08

	
Right of Setoff; Marshalling; Payments Set Aside

	
175

	  	  	  
	
Section 10.09

	
Governing Law; Jurisdiction; Consent to Service of Process

	
175

	  	  	  
	
Section 10.10

	
Waiver of Jury Trial

	
176

	  	  	  
	
Section 10.11

	
Headings

	
177

	  	  	  
	
Section 10.12

	
Confidentiality

	
177

	  	  	  
	
Section 10.13

	
Interest Rate Limitation

	
178

	  	  	  
	
Section 10.14

	
Assignment and Assumption

	
178

	  	  	  
	
Section 10.15

	
Obligations Absolute

	
178

	  	  	  
	
Section 10.16

	
Waiver of Defenses; Absence of Fiduciary Duties

	
179

	  	  	  
	
Section 10.17

	
Reinstatement

	
179

	  	  	  
	
Section 10.18

	
USA Patriot Act

	
180

	  	  	  
	
ANNEXES

	  	  
	  	  	  
	
Annex I

	
Initial Lenders and Commitments

	  

 

    	- v -

    	 

    
 

 

SCHEDULES

	
Schedule 1.01(a)

	
Mortgaged Property

	
Schedule 1.01(b)

	
Guarantors

	
Schedule 1.01(c)

	
Pledgors

	
Schedule 1.01(d)

	
Refinancing Indebtedness

	
Schedule 1.01(e)

	
Data Center Leases

	
Schedule 3.01(b)

	
Regulatory Licenses

	
Schedule 3.06(a)

	
Ownership; No Claims; Use of Intellectual Property; Protection of Trade Secrets

	
Schedule 3.07(a)

	
Subsidiaries

	
Schedule 3.07(c)

	
Corporate Organizational Chart

	
Schedule 3.09

	
Material Agreements

	
Schedule 3.18

	
Environmental Matters

	
Schedule 3.19

	
Insurance

	
Schedule 3.20

	
Mortgage Filing Offices

	
Schedule 3.23

	
Acquisition Documents

	
Schedule 4.01(l)(vi)

	
Landlord Access Agreements

	
Schedule 4.01(m)(iii)

	
Title Insurance Amounts

	
Schedule 5.15

	
Post-Closing Matters

	
Schedule 6.01(b)

	
Existing Indebtedness

	
Schedule 6.02(c)

	
Existing Liens

	
Schedule 6.04(b)

	
Existing Investments

	
Schedule 8.01(o)

	
Permissible Data Center Terminations

	  	  
	
EXHIBITS

	  
	 	 
	
Exhibit A

	
Form of Assignment and Assumption

	
Exhibit B

	
Form of Borrowing Request

	
Exhibit C

	
Form of Compliance Certificate

	
Exhibit D

	
Form of Intercompany Note

	
Exhibit E

	
Form of Interest Election Request

	
Exhibit F

	
Form of Landlord Access Agreement

	
Exhibit G

	
Form of LC Request

	
Exhibit H-1

	
Form of Fee Mortgage

	
Exhibit H-2

	
Form of Leasehold Mortgage

	
Exhibit I-1

	
Form of Term Note

	
Exhibit I-2

	
Form of Revolving Note

	
Exhibit I-3

	
Form of Swingline Note

	
Exhibit J-1

	
Form of Perfection Certificate

	
Exhibit J-2

	
Form of Perfection Certificate Supplement

	
Exhibit K

	
Form of Security Agreement

	
Exhibit L

	
Form of Non-Bank Certificate

	
Exhibit M

	
Form of Solvency Certificate

	
Exhibit N-1

	
Form of Opinion of Warner Norcross & Judd LLP

 

    	- vi -

    	 

    
 

 

	
Exhibit N-2

	
Form of Opinion of Jones Day

 

    	- vii -

    	 

    
 

CREDIT AGREEMENT

 

This CREDIT AGREEMENT (this “Agreement”) dated as of November 26, 2013, among Internap Network Services Corporation, a Delaware corporation (“Borrower”), the Guarantors (such term and each other capitalized term used but not defined herein having the meaning given to it in Article I), the Lenders, Jefferies Finance LLC and PNC Capital Markets LLC, as joint lead arrangers (in such capacity, the “Arrangers”) and as book managers (in such capacity, the “Book Managers”), Jefferies Finance LLC, as administrative agent for the Lenders (in such capacity, the “Administrative Agent”) and as collateral agent for the Secured Parties (in such capacity, the “Collateral Agent”), PNC Bank, National Association, as syndication agent (in such capacity, the “Syndication Agent”), ING Capital LLC, as documentation agent  (in such capacity, the “Documentation Agent”), JEFFERIES FINANCE LLC, as swingline lender (in such capacity, the “Swingline Lender”) for the Lenders and as issuing bank (in such capacity, the “Issuing Bank”) for the Lenders.

 

WITNESSETH:

 

WHEREAS, 8672377 Canada Inc., a corporation organized under the Canadian Business Corporations Act (“Acquiror”) and a Wholly Owned Subsidiary of Borrower, has entered into a Share Purchase Agreement, dated as of October 30, 2013 (as amended, supplemented or otherwise modified from time to time in accordance with the provisions hereof and thereof, together with the annexes, schedules, exhibits and attachments thereto and the Transition Plan, the “Purchase Agreement”), among Acquiror, Groupe iWeb Inc. (also known as iWeb Group Inc.), a corporation organized under the Canadian Business Corporations Act (“Target”), Borrower, the sellers party thereto (collectively, the “Sellers”) and Novacap Technologies III, L.P., as sellers’ representative, to acquire (the “Acquisition”) all of the outstanding Equity Interests of Target from the Sellers.

 

WHEREAS, Borrower has requested the Lenders to extend credit in the form of (a) Initial Term Loans on the Closing Date in an aggregate principal amount not in excess of $300,000,000 and (b) Revolving Loans at any time and from time to time before the Revolving Credit Maturity Date in an aggregate principal amount at any time outstanding not in excess of $50,000,000.  Borrower has requested the Swingline Lender to extend credit at any time and from time to time before the Revolving Credit Maturity Date in the form of Swingline Loans in an aggregate principal amount at any time outstanding not in excess of $10,000,000.  Borrower has requested the Issuing Bank to issue Letters of Credit in an aggregate face amount at any time outstanding not in excess of $15,000,000 to support payment obligations incurred in the ordinary course of business by Borrower and its Subsidiaries.  The proceeds of the Initial Term Loans are to be used solely to finance the Transactions and to pay any related fees and expenses.  The proceeds of the Revolving Loans and the Swingline Loans are to be used (i) on the Closing Date to pay upfront fees (or original issue discount) and expenses in connection with the Credit Facilities and (ii) after the Closing Date for working capital and general corporate purposes of Borrower and its Subsidiaries.

 

    	1

    	 

    
 

 

WHEREAS, the Lenders are willing to extend such credit to Borrower, and the Issuing Bank is willing to issue Letters of Credit for the account of Borrower, in each case on the terms and subject to the conditions set forth herein.

 

Accordingly, the parties hereto agree as follows:

 

ARTICLE I

DEFINITIONS

 

Section 1.01    Defined Terms.  As used in this Agreement, the following terms have the meanings specified below:

 

“ABR” when used in reference to any Loan or Borrowing, is used when such Loan comprising such Borrowing is, or the Loans comprising such Borrowing are, bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

 

“ABR Borrowing” means a Borrowing comprised of ABR Loans.

 

“ABR Loan” means any ABR Term Loan or ABR Revolving Loan.

 

“ABR Revolving Loan” means any Revolving Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

 

“ABR Term Loan” means any Term Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

 

“Acquired Business” means the Target and its Subsidiaries.

 

“Acquiror” has the meaning set forth in the recitals hereto.

 

“Acquisition” has the meaning set forth in the recitals hereto.

 

“Acquisition Consideration” means the purchase consideration for a Permitted Acquisition and all other payments (including related acquisition fees, costs and expenses), directly or indirectly, by Borrower or any of its Subsidiaries in exchange for, or as part of, or in connection with, a Permitted Acquisition, whether paid in cash or by exchange of Equity Interests or of properties or otherwise and whether payable at or before the consummation of a Permitted Acquisition or deferred for payment at any future time, whether or not any such future payment is subject to the occurrence of any contingency, and includes any and all payments representing the purchase price and any assumptions or repayments of Indebtedness, Contingent Obligations and/or Earnouts; provided that any such Earnout that is subject to a contingency shall be considered Acquisition Consideration only to the extent of the reserve, if any, required under GAAP (as determined at the time of the consummation of such Permitted Acquisition) to be established in respect thereof by Borrower or any of its Subsidiaries.

 

    	2

    	 

    
 

 

“Acquisition Documents” means the collective reference to the Purchase Agreement and the other documents listed or required to be listed on Schedule 3.23.

 

“Adjusted LIBOR Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per annum (rounded upward, if necessary, to the next 1/100th of 1%) determined by the Administrative Agent to be equal to (x) the LIBOR Rate for such Eurodollar Borrowing in effect for such Interest Period divided by (y) 1 minus the Statutory Reserves (if any) for such Eurodollar Borrowing for such Interest Period; provided that in no event shall the Adjusted LIBOR Rate be less than zero percent per annum.

 

“Administrative Agent” has the meaning set forth in the preamble hereto and includes each other Person appointed as the successor administrative agent pursuant to Article IX.

 

“Administrative Agent Fees” has the meaning set forth in Section 2.05(b).

 

“Administrative Questionnaire” means an administrative questionnaire in the form supplied from time to time by the Administrative Agent.

 

“Advisors” means legal counsel (including local, regulatory, foreign and in-house counsel), auditors, accountants, consultants, appraisers, engineers or other advisors.

 

“Affiliate” means, when used with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified; provided, however, that, (x) for purposes of Section 6.09, the term “Affiliate” shall also include (i) any Person that directly or indirectly owns more than 10% of any class of Equity Interests of the Person specified or (ii) any Person that is an officer or director of the Person specified and (y) for purposes of this Agreement, Jefferies LLC, and its Affiliates shall be deemed to be “Affiliates” of Jefferies Finance LLC.

 

“Agents” means the Arrangers, the Syndication Agent, the Documentation Agent, the Administrative Agent, the Collateral Agent and the Book Managers; and “Agent” means any of them as the context requires.

 

“Agreement” has the meaning set forth in the preamble hereto.

 

“Alternate Base Rate” means, for any day, a rate per annum (rounded upward, if necessary, to the next 1/100th of 1%) equal to the greater of (a) the Base Rate in effect on such day, (b) with respect to the Term Loans issued on the Closing Date, 2.00% per annum, (c) the Federal Funds Effective Rate in effect on such day plus 0.50% and (d) except during the Eurodollar Unavailability Period, the Adjusted LIBOR Rate for a Eurodollar Loan with a one-month interest period (or if such day is not a Business Day, the immediately preceding Business Day) plus 1.00%.  If the Administrative Agent shall have determined (which determination shall be conclusive and binding absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate or the Adjusted LIBOR Rate for any reason, including the inability or failure of the Administrative Agent to obtain sufficient quotations in accordance with the terms of the definition thereof, the Alternate Base Rate shall be determined without regard to clause (c) or (d), as applicable, of the preceding sentence until the circumstances giving rise to such inability no longer exist; provided that in no event shall the Alternate Base Rate be less than zero percent per annum.  Any change in the Alternate Base Rate due to a change in the Base Rate, the Federal Funds Effective Rate or the then applicable or the Adjusted LIBOR Rate shall be effective on the effective date of such change in the Base Rate, the Federal Funds Effective Rate or the then applicable Adjusted LIBOR Rate, respectively.

 

    	3

    	 

    
 

 

“Anti-Terrorism Laws” has the meaning set forth in Section 3.21.

 

“Applicable Revolving Loan Margin” means, for any day, with respect to any Revolving Loan that is an ABR Loan, 3.50% per annum and any Revolving Loan that is a Eurodollar Loan, 4.50% per annum.

 

“Applicable Term Loan Margin” means, for any day, with respect to any Term Loan that is an ABR Loan, 4.00% per annum and any Term Loan that is a Eurodollar Loan, 5.00% per annum.

 

“Approved Electronic Communications” means any notice, demand, communication, information, document or other material that any Loan Party provides to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein which is distributed to the Agents or the Lenders by means of electronic communications pursuant to Section 10.01(b).

 

“Approved Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or investing in bank and other commercial loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

 

“Arrangers” has the meaning set forth in the preamble hereto.

 

“Asset Sale” means (a) any Disposition of any Property, by any Company and (b) any issuance or sale of any Equity Interests of any Subsidiary of Borrower, in each case, to any Person other than (x) a Loan Party or (y) in the case of a Wholly Owned Subsidiary of Borrower that is not a Loan Party, another Wholly Owned Subsidiary of Borrower that is not a Loan Party.  Notwithstanding the foregoing, none of the following shall constitute “Asset Sales”:  (i) any Disposition of assets permitted by, or expressly referred to in, Section 6.04(c), 6.05(a), 6.06(a), 6.06(d), 6.06(h) or 6.06(i), or (ii) solely for purposes of clause (a) above, any other Disposition of any property, by any Company for Fair Market Value resulting in not more than $2,500,000 in Net Cash Proceeds per Disposition (or series of related Dispositions) and not more than $5,000,000 in Net Cash Proceeds in any fiscal year.

 

    	4

    	 

    
 

 

“Assignment and Assumption” means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required pursuant to Section 10.04(b)), and accepted by the Administrative Agent, substantially in the form of Exhibit A, or such other form as shall be approved by the Administrative Agent from time to time.

 

“Attributable Indebtedness” means, when used with respect to any Sale and Leaseback Transaction, as at the time of determination, the present value (discounted at a rate equivalent to Borrower’s then-current weighted average cost of funds for borrowed money as at the time of determination, compounded on a semi-annual basis) of the total obligations of the lessee for rental payments (and substantially similar payments) during the remaining term of the lease included in any such Sale and Leaseback Transaction.

 

“Auction” has the meaning set forth in Section 10.04(j)(i)).

 

“Bailee Letter” has the meaning set forth in the Security Agreement.

 

“Bankruptcy Code” means Chapter 11 of Title 11 of the United States Code, as amended from time to time and any successor statute and all rules and regulations promulgated thereunder.

 

“Base Amount” has the meaning set forth in  Section 6.10(c).

 

“Base Period” has the meaning set forth in Section 6.10(c).

 

“Base Rate” means, for any day, the prime rate published in The Wall Street Journal for such day; provided that if The Wall Street Journal ceases to publish for any reason such rate of interest, “Base Rate” means the prime lending rate as set forth on the Bloomberg page PRIMBB Index (or successor page) for such day (or such other service as determined by the Administrative Agent from time to time for purposes of providing quotations of prime lending interest rates); each change in the Base Rate shall be effective on the date such change is effective.  The prime rate is not necessarily the lowest rate charged by any financial institution to its customers.

 

“Board” means the Board of Governors of the Federal Reserve System of the United States.

 

“Board of Directors” means, with respect to any Person, (i) in the case of any corporation, the board of directors of such Person, (ii) in the case of any limited liability company, the board of managers or board of directors, as applicable, of such Person, or if such limited liability company does not have a board of managers or board of directors, the functional equivalent of the foregoing, (iii) in the case of any partnership, the board of directors or board of managers, as applicable, of the general partner of such Person and (iv) in any other case, the functional equivalent of the foregoing.

 

“Book Managers” has the meaning set forth in the preamble hereto.

 

“Borrower” has the meaning set forth in the preamble hereto.

 

    	5

    	 

    
 

 

“Borrowing” means (a) Loans of the same Class and Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect, or (b) a Swingline Loan.

 

“Borrowing Request” means a request by Borrower in accordance with the terms of Section 2.03 and substantially in the form of Exhibit B, or such other form as shall be approved by the Administrative Agent.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which banks in New York City are authorized or required by law or other governmental action to close; provided, however, that when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in Dollar deposits in the London interbank market.

 

“Canadian Anti-Terrorism Laws” has the meaning set forth in Section 3.21.

 

“Canadian Pension Plan” means each “registered pension plan” as such term is defined under the Income Tax Act (Canada) that is maintained or contributed to by any Company for its employees or former employees, but does not include the Canada Pension Plan or the Quebec Pension Plan as maintained by the Government of Canada or the Province of Quebec, respectively.

 

“Canadian Sanctions” has the meaning set forth in Section 3.21.

 

“Canadian Welfare Plan” means any medical, health, hospitalization, insurance or other employee benefit or welfare plan or arrangement applicable to employees resident in Canada of any Company, excluding any Canadian Pension Plan.

 

“Capital Expenditures” means, without duplication, (a) any expenditure or commitment to expend money for any purchase or other acquisition of any asset including capitalized leasehold improvements, which would be classified as a fixed or capital asset on a consolidated balance sheet of Borrower and its Subsidiaries prepared in accordance with GAAP, and (b) Capital Lease Obligations and Synthetic Lease Obligations, but excluding (i) expenditures made in connection with the replacement, substitution or restoration of Property pursuant to Section 2.10(f), (ii) the purchase price of equipment that is purchased substantially contemporaneously with the trade-in of existing equipment to the extent that the gross amount of such purchase price is reduced by the credit granted by the seller of such equipment for the equipment being traded in at such time and (iii) Permitted Acquisitions.

 

“Capital Lease” means, with respect to any Person, any lease of, or other arrangement conveying the right to use, any Property by such Person as lessee that has been or should be accounted for as a capital lease on a balance sheet of such Person prepared in accordance with GAAP.

 

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“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any Capital Lease, any lease entered into as part of any Sale and Leaseback Transaction or any Synthetic Lease, or a combination thereof, which obligations are (or would be, if such Synthetic Lease or other lease were accounted for as a Capital Lease) required to be classified and accounted for as Capital Leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof (or the amount that would be capitalized, if such Synthetic Lease or other lease were accounted for as a Capital Lease) determined in accordance with GAAP.

 

“Capital Requirements” means, as to any Person, any matter, directly or indirectly, (i) regarding capital adequacy, capital ratios, capital or liquidity requirements, the calculation of such Person’s capital, liquidity or similar matters, or (ii) affecting the amount of capital required to be obtained or maintained by such Person or any Person controlling such Person (including any direct or indirect holding company), or the manner in which such Person or any Person controlling such Person (including any direct or indirect holding company), allocates capital to any of its contingent liabilities (including letters of credit), advances, acceptances, commitments, assets or liabilities.

 

“Cash Equivalents” means, as of any date of determination and as to any Person, any of the following (a) marketable securities issued, or directly, unconditionally and fully guaranteed or insured, by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than one year from the date of acquisition by such Person, (b) time deposits and certificates of deposit of any Lender or any commercial bank having, or which is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any state thereof or the District of Columbia having, capital and surplus aggregating in excess of $250,000,000 and a rating of “A” (or such other similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act) with maturities of not more than one year from the date of acquisition by such Person, (c) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (a) above entered into with any Person meeting the qualifications specified in clause (b) above, which repurchase obligations are secured by a valid perfected security interest in the underlying securities, (d) commercial paper issued by any Person incorporated in the United States rated at least A-1 or the equivalent thereof by Standard & Poor’s Rating Service or at least P-1 or the equivalent thereof by Moody’s Investors Service Inc., and in each case maturing not more than one year after the date of acquisition by such Person and (e) solely with respect to any Foreign Subsidiary, substantially similar investments to those outlined in clauses (a) through (d) above, of comparable credit quality and denominated in Dollars or the currency of any jurisdiction in which such Foreign Subsidiary conducts the majority of its business.

 

“Cash Collateralized” means, with respect to any Letter of Credit, as of any date, that Borrower shall have deposited with the Collateral Agent for the benefit of the Revolving Lenders, an amount in cash equal to 103% of the LC Exposure as of such date plus any accrued and unpaid interest thereon.  “Cash Collateralize” shall have the correlative meaning.

 

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“Cash Interest Expense” means, for any period, Consolidated Interest Expense for such period, less the sum of (a) interest on any debt paid by the increase in the principal amount of such debt including by issuance of additional debt of such kind or the accretion or capitalization of interest as principal and (b) other than to the extent paid in cash or cash equivalents, items described in clause (f) of the definition of “Consolidated Interest Expense.”

 

“Cash Management Services” “means (a) credit cards for commercial customers (including, without limitation, commercial credit cards and purchasing cards), (b) stored value cards and (c) treasury management services (including, without limitation, controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository network services).

 

“Casualty Event” means any loss of title (other than through a consensual Disposition of such Property in accordance with this Agreement) or any loss of or damage to or any destruction of, or any condemnation or other taking (including by any Governmental Authority) of, any Property of any Company.  “Casualty Event” shall include any taking of all or any part of any Real Property of any Person or any part thereof, in or by condemnation or other eminent domain proceedings pursuant to any Legal Requirement, or by reason of the temporary requisition of the use or occupancy of all or any part of any Real Property of any Person or any part thereof by any Governmental Authority, or any settlement in lieu thereof.

 

“CERCLA” means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. § 9601 et seq.

 

A “Change in Control” means the occurrence of any of the following:

 

(a)           any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act, but excluding any employee benefit plan of such person or group or its respective subsidiaries, and any Person acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan), is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for purposes of this clause such person or group shall be deemed to have “beneficial ownership” of all securities that such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time (such right, an “option right”)), directly or indirectly, of Voting Stock of Borrower representing more than 40% of the voting power of the total outstanding Voting Stock of Borrower (and taking into account all such securities that such person or group has the right to acquire (whether pursuant to an option right or otherwise));

 

(b)          during any period of 12 consecutive months, a majority of the members of the Board of Directors of Borrower cease to be composed of individuals (i) who were members of that Board of Directors at the commencement of such period, (ii) whose election or nomination to that Board of Directors was approved by individuals referred to in preceding clause (i) constituting at the time of such election or nomination at least a majority of that Board of Directors or (iii) whose election or nomination to that Board of Directors was approved by individuals referred to in preceding clauses (i) and (ii) constituting at the time of such election or nomination at least a majority of that Board of Directors (excluding, in the case of both preceding clauses (i) and (ii), any individual whose initial nomination for, or assumption of office as, a member of that Board of Directors occurs as a result of an actual (or threatened) solicitation of proxies or consents for the election or removal of one or more directors by any person or group other than a solicitation for the election of one or more directors by or on behalf of the Board of Directors), or

 

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(c)           any Person or two or more Persons acting in concert shall have acquired by contract or otherwise, or shall have entered into a contract or arrangement that, upon consummation thereof, will result in its or their acquisition of the power to exercise, directly or indirectly, a controlling influence over the management or policies of Borrower, or control over the equity securities of Borrower entitled to vote for members of the Board of Directors of Borrower on a fully-diluted basis (and taking into account all such securities that such Person or Persons have the right to acquire (whether pursuant to an option right or otherwise)) representing 40% or more of the combined voting power of such securities.

 

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, order, rule, regulation, policy, or treaty by any Governmental Authority, (b) any change in any law, order, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

 

“Charges” has the meaning set forth in Section 10.13.

 

“Claims” has the meaning set forth in Section 10.03(b).

 

“Class,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans, Term Loans or Swingline Loans and, when used in reference to any Commitment, refers to whether such Commitment is a Revolving Commitment, Term Loan Commitment or Swingline Commitment.

 

“Closing Date” means the date of the initial Credit Extension hereunder.

 

“Code” means the Internal Revenue Code of 1986, as amended.

 

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“Collateral” means, collectively, all of the Security Agreement Collateral, the Mortgaged Property and all other Property of whatever kind and nature, whether now existing or hereafter acquired, pledged or purported to be pledged as collateral or otherwise subject to a security interest or purported to be subject to a security interest under any Security Document.

 

“Collateral Account” has the meaning set forth in the Security Agreement.

 

“Collateral Agent” has the meaning set forth in the preamble hereto.

 

“Commitment” means, with respect to any Lender, such Lender’s Revolving Commitment, Term Loan Commitment or Swingline Commitment.

 

“Commitment Fee” has the meaning set forth in Section 2.05(a).

 

“Commitment Letter” means the Commitment Letter, dated October 30, 2013, among Borrower, Jefferies Finance LLC, PNC Bank, National Association and PNC Capital Markets LLC.

 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

 

“Communications” has the meaning set forth in Section 10.01(d).

 

“Communications Act” means, collectively, the Communications Act of 1934, as amended by the Telecommunications Act of 1996, and as further amended, and the rules and regulations promulgated thereunder, including, without limitation, C.F.R. Title 47 and the rules, regulations and decisions by the FCC, in each case, as from time to time in effect.

 

“Companies” means Borrower and its Subsidiaries; and “Company” means any one of them.

 

“Compliance Certificate” means a certificate of a Financial Officer of Borrower substantially in the form of Exhibit C or such other form as may be approved by the Administrative Agent and Borrower.

 

“Confidential Information Memorandum” means that certain confidential information memorandum dated November 8, 2013.

 

“Consolidated Amortization Expense” means, for any period, the amortization expense of Borrower and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

 

“Consolidated Current Assets” means, as at any date of determination, the total assets of Borrower and its Subsidiaries (other than cash, cash equivalents and marketable securities) which may properly be classified as current assets on a consolidated balance sheet of Borrower and its Subsidiaries in accordance with GAAP.

 

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“Consolidated Current Liabilities” means, as at any date of determination, the total liabilities of Borrower and its Subsidiaries which may properly be classified as current liabilities (other than the current portion of any Loans) on a consolidated balance sheet of Borrower and its Subsidiaries in accordance with GAAP.

 

“Consolidated Depreciation Expense” means, for any period, the depreciation expense of Borrower and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

 

“Consolidated EBITDA” means, for any period, Consolidated Net Income for such period, adjusted by (x) adding thereto, without duplication, in each case only to the extent (and in the same proportion) deducted in determining such Consolidated Net Income (and with respect to the portion of Consolidated Net Income attributable to any Subsidiary of Borrower only if a corresponding amount of cash would be permitted to be distributed to Borrower by such Subsidiary by operation of the terms of its Organizational Documents and all agreements, instruments, Orders and other Legal Requirements applicable to such Subsidiary or its equityholders during such period):

 

(a)           Consolidated Interest Expense for such period;

 

(b)           Consolidated Amortization Expense for such period;

 

(c)           Consolidated Depreciation Expense for such period;

 

(d)           Consolidated Tax Expense for such period;

 

(e)           non-recurring costs and expenses directly incurred, within 60 days following the Closing Date, in connection with the Transactions;

 

(f)           customary transaction costs, fees and expenses in connection with any Permitted Acquisition, Investment permitted under Section 6.04(n) or (o), Equity Issuances or the incurrence of any Indebtedness permitted hereunder, including a refinancing thereof;

 

(g)           customary transaction costs, fees and expenses in connection with any contemplated Permitted Acquisition, Investment permitted under Section 6.04(n) or (o), Equity Issuances or the incurrence of any Indebtedness permitted hereunder that is not consummated not to exceed $1,500,000 for any Test Period;

 

(h)           nonrecurring or extraordinary cash losses and expenses not to exceed $5,000,000 for any Test Period;

 

(i)            restructuring charges or reserves incurred during such period determined on a consolidated basis in accordance with GAAP;

 

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(j)            non-cash compensation expense (including deferred non-cash compensation expense), or other non-cash expenses or charges, arising from the sale or issuance of Equity Interests, the granting of stock options, and the granting of stock appreciation rights and similar arrangements (including any repricing, amendment, modification, substitution, or change of any such Equity Interests, stock option, stock appreciation rights, or similar arrangements) minus the amount of any such expenses or charges when paid in cash to the extent not deducted in the computation of Consolidated Net Income determined on a consolidated basis in accordance with GAAP;

 

(k)           the after-tax effect of any loss on sales of fixed assets or write-downs of fixed or intangible assets determined on a consolidated basis in accordance with GAAP;

 

(l)           any additional items that were added back in determining Consolidated EBITDA for such period in the Quality of Earnings Report dated November 8, 2013 provided by Ernst & Young;

 

(m)         the after-tax effect of any loss from the early purchase and retirement or extinguishment of Indebtedness; and

 

(n)          the aggregate amount of all other non-cash items reducing Consolidated Net Income (excluding any non-cash charge that results in an accrual of a reserve for cash charges in any future period or the amortization of a prepaid cash item that was paid in a prior period or any write-down or writeoff of assets for such period); and

 

(y) subtracting therefrom (A) the aggregate amount of all non-cash items increasing Consolidated Net Income (other than the accrual of revenue or recording of receivables in the ordinary course of business) for such period; (B) the after-tax effect of any gain on sales of assets outside of the ordinary course of business, (C) the after-tax effect of any income from the early purchase and retirement or extinguishment of Indebtedness and (D) any items that were deducted in determining Consolidated EBITDA for such period in the Quality of Earnings Report dated November 8, 2013 provided by Ernst & Young; provided, that for the fiscal quarters ended December 31, 2012, March 31, 2013, June 30, 2013 and September 30, 2013, the Consolidated EBITDA of Borrower and its Subsidiaries shall be $18,081,507, $17,180,737, $17,431,300 and $17,723,106, respectively.

 

For purposes of this definition of “Consolidated EBITDA,” “nonrecurring” means any non-cash gain or loss as of any date that (i) did not occur in the ordinary course of Borrower’s or its Subsidiaries’ business and (ii) is of a nature and type that has not occurred in the prior two years and is not reasonably expected to recur in the future.

 

“Consolidated Indebtedness” means, as at any date of determination, without duplication, the aggregate amount of all Indebtedness and all LC Exposure of Borrower and its Subsidiaries, determined on a consolidated basis in accordance with GAAP.

 

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“Consolidated Interest Coverage Ratio” means, for any Test Period, the ratio of (x) Consolidated EBITDA for such Test Period to (y) Consolidated Interest Expense for such Test Period.

 

“Consolidated Interest Expense” means, for any period, the total consolidated interest expense, net of total interest income, of Borrower and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP plus, without duplication:

 

(a)           imputed interest on Capital Lease Obligations and Attributable Indebtedness of Borrower and its Subsidiaries for such period;

 

(b)           commissions, discounts and other fees and charges owed by Borrower or any of its Subsidiaries with respect to letters of credit securing financial obligations, bankers’ acceptance financing, receivables financings and similar credit transactions for such period;

 

(c)           cash contributions to any employee stock ownership plan or similar trust made by Borrower or any of its Subsidiaries to the extent such contributions are used by such plan or trust to pay interest or fees to any Person (other than Borrower or any of its Wholly Owned Subsidiaries) in connection with Indebtedness incurred by such plan or trust for such period;

 

(d)           all interest paid or payable with respect to discontinued operations of Borrower or any of its Subsidiaries for such period;

 

(e)           the interest portion of any payment obligations of Borrower or any of its Subsidiaries for such period deferred for payment at any future time, whether or not such future payment is subject to the occurrence of any contingency, and includes any and all payments representing the purchase price and any assumptions of Indebtedness, Contingent Obligations and/or Earnouts; and

 

(f)           all interest on any Indebtedness of Borrower or any of its Subsidiaries of the type described in clause (e) or (j) of the definition of “Indebtedness” for such period;

 

provided that Consolidated Interest Expense shall be calculated excluding the effect of Hedging Agreements (including associated costs) intended to protect against fluctuations in interest rates, and unrealized gains and losses with respect to any such Hedging Agreements; provided, further, that for each of the fiscal quarters ended December 31, 2012, March 31, 2013, June 30, 2013 and September 30, 2013, and the fiscal quarter ending December 31, 2013, the Consolidated Interest Expense of Borrower and its Subsidiaries shall be deemed to be $5,848,151.

 

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“Consolidated Net Income” means, for any period, the consolidated net income (or loss) of Borrower and its Subsidiaries determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein), without duplication:

 

(a)           the net income (or loss) of any Person (other than a Subsidiary of Borrower) in which any Person other than Borrower or any of its Subsidiaries has an ownership interest, except to the extent that cash in an amount equal to any such income has actually been received by Borrower or (subject to clause (b) below) any of its Wholly Owned Subsidiaries from such Person during such period;

 

(b)           the net income of any Subsidiary of Borrower during such period to the extent that the declaration and/or payment of dividends or similar distributions by such Subsidiary of that income is not permitted by operation of the terms of its Organizational Documents or any agreement, instrument, Order or other Legal Requirement applicable to that Subsidiary or its equityholders during such period, except that Borrower’s equity in net loss of any such Subsidiary for such period shall be included in determining Consolidated Net Income;

 

(c)           earnings resulting from any reappraisal, revaluation or write-up of assets; and

 

(d)           any extraordinary or nonrecurring noncash gain (or extraordinary or nonrecurring noncash loss), together with any related provision for taxes on any such noncash gain (or the tax effect of any such noncash loss), recorded or recognized by Borrower or any of its Subsidiaries during such period.

 

For purposes of this definition of “Consolidated Net Income,” “nonrecurring” means any non-cash gain or loss as of any date that (i) did not occur in the ordinary course of Borrower’s or its Subsidiaries’ business and (ii) is of a nature and type that has not occurred in the prior two years and is not reasonably expected to recur in the future.

 

“Consolidated Tax Expense” means, for any period, the tax expense (including federal, state, local and foreign income taxes) of Borrower and its Subsidiaries, for such period, determined on a consolidated basis in accordance with GAAP.

 

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“Contingent Obligation” means, as to any Person, any obligation, agreement, understanding or arrangement of such Person guaranteeing or intended to guarantee any Indebtedness, leases, dividends or other obligations (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation, agreement, understanding or arrangement of such Person, whether or not contingent, (a) to purchase any such primary obligation or any Property constituting direct or indirect security therefor, (b) to advance or supply funds (i) for the purchase or payment of any such primary obligation or (ii) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth, net equity, liquidity, level of income, cash flow or solvency of the primary obligor, (c) to purchase or lease Property, securities or services primarily for the purpose of assuring the primary obligor of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation, (d) with respect to bankers’ acceptances, letters of credit and similar credit arrangements, until a reimbursement or equivalent obligation arises (which reimbursement obligation shall constitute a primary obligation), or (e) otherwise to assure or hold harmless the primary obligor of any such primary obligation against loss (in whole or in part) in respect thereof; provided, however, that the term “Contingent Obligation” shall not include endorsements of instruments for deposit or collection in the ordinary course of business or any product or service warranties given in the ordinary course of business.  The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation, or portion thereof, in respect of which such Contingent Obligation is made (or, if less, the maximum amount of such primary obligation for which such Person may be liable, whether singly or jointly, pursuant to the terms of the instrument, agreements or other documents or, if applicable, unwritten agreement, evidencing such Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith.

 

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise, and the terms “Controlling” and “Controlled” shall have meanings correlative thereto.

 

“Control Agreement” has the meaning set forth in the Security Agreement.

 

“Corrective Extension Amendment”  has the meaning set forth in Section 2.20(f).

 

“Credit Extension” means, as the context may require, (i) the making of a Loan by a Lender or (ii) the issuance of any Letter of Credit, or the extension of the expiry date or renewal, or any amendment or other modification to increase the amount, of any existing Letter of Credit, by the Issuing Bank.

 

“Credit Facilities” means the revolving credit, swingline, letter of credit and term loan facilities provided for hereunder (including any increases in such facilities pursuant to Section 2.19 and extensions of such term loan facilities pursuant to Section 2.20).

 

“Cumulative Credit Availability” means, as of any date, an amount (which shall not be less than zero), determined on a cumulative basis, equal to, without duplication:

 

	
  

	
(a)

	
the Retained Excess Cash Flow Amount; plus

 

	
  

	
(b)

	
the cumulative amount of Net Cash Proceeds received after the Closing Date that have been contributed as a capital contribution to Borrower, or otherwise received by Borrower in respect of the issuance of Qualified Capital Stock by Borrower, but excluding any such sale or issuance by Borrower of its Equity Interests upon exercise of any warrant or option to directors, officers or employees of any Company; provided that such proceeds were not obtained in connection with the Transactions or any Specified Equity Contribution; plus

 

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(c)

	
an amount equal to any cash actually received by Borrower or any Subsidiary in respect of any Investments made pursuant to Section 6.04(o) to the extent constituting a return of capital or other return with respect to such Investment; provided, that in no case shall such amount exceed the amount of such Investment made pursuant to Section 6.04(o); minus

 

	
  

	
(d)

	
the cumulative amount of Investments made in reliance on Section 6.04(o), minus

 

	
  

	
(e)

	
the cumulative Net Cash Proceeds of Qualified Excluded Issuances; minus

 

	
  

	
(f)

	
the cumulative amount of Capital Expenditures made in reliance on Section 6.10(c).

 

“Data Center Lease” means the Leases listed on Schedule 1.01(e) and any lease of a data center entered into by a Loan Party after the Closing Date (other than pay-as-you-go or partner site leases).

 

“Debt Issuance” means the incurrence by any Company of any Indebtedness after the Closing Date (other than as permitted by Section 6.01).

 

“Debt Service” means, for any period, Cash Interest Expense for such period plus scheduled principal amortization and mandatory principal repayments (whether pursuant to this Agreement or otherwise) of all Indebtedness for such period.

 

“Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect.

 

“Default” means any event, occurrence or condition which is, or upon notice, lapse of time or both would constitute, an Event of Default.

 

“Default Excess” has the meaning set forth in Section 2.16(c).

 

“Default Rate” has the meaning set forth in Section 2.06(c).

 

“Defaulted Loan” has the meaning set forth in Section 2.16(c).

 

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“Defaulting Lender” means any Lender that has (a) failed to fund its portion of any Borrowing, or any portion of its participation in any Letter of Credit or Swingline Loan, within two Business Days of the date on which it shall have been required to fund the same, unless the subject of a good faith dispute between Borrower and such Lender related hereto, (b) notified Borrower, the Administrative Agent, any Issuing Bank, the Swingline Lender or any other Lender in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or under agreements in which it commits to extend credit generally, (c) failed, within three Business Days after written request by the Administrative Agent or Borrower, to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans (unless the subject of a good faith dispute between Borrower and such Lender) and participations in then outstanding Letters of Credit and Swingline Loans; provided that any such Lender shall cease to be a Defaulting Lender under this clause (c) upon receipt of such confirmation by the Administrative Agent or Borrower, (d) otherwise failed to pay over to Borrower, the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within two Business Days of the date when due (unless the subject of a good faith dispute), or (e) (i) been adjudicated as, or determined by any Governmental Authority having regulatory authority over such Person or its Properties or assets to be, insolvent or (ii) become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or custodian, appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment, unless, in the case of any Lender referred to in this clause (e), Borrower, the Administrative Agent, the Swingline Lender and each Issuing Bank shall be satisfied that such Lender intends, and has all approvals required to enable it, to continue to perform its obligations as a Lender hereunder; provided, however, that no Lender shall be deemed to be a Defaulting Lender under this clause (e) solely by virtue of an Undisclosed Administration.  For the avoidance of doubt, a Lender shall not be deemed to be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in such Lender or its parent by a Governmental Authority; provided that, as of any date of determination, the determination of whether any Lender is a Defaulting Lender hereunder shall not take into account, and shall not otherwise impair, any amounts funded by such Lender which have been assigned by such Lender to an SPC pursuant to Section 10.04(h).  Any determination by the Administrative Agent that a Lender is a Defaulting Lender shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender upon delivery of written notice of such determination by the Administrative Agent to Borrower and each other Lender.

 

“Disposition” means, with respect to any Property, any conveyance, sale, lease, sublease, assignment, transfer or other disposition of such Property (including (i) by way of merger, consolidation or amalgamation, (ii) any Sale and Leaseback Transaction and (iii) any Synthetic Lease).

 

“Disqualified Capital Stock” means any Equity Interest which, by its terms (or by the terms of any security or instrument into which it is convertible or for which it is exchangeable or exercisable), or upon the happening of any event, (a) matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, on or before the first anniversary of the Final Maturity Date, (b) is convertible into or exchangeable or exercisable (unless at the sole option of the issuer thereof) for (i) debt securities or other indebtedness or (ii) any Equity Interests referred to in (a) above, in each case at any time on or before the first anniversary of the Final Maturity Date, or (c) contains any repurchase or payment obligation which may come into effect before the first anniversary of the Final Maturity Date.

 

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“Dividend” means, with respect to any Person, that such Person has declared or paid a dividend or returned any equity capital to the holders of its Equity Interests or authorized or made any other distribution, payment or delivery of Property (other than Qualified Capital Stock of such Person) or cash to the holders of its Equity Interests as such, or redeemed, retired, purchased or otherwise acquired, directly or indirectly, for consideration any of its Equity Interests outstanding (or any options or warrants issued by such Person with respect to its Equity Interests), or set aside or otherwise reserved, directly or indirectly, any funds for any of the foregoing purposes, or shall have permitted any of its Subsidiaries to purchase or otherwise acquire for consideration any of the outstanding Equity Interests of such Person (or any options or warrants issued by such Person with respect to its Equity Interests).  Without limiting the foregoing, “Dividends” with respect to any Person shall also include all payments made or required to be made by such Person with respect to any stock appreciation rights, plans, equity incentive or achievement plans or any similar plans or setting aside of or otherwise reserving any funds for the foregoing purposes.

 

“Documentation Agent” has the meaning set forth in the preamble hereto.

 

“Dollars” or “$” means lawful money of the United States.

 

“Domestic Subsidiary” means any Subsidiary other than a Foreign Subsidiary.

 

“Earnout” means, in connection with the Acquisition or any Permitted Acquisition or other Investment, any “earn-out” or other agreement to make any payment the amount of which is, or the terms of payment of which are, in any respect subject to or contingent upon the revenues, income, cash flow or profits (or the like) of any Person or business.

 

“ECP” has the meaning assigned to such term in the definition of Excluded Swap Obligation.

 

“Effective Yield” means, as to any tranche of term loans or revolving loans (including, without limitation, the Term Loans and the Revolving Loans), the effective yield on such tranche of term loans or revolving loans, as applicable, as reasonably determined by the Administrative Agent, taking into account the applicable interest rate margins, interest rate benchmark floors and all fees, including recurring, up-front or similar fees or original issue discount (amortized over four years following the date of incurrence thereof; provided, that if the stated maturity date of a new tranche of term loans or revolving loans, as applicable, is less than four years from the date of determination, then the “Effective Yield” for such tranche of term loans or revolving loans, as applicable, shall be determined using an assumed amortization period equal to the actual remaining life to maturity of such tranche) payable generally to the lenders making such tranche of term loans or revolving loans, as applicable, but excluding any arrangement, structuring or other fees payable in connection therewith that are not generally shared with the lenders thereunder.

 

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 10.04(b) (subject to such consents, if any, as may be required under Section 10.04(b)).

 

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“Embargoed Person” means any Person subject to sanctions or trade restrictions under (a) United States law that is identified on (i) the “List of Specially Designated Nationals and Blocked Persons” (the “SDN List”) maintained by OFAC and/or on any other similar list (“Other List”) maintained by OFAC pursuant to any authorizing statute including the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., the Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and any Executive Order or regulation promulgated thereunder, with the result that the investment in the Loan Parties (whether directly or indirectly) is prohibited by applicable Legal Requirements, or the Loans or other Credit Extensions made by the Lenders and the Issuing Bank would be in violation of Legal Requirements, or (ii) the Executive Order, any related enabling legislation or any other similar executive orders or (b) any person that is designated, listed or otherwise identified under Canadian Sanctions (the Legal Requirements referred to in clauses (a) and (b), collectively, “Sanctions Laws”).

 

“Employee Benefit Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA which is or was maintained, contributed to, or required to be maintained or contributed to by any Company or any of its ERISA Affiliates, excluding any Canadian Welfare Plan or Canadian Pension Plan.

 

“Environment” means any surface or subsurface physical medium or natural resource, including air, land, soil, surface waters, ground waters, stream and river sediments, biota and any indoor area, surface or physical medium.

 

“Environmental Claim” means any claim, notice, demand, Order, action, suit, proceeding, or other communication alleging or asserting liability or obligations under or relating to Environmental Law, including liability or obligation for investigation, assessment, remediation, removal, cleanup, Response, corrective action, monitoring, post-remedial or post-closure studies, investigations, operations and maintenance, injury, damage, destruction or loss to natural resources, personal injury, wrongful death, Property damage, indemnification, fines, penalties or other costs resulting from, related to or arising out of (i) the presence, Release or threatened Release of Hazardous Material in, on, into or from the Environment at any location or (ii) any violation of or non-compliance with Environmental Law, and shall include any claim, notice, demand, Order, action, suit or proceeding seeking damages (including the costs of remediation), contribution, indemnification, cost recovery, penalties, fines, indemnities, compensation or injunctive relief resulting from, related to or arising out of the presence, Release or threatened Release of Hazardous Material or alleged injury or threat of injury to health, safety or the Environment.

 

“Environmental Law” means any and all applicable current and future Legal Requirements relating to health, safety or the Environment, the Release or threatened Release of Hazardous Material, natural resources or natural resource damages, or occupational safety or health.

 

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“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

“Environmental Permit” means any permit, license, approval, consent, registration, notification, exemption or other authorization required by or from a Governmental Authority under any Environmental Law.

 

“Equity Interest” means, with respect to any Person, any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents, including membership interests (however designated, whether voting or nonvoting), of equity of such Person, including, if such Person is a partnership, partnership interests (whether general or limited), or if such Person is a limited liability company, membership interests and any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of Property of, such partnership, whether outstanding on the date hereof or issued on or after the Closing Date, but excluding debt securities convertible or exchangeable into such equity.

 

“Equity Issuance” means, without duplication, (i) any issuance or sale by Borrower after the Closing Date of any Equity Interests in Borrower (including any Equity Interests issued upon exercise of any warrant or option or equity-based derivative) or any warrants or options or equity-based derivatives to purchase Equity Interests in Borrower, (ii) any Preferred Stock Issuance by Borrower or (iii) any contribution to the capital of Borrower.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

“ERISA Affiliate” means, with respect to any Person, any trade or business (whether or not incorporated) that, together with such Person, is treated as a single employer under Section 414(b) or (c) of the Code, or solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.  Any former ERISA Affiliate of a Person or any of its Subsidiaries shall continue to be considered an ERISA Affiliate of such Person or such Subsidiary within the meaning of this definition with respect to the period such entity was an ERISA Affiliate of such Person or such Subsidiary and with respect to liabilities arising after such period for which such Person or such Subsidiary could reasonably be expected to be liable under the Code or ERISA, but in no event for more than six years after such period if no such liability has been asserted against such Person or such Subsidiary; provided, however, that such Person or such Subsidiary shall continue to be an ERISA Affiliate of such Person or such Subsidiary after the expiration of the six-year period solely with respect to any liability asserted against such Person or such Subsidiary before the expiration of such six-year period.

 

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“ERISA Event” means (i) a “reportable event” within the meaning of Section 4043 of ERISA and the regulations issued thereunder with respect to any Pension Plan; (ii) the failure to meet the minimum funding standard of Section 412 of the Code with respect to any Pension Plan (whether or not waived) or the failure to make by its due date a required installment under Section 430(j) of the Code with respect to any Pension Plan or the failure to make any required contribution to a Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination described in Section 4041(c) of ERISA; (iv) the withdrawal by any Company or any of its ERISA Affiliates from any Pension Plan with two or more contributing sponsors or the termination of any such Pension Plan resulting in liability pursuant to Section 4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any event or condition which could reasonably be expected to constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (vi) the imposition of liability on any Company or any of its ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA; (vii) the withdrawal of any Company or any of its ERISA Affiliates in a complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any potential liability therefor, or the receipt by any Company or any of its ERISA Affiliates of notice from any Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the assertion of a material claim (other than routine claims for benefits) against any Employee Benefit Plan, or the assets thereof, or against any Company or any of its ERISA Affiliates in connection with any Employee Benefit Plan; (ix) receipt from the Internal Revenue Service of notice of the failure of any Pension Plan (or any other Employee Benefit Plan intended to be qualified under Section 401(a) of the Code) to qualify under Section 401(a) of the Code, or the failure of any trust forming part of any Pension Plan to qualify for exemption from taxation under Section 501(a) of the Code; (x) the imposition of a Lien pursuant to Section 401(a)(29) or 430(k) of the Code or pursuant to ERISA with respect to any Pension Plan; or (xi) the occurrence of a non-exempt prohibited transaction (within the meaning of Section 4975 of the Code or Section 406 of ERISA) which could reasonably be expected to result in liability to any Company or any of its ERISA Affiliates.

 

“Eurodollar Borrowing” means a Borrowing comprised of Eurodollar Loans.

 

“Eurodollar Loan” means any Eurodollar Revolving Loan or Eurodollar Term Loan.

 

“Eurodollar Revolving Borrowing” means a Borrowing comprised of Eurodollar Revolving Loans.

 

“Eurodollar Revolving Loan” means any Revolving Loan bearing interest at a rate determined by reference to the Adjusted LIBOR Rate.

 

“Eurodollar Term Loan” means any Term Loan bearing interest at a rate determined by reference to the Adjusted LIBOR Rate.

 

“Event of Default” has the meaning set forth in Article VIII.

 

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“Excess Cash Flow” means, for any Excess Cash Flow Period, the sum, without duplication, of:

 

(a)           the sum, without duplication, of:

 

(i)          Consolidated EBITDA for such Excess Cash Flow Period;

 

(ii)         cash items of income during such Excess Cash Flow Period not included in calculating Consolidated EBITDA;

 

(iii)        the decrease, if any, in the Net Working Capital from the beginning to the end of such Excess Cash Flow Period; and

 

(iv)        the reversal, during such Excess Cash Flow Period, of any reserve established pursuant to clause (b)(i) below; minus

 

(b)           the sum, without duplication, of:

 

(i)          the amount of any cash Consolidated Tax Expense paid or payable by Borrower and its Subsidiaries with respect to such Excess Cash Flow Period and for which, to the extent required under GAAP, reserves have been established;

 

(ii)         the amount of any cash Permitted Tax Distributions paid during such Excess Cash Flow Period;

 

(iii)        the amount of Debt Service for such Excess Cash Flow Period;

 

(iv)        amounts actually paid and applied to scheduled amortization of the Loans in accordance with Section 2.09;

 

(v)         the sum of (i) Capital Expenditures made in cash in accordance with Section 6.10 during such Excess Cash Flow Period, to the extent funded from Internally Generated Funds, (ii) cash consideration paid during such Excess Cash Flow Period to make Permitted Acquisitions to the extent funded from Internally Generated Funds and (iii) Investments made in cash pursuant to Section 6.04(n) or (o) during such Excess Cash Flow Period that are designed to increase future Consolidated EBITDA (other than Investments that are principally designed to provide interest income, dividends or gains on principal), to the extent funded from Internally Generated Funds;

 

(vi)        the increase, if any, in the Net Working Capital from the beginning to the end of such Excess Cash Flow Period; and

 

(vii)       cash items of expense (including losses) during such Excess Cash Flow Period not deducted in calculating Consolidated EBITDA.

 

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“Excess Cash Flow Period” means (i) the period taken as one accounting period from January 1, 2014, and ending on December 31, 2014, and (ii) each fiscal year of Borrower thereafter.

 

“Exchange Act” means the Securities Exchange Act of 1934.

 

“Excluded Regulated Subsidiary” means any Subsidiary of Borrower (a) that is prohibited by applicable Legal Requirements existing on the Closing Date or by applicable Legal Requirements or by any contractual obligation existing at the time of acquisition thereof after the Closing Date (to the extent such contractual obligation was not created in contemplation of such acquisition) for so long as such prohibition exists, in each case from guaranteeing the Facilities, or (b) to the extent such Subsidiary providing a guarantee of the Obligations would reasonably be expected to result in an adverse tax consequence to Borrower and its Subsidiaries (including as a result of the operation of Section 956 of the Code or any similar law or regulation in any applicable jurisdiction), as reasonably determined by Borrower, for so long as such adverse tax consequence exists.

 

“Excluded Subsidiary” means (i) any Immaterial Subsidiary, (ii) any Foreign Subsidiary and (iii) any Excluded Regulated Subsidiary.

 

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason not to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (an “ECP”) at the time the Guarantee of such Guarantor becomes effective with respect to such related Swap Obligation.

 

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) net income imposed as a result of such recipient being organized under the laws of, or having its principal office located in, or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such tax, (b) in the case of a Foreign Lender (other than an Eligible Assignee pursuant to a request by Borrower under Section 2.16), any United States federal withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 2.15(e), except, in each case, to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts with respect to such withholding tax pursuant to Section 2.15(a) (it being understood and agreed, for the avoidance of doubt, that any withholding tax imposed on a Foreign Lender as a result of a Change in Law occurring after the time such Foreign Lender became a party to this Agreement shall not be an Excluded Tax) and (c) any United States federal withholding tax imposed as a result of FATCA.

 

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“Executive Order” has the meaning set forth in Section 3.21.

 

“Existing Lien” has the meaning set forth in Section 6.02(c).

 

“Existing Term Loan Class” has the meaning set forth in Section 2.20(a).

 

“Extended Term Loan Maturity Date” means with respect to any tranche of Extended Term Loans, the final maturity date applicable thereto as specified in the applicable Extension Notice accepted by the respective Extending Lender or Extending Lenders.

 

“Extended Term Loans” has the meaning set forth in Section 2.20(a).

 

“Extending Lender” has the meaning set forth in Section 2.20(a).

 

“Extension”  has the meaning set forth in Section 2.20(a).

 

“Extension Amendment” has the meaning set forth in Section 2.20(a).

 

“Extension Date” has the meaning set forth in Section 2.20(b).

 

“Extension Notice” has the meaning set forth in Section 2.20(a).

 

“Extension Offer” has the meaning set forth in Section 2.20(a).

 

“Extension Series” means all Extended Term Loans that are established pursuant to the same Extension Amendments (or any subsequent Extension Amendment to the extent such Extension Amendment expressly provides that the Extended Term Loans provided for therein are intended to be part of any previously established Extension Series) and that provide for the same interest margins, extension fees, if any, and amortization schedule.

 

“Fair Market Value” means, with respect to any asset (including any Equity Interests of any Person), the price at which a willing buyer, not an Affiliate of the seller, and a willing seller who does not have to sell, would agree to purchase and sell such asset, as determined in good faith by the Board of Directors or, pursuant to a specific delegation of authority by such Board of Directors or a designated senior executive officer, of Borrower, or the Subsidiary of Borrower selling such asset.

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

 

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“FCC” means the U.S. Federal Communications Commission, or any successor agency of the federal government administering the Communications Act, including its staff acting under delegated authority.

 

 “Federal Funds Effective Rate” means, for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System of the United States arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary to the next 1/100th of 1%) of the quotations for the day for such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it.

 

“Fee Letter” means the confidential Fee Letter, dated October 30, 2013, among Borrower, Jefferies Finance LLC, PNC Bank, National Association and PNC Capital Markets LLC.

 

“Fees” means the Commitment Fees, the Administrative Agent Fees, the LC Participation Fees, the Fronting Fees and the other fees referred to in Section 2.05(d).

 

“Final Maturity Date” means the later of (i) the Revolving Maturity Date, (ii) the Initial Term Loan Maturity Date and (iii) each Extended Term Loan Maturity Date.

 

“Financial Officer” of any Person means the chief financial officer, principal accounting officer, treasurer, assistant treasurer, controller or assistant controller of such Person.

 

“FIRREA” means the Financial Institutions Reform, Recovery and Enforcement Act of 1989.

 

“Foreign Entity” means any entity not organized under the laws of the United States, any state thereof or the District of Columbia.

 

“Foreign Lender” means any Lender that is not, for United States federal income tax purposes, (i) a citizen or resident of the United States, (ii) a corporation or entity treated as a corporation created or organized in or under the laws of the United States, or any political subdivision thereof, (iii) an estate whose income is subject to U.S. federal income taxation regardless of its source or (iv) a trust if a court within the United States is able to exercise primary supervision over the administration of such trust and one or more United States Persons have the authority to control all substantial decisions of such trust.

 

“Foreign Plan” means any employee benefit plan, program, policy, arrangement or agreement maintained or contributed to by any Company with respect to employees, officers or directors employed, or otherwise engaged, outside the United States and Canada.

 

“Foreign Subsidiary” means a Subsidiary that is organized under the laws of a jurisdiction other than the United States or any state thereof or the District of Columbia.

 

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“Fronting Fee” has the meaning set forth in Section 2.05(c).

 

“Funding Default” has the meaning set forth in Section 2.16(c).

 

“GAAP” means generally accepted accounting principles in the United States, or successors thereto (e.g., subject to Section 1.04, IFRS), applied on a consistent basis.

 

“Governmental Authority” means any federal, state, provincial, territorial, local or foreign (whether civil, administrative, criminal, military or otherwise) court, central bank or governmental agency, tribunal, authority, instrumentality self-regulatory organization, or regulatory body, including the FCC and any PUC, or any subdivision thereof or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers of or pertaining any government or any court, in each case whether associated with a state of the United States, the United States, a province or territory of Canada, Canada or another foreign entity or government (including any supra-national bodies such as the European Union or the European Central Bank).

 

“Governmental Real Property Disclosure Requirements” means any Legal Requirement of any Governmental Authority requiring notification of the buyer, lessee, mortgagee, assignee or other transferee of any Real Property, facility, establishment or business, or any notification, registration or filing to or with any Governmental Authority, in connection with the Disposition (including any transfer of control) of any Real Property, facility, establishment or business, as may be required under any applicable Environmental Law or of any actual or threatened presence or Release in, on, into or from the Environment, or the use, disposal or handling of Hazardous Material on, at, under, from or near the Real Property, facility, establishment or business to be sold, acquired, leased, mortgaged, assigned or transferred.

 

“Granting Lender” has the meaning set forth in Section 10.04(h).

 

“Guaranteed Obligations” has the meaning set forth in Section 7.01.  Notwithstanding anything to the contrary contained herein or in any other Loan Document, in no event will Guaranteed Obligations include any Excluded Swap Obligations.

 

“Guarantees” means the guarantees issued pursuant to Article VII by the Guarantors.

 

“Guarantor” means each Subsidiary listed on Schedule 1.01(b), and each other Subsidiary of any Loan Party that is or becomes a party to this Agreement and the Security Documents pursuant to Section 5.11.

 

“Hazardous Materials” means hazardous substances, hazardous wastes, hazardous materials, polychlorinated biphenyls (“PCBs”) or any substance or compound containing PCBs, asbestos or any asbestos-containing materials in any form or condition, lead-based paint, urea formaldehyde, pesticides, radon or any other radioactive materials including any source, special nuclear or by-product material, petroleum, petroleum products, petroleum-derived substances, crude oil or any fraction thereof, underground or aboveground storage tanks, whether empty or containing any substance, any mold, microbial or fungal contamination that could pose a risk to human health or the Environment or would negatively impact the condition of the Real Property or any other pollutants (including greenhouse gases), contaminants, chemicals, wastes, materials, compounds, constituents or substances, defined under, subject to regulation under, or which can give rise to liability or obligations under, any Environmental Laws.

 

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“Hedging Agreement” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, currency swap transactions, cross-currency rate swap transactions, currency options, cap transactions, floor transactions, collar transactions, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options or warrants to enter into any of the foregoing), whether or not any such transaction is governed by, or otherwise subject to, any master agreement or any netting agreement, and (b) any and all transactions or arrangements of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement (or similar documentation) published from time to time by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such agreement or documentation, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

 

“Hedging Obligations” means obligations under or with respect to Hedging Agreements.

 

“Hedging Termination Value” means, in respect of any one or more Hedging Agreements, after taking into account the effect of any netting agreements relating to such Hedging Agreements (to the extent, and only to the extent, such netting agreements are legally enforceable in Insolvency Proceedings against the applicable counterparty obligor thereunder), (i) for any date on or after the date such Hedging Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (ii) for any date before the date referenced in preceding clause (i), the amount(s) determined as the mark-to-market value(s) for such Hedging Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedging Agreements (which may include a Lender or any Affiliate of a Lender).

 

“IFRS” means International Financial Reporting Standards issued by the International Accounting Standards Board (or the Financial Accounting Standards Board of the American Institute of Certified Public Accountants or the SEC, as the case may be), as in effect from time to time.

 

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“Immaterial Subsidiary” means, as of any date of determination, any Wholly Owned Subsidiary of Borrower (a) whose total assets (on a consolidated basis including its Subsidiaries) as of the last day of the most recently ended Test Period did not exceed $2,500,000 or (b) whose Consolidated EBITDA attributable to such Subsidiary (on a consolidated basis including its Subsidiaries) for such Test Period did not exceed $1,000,000; provided, however, that (x) a Wholly Owned Subsidiary of Borrower that no longer meets the foregoing requirements of this definition or is otherwise required to become a Loan Party pursuant to Section 5.11 shall no longer constitute an Immaterial Subsidiary for purposes of this Agreement and (y) notwithstanding the foregoing, Borrower may elect to cause an Immaterial Subsidiary to become a Loan Party pursuant to Section 4.01 or 5.11, as the case may be, in which case such Immaterial Subsidiary shall, upon satisfaction of the provisions of either such Section, no longer constitute an Immaterial Subsidiary.  Notwithstanding the foregoing, (i)  if the total assets of all Immaterial Subsidiaries as of the last day of the most recently ended Test Period exceeds $10,000,000 or the Consolidated EBITDA attributable to all Immaterial Subsidiaries as of such Test Period exceeds $5,000,000, Borrower shall designate sufficient Immaterial Subsidiaries as no longer constituting Immaterial Subsidiaries to eliminate such excess (or, if Borrower shall have failed to designate such Subsidiaries within 20 Business Days of such excess arising, Subsidiaries shall automatically be deemed not to constitute Immaterial Subsidiaries in descending order based on the amounts of their contributions to total assets until such excess shall have been eliminated), and the Subsidiaries so designated or deemed designated shall not constitute Immaterial Subsidiaries for any purpose of the Loan Documents, (ii) any Subsidiary of Borrower that guarantees or is an obligor of the Indebtedness incurred under this Agreement and the other Loan Documents shall not be deemed an Immaterial Subsidiary, (iii) any Subsidiary of Borrower that is the owner of material Intellectual Property Collateral shall not be deemed an Immaterial Subsidiary, (iv) any License Subsidiary shall not be deemed an Immaterial Subsidiary and (v) any Subsidiary of Borrower that is a party to a Data Center Lease shall not be deemed an Immaterial Subsidiary.  The Immaterial Subsidiaries on the Closing Date are iWeb Peering Corporation and iWeb U.S., LLC.

 

“Impacted Interest Period” has the meaning set forth in the definition of “LIBOR Rate.”

 

“Increasing Lenders” has the meaning set forth in Section 2.19(b).

 

“Incremental Loan Amendment” has the meaning set forth in Section 2.19(d).

 

“Incremental Term Loan” means term loans made pursuant to Section 2.19.

 

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“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or advances; (b) all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or similar instruments; (c) all obligations of such Person under conditional sale or other title retention agreements relating to Property purchased by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such Property); (d) all obligations of such Person issued or assumed as part of the deferred purchase price of Property or services (excluding trade accounts payable and accrued obligations incurred in the ordinary course of business on normal trade terms and not overdue by more than 60 days); (e) all Indebtedness secured by any Lien on Property owned or acquired by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not the obligations secured thereby have been assumed, but limited to the lower of (i) the Fair Market Value of such Property and (ii) the amount of the Indebtedness secured; (f) all Capital Lease Obligations, Purchase Money Obligations and Synthetic Lease Obligations of such Person; (g) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any Equity Interests of such Person, valued, in the case of a redeemable preferred Equity Interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; (h) all Hedging Obligations, valued at the Hedging Termination Value thereof; (i) all obligations of such Person for the reimbursement of any obligor in respect of letters of credit, letters of guaranty, bankers’ acceptances and similar credit transactions; (j) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of Disqualified Capital Stock and (k) all Contingent Obligations of such Person in respect of Indebtedness or obligations of others of the kinds referred to in clauses (a) through (j) above.  The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except (other than in the case of general partner liability) to the extent that terms of such Indebtedness expressly provide that such Person is not liable therefor.

 

“Indemnified Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitee” has the meaning set forth in Section 10.03(b).

 

“Information” has the meaning set forth in Section 10.12.

 

“Interpolated Rate” has the meaning set forth in the definition of “LIBOR Rate.”

 

“Initial Revolving Commitment” means, with respect to each Lender, the commitment, if any, of such Lender to make Revolving Loans hereunder up to the amount set forth on Annex I or on Schedule 1 to the Assignment and Assumption pursuant to which such Lender assumed its Revolving Commitment, as applicable, as the same may be (a)  reduced from time to time pursuant to Section 2.07 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The Initial Revolving Commitment shall exclude any Revolving Commitment Increase. The aggregate principal amount of the Lenders’ Initial Revolving Commitments on the Closing Date is $50,000,000.

 

“Initial Revolving Loans” means a Revolving Loan made pursuant to the Initial Revolving Commitment.

 

“Initial Term Loan Maturity Date” means with respect to the Initial Term Loans, November 26, 2019, or, if such date is not a Business Day, the first Business Day thereafter.

 

“Initial Term Loans” means the Term Loans made on the Closing Date pursuant to Section 2.02.

 

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“Insolvency Laws” means the Bankruptcy Code and all other insolvency, bankruptcy, receivership, liquidation, conservatorship, assignment for the benefit of creditors, moratorium, rearrangement, reorganization, or similar federal or state Legal Requirements of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally, including the Companies’ Creditors Arrangement Act (Canada), the Bankruptcy and Insolvency Act (Canada), the Winding-up and Restructuring Act (Canada) and the Civil Code of Quebec).

 

“Insolvency Proceeding” means (i) any case, action or proceeding before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (ii) any general assignment for the benefit of creditors, formal or informal moratorium, composition, marshaling of assets for creditors or other, similar arrangement in respect of its creditors generally or any substantial portion of its creditors, in each case, undertaken under United States federal or state or non-United States federal or state Legal Requirements, including any Insolvency Laws.

 

“Insurance Policies” means the insurance policies and coverages required to be maintained by each Loan Party that is an owner or lessee of Mortgaged Property with respect to the applicable Mortgaged Property pursuant to Section 5.04 and all renewals and extensions thereof.

 

“Insurance Requirements” means, collectively, all provisions of the Insurance Policies, all requirements of the issuer of any of the Insurance Policies and all Orders, rules, regulations and any other requirements of the National Board of Fire Underwriters (or any other body exercising similar functions) binding upon any Loan Party that is an owner of Mortgaged Property and applicable to the Mortgaged Property or any use or condition thereof.

 

“Intellectual Property” has the meaning set forth in Section 3.06(a).

 

“Intercompany Note” means the intercompany demand promissory note substantially in the form of Exhibit D.

 

“Interest Election Request” means a request by Borrower to convert or continue a Revolving Borrowing or Term Borrowing in accordance with Section 2.08(b), substantially in the form of Exhibit E.

 

“Interest Payment Date” means (a) with respect to any ABR Loan (including Swingline Loans), the last Business Day of each March, June, September and December to occur during any period in which such Loan is outstanding, (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurodollar Loan with an Interest Period of more than three months’ duration, each day before the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period, (c) with respect to any Revolving Loan or Swingline Loan, the Revolving Maturity Date (or such earlier date on which the Revolving Commitments are terminated) and, after such maturity (or termination as the case may be), on each date on which demand for payment is made, (d) with respect to any Initial Term Loan, the Initial Term Loan Maturity Date and, after such maturity, on each date on which demand for payment is made and (e) with respect to any Extended Term Loan, the applicable Extended  Term Loan Maturity Date and, after such maturity, on each date on which demand for payment is made.

 

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“Interest Period” means, with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months thereafter, as Borrower may elect; provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, and (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.  For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

 

“Internally Generated Funds” means funds not constituting the proceeds of any Indebtedness, Debt Issuance, Equity Issuance, Asset Sale or Casualty Event (in each case, without regard to the exclusions from the definitions thereof, other than in the case of an Asset Sale only, any Disposition of assets permitted by Section 6.04(c), 6.05(a), 6.06(a), 6.06(d), 6.06(h), or 6.06(i)).

 

“Investments” has the meaning set forth in Section 6.04.

 

“ISP” means, with respect to any Letter of Credit, the ‘International Standby Practices 1998’ (or ‘ISP 98’) published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance of such Letter of Credit).

 

“Issuing Bank” means, as the context may require, (a) each of Jefferies Finance LLC (directly or through its affiliates, indirectly through Natixis, New York Branch, or its Affiliates or through any other financial institution acceptable to Jefferies Finance LLC) and any Lender reasonably acceptable to the Administrative Agent and Borrower which agrees to issue Letters of Credit hereunder, with respect to Letters of Credit issued by it; (b) any other Lender that may become an Issuing Bank pursuant to Sections 2.18(j) and (k) with respect to Letters of Credit issued by such Lender; and/or (c) collectively, all of the foregoing.  Any Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by one or more Affiliates of such Issuing Bank (and such Affiliate shall be deemed to be an “Issuing Bank” for all purposes of the Loan Documents).  In the event that there is more than one Issuing Bank at any time, references herein and in the other Loan Documents to the Issuing Bank shall be deemed to refer to the Issuing Bank in respect of the applicable Letter of Credit or to all Issuing Banks, as the context requires.

 

“Joinder Agreement” means a joinder agreement substantially in the form of Exhibit 3 to the Security Agreement.

 

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“Landlord Access Agreement” means a Landlord Access Agreement, substantially in the form of Exhibit F, or such other form as may reasonably be acceptable to the Administrative Agent.

 

“LC Commitment” means the commitment of the Issuing Bank to issue Letters of Credit pursuant to Section 2.18; provided that at no time shall the LC Commitment exceed the Revolving Commitment.  The amount of the LC Commitment shall be $15,000,000 on the Closing Date.

 

“LC Disbursement” means a payment or disbursement made by the Issuing Bank pursuant to a Letter of Credit.

 

“LC Exposure” means, as at any date of determination, the sum of (a) the aggregate amount available to be drawn under all outstanding Letters of Credit at such time plus (b) the aggregate principal amount of all Reimbursement Obligations outstanding at such time.  The LC Exposure of any Revolving Lender at any time means its Pro Rata Percentage of the aggregate LC Exposure at such time.  For all purposes of this Agreement and the other Loan Documents, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP (or any other equivalent applicable rule with respect to force majeure events), such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

 

“LC Participation Fee” has the meaning set forth in Section 2.05(c).

 

“LC Request” means a request by Borrower in accordance with the terms of Section 2.18(b) and substantially in the form of Exhibit G, or such other form as shall be approved by the Issuing Bank.

 

“Leases” means any and all leases, subleases, tenancies, options, concession agreements, rental agreements, occupancy agreements, franchise agreements, access agreements and any other agreements (including all amendments, extensions, replacements, renewals, modifications and/or guarantees thereof), whether or not of record and whether now in existence or hereafter entered into, affecting the use or occupancy of all or any portion of any Real Property.

 

“Legal Requirements” means, as to any Person, the Organizational Documents of such Person, and any treaty, law (including the common law), statute, ordinance, code, rule, regulation, guidelines, license, permit requirement, Order or determination of an arbitrator or a court or other Governmental Authority, and the interpretation or administration thereof, in each case applicable to or binding upon such Person or any of its Property or to which such Person or any of its Property is subject, in each case whether or not having the force of law.  For purposes of Section 2.15, the term “applicable Legal Requirements” shall include FATCA.

 

“Lenders” means (a) the financial institutions and other Persons party hereto as “Lenders” on the date hereof, and (b) each financial institution or other Person that becomes a party hereto pursuant to an Assignment and Assumption (including pursuant to Section 2.19), other than, in each case, any such financial institution or Person that has ceased to be a party hereto pursuant to an Assignment and Assumption.  Unless the context clearly indicates otherwise, the term “Lenders” shall include the Swingline Lender.

 

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“Letter of Credit” means any standby letter of credit issued or to be issued by an Issuing Bank for the account of Borrower or one of its Subsidiaries pursuant to Section 2.18.

 

“Letter of Credit Expiration Date” means the date which is five Business Days before the Revolving Maturity Date.

 

“LIBOR Rate” means, with respect to any Eurodollar Borrowing for any Interest Period therefor, the rate per annum equal to the arithmetic mean (rounded to the nearest 1/100th of 1%) of the offered rates for deposits in Dollars with a term comparable to such Interest Period that appears on Reuters Screen LIBOR01 Page (or such other page as may replace such page on such service for the purpose of displaying the rates at which Dollar deposits are offered by leading banks in the London interbank deposit market as designated by the Administrative Agent from time to time) (the “Screen Rate”) at approximately 11:00 a.m., London, England time, on the second full Business Day preceding the first day of such Interest Period; provided, however, that (i) if the Screen Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement, (ii) if no comparable term for an Interest Period (the “Impacted Interest Period”) is available, the LIBOR Rate shall be determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the applicable Screen Rate (for the longest period for which the applicable Screen Rate is available) that is shorter than the Impacted Interest Period and (b) the applicable Screen Rate for the shortest period (for which such Screen Rate is available) that exceeds the Impacted Interest Period, in each case, for such Interest Period (such rate, the “Interpolated Rate”) and (iii) if Reuters Screen LIBOR01 Page shall at any time no longer exist, “LIBOR Rate” means, with respect to each day during each Interest Period pertaining to Eurodollar Borrowings comprising part of the same Borrowing, the rate per annum equal to the rate at which the Administrative Agent is offered deposits in Dollars at approximately 11:00 a.m., London, England time, two Business Days before the first day of such Interest Period in the London interbank market for delivery on the first day of such Interest Period for the number of days comprised therein and in an amount comparable to its portion of the amount of such Eurodollar Borrowing to be outstanding during such Interest Period.  In no event, with respect to the Term Loans issued on the Closing Date, notwithstanding the rate determined pursuant to the foregoing, shall the LIBOR Rate be less than 1.00%.  “Reuters Screen LIBOR01 Page” means the display designated on the Reuters 3000 Xtra Page (or such other page as may replace such page on such service for the purpose of displaying the rates at which Dollar deposits are offered by leading banks in the London interbank deposit market).

 

“License Subsidiary” shall mean each single purpose Subsidiary of Borrower created solely to hold Regulatory Licenses for one or more of its businesses.  As of the Closing Date, Internap Connectivity, LLC is the only License Subsidiary.

 

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“Lien” means, with respect to any Property, (a) any mortgage, deed of trust, lien (statutory or other), judgment liens, pledge, encumbrance, claim, charge, assignment, hypothecation, deposit arrangement, security interest or encumbrance of any kind or any arrangement to provide priority or preference or any filing of any financing statement under the UCC, PPSA or any other similar notice of Lien under any similar notice or recording statute of any Governmental Authority, including any easement, servitude, right-of-way or other encumbrance on title to Real Property, in each of the foregoing cases whether voluntary or imposed or arising by operation of law, and any agreement to give any of the foregoing, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement and any lease in the nature thereof and any option, call, trust, contractual, statutory, UCC or PPSA (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such Property, and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

 

“Loan Documents” means this Agreement, the Letters of Credit, the Notes (if any), the Security Documents, each Joinder Agreement, any other agreements, documents and instruments providing for or evidencing any other Obligations, and any other document or instrument executed or delivered at any time in connection with any Obligations, including any intercreditor or joinder agreement among holders of Obligations, to the extent such are effective at the relevant time, as each may be amended, restated, supplemented, modified, renewed or extended from time to time, and, except for purposes of Section 10.02(b), the Fee Letter.

 

“Loan Parties” means Borrower and the Guarantors.

 

“Loans” means, as the context may require, a Revolving Loan, a Term Loan or a Swingline Loan.

 

“Majority Revolving Lenders” means, at any time, Lenders having Revolving Loans, LC Exposure and unused Revolving Commitments representing more than 50% of the sum of all Revolving Loans outstanding, LC Exposure and unused Revolving Commitments at such time.

 

“Margin Stock” has the meaning set forth in Regulation U.

 

“Material Adverse Effect” means (a) a material adverse effect on, or material adverse change in the financial condition, results of operations, Material Agreements or value of the Companies, taken as a whole, or the Loan Parties, taken as a whole, (b) material impairment of the ability of the Loan Parties, taken as a whole, to fully and timely perform any of their obligations under any Loan Document, (c) a material impairment of the rights of or benefits or remedies available to the Lenders, the Issuing Bank or any Agent under any Loan Document, taken as a whole or (d) a material adverse effect on the Collateral, taken as a whole, or the Liens in favor of the Collateral Agent (for its benefit and for the benefit of the other Secured Parties) on the Collateral, taken as a whole, or the validity, enforceability, perfection or priority of such Liens, taken as a whole.

 

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“Material Agreement” means any agreement, contract or instrument to which any Company is a party or by which any Company or any of its properties is bound (i) pursuant to which any Company is required to make payments or other consideration, or will receive payments or other consideration, in excess of $2,500,000 in any twelve month period, (ii) the Data Center Leases, (iii) governing, creating, evidencing or relating to Material Indebtedness of any Company, or (iv) the termination or suspension of which, or the failure of any party thereto to perform its obligations thereunder, could reasonably be expected to have a Material Adverse Effect.

 

“Material Indebtedness” means any Indebtedness (other than the Loans and Letters of Credit) or Hedging Obligations of any Company in an aggregate outstanding principal amount exceeding $10,000,000.  For purposes of determining Material Indebtedness, the “principal amount” in respect of any Hedging Obligations of any Company at any time shall be the Hedging Termination Value thereof at such time.

 

“Maximum Rate” has the meaning set forth in Section 10.13.

 

“Minimum Extension Condition”  has the meaning set forth in Section 2.20(c).

 

“Mortgage” means an agreement, including a mortgage, deed of trust or any other document, creating and evidencing a first priority Lien (subject to Permitted Collateral Liens) on a Mortgaged Property, which (i) in the case of Real Property owned in fee, shall be substantially in the form of Exhibit H-1 and (ii) in the case of leased Real Property, shall be substantially in the form of Exhibit H-2 or other form reasonably satisfactory to the Collateral Agent, in each case, with such schedules and including such provisions as shall be necessary to conform such document to applicable local or foreign law or as shall be customary under applicable local or foreign Legal Requirements.

 

“Mortgaged Property” means (a) each Real Property identified on Schedule 1.01(a) hereto and (b) each Real Property, if any, which shall be subject to a Mortgage delivered after the Closing Date pursuant to Section 5.11(d) or Section 5.15.

 

“Multiemployer Plan” means a multiemployer plan within the meaning of Section 4001(a)(3) or Section 3(37) of ERISA, (a) to which any Company or any of its ERISA Affiliates is then making or accruing an obligation to make contributions, (b) to which any Company or any of its ERISA Affiliates has within the preceding six plan years made or been obligated to make contributions, or (c) with respect to which any Company could incur liability, whether absolute or contingent.

 

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“Net Cash Proceeds” means:

 

(a)           with respect to any Asset Sale (other than any issuance or sale of Equity Interests), an amount equal to the proceeds thereof in the form of cash and Cash Equivalents (including any such proceeds received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable, or by the sale, transfer or other Disposition of any non-cash consideration received in connection therewith or otherwise, but only as and when received) received by any Company (including cash proceeds subsequently received (as and when received by any Company) in respect of non-cash consideration initially received) net of (i)reasonable and customary selling expenses (including reasonable brokers’ fees or commissions, legal, accounting and other professional and transactional fees, transfer and similar taxes and Borrower’s good faith estimate of income taxes paid or payable in connection with such sale (after taking into account any available tax credits or deductions and any tax sharing arrangements)), (ii) amounts provided as a reserve, in accordance with GAAP, against (x)any liabilities under any indemnification obligations associated with such Asset Sale or (y)any other liabilities retained by any Company associated with the properties sold in such Asset Sale (provided that, to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds), and (iii) the principal amount, premium or penalty, if any, interest and other amounts on any Indebtedness for borrowed money that is secured by a Lien on the properties sold in such Asset Sale (so long as such Lien was permitted to encumber such properties under the Loan Documents at the time of such sale) and which is repaid with such proceeds (other than any such Indebtedness assumed by the purchaser of such properties);

 

(b)           with respect to any (i) Debt Issuance, (ii) Equity Issuance or (iii) other issuance or sale of Equity Interests by Borrower or any of its Subsidiaries, an amount equal to the cash proceeds thereof received by any Company, net of reasonable and customary fees, commissions, costs and other expenses incurred in connection therewith; and

 

(c)           with respect to any Casualty Event, an amount equal to the cash insurance proceeds (other than business interruption insurance proceeds), condemnation awards and other compensation  received by any Company in respect thereof, net of all reasonable costs and expenses incurred in connection with the collection of such proceeds, awards or other compensation in respect of such Casualty Event.

 

“Net Working Capital” means, at any time, Consolidated Current Assets at such time minus Consolidated Current Liabilities at such time.

 

“New Lender” has the meaning set forth in Section 2.19(c).

 

“Non-Public Information” means (i) material non-public information (within the meaning of United States federal, state or other applicable securities laws) with respect to  Borrower or its Subsidiaries or their securities and (ii) information of a type that would be material non-public information (within the meaning of United States federal, state or other applicable securities laws) relating to Borrower if Borrower were a public reporting company with respect to Borrower or its Subsidiaries or their respective securities.

 

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“Notes” means any notes evidencing the Term Loans, Revolving Loans or Swingline Loans, in each case issued pursuant to Section 2.04(e), if any, substantially in the form of Exhibit I-1, I-2 or I-3, respectively.

 

“Obligations” means (a) all obligations of Borrower and the other Loan Parties from time to time arising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including interest accruing during the pendency of any Insolvency Proceeding, regardless of whether allowed or allowable in such Insolvency Proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by Borrower and the other Loan Parties under this Agreement in respect of any Letter of Credit, when and as due, including payments in respect of Reimbursement Obligations, interest thereon and obligations to provide cash collateral and (iii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any Insolvency Proceeding, regardless of whether allowed or allowable in such Insolvency Proceeding), of Borrower and the other Loan Parties under this Agreement and the other Loan Documents, and (b) the due and punctual performance of all covenants, agreements, obligations and liabilities of Borrower and the other Loan Parties under or pursuant to this Agreement and the other Loan Documents, in each case, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising.  Notwithstanding the foregoing, the Obligations shall not include any Excluded Swap Obligations.

 

“OFAC” has the meaning set forth in Section 3.21.

 

“Offer Loans” has the meaning set forth in Section 10.04(j)(i).

 

“Officers’ Certificate” means a certificate executed by (i) the chairman of the Board of Directors (if an officer), the chief executive officer or the president and (ii) one of the Financial Officers, each in his or her official (and not individual) capacity.

 

“Order” means any judgment, decree, verdict, order, consent order, consent decree, writ, declaration or injunction.

 

“Organizational Documents” means, with respect to any Person, (i) in the case of any corporation, the certificate of incorporation, articles of incorporation or deed of incorporation and by-laws (or similar constituent documents) of such Person, (ii) in the case of any limited liability company, the certificate or articles of formation or organization and operating agreement or memorandum and articles of association (or similar constituent documents) of such Person, (iii) in the case of any limited partnership, the certificate of formation and limited partnership agreement (or similar constituent documents) of such Person (and, where applicable, the equityholders or shareholders registry of such Person), (iv) in the case of any general partnership, the partnership agreement (or similar constituent document) of such Person, (v) in any other case, the functional equivalent of the foregoing, and (vi) any shareholder, voting trust or similar agreement between or among any holders of Equity Interests of such Person.

 

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“Other List” has the meaning set forth in the definition of “Embargoed Person.”

 

“Other Taxes” means any and all present or future stamp, documentary, intangible, recording, filing or similar Taxes or any excise or Property Taxes, charges (including fees and expenses to the extent incurred with respect to any such Taxes or charges) or similar levies (including interest, fines, penalties and additions with respect to any of the foregoing) arising from any payment made or required to be made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document.

 

“Participant” has the meaning set forth in Section 10.04(e).

 

“Participant Register” has the meaning set forth in Section 10.04(e).

 

“Patriot Act” has the meaning set forth in Section 3.21(a).

 

“PBGC” means the Pension Benefit Guarantee Corporation referred to and defined in ERISA.

 

“Pension Plan” means any Employee Benefit Plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA which is maintained or contributed to by any Company or any of its ERISA Affiliates or with respect to which any Company could incur liability, whether absolute or contingent (including under Section 4069 of ERISA).

 

“Perfection Certificate” means a perfection certificate in the form of Exhibit J-1 or any other form approved by the Collateral Agent, as the same shall be supplemented from time to time by a Perfection Certificate Supplement or otherwise.

 

“Perfection Certificate Supplement” means a perfection certificate supplement in the form of Exhibit J-2 or any other form approved by the Collateral Agent.

 

“Permitted Acquisition” means any transaction or series of related transactions for the direct or indirect (a) acquisition of all or substantially all of the Property of any Person, or of any business or division of any Person, (b) acquisition of all of the Equity Interests of any Person, and otherwise causing such Person to become a Wholly Owned Subsidiary of such Person, or (c) merger, consolidation or amalgamation or any other combination with any Person, if each of the following conditions is met:

 

(i)             no Default or Event of Default then exists or would result therefrom;

 

(ii)            after giving effect to such transaction on a Pro Forma Basis, Borrower shall be in compliance with all covenants set forth in Section 6.10 as of the most recently ended Test Period (assuming, for purposes of Section 6.10, that (i) such transaction had occurred on the first day of such relevant Test Period, and (ii) the maximum Total Leverage Ratio permitted in any Test Period pursuant to Section 6.10(a) is 0.25:1.00 lower than the maximum Total Leverage Ratio set forth in Section 6.10(a) for such Test Period);

 

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(iii)          no Company shall, in connection with any such transaction, assume or remain liable with respect to any Indebtedness or Contingent Obligation (including any material tax or ERISA liability) of the related seller or the business, Person or properties acquired, except (A) to the extent permitted to be incurred under Section 6.01 and (B) obligations not constituting Indebtedness incurred in the ordinary course of business (and not in anticipation of such acquisition) and necessary or desirable to the continued operation of the underlying business, Persons or properties being so acquired, and any other such liabilities or obligations not permitted to be assumed or otherwise supported by any Company hereunder shall be paid in full or released as to the business, Persons or properties being so acquired on or before the consummation of such acquisition;

 

(iv)          the Person or business to be acquired shall be, or shall be engaged in, a business of the type that Borrower and its Subsidiaries are permitted to be engaged in under Section 6.14 and the Property acquired in connection with any such transaction shall be made subject to the Lien of the Security Documents in accordance with Section 5.11 and shall be free and clear of any Liens, other than Permitted Collateral Liens;

 

(v)           the Board of Directors of the Person to be acquired shall not have indicated its opposition to the consummation of such acquisition (which opposition has not been publicly withdrawn);

 

(vi)          all transactions in connection therewith shall be consummated, in all material respects, in accordance with all applicable Legal Requirements;

 

(vii)         Borrower shall have provided the Administrative Agent and the Lenders with (A) historical financial statements for the last three fiscal years (or, if less, the number of years since formation) of the Person or business to be acquired (audited if available without undue cost or delay) and unaudited financial statements thereof for the most recent interim period that is available, (B) a reasonably detailed description of all material information relating thereto and copies of all material documentation pertaining to such transaction, and (C) all such other information and data, including projections, relating to such transaction or the Person or business to be acquired as may be reasonably requested by the Administrative Agent or any Lender;

 

(viii)        such transaction could not reasonably be expected to result in a Material Adverse Effect;

 

(ix)          at least 10 Business Days before the proposed date of consummation of the transaction (or such shorter period as is acceptable to the Administrative Agent in its sole discretion, but in any event prior to the consummation of such transaction), Borrower shall have delivered to the Administrative Agent and the Lenders an Officers’ Certificate certifying that such transaction complies with this definition (which shall have attached thereto reasonably detailed backup data and calculations showing such compliance);

 

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(x)            the Acquisition Consideration (exclusive of any amounts financed by Qualified Excluded Issuances) for all Foreign Permitted Acquisitions since the Closing Date shall not exceed $10,000,000, the Acquisition Consideration (exclusive of any amounts financed by Qualified Excluded Issuances) for any other acquisition (other than Foreign Permitted Acquisitions) shall not exceed $40,000,000, and the aggregate amount of the Acquisition Consideration (exclusive of any amounts financed by Qualified Excluded Issuances) for all Permitted Acquisitions (including Foreign Permitted Acquisitions) since the Closing Date shall not exceed $80,000,000; provided that (x) no Equity Interests constituting all or a portion of such Acquisition Consideration shall constitute Disqualified Capital Stock and (y) any Earnout obligations by a Company in connection with any such Permitted Acquisition shall be unsecured;

 

(xi)           (a) in the case of an acquisition of all or substantially all of the Property of any Person, (A) the Person making such acquisition is Borrower, a Guarantor or, in the case of a Permitted Foreign Acquisition, a Permitted Foreign AcquisitionCo, and (B) to the extent required under the Loan Documents, including Section 5.11, upon consummation of the Permitted Acquisition, the Person being so acquired (and, in the case of a Permitted Foreign Acquisition, the Permitted Foreign AcquisitionCo) becomes a Guarantor, (b) in the case of an acquisition of the Equity Interests of any Person, (A) the Person making such acquisition is Borrower, a Guarantor or, in the case of a Permitted Foreign Acquisition, a Permitted Foreign AcquisitionCo, (B) no less than 100% of the Equity Interests of the target Person shall be acquired by the Person making such acquisition, and (C) to the extent required under the Loan Documents, including Section 5.11, upon consummation of the Permitted Acquisition, the Person the Equity Interests of which are being so acquired (and, in the case of a Permitted Foreign Acquisition, the Permitted Foreign AcquisitionCo) becomes a Guarantor, and (c) in the case of a merger, consolidation or amalgamation or any other combination with any Person, the Person surviving such merger, consolidation, amalgamation or other combination (x) is Borrower or a Guarantor or (y) to the extent required under the Loan Documents, including Section 5.11, upon consummation of the Permitted Acquisition becomes a Guarantor; and

 

(xii)           in the case of the acquisition of 100% of the Equity Interests of any Person (including by way of merger, consolidation, amalgamation or other combination), such Person shall own no Equity Interests of any other Person (other than de minimis amounts) unless either (x) such Person owns 100% of the Equity Interests of such other Person or (y) if such Person owns Equity Interests in any other Person which is not a Wholly Owned Subsidiary of such Person, (1) such non-Wholly Owned Subsidiary shall not have been created or established in contemplation of, or for purposes of, the respective Permitted Acquisition, (2) any such non-Wholly Owned Subsidiary of the respective Person shall have been a non-Wholly Owned Subsidiary of such Person before the date of the respective Permitted Acquisition and (3) such Person and/or its Wholly Owned Subsidiaries own at least 95% of the total value of all the assets owned by such Person and its Subsidiaries (for purposes of such determination, excluding the value of the Equity Interests of non-Wholly Owned Subsidiaries held by such Person and its Wholly Owned Subsidiaries).

 

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“Permitted Collateral Liens” means (a) in the case of Collateral other than Mortgaged Property, Permitted Liens and (b) in the case of Mortgaged Property, “Permitted Collateral Liens” means the Liens described in clauses (a), (b), (d), (e), (g) and (n) of Section 6.02; provided, however, on the Closing Date or upon the date of delivery of each additional Mortgage under Section 5.11 or 5.12, Permitted Collateral Liens means only those Liens that are (i) identified on a schedule to the applicable Mortgage and/or (ii) excepted as being prior to the Lien of such Mortgage as set forth in the Title Policy relating to such Mortgaged Property issued to the Collateral Agent by the applicable Title Company, provided that, in either case, such Liens are otherwise Permitted Liens.

 

“Permitted Foreign Acquisition” means a Permitted Acquisition, in which (i) the Person being acquired is a Foreign Entity, (ii) in the case of a Permitted Acquisition consisting of the acquisition of assets (other than of in excess of 50% of the Equity Interests of any Person), the acquiror of such assets is a Foreign Entity, or (iii) in the case of a Permitted Acquisition consisting of the acquisition of in excess of 50% of the Equity Interests of any Person, the Person making the Permitted Acquisition is a Foreign Entity; provided that, in the case of clauses (ii) and (iii) above, the Foreign Entity is a Permitted Foreign AcquisitionCo.

 

“Permitted Foreign AcquisitionCo” means any Foreign Entity that is formed by Borrower or a Guarantor solely to effect a Permitted Foreign Acquisition; provided that:

 

(i)            such Foreign Entity is a special-purpose entity formed not more than 30 days before the consummation of such Permitted Acquisition;

 

(ii)           such Foreign Entity is the direct acquiror of the Foreign Subsidiary acquired in such Permitted Acquisition;

 

(iii)          such Foreign Entity does not engage in any business activities or have any properties or liabilities (including Indebtedness) other than (A) its obligations under the definitive documentation governing such Permitted Acquisition, (B) the incurrence of Indebtedness in compliance with Section 6.01 the proceeds of which are used in whole solely to finance the Permitted Acquisition and to pay reasonable fees and expenses in connection therewith, (C) to the extent constituting Investments, the incurrence of Indebtedness pursuant to clause (B) above, and (D) special purpose holding company activities and properties reasonably incidental to the foregoing clauses (A) through (C); provided that any Indebtedness incurred pursuant to clause (B) is not directly or indirectly recourse to any of the Companies or any of their respective assets, other than to such Foreign Entity and the Persons or assets acquired in such Permitted Acquisition;

 

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(iv)          such Foreign Entity does not (1) incur, create, assume or permit to exist, directly or indirectly, any Indebtedness, other than Indebtedness permitted pursuant to clause (iii) of this definition, (2) incur, create, assume or permit to exist, directly or indirectly, any Liens on any Property now owned or hereafter acquired by it or on any income or revenues or rights in respect of any thereof, (3) enter into any Sale and Leaseback Transaction, (4) make any Investments (other than the Permitted Acquisition or to the extent constituting an Investment, Indebtedness permitted pursuant to clause (iii) of this definition), (5) purchase or otherwise acquire (in one or a series of related transactions) any part of the Property (whether tangible or intangible) of any Person (or agree to do any of the foregoing at any time), other than the acquisition of the Person or assets to be acquired in such Permitted Acquisition, (6) issue any Equity Interests to any Person other than Borrower or a Guarantor, and (7) establish, create or acquire any additional Subsidiaries, other than the Permitted Acquisition;

 

(v)           Borrower or a Guarantor shall directly own, and have the power to vote and direct the voting of, 100% of the Equity Interests of such Foreign Entity, and

 

(vi)          the Organizational Documents of such Foreign Entity expressly contain at all times from and after the formation of such Foreign Entity the prohibitions contained in clauses (iii) and (iv) of this definition.

 

“Permitted Hedging Agreement” means any Hedging Agreement to the extent constituting a swap, cap, collar, forward purchase or similar agreements or arrangements dealing with interest rates, currency exchange rates or commodity prices, either generally or under specific contingencies, in each case entered into in the ordinary course of business and not for speculative purposes or taking a “market view.”

 

“Permitted Liens” has the meaning set forth in Section 6.02.

 

“Person” means any natural person, corporation, business trust, joint venture, trust, association, company (whether limited in liability or otherwise), partnership (whether limited in liability or otherwise) or Governmental Authority, or any other entity, in any case, whether acting in a personal, fiduciary or other capacity.

 

“Platform” means IntraLinks, SyndTrak or a substantially similar electronic transmission system.

 

“Pledgor” means each Company listed on Schedule 1.01(c), and each other Subsidiary of any Loan Party that is or becomes a party to this Agreement (in its capacity as a Guarantor) and the Security Documents pursuant to Section 5.11.

 

“PPSA” means the Personal Property Security Act as in effect from time to time (except as otherwise specified) in any applicable province or jurisdiction, or, in the case of the Province of Quebec, the Civil Code of Quebec.

 

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“Preferred Stock” means, with respect to any Person, any and all preferred or preference Equity Interests (however designated) of such Person whether now outstanding or issued after the Closing Date.

 

“Preferred Stock Issuance” means the issuance or sale by any Company of any Preferred Stock after the Closing Date.

 

“Premises” has the meaning assigned thereto in the applicable Mortgage.

 

“Pro Forma Basis” means, with respect to compliance with any test or covenant hereunder, compliance with such covenant or test after giving effect to (a) the Acquisition, (b) any Permitted Acquisition (to the extent not subsequently disposed of during such period), or (c) any Disposition, as if the Acquisition or such Permitted Acquisition or Disposition, and all other Permitted Acquisitions or Dispositions consummated during the applicable period, and any Indebtedness or other liabilities incurred in connection with the Acquisition or any such Permitted Acquisitions or Dispositions, and any refinancing of Indebtedness in connection therewith, had been consummated and incurred at the beginning of such period.  For purposes of this definition, if any Indebtedness to be so incurred bears interest at a floating rate and is being given pro forma effect, the interest on such Indebtedness will be calculated as if the rate in effect on the date of incurrence had been the applicable rate for the entire period (taking into account any applicable interest rate Hedging Agreements).

 

“Pro Rata Percentage” of any Revolving Lender at any time means the percentage of the total Revolving Commitments of all Revolving Lenders represented by such Lender’s Revolving Commitment.

 

“Projections” has the meaning set forth in Section 3.04(c).

 

“Property” means any right, title or interest in or to property or assets of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible and including Equity Interests of any Person and whether now in existence or owned or hereafter entered into or acquired, including all Real Property, cash, securities, accounts, revenues and contract rights.

 

“Public Lenders” means Lenders that do not wish to receive Non-Public Information with respect to Borrower or its Subsidiaries.

 

“PUC” means any state public service or public utility commission or other state Governmental Authority that exercises jurisdiction over the rates or services or the acquisition, construction or operation of any telecommunications system of any person who owns, constructs or operates any telecommunications system, in each case by reason of the nature or type of the business subject to regulation and not pursuant to laws and regulations of general applicability to persons conducting business in such state.

 

“Purchase Agreement” has the meaning set forth in the recitals hereto.

 

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“Purchase Agreement Material Adverse Effect” means any result, occurrence, fact, change, event or effect that has or could reasonably be expected to have a materially adverse effect on the business, assets, liabilities, capitalization, condition (financial or other) or results of operations of the Companies and the Acquired Business, taken as a whole, except (i) relating to general political, economic or financial conditions or the securities markets in North America or to any natural disaster or epidemic or any acts of terrorism, sabotage, military action or war (whether or not declared) or any escalation or worsening thereof; (ii) relating to conditions generally affecting the industry in which the Companies or the Acquired Business operate or the markets for any of the Companies’ or the Acquired Business’s products or services,  (iii) relating to any failure by any Company or the Acquired Business to meet any forecasts, projections or earnings guidance or expectations provided or released by any Company or the Acquired Business, (iv) relating to changes in IFRS or GAAP, (v) resulting from (a) the announcement or pendency of the transactions contemplated by the Transaction Documents or other communication by the Acquiror or any of its Affiliates of its plans or other intentions with respect to the business of the Acquired Business, or (b) compliance with the terms of the Purchase Agreement; and (vi) relating to changes, after the date of the Purchase Agreement, in applicable Laws or the interpretation thereof, except, in the case of clauses (i), (ii), (iv), and (vi), to the extent specifically related to or disproportionately impacting the Companies or the Acquired Business.  Defined terms used in this paragraph that are otherwise not defined herein have the meanings ascribed thereto in the Purchase Agreement.

 

“Purchase Money Obligation” means, for any Person, the obligations of such Person in respect of Indebtedness (including Capital Lease Obligations) incurred for the purpose of financing all or any part of the purchase price of any fixed or capital assets (including Equity Interests of any Person owning fixed or capital assets) or the cost of installation, construction or improvement of any fixed or capital assets provided, however, that (i) such Indebtedness is incurred within 30 days after such acquisition, installation, construction or improvement of such fixed or capital assets (including Equity Interests of any Person owning the applicable fixed or capital assets) by such Person and (ii) the amount of such Indebtedness does not exceed the lesser of 100% of the Fair Market Value of such fixed or capital asset or the cost of the acquisition, installation, construction or improvement thereof, as the case may be.

 

“Qualified Capital Stock” of any Person means any Equity Interests of such Person that are not Disqualified Capital Stock.

 

“Qualified ECP Guarantor” means, in respect of any Hedging Obligation under (or in respect of) a Permitted Hedging Agreement, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant Guarantee or grant of the relevant security interest becomes effective with respect to such Hedging Obligation or such other Person as constitutes an “ECP” under the Commodity Exchange Act (7 U.S.C. 1, et seq.) or any regulations promulgated thereunder and can cause another Person to qualify as an ECP at such time by entering into a keepwell under Section 1a(A)(v)(II) of the Commodity Exchange Act (7 U.S.C. 1, et seq.).

 

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“Qualified Excluded Issuance” means an Equity Issuance solely to the extent the Net Cash Proceeds thereof are used within 10 days following the date of such Equity Issuance to finance one or more Permitted Acquisitions.

 

“Real Property” means, collectively, all right, title and interest (including any leasehold, fee, mineral or other estate) in and to any and all parcels of or interests in real Property owned, leased or operated by any Person, whether by lease, license or other means, together with, in each case, all easements, hereditaments and appurtenances relating thereto, all improvements and appurtenant fixtures and equipment, all general intangibles and contract rights and other Property and rights incidental to the ownership, lease or operation thereof.

 

“Refinancing” means the repayment in full of, the termination of any commitment to make extensions of credit under, all of the outstanding indebtedness of any Company as of the Closing Date listed on Schedule 1.01(d), including the payment of all principal, prepayment premiums, accrued interest, fees and any commissions, costs and expenses in connection with the foregoing and the release of all guarantees and security in respect thereof.

 

“Register” has the meaning set forth in Section 10.04(c).

 

“Regulation D” means Regulation D of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation T” means Regulation T of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation U” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation X” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

 

“Regulatory Licenses” has the meaning set forth in Section 3.01(a).

 

“Reimbursement Obligations” means Borrower’s obligations under Section 2.18(e) to reimburse LC Disbursements.

 

“Related Person” means, with respect to any Person, (a) each Affiliate of such Person and each of the officers, directors, partners, trustees, employees, affiliates, shareholders, Advisors, agents, attorneys-in-fact and Controlling Persons of each of the foregoing, and (b) if such Person is an Agent, each other Person designated, nominated or otherwise mandated by or assisting such Agent pursuant to Section 9.05 or any comparable provision of any Loan Document.

 

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“Release” means any spilling, leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing, depositing, dispersing, emanating or migrating of any Hazardous Materials in, into, onto, from or through the Environment or any Real Property (including the abandonment or discarding of barrels, containers and other closed receptacles containing any Hazardous Materials).

 

“Required Lenders” means, at any date of determination, Lenders having Loans, LC Exposure and unused Revolving Commitments and Term Loan Commitments representing more than 50% of the sum of all Loans outstanding, LC Exposure and unused Revolving Commitments and Term Loan Commitments at such time.

 

“Response” means (a) “response” as such term is defined in CERCLA, 42 U.S.C. § 9601(25) or any words of similar import defined under other applicable Environmental Law, or (b) all other actions required by any Governmental Authority or voluntarily undertaken to (i) clean up, remove, treat, remediate, contain, assess, abate, monitor or in any other way address any Hazardous Materials at, in, on, under or from any Real Property, or otherwise in the Environment, (ii) prevent, stop, control or minimize the Release or threat of Release, or minimize the further Release, of any Hazardous Material, or (iii) perform studies, investigations, maintenance or monitoring in connection with, following, or as a precondition to or to determine the necessity of, the actions set forth in clause (i) or (ii) above.

 

“Responsible Officer” of any Person means any executive officer or Financial Officer of such Person and any other officer or similar official thereof with significant responsibility for the administration of the obligations of such Person in respect of this Agreement.

 

“Restricted Indebtedness” means Indebtedness of any Company, the payment, prepayment, repurchase, defeasance or acquisition for value of which is restricted under Section 6.11.

 

“Retained Excess Cash Flow Amount” means, at any date of determination, an amount equal to (a) the sum of the amounts of Excess Cash Flow for all Excess Cash Flow Periods ending on or before the date of determination for which the amount of Excess Cash Flow shall have been calculated as provided in Section 5.01(d) and with respect to which any payment required under Section 2.10(g) has been paid, minus (b) the sum at the time of determination of the aggregate amount of prepayments required to be made pursuant to Section 2.10(g) through the date of determination (whether or not such prepayments are accepted by Term Loan Lenders) calculated without regard to any reduction in such sum that resulted from optional prepayments of the Term Loans or Revolving Loans referred to in Section 2.10(g)(B).

 

“Revolving Availability Period” means the period from and including the Closing Date to but excluding the earlier of (i) the Business Day preceding the Revolving Maturity Date and (ii) the date of termination of the Revolving Commitments.

 

“Revolving Borrowing” means a Borrowing comprised of Revolving Loans.

 

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“Revolving Commitment” means, with respect to each Lender, the commitment, if any, of such Lender to make Revolving Loans hereunder up to the amount set forth on Annex I or on Schedule 1 to the Assignment and Assumption pursuant to which such Lender assumed its Revolving Commitment, as applicable, as the same may be (a) increased from time to time pursuant to Section 2.19 and (b) reduced from time to time pursuant to Section 2.07 and (c) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The aggregate principal amount of the Lenders’ Revolving Commitments on the Closing Date is $50,000,000.

 

“Revolving Commitment Increase” has the meaning set forth in Section 2.19(e).

 

“Revolving Exposure” means, with respect to any Lender at any time, the aggregate principal amount at such time of all outstanding Revolving Loans of such Lender, plus the aggregate amount at such time of such Lender’s LC Exposure, plus the aggregate amount at such time of such Lender’s Swingline Exposure.

 

“Revolving Increasing Lender” has the meaning set forth in Section 2.19(e).

 

“Revolving Lender” means a Lender with a Revolving Commitment.

 

“Revolving Loan” means a Loan made by the Lenders to Borrower pursuant to Section 2.01(b).  Each Revolving Loan shall either be an ABR Revolving Loan or a Eurodollar Revolving Loan.

 

“Revolving Maturity Date” means November 26, 2018, or, if such date is not a Business Day, the first Business Day thereafter.

 

“Sale and Leaseback Transaction” has the meaning set forth in Section 6.03.

 

“Sanctions Laws” has the meaning set forth in the definition of “Embargoed Person.”

 

“Sarbanes-Oxley Act” means the United States Sarbanes-Oxley Act of 2002, as amended from time to time and, and any successor statute.

 

“Screen Rate” has the meaning set forth in the definition of “LIBOR Rate.”

 

“SDN List” has the meaning set forth in the definition of “Embargoed Person.”

 

“SEC” means, the Securities and Exchange Commission (or successors thereto or an analogous Governmental Authority).

 

“Secured Obligations” means (a) the Obligations, (b) the due and punctual payment and performance of all obligations of Borrower and the other Loan Parties under each Permitted Hedging Agreement intended to protect against fluctuations in interest rates entered into with any counterparty that is a Secured Party and (c) the due and punctual payment and performance of all obligations of Borrower and the other Loan Parties owed to any Secured Party arising from Cash Management Services.  Notwithstanding anything to the contrary contained herein or in any other Loan Document, in no event will Secured Obligations include any Excluded Swap Obligations.

 

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“Secured Parties” means, collectively:

 

(a)           with respect to the Obligations, the Administrative Agent, the Collateral Agent, each other Agent, each Issuing Bank and the Lenders;

 

(b)           with respect to obligations under Permitted Hedging Agreements intended to protect against fluctuations in interest rates, the Administrative Agent, the Collateral Agent, each other Agent, the Lenders and each counterparty to a Permitted Hedging Agreement relating to the Loans if (i) at the date of entering into such Hedging Agreement such counterparty was an Agent, a Lender or an Affiliate of an Agent or Lender, and (ii) such counterparty executes and delivers to the Administrative Agent a letter agreement in form and substance acceptable to the Administrative Agent pursuant to which such counterparty (x) appoints the Administrative Agent and the Collateral Agent as its agents under the applicable Loan Documents and (y) agrees to be bound by the provisions of Sections 9.03, 10.03 and 10.09 as if it were a Lender; and

 

(c)           with respect to obligations arising from Cash Management Services, the Administrative Agent, the Collateral Agent, each other Agent, each Lender, and each Affiliate of an Agent or Lender that, in each case, provides Cash Management Services to a Loan Party; provided that such Affiliate executes and delivers to the Administrative Agent a letter agreement in form and substance acceptable to the Administrative Agent pursuant to which such Affiliate (x) appoints the Administrative Agent and the Collateral Agent as its agents under the applicable Loan Documents and (y) agrees to be bound by the provisions of Sections 9.03, 10.03 and 10.09 as if it were a Lender.

 

“Securities Act” means the Securities Act of 1933, as amended from time to time and, and any successor statute.

 

“Securities Collateral” has the meaning set forth in the Security Agreement.

 

“Security Agreement” means a Security Agreement substantially in the form of Exhibit K among the Loan Parties and the Collateral Agent for the benefit of the Secured Parties, as the same may be amended, restated, modified or supplemented from time to time.

 

“Security Agreement Collateral” means all Property pledged or granted as collateral pursuant to the Security Agreement delivered on the Closing Date or thereafter pursuant to Section 5.11.

 

“Security Documents” means the Security Agreement, the Mortgages, each Control Agreement and each other security document or pledge agreement delivered in accordance with applicable local or foreign Legal Requirements to grant a valid, enforceable, perfected security interest (with the priority required under the Loan Documents) in any Property as collateral for the Secured Obligations, and all UCC or other financing statements (including fixture filings and transmitting utility filings, as applicable) or instruments of perfection required by this Agreement, the Security Agreement, any Mortgage, any Control Agreement or any other such security document or pledge agreement to be filed or registered with respect to the security interests in Property created pursuant to the Security Agreement, any Mortgage, any Control Agreement and any other document or instrument utilized to pledge any Property as collateral for the Secured Obligations.

 

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“Sellers” has the meaning set forth in the recitals hereto.

 

“Solvency Certificate” has the meaning set forth in Section 4.01(g).

 

“SPC” has the meaning set forth in Section 10.04(h).

 

“Specified Equity Contribution” has the meaning set forth in Section 8.03.

 

“Specified Event of Default” means an Event of Default under any of Sections 8.01(a), (b), (g) or (h).

 

“Specified Purchase Agreement Representations”  means (x) with respect to the Acquisition, those representations and warranties made by Target or any of its Subsidiaries in the Purchase Agreement as are material to the interests of the Lenders or the Arrangers, but only to the extent that Borrower or Acquiror have a right (a) not to consummate the transactions contemplated by the Purchase Agreement or (b) to terminate Borrower’s or Acquiror’s obligations under the Purchase Agreement, in each case, as a result of a breach of such representation or warranty made by Target or any of its Subsidiaries in the Purchase Agreement, and (x) with respect to any other Permitted Acquisition, those representations and warranties made by the seller or Person being acquired or any of its Subsidiaries in the acquisition agreement (however defined) with respect to such Permitted Acquisition as are material to the interests of the Lenders or the Arrangers, but only to the extent that Borrower or any of its Subsidiaries party to such acquisition agreement has a right (a) not to consummate the transactions contemplated by such acquisition agreement or (b) to terminate Borrower’s or any such Subsidiary’s obligations under such acquisition agreement, in each case, as a result of a breach of such representation or warranty made by the seller, the Person to be acquired or any of its Subsidiaries in such acquisition agreement.

 

“Specified Representations” means those representations and warranties set forth in Sections 3.01(a), 3.02, 3.03, 3.04(d), 3.10, 3.11, 3.16, 3.21 and 3.22.

 

“Statutory Reserves” means, for any day during any Interest Period for any Eurodollar Borrowing, the average maximum rate at which reserves (including any marginal, supplemental or emergency reserves) are required to be maintained, during such Interest Period under regulations issued from time to time (including “Regulation D,” issued by the Board of Governors of the Federal Reserve Bank of the United States (the “Reserve Regulations”) by member banks of the United States Federal Reserve System in New York City with deposits exceeding one billion Dollars against Eurocurrency funding liabilities (currently referred to as “Eurocurrency liabilities” (as such term is used in Regulation D)).  Eurodollar Borrowings shall be deemed to constitute Eurodollar liabilities and to be subject to such reserve requirements without benefit of or credit for proration, exceptions or offsets which may be available from time to time to any Lender under the Reserve Regulations.

 

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“Subordinated Indebtedness” means Indebtedness of any Company that is by its terms subordinated in right of payment to all or any portion of the Secured Obligations.

 

“Subsidiary” means, with respect to any Person (the “parent”) at any date, (i) any Person the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, (ii) any other corporation, limited liability company, association or other business entity of which securities or other ownership interests representing more than 50% of the voting power of all Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Board of Directors thereof are, as of such date, owned, controlled or held by the parent and/or one or more subsidiaries of the parent, (iii) any partnership (a) the sole general partner or the managing general partner of which is the parent and/or one or more subsidiaries of the parent or (b) the only general partners of which are the parent and/or one or more subsidiaries of the parent and (iv) any other Person that is otherwise Controlled by the parent and/or one or more subsidiaries of the parent.  Unless the context requires otherwise, “Subsidiary” refers to a Subsidiary of Borrower.

 

“Survey” means a survey of any Mortgaged Property (and all improvements thereon) which is (a) (i) prepared by a surveyor or engineer licensed to perform surveys in the state where such Mortgaged Property is located, (ii) dated (or redated) not earlier than six months before the date of delivery thereof unless there shall have occurred within six months before such date of delivery any exterior construction on the site of such Mortgaged Property or any easement, right of way or other interest in such Mortgaged Property has been granted or become effective through operation of applicable Legal Requirements or otherwise with respect to such Mortgaged Property which, in either case, can be depicted on a survey, in which events, as applicable, such survey shall be dated (or redated) after the completion of such construction or if such construction shall not have been completed as of such date of delivery, not earlier than 20 days before such date of delivery, or after the grant or effectiveness of any such easement, right of way or other interest in such Mortgaged Property, (iii) certified by the surveyor (in a manner reasonably acceptable to the Administrative Agent) to the Administrative Agent, the Collateral Agent and the Title Company, (iv) complying in all respects with the minimum detail requirements of the American Land Title Association as such requirements are in effect on the date of preparation of such survey and (v) sufficient for the Title Company to remove all standard survey exceptions from the title insurance policy (or commitment) relating to such Mortgaged Property and issue the endorsements of the type required by Section 4.01(m)(iii) or (b) otherwise reasonably acceptable to the Collateral Agent.

 

“Swap Obligation” means, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

 

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“Swingline Commitment” means the commitment of the Swingline Lender to make loans pursuant to Section 2.17, as the same may be reduced from time to time pursuant to Section 2.07 provided that at no time shall the Swingline Commitment exceed the Revolving Commitment.  The aggregate principal amount of the Swingline Commitment shall be $10,000,000 on the Closing Date

 

“Swingline Exposure” means at any time the aggregate principal amount at such time of all outstanding Swingline Loans.  The Swingline Exposure of any Revolving Lender at any time shall equal its Pro Rata Percentage of the aggregate Swingline Exposure at such time.

 

“Swingline Lender” has the meaning set forth in the preamble hereto.

 

“Swingline Loan” means any loan made by the Swingline Lender pursuant to Section 2.17.

 

“Syndication Agent” has the meaning set forth in the preamble hereto.

 

“Synthetic Lease” means, as to any Person, (a) any lease (including leases that may be terminated by the lessee at any time) of any Property (i) that is accounted for as an operating lease under GAAP and (ii) in respect of which the lessee retains or obtains ownership of the Property so leased for U.S. federal (or foreign) income tax purposes, other than any such lease under which such Person is the lessor or (b) (i) a synthetic, off-balance sheet or tax retention lease, or (ii) an agreement for the use or possession of Property (including a Sale and Leaseback Transaction), in each case under this clause (b), creating obligations that do not appear on the balance sheet of such Person but which, upon the application of any Insolvency Laws to such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

 

“Synthetic Lease Obligations” means, as to any Person, an amount equal to the capitalized amount of the remaining lease payments under any Synthetic Lease that would appear on a balance sheet of such Person in accordance with GAAP if such obligations were accounted for as Capital Lease Obligations.

 

“Synthetic Purchase Agreement” means any swap, derivative or other agreement or combination of agreements pursuant to which any Company is or may become obligated to make (a) any payment in connection with a purchase by any third party from a Person other than a Company of any Equity Interest or Restricted Indebtedness or (b) any payment (other than on account of a permitted purchase by it of any Equity Interest or Restricted Indebtedness) the amount of which is determined by reference to the price or value at any time of any Equity Interest or Restricted Indebtedness.

 

“Target” has the meaning set forth in the recitals hereto.

 

“Tax Returns” means all returns, statements, filings, attachments and other documents or certifications filed or required to be filed in respect of Taxes.

 

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“Taxes” means (i) any and all present or future taxes, duties, levies, imposts, assessments, fees, deductions, withholdings or other similar charges, whether computed on a separate, consolidated, unitary, combined or other basis and any and all liabilities (including interest, fines, penalties or additions with respect to any of the foregoing) with respect to the foregoing, and (ii) any transferee, successor, joint and several, contractual or other liability (including liability pursuant to Treasury Regulation § 1.1502-6 (or any similar provision of state, local or non-U.S. law)) in respect of any item described in clause (i).

 

“Term Borrowing” means a Borrowing comprised of Term Loans.

 

“Term Loan Commitment” means, with respect to each Lender, the commitment, if any, of such Lender to make a Term Loan hereunder in the amount set forth on Annex I to this Agreement or on Schedule 1 to the Assignment and Assumption pursuant to which such Lender assumed its Term Loan Commitment, as applicable, as the same may be (a) increased from time to time pursuant to Section 2.19 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The aggregate principal amount of the Lenders’ Term Loan Commitments on the Closing Date is $300,000,000.

 

“Term Loan Facility” means the term loan facility represented by the Term Loans.

 

“Term Loan Lender” means a Lender with a Term Loan Commitment or an outstanding Term Loan.

 

“Term Loan Repayment Date” has the meaning set forth in Section 2.09(a).

 

“Term Loans” means the Initial Term Loans, an Incremental Term Loan or an Extended Term Loan, as applicable.  Each Term Loan shall be either an ABR Term Loan or a Eurodollar Term Loan.

 

“Test Period” means, at any time, the four consecutive fiscal quarters of Borrower then last ended (in each case taken as one accounting period) for which financial statements have been or are required to be delivered pursuant to Section 5.01(a) or (b).

 

“Title Company” means any title insurance company as shall be retained by Borrower and reasonably acceptable to the Administrative Agent.

 

“Title Policy” has the meaning set forth in Section 4.01(m)(iii).

 

“Total Leverage Ratio” means, at any date of determination, the ratio of (i) Consolidated Indebtedness on such date to (ii) Consolidated EBITDA for the Test Period then most recently ended.

 

“Transaction Documents” means the Acquisition Documents and the Loan Documents.

 

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“Transactions” means, collectively, the transactions to occur pursuant to, or contemplated by, the Transaction Documents, including (a) the consummation of the Acquisition, (b) the execution, delivery and performance of the Loan Documents and the initial Credit Extensions hereunder, (c) the Refinancing; and (d) the payment of all fees, costs and expenses to be paid on or before the Closing Date owing in connection with the foregoing.

 

“Transferred Guarantor” has the meaning set forth in Section 7.09.

 

“Transition Plan” has the meaning set forth in the Purchase Agreement.

 

“Type” means, when used in reference to any Loan or Borrowing, a reference to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined on the basis of Adjusted LIBOR Rate or the Alternate Base Rate.

 

“UCC” means the Uniform Commercial Code as in effect from time to time (except as otherwise specified) in any applicable state or jurisdiction.

 

“Undisclosed Administration” means, in relation to a Lender or its direct or indirect parent company, the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official by a supervisory authority or regulator under or based on the law in the country where such Lender or parent company is subject to home jurisdiction supervision if applicable Legal Requirements require that such appointment is not to be publicly disclosed.

 

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the actuarial assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

 

“United States” and “U.S.” means the United States of America.

 

“Voting Stock” means, with respect to any Person, any class or classes of Equity Interests pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the Board of Directors of such Person.

 

“Wholly Owned Domestic Subsidiary” means a Domestic Subsidiary that is a Wholly Owned Subsidiary.

 

“Wholly Owned Subsidiary” means, with respect to any Person, (a) any corporation 100% of whose capital stock (other than directors’ qualifying shares to the extent required under applicable Legal Requirements) is at the time owned by such Person and/or one or more Wholly Owned Subsidiaries of such Person and (b) any partnership, association, joint venture, limited liability company or other entity in which such Person and/or one or more Wholly Owned Subsidiaries of such Person have a 100% Equity Interest (other than directors’ qualifying shares to the extent required under applicable Legal Requirements) at such time.

 

“Yield Differential” means, with respect to any Term Loans and/or Revolving Loans made pursuant to Section 2.19, (i) the Effective Yield applicable to such Term Loans and/or Revolving Loans, as the case may be, minus (ii) the Effective Yield applicable to the Initial Term Loans and/or Initial Revolving Loans, minus (iii) 50 basis points.

 

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Section 1.02     Classification of Loans and Borrowings.  For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar Revolving Loan”).  Borrowings also may be classified and referred to by Class (e.g., a “Revolving Borrowing” or “Borrowing of Term Loans”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).

 

Section 1.03    Terms Generally.  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The phrase “Material Adverse Effect” shall be deemed to be followed by the phrase “, individually or in the aggregate”.  The words “asset” and “property” shall be construed to have the same meaning and effect.  The word “will” shall be construed to have the same meaning and effect as the word “shall.”  Unless the context requires otherwise (a) any definition of or reference to any Loan Document, agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth in any Loan Document), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, unless otherwise indicated and (e) any reference to any law or regulation shall (i) include all statutory and regulatory provisions consolidating, amending, replacing or interpreting or supplementing such law or regulation, and (ii) unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time.  This Section 1.03 shall apply, mutatis mutandis, to all Loan Documents.

 

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Section 1.04     Accounting Terms; GAAP.  Except as otherwise expressly provided herein, all financial statements to be delivered pursuant to this Agreement shall be prepared in accordance with and all terms of an accounting or financial nature shall be construed and interpreted in accordance with GAAP as in effect from time to time.  If at any time any change in GAAP would affect the computation of any financial ratio set forth in any Loan Document or any financial definition of any other provision of any Loan Document, and Borrower or the Required Lenders shall so request, the Administrative Agent and Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to approval by the Required Lenders and Borrower); provided that, until so amended, such ratio or requirement shall continue to be computed in accordance with GAAP before such change, and Borrower shall provide to the Administrative Agent and the Lenders within five days after delivery of each certificate or financial report required hereunder that is affected thereby a written statement of a Financial Officer of Borrower setting forth in reasonable detail the differences (including any differences that would affect any calculations relating to the financial covenants as set forth in Section 6.10) that would have resulted if such financial statements had been prepared without giving effect to such change.  Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made (i) without giving effect to any election under Accounting Standards Codification 825-10-25 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of Borrower or any Subsidiary at “fair value”, as defined therein and (ii) without giving effect to any treatment of Indebtedness in respect of convertible debt instruments under Accounting Standards Codification 470-20 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof.  Notwithstanding the foregoing, all liabilities under or in respect of any lease (whether now outstanding or at any time entered into or incurred) that, under GAAP as in effect on the Closing Date, would be accrued as rental and lease expense and would not constitute a capital lease obligation in accordance with GAAP as in effect on the Closing Date shall continue to not constitute a capital lease obligation, in each case, for purposes of the covenants set forth herein and all defined terms as used therein.

 

Without limiting the foregoing, if at any time the SEC permits or requires United States reporting companies to use IFRS in lieu of GAAP for reporting purposes, Borrower may notify the Administrative Agent that it has elected to so use IFRS in lieu of GAAP and, upon any such notice, references herein to GAAP shall thereafter be construed to mean IFRS as in effect from time to time; provided that, to the extent that such election would affect any financial ratio set forth in this Agreement or any requirement set forth in Section 5.01, (i) Borrower shall provide to the Administrative Agent financial statements and other documents reasonably requested by the Administrative Agent or any Lender setting forth a reconciliation with respect to such ratio or requirement made before and after giving effect to such election and (ii) if Borrower, the Administrative Agent or the Required Lenders shall so request, the Administrative Agent, the Required Lenders and Borrower shall negotiate in good faith to amend such ratio to preserve the original intent thereof in light of such change.

 

Section 1.05     Pro Forma Calculations.  With respect to any applicable period during which the Acquisition, any Permitted Acquisition or any Disposition occurs as permitted pursuant to the terms hereof, the financial covenants set forth in Section 6.10 shall be calculated with respect to such period and the Acquisition, such Permitted Acquisition or Disposition on a Pro Forma Basis.  Any financial ratios required to be satisfied in order for a specific action to be permitted under this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

 

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Section 1.06     Resolution of Drafting Ambiguities.  Each Loan Party acknowledges and agrees that it was represented by counsel in connection with the execution and delivery of the Loan Documents to which it is a party, that it and its counsel reviewed and participated in the preparation and negotiation hereof or thereof and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation hereof or thereof.

 

ARTICLE II

THE CREDITS

 

Section 2.01     Commitments.  Subject to the terms and conditions and relying upon the representations and warranties herein set forth:

 

(a)           each Term Loan Lender agrees, severally and not jointly, to make an Initial Term Loan to Borrower on the Closing Date in the principal amount equal to its Term Loan Commitment; and

 

(b)           each Revolving Lender agrees, severally and not jointly, to make Revolving Loans to Borrower, at any time and from time to time on and after the Closing Date until the earlier of the Revolving Maturity Date and the termination of the Revolving Commitment of such Lender in accordance with the terms hereof, in an aggregate principal amount at any time outstanding that will not result in such Lender’s Revolving Exposure exceeding such Lender’s Revolving Commitment.

 

Amounts paid or prepaid in respect of Term Loans, including Extended Term Loans may not be reborrowed.  Within the limits set forth in clause (b) above and subject to the terms, conditions and limitations set forth herein, Borrower may borrow, pay or prepay and reborrow Revolving Loans.

 

Section 2.02     Loans. (a)  Each Loan (other than Swingline Loans) shall be made as part of a Borrowing consisting of Loans made by the Lenders ratably in accordance with their applicable Commitments; provided that the failure of any Lender to make any Loan shall not in itself relieve any other Lender of its obligation to lend hereunder (it being understood, however, that no Lender shall be responsible for the failure of any other Lender to make any Loan required to be made by such other Lender).  Except for Loans deemed made pursuant to Section 2.18(e)(ii), (x) any Borrowing shall be in an aggregate principal amount that is (i) an integral multiple of $250,000 and not less than $500,000 or (ii) equal to the remaining available balance of the applicable Commitments.

 

(b)           Subject to Sections 2.11 and 2.12, each Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as Borrower may request pursuant to Section 2.03.  Each Lender may at its option make any Eurodollar Loan by causing any domestic or foreign branch of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Lender to make such Loan and the obligation of Borrower to repay such Loan in accordance with the terms of this Agreement.  Borrowings of more than one Type may be outstanding at the same time; provided that Borrower shall not be entitled to request any Borrowing that, if made, would result in more than five Eurodollar Borrowings in the aggregate outstanding hereunder at any one time.  For purposes of the foregoing, Borrowings having different Interest Periods, regardless of whether they commence on the same date, shall be considered separate Borrowings.

 

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(c)           Except with respect to Loans made pursuant to Section 2.18(e)(ii), each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds to such account in New York City as the Administrative Agent may designate from time to time not later than 10:00 a.m., New York City time, and the Administrative Agent shall promptly credit the amounts so received to an account as directed by Borrower in the applicable Borrowing Request maintained with the Administrative Agent or, if a Borrowing shall not occur on such date because any condition precedent herein specified shall not have been met, return the amounts so received to the respective Lenders within two Business Days.

 

(d)           Unless the Administrative Agent shall have received written notice from a Lender before the date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s portion of such Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent on the date of such Borrowing in accordance with Section 2.02(c), and the Administrative Agent may (but shall not be obligated to), in reliance upon such assumption, make available to Borrower on such date a corresponding amount.  If the Administrative Agent shall have so made funds available, then, to the extent that such Lender shall not have made such portion available to the Administrative Agent, each of such Lender and Borrower severally agrees to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to Borrower until the date such amount is repaid to the Administrative Agent at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules or practices on interbank compensation, and (ii) in the case of Borrower, the greater of the interest rate applicable at the time to ABR Loans and the interest rate applicable to such Borrowing.  If such Lender shall subsequently repay to the Administrative Agent such corresponding amount, such amount shall constitute such Lender’s Loan as part of such Borrowing for purposes of this Agreement, and Borrower’s obligation to repay the Administrative Agent such corresponding amount pursuant to this Section 2.02(d) shall cease and any amounts previously so paid by Borrower shall be returned to Borrower.

 

(e)           Notwithstanding any other provision of this Agreement, Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Revolving Maturity Date or in the case of the Initial Term Loans, the Initial Term Loan Maturity Date or in the case of any Extended Term Loans, the applicable Extended Term Loan Maturity Date, as applicable.

 

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Section 2.03     Borrowing Procedure.  To request a Revolving Borrowing or Term Borrowing, Borrower shall deliver, by hand delivery or facsimile (or other electronic transmission), a duly completed and executed Borrowing Request to the Administrative Agent (i) in the case of a Eurodollar Borrowing, not later than 1:00 p.m., New York City time, three Business Days before the date of the proposed Borrowing or (ii) in the case of an ABR Borrowing, not later than 1:00 p.m., New York City time, one Business Day before the date of the proposed Borrowing.  Each Borrowing Request for a Revolving Loan or a Term Loan shall be irrevocable and shall specify the following information in compliance with Section 2.02:

 

(a)           whether the requested Borrowing is to be a Borrowing of Revolving Loans or Term Loans;

 

(b)           the aggregate principal amount of such Borrowing;

 

(c)           the date of such Borrowing, which shall be a Business Day;

 

(d)           whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;

 

(e)           in the case of a Eurodollar Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of “Interest Period”;

 

(f)            the location and number of Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of Section 2.02(c); and

 

(g)           that the conditions set forth in Sections 4.02(b) and (c) are satisfied as of the date of the notice.

 

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be a Eurodollar Borrowing with an Interest Period of one month; provided, however, each Swingline Loan shall be an ABR Loan.  If no Interest Period is specified with respect to any requested Eurodollar Revolving Borrowing, then Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing Request in accordance with this Section 2.03, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

 

Section 2.04     Evidence of Debt; Repayment of Loans.  (a)  Borrower hereby unconditionally promises to pay to (i) the Administrative Agent for the account of each Term Loan Lender, the principal amount of each Term Loan of such Term Loan Lender as provided in Section 2.09, (ii) the Administrative Agent for the account of each Revolving Lender, the then unpaid principal amount of each Revolving Loan of such Revolving Lender on the Revolving Maturity Date and (iii) the Swingline Lender, the then unpaid principal amount of each Swingline Loan on the earlier of the Revolving Maturity Date and the first date after such Swingline Loan is made that is the 15th or last day of a calendar month (or, if such date is not a Business Day, on the next succeeding Business Day) and is at least two Business Days after such Swingline Loan is made; provided that, on each date that a Revolving Borrowing is made, Borrower shall repay all Swingline Loans that were outstanding on the date such Borrowing was requested.

 

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(b)           Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of Borrower to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.

 

(c)           The Administrative Agent shall maintain accounts in which it will record (i) the amount of each Loan made hereunder, the Type and Class thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from Borrower to each Lender hereunder, and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.

 

(d)           The entries made in the accounts maintained pursuant to Sections 2.04(b) and (c) shall be prima facie evidence of the existence and amounts of the obligations therein recorded; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligations of Borrower and the other Loan Parties to pay, and perform, the Obligations in accordance with the Loan Documents.  In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such entries, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

 

(e)            Any Lender by written notice to Borrower (with a copy to the Administrative Agent) may request that Loans of any Class made by it be evidenced by a promissory note.  In such event, the Administrative Agent shall promptly prepare and deliver to Borrower, and Borrower shall promptly (and, in all events, within five Business Days of receipt), execute and deliver to such Lender, a promissory note payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns) in the form of Exhibit I-1, I-2 or I-3, as the case may be.  Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 10.04) be represented by one or more promissory notes in such form payable to the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

 

Section 2.05     Fees.

 

(a)            Commitment Fee.  Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender a commitment fee (a “Commitment Fee”) equal 0.50% per annum of the average daily unused amount of each Revolving Commitment of such Revolving Lender during the period from and including the date hereof to but excluding the date on which such Revolving Commitment terminates.  Accrued Commitment Fees shall be payable in arrears (A) on the last Business Day of March, June, September and December of each year, commencing on the first such date to occur after the date hereof, and (B) on the date on which such Revolving Commitment terminates.  Commitment Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  For purposes of computing Commitment Fees, a Revolving Commitment of a Revolving Lender shall be deemed to be used to the extent of the outstanding Revolving Loans and LC Exposure of such Revolving Lender (and the Swingline Exposure of such Lender shall be disregarded for such purpose).

 

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(b)           Administrative Agent Fees.  Borrower agrees to pay to the Administrative Agent, for its own account, the administrative fees set forth in the Fee Letter and such other fees payable in the amounts and at the times separately agreed upon between Borrower and the Administrative Agent (the “Administrative Agent Fees”).

 

(c)           LC and Fronting Fees.  Borrower agrees to pay to (i) the Administrative Agent for the account of each Revolving Lender a participation fee (“LC Participation Fee”) with respect to its participations in Letters of Credit, which shall accrue at a rate per annum equal to the Applicable Revolving Loan Margin from time to time used to determine the interest rate on Eurodollar Revolving Loans pursuant to Section 2.06 on the average daily amount of such Revolving Lender’s LC Exposure (excluding any portion thereof attributable to Reimbursement Obligations) during the period from and including the Closing Date to but excluding the later of the date on which such Lender’s Revolving Commitment terminates and the date on which such Lender ceases to have any LC Exposure, and (ii) the Issuing Bank a fronting fee (“Fronting Fee”), which shall accrue at the rate of 0.25% per annum (or such other rate per annum as the Issuing Bank and Borrower may from time to time agree) on the average daily amount of the LC Exposure (excluding any portion thereof attributable to Reimbursement Obligations) during the period from and including the Closing Date to but excluding the later of the date of termination of the Revolving Commitments and the date on which there ceases to be any LC Exposure, as well as the Issuing Bank’s customary charges with respect to the administration, issuance, amendment, negotiation, renewal, payment or extension of any Letter of Credit or processing of drawings thereunder.  Accrued LC Participation Fees and Fronting Fees shall be payable in arrears (i) on the last Business Day of March, June, September and December of each year, commencing on the first such date to occur after the Closing Date, and (ii) on the date on which the Revolving Commitments terminate and no Letters of Credit remain outstanding.  Any such fees accruing after the date on which the Revolving Commitments terminate shall be payable on demand.  Any other fees payable to the Issuing Bank pursuant to this Section 2.05(c) shall be payable within 10 Business Days after demand therefor.  All LC Participation Fees and Fronting Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

 

(d)           Other Fees.  Borrower agrees to pay the Agents, for their own account, fees payable in the amounts and at the times separately agreed upon between Borrower and the applicable Agents.

 

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(e)            Payment of Fees.  All Fees shall be paid on the dates due, in immediately available funds in Dollars, to the Administrative Agent for distribution, if and as appropriate, among the Lenders, except that Borrower shall pay (i) the Fronting Fees directly to the Issuing Bank, and (ii) the Fees provided under Section 2.05(d) directly to the Agents.  Once paid, none of the Fees that are required to be paid hereunder shall be refundable under any circumstances.

 

Section 2.06     Interest on Loans. (a)  Subject to the provisions of Section 2.06(c), (i) the Revolving Loans comprising each ABR Borrowing, including each Swingline Loan, shall bear interest at a rate per annum equal to the Alternate Base Rate plus the Applicable Revolving Loan Margin in effect from time to time and (ii) the Term Loans comprising each ABR Borrowing shall bear interest at a rate per annum equal to the Alternate Base Rate plus the Applicable Term Loan Margin in effect from time to time.

 

(b)           Subject to the provisions of Section 2.06(c), (i) the Revolving Loans comprising each Eurodollar Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBOR Rate for the Interest Period in effect for such Borrowing plus the Applicable Revolving Loan Margin in effect from time to time and (ii) the Term Loans comprising each Eurodollar Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBOR Rate for the Interest Period in effect for such Borrowing plus the Applicable Term Loan Margin in effect from time to time.

 

(c)           Notwithstanding the foregoing, at any time while a Specified Event of Default has occurred and is continuing, the overdue principal amount of any Loans and, to the extent permitted by applicable law, all overdue interest in respect of each Loan, and all overdue fees or other overdue amounts owed in respect of the Obligations shall be payable upon demand and shall, bear interest, after as well as before judgment, at a per annum rate equal to (i) in the case of principal of or interest on any Loan, 2.00% plus the rate otherwise applicable to such Loan as provided in Sections 2.06(a) and (b) or (ii) in the case of any other Obligation, 2.00% plus the rate applicable to ABR Revolving Loans as provided in Section 2.06(a) (in either case, the “Default Rate”).

 

(d)           Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan; provided that (i) interest accrued pursuant to Section 2.06(c) (including interest on past due interest) and all interest accrued but unpaid on or after the Revolving Maturity Date or, in the case of the Initial Term Loans, the Initial Term Loan Maturity Date or, in the case of any Extended Term Loans, the applicable Extended Term Loan Maturity Date, as applicable, shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan or a Swingline Loan), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan before the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

 

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(e)           All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Base Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day); provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.14, bear interest for one day.  The applicable Alternate Base Rate or Adjusted LIBOR Rate shall be determined by the Administrative Agent in accordance with the provisions of this Agreement and such determination shall be conclusive and binding absent manifest error.  Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any Insolvency Proceeding.

 

Section 2.07     Termination and Reduction of Commitments.  (a)  Subject to the provisions of Section 2.19, the Term Loan Commitments shall automatically terminate at 5:00 p.m., New York City time, on the Closing Date.  The Revolving Commitments, the Swingline Commitment and the LC Commitment shall automatically terminate on the Revolving Maturity Date.

 

(b)           At its option, Borrower may at any time terminate, or from time to time permanently reduce, the Commitments of any Class; provided that (i) each reduction of the Commitments of any Class shall be in an amount that is an integral multiple of $250,000 and not less than $500,000 and (ii) the Revolving Commitments shall not be terminated or reduced if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.10, the aggregate amount of Revolving Exposures would exceed the aggregate amount of Revolving Commitments.

 

(c)           Borrower shall notify the Administrative Agent in writing of any election to terminate or reduce the Commitments under Section 2.07(b) at least five Business Days before the effective date of such termination or reduction (which effective date shall be a Business Day), specifying such election and the effective date thereof.  Promptly following receipt of any such notice, the Administrative Agent shall advise the Lenders of the contents thereof.  Each notice delivered by Borrower pursuant to this Section 2.07 shall be irrevocable.  Any termination or reduction of the Commitments of any Class shall be permanent.  Each reduction of the Commitments of any Class shall be made ratably among the Lenders in accordance with their respective Commitments of such Class.

 

Section 2.08     Interest Elections.  (a)  Each Revolving Borrowing and Term Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Borrowing Request.  Thereafter, Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section 2.08.  Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.  Notwithstanding anything to the contrary Borrower shall not be entitled to request any conversion or continuation that, if made, would result in more than five Eurodollar Borrowings outstanding hereunder at any one time. This Section 2.08 shall not apply to Swingline Borrowings, which may not be converted or continued.

 

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(b)           To make an election pursuant to this Section 2.08, Borrower shall deliver, by hand delivery or facsimile (or by other electronic transmission), a duly completed and executed Interest Election Request to the Administrative Agent not later than the time that a Borrowing Request would be required under Section 2.03 if Borrower were requesting a Revolving Borrowing or Term Borrowing of the Type resulting from such election to be made on the effective date of such election.  Each Interest Election Request shall be irrevocable.

 

(c)           Each Interest Election Request shall specify the following information in compliance with Section 2.02:

 

(i)            the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, or if outstanding Borrowings are being combined, allocation to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

 

(ii)           the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

 

(iii)          whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and

 

(iv)          if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.

 

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then Borrower shall be deemed to have selected an Interest Period of one month’s duration.

 

(d)           Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.

 

(e)           If an Interest Election Request with respect to a Eurodollar Borrowing is not timely delivered before the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to a Eurodollar Borrowing with an Interest Period of one month.  Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing, the Administrative Agent or the Required Lenders may require, by notice to Borrower, that (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.

 

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Section 2.09     Amortization of Term Borrowings.  (a)  Subject to Sections 2.19 and 2.20, Borrower shall pay to the Administrative Agent, for the account of the Term Loan Lenders, on each March 31, June 30, September 30 and December 31, beginning with March 31, 2014, or if any such date is not a Business Day, on the immediately following Business Day (each such date, a “Term Loan Repayment Date”), a principal amount of the Term Loans equal to 0.25% of the initial aggregate principal amount of such Term Loans (as adjusted from time to time pursuant to Section 2.10), together in each case with accrued and unpaid interest on the principal amount to be paid to but excluding the date of such payment.

 

(b)           To the extent not previously irrevocably paid in full in cash, all Initial Term Loans shall be due and payable on the Initial Term Loan Maturity Date and each Extended Term Loans shall be due and payable on the applicable Extended Term Loan Maturity Date.

 

Section 2.10     Optional and Mandatory Prepayments of Loans.

 

(a)           Optional Prepayments.  Borrower shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, subject to the requirements of this Section 2.10 (including, if applicable, the premium payable under Section 2.10(i); provided that each partial prepayment shall be in an amount that is an integral multiple of $250,000 and not less than $1,000,000.

 

(b)           Revolving Loan Prepayments.

 

(i)            In the event of the termination of all the Revolving Commitments, Borrower shall, on the date of such termination, repay or prepay all its outstanding Revolving Borrowings and all outstanding Swingline Loans and either (A) replace all outstanding Letters of Credit or (B) Cash Collateralize all outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i).

 

(ii)           In the event of any partial reduction of the Revolving Commitments, then (x) at or before the effective date of such reduction, the Administrative Agent shall notify Borrower and the Revolving Lenders of the sum of the Revolving Exposures after giving effect thereto and (y) if the sum of the Revolving Exposures would exceed the aggregate amount of Revolving Commitments after giving effect to such reduction, then Borrower shall, on the date of such reduction, first, repay or prepay Swingline Loans, second, repay or prepay Revolving Borrowings and third, replace outstanding Letters of Credit or Cash Collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i) in an aggregate amount sufficient to eliminate such excess.

 

(iii)          In the event that the sum of all Lenders’ Revolving Exposures exceeds the Revolving Commitments then in effect, Borrower shall, without notice or demand, immediately first, repay or prepay Swingline Loans, second, repay or prepay Revolving Borrowings, and third, replace outstanding Letters of Credit or Cash Collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i) in an aggregate amount sufficient to eliminate such excess.

 

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(iv)           In the event that the aggregate LC Exposure exceeds the LC Commitment then in effect, Borrower shall, without notice or demand, immediately replace outstanding Letters of Credit or Cash Collateralize outstanding Letters of Credit  in accordance with the procedures set forth in Section 2.18(i) in an aggregate amount sufficient to eliminate such excess.

 

(c)           Asset Sales.  Not later than 5 Business Days following the receipt of any Net Cash Proceeds of any Asset Sale by any Company, Borrower shall apply an amount equal to  100% of such Net Cash Proceeds to make prepayments in accordance with Sections 2.10(h); provided that:

 

(i)            so long as no Default or Event of Default shall then exist or would arise therefrom, such proceeds shall not be required to be so applied on such date to the extent that Borrower shall have delivered an Officers’ Certificate to the Administrative Agent on or before such date stating that such Net Cash Proceeds are reasonably expected to be reinvested in fixed or capital assets of any Loan Party within 270 days following the date of such Asset Sale (which Officers’ Certificate shall set forth the estimates of the proceeds to be so expended); provided that, if the Property subject to such Asset Sale constituted Collateral, then all Property purchased or otherwise acquired with the Net Cash Proceeds thereof pursuant to this subsection shall be made subject to the first priority perfected Lien (subject to Permitted Liens) of the applicable Security Documents in favor of the Collateral Agent, for its benefit and for the benefit of the other Secured Parties in accordance with Sections 5.11 and 5.12; and

 

(ii)           if all or any portion of such Net Cash Proceeds is not so reinvested within such 270-day period, such unused portion shall be applied on the last day of such period as a mandatory prepayment as provided in this Section 2.10(c).

 

(d)           Debt Issuance or Preferred Stock Issuance.  Not later than one Business Day following the receipt of any Net Cash Proceeds of any Debt Issuance by any Company or of any Preferred Stock Issuance by Borrower of Disqualified Capital Stock, Borrower shall make prepayments in accordance with Section 2.10(h) in an aggregate principal amount equal to 100% of such Net Cash Proceeds.

 

(e)           Reserved

 

(f)            Casualty Events.  Not later than 5 Business Days following the receipt of any Net Cash Proceeds from a Casualty Event by any Company, Borrower shall apply an amount equal to 100% of such Net Cash Proceeds to make prepayments in accordance with Section 2.10(h); provided that:

 

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(i)            so long as no Default or Event of Default shall then exist or would arise therefrom, such proceeds shall not be required to be so applied on such date to the extent that (A) in the event such Net Cash Proceeds shall not exceed $1,000,000 per Casualty Event or $3,000,000 in Net Cash Proceeds in any fiscal year of Borrower, Borrower shall have delivered an Officers’ Certificate to the Administrative Agent on or before such date stating that such proceeds are reasonably expected to be used, or (B) in the event that such Net Cash Proceeds equals or exceeds $1,000,000 per Casualty Event or $3,000,000 in Net Cash Proceeds in any fiscal year of Borrower, the Administrative Agent has elected by notice to Borrower on or before such date to require such proceeds to be used, in each case, to repair, replace or restore any Property in respect of which such Net Cash Proceeds were paid or to reinvest in fixed or capital assets of any Loan Party, no later than 270 days following the date of receipt of such proceeds (which Officers’ Certificate shall set forth the estimates of the proceeds to be so expended); provided that if the Property subject to such Casualty Event constituted Collateral, then all Property purchased or otherwise acquired with the Net Cash Proceeds thereof pursuant to this subsection shall be made subject to the first priority perfected Lien (subject to Permitted Liens) of the applicable Security Documents in favor of the Collateral Agent, for its benefit and for the benefit of the other Secured Parties in accordance with Sections 5.11 and 5.12; and

 

(ii)           if all or any portion of such Net Cash Proceeds shall not be so applied within such 270-day period, such unused portion shall be applied on the last day of such period as a mandatory prepayment as provided in this Section 2.10(f).

 

(g)           Excess Cash Flow.  No later than the earlier of (i) 90 days after the end of each Excess Cash Flow Period and (ii) the date on which the financial statements with respect to such fiscal year in which such Excess Cash Flow Period occurs are delivered pursuant to Section 5.01(a), Borrower shall make prepayments in accordance with Section 2.10(h) in an aggregate principal amount equal to (A) (x) 50% of Excess Cash Flow for the Excess Cash Flow Period then ended if the Total Leverage Ratio at the end of such period is greater than or equal to 3.5:1.0, (y) 25% of Excess Cash Flow for the Excess Cash Flow Period then ended if the Total Leverage Ratio at the end of such period is less than 3.5:1.0 but greater than 2.5:1.0 and (z) 0.0% of Excess Cash Flow for the Excess Cash Flow Period then ended if the Total Leverage Ratio at the end of such period is less than or equal to 2.5:1.0 minus (B) the aggregate principal amount of optional prepayments of Term Loans (excluding as a result of any repurchase of Term Loans pursuant to Section 10.04(j)) or Revolving Loans (accompanied by a permanent reduction in the corresponding Revolving Commitments in an aggregate amount equal to such prepayment of Revolving Loans) pursuant to Section 2.10(a) made during such Excess Cash Flow Period to the extent such prepayment (1) does not occur in connection with a refinancing of all or a portion of such Loans and (2) is made with Internally Generated Funds.

 

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(h)           Application of Prepayments.

 

(i)           Before any prepayment or repayment hereunder, Borrower shall select the Borrowing or Borrowings to be prepaid and shall specify such selection in the notice of such prepayment pursuant to Section 2.10(h)(ii), subject to the provisions of this Section 2.10(h)(i).  Any prepayments required pursuant to Section 2.10(c)-(g) shall be applied (x) first to reduce the next four scheduled payments of Initial Term Loans, Extended Term Loans and Incremental Term Loans required to be made under Section 2.09(a) in direct order of maturity, on a pro rata basis among such Term Loans, (y) second on a pro rata basis among the payments on account of Initial Term Loans, Extended Term Loans and Incremental Term Loans remaining to be made on each Term Loan Repayment Date and the Final Maturity Date, and (z) third to the extent there are prepayment amounts remaining after the application of such prepayments under clause first and second, such excess amounts shall be applied to the prepayment of outstanding Revolving Loans, including to Cash Collateralize outstanding Letters of Credit (but without any corresponding reduction in Revolving Commitments), and Borrower shall comply with Section 2.10(b).  Any prepayments of Term Loans pursuant to Section 2.10(a) shall be applied to the remaining scheduled payments of Initial Term Loans, Extended Term Loans and Incremental Term Loans required to be made under Section 2.09(a) on a pro rata basis among such Term Loans as directed by Borrower (or, in the absence of any such direction, in direct order of maturity) unless otherwise agreed by the adversely affected Lenders.

 

(ii)           Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by written notice of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three Business Days before the date of prepayment, (ii) in the case of prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time, one Business Day before the date of prepayment and (iii) in the case of prepayment of a Swingline Loan, not later than 11:00 a.m., New York City time, on the date of prepayment.  Each such notice shall be irrevocable.  Each such notice shall specify the prepayment date, the principal amount of each Borrowing or portion thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably detailed calculation of the amount of such prepayment.  Promptly following receipt of any such notice (other than a notice relating solely to Swingline Loans), the Administrative Agent shall advise the Lenders of the contents thereof.  Such notice to the Lenders may be by electronic communication.  Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of a Borrowing of the same Type as provided in Section 2.02, except as necessary to apply fully the required amount of a mandatory prepayment.  Each prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing and otherwise in accordance with this Section 2.10.  Prepayments shall be accompanied by accrued interest to the extent required by Section 2.06.

 

(i)           Soft Call Protection.  (i)  Any prepayment with respect to all or any portion of the Term Loans with the proceeds of, or any conversion of Term Loans into, any new or replacement tranche of term loans bearing interest at an Effective Yield less than the Effective Yield applicable to the Term Loans (as such comparative rates are determined by the Administrative Agent) and (ii) any amendment to the Term Loan Facility that, directly or indirectly, reduces the Effective Yield applicable to the Term Loans (in each case, with original issue discount and upfront fees, which shall be deemed to constitute like amounts of original issue discount, being equated to interest rate margins in a manner consistent with generally accepted financial practice based on an assumed four year life to maturity) shall be accompanied by a prepayment premium equal to 1.00% of the amount of such Term Loans repaid or repriced, if such repayment or repricing is effected on or before the one year anniversary of the Closing Date.  Any such determination by the Administrative Agent as contemplated by the preceding sentence shall be conclusive and binding on Borrower and all Lenders, absent manifest error.

 

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Section
2.11        Alternate Rate of Interest.  If before the commencement
of any Interest Period for a Eurodollar Borrowing:

 

(a)           the Administrative Agent determines (which determination shall be final and conclusive absent manifest error) either (i) that Dollar deposits in the principal amounts of the Loans comprising the applicable Borrowing are not generally available in the London interbank market or (ii) that adequate and reasonable means (including by means of an Interpolated Rate) do not exist for ascertaining the Adjusted LIBOR Rate for such Interest Period; or

 

(b)           the Administrative Agent is advised in writing by the Required Lenders that the Adjusted LIBOR Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period;

 

then the Administrative Agent shall give written notice thereof to Borrower and the Lenders as promptly as practicable thereafter and, until the Administrative Agent notifies Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective and any Eurodollar Borrowing shall be converted into an ABR Borrowing on the last day of the then current Interest Period applicable thereto and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR Borrowing.

 

Section 2.12         Increased Costs; Change in Legality.  (a)  If any Change in Law shall:

 

(i)            impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge, liquidity or similar requirement against Property of, deposits with or for the account of, or credit extended by or participated in by, any Lender (except any such reserve requirement reflected in the Adjusted LIBOR Rate) or the Issuing Bank;

 

(ii)           impose on any Lender or the Issuing Bank or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Loans made by such Lender or any Letter of Credit or participation therein; or

 

(iii)          subjects any Lender or the Issuing Bank to any Taxes (other than (A) Indemnified Taxes indemnified pursuant to Section 2.15 and (B) taxes described in clauses (b) and (c) of the definition of Excluded Taxes) on its Loans, principal, letters of credit, Commitments, or other Obligations, or its deposits, reserves, other liabilities or capital attributable thereto;

 

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and the result of any of the foregoing shall be to increase the cost to such Lender by an amount deemed by such Lender to be material of making, converting to or from, continuing or maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender, the Issuing Bank or such Lender’s or the Issuing Bank’s holding company by an amount deemed by such Person to be material, if any, of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit) or to reduce the amount of any sum received or receivable by such Lender or the Issuing Bank hereunder by an amount deemed by such Lender or the Issuing Bank to be material (whether of principal, interest or otherwise), then Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered.  The protection of this Section 2.12 shall be available to each Lender and the Issuing Bank regardless of any possible contention of the invalidity or inapplicability of the Change in Law that shall have occurred or been imposed.

 

(b)           If any Lender or the Issuing Bank determines (in good faith, but in its sole absolute discretion) that any Change in Law regarding Capital Requirements has or would have the effect of reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on the capital of such Lender’s or the Issuing Bank’s holding company by any amount deemed by such Lender or the Issuing Bank to be material, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit or Swingline Loans held by such Lender, or the Letters of Credit issued by the Issuing Bank, to a level below that which such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or the Issuing Bank’s policies and the policies of such Lender’s or the Issuing Bank’s holding company with respect to capital adequacy or liquidity), then from time to time Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s holding company, for any such reduction suffered.

 

(c)           A certificate of a Lender or the Issuing Bank setting forth in reasonable detail the amount or amounts necessary to compensate such Lender or the Issuing Bank or its holding company, as the case may be, as specified in Sections 2.12(a) or (b) shall be delivered to Borrower (with a copy to the Administrative Agent) and shall be conclusive and binding absent manifest error; provided, however, that such certificate need not include any confidential or price sensitive information or any information that is prohibited by applicable Legal Requirements from being disclosed.  Borrower shall pay such Lender or the Issuing Bank, as the case may be, the amount shown as due on any such certificate within 10 Business Days after receipt thereof.

 

(d)           Failure or delay on the part of any Lender or the Issuing Bank to demand compensation pursuant to this Section 2.12 shall not constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such compensation; provided that Borrower shall not be required to compensate a Lender or the Issuing Bank for any increased costs or reductions incurred more than 180 days before the date that such Lender or the Issuing Bank, as the case may be, notifies Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or the Issuing Bank’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to indicate the period of retroactive effect thereof.

 

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(e)           Notwithstanding any other provision of this Agreement, if any Change in Law shall make it unlawful for any Lender to make or maintain any Eurodollar Loan or to give effect to its obligations as contemplated hereby with respect to any Eurodollar Loan, then, by written notice to Borrower and to the Administrative Agent:

 

(i)           such Lender may declare that Eurodollar Loans will not thereafter (for the duration of such unlawfulness (as determined in good faith by such Lender)) be made by such Lender hereunder (or be continued for additional Interest Periods and ABR Loans will not thereafter (for such duration) be converted into Eurodollar Loans), whereupon any request for a Eurodollar Loan (or to convert an ABR Loan to a Eurodollar Loan or to continue a Eurodollar Loan for an additional Interest Period) shall, as to such Lender only, be deemed a request for an ABR Loan (or a request to continue an ABR Loan as such for an additional Interest Period or to convert a Eurodollar Loan into an ABR Loan, as the case may be), unless such declaration shall be subsequently withdrawn by such Lender by written notice to Borrower and to the Administrative Agent; and

 

(ii)           such Lender may require that all outstanding Eurodollar Loans made by it be converted to ABR Loans, in which event all such Eurodollar Loans shall be automatically converted to ABR Loans as of the effective date of such notice as provided in Section 2.12(f).

 

In the event any Lender shall exercise its rights under clause (i) or (ii) above, all payments and prepayments of principal that would otherwise have been applied to repay the Eurodollar Loans that would have been made by such Lender or the converted Eurodollar Loans of such Lender shall instead be applied to repay the ABR Loans made by such Lender in lieu of, or resulting from the conversion of, such Eurodollar Loans.

 

(f)           For purposes of Section 2.12(e), a notice to Borrower by any Lender shall be effective as to each Eurodollar Loan made by such Lender, if lawful, on the last day of the Interest Period then applicable to such Eurodollar Loan; in all other cases such notice shall be effective on the date of receipt by Borrower.

 

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Section 2.13     Breakage Payments.  In the event of (a) the payment or prepayment, whether optional or mandatory, of any principal of any Eurodollar Loan earlier than the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan earlier than the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Revolving Loan or Term Loan on the date specified in any notice delivered pursuant hereto or (d) the assignment of any Eurodollar Loan earlier than the last day of the Interest Period applicable thereto as a result of a request by Borrower pursuant to Section 2.16, then, in any such event, Borrower shall compensate each Lender for the loss, cost and expense attributable to such event and any liquidation or deployment of deposits required by such Lender to make, maintain or convert to such Loan.  In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest that would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBOR Rate (together with any interest payable at the Default Rate, if then applicable) that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest that would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for Dollar deposits of a comparable amount and period from other banks in the Eurodollar market, whether or not such Loan was in fact so funded.  A certificate of any Lender setting forth in reasonable detail any amount or amounts that such Lender is entitled to receive pursuant to this Section 2.13 shall be delivered to Borrower (with a copy to the Administrative Agent) and shall be conclusive and binding absent manifest error.  Borrower shall pay such Lender the amount shown as due on any such certificate within 10 Business Days after receipt thereof; provided, however, that such certificate need not include any confidential or price sensitive information or any information that is prohibited by applicable Legal Requirements from being disclosed.

 

Section 2.14     Payments Generally; Pro Rata Treatment; Sharing of Setoffs.  (a)  Borrower shall make each payment required to be made by it hereunder or under any other Loan Document (whether of principal, interest, fees or Reimbursement Obligations, or of amounts payable under Section 2.10(i), 2.12, 2.13 or 2.15, or otherwise) on or before the time expressly required hereunder or under such other Loan Document for such payment (or, if no such time is expressly required, before 1:00 p.m., New York City time), on the date when due, in immediately available funds, without setoff, deduction or counterclaim.  Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the Administrative Agent at its offices at 520 Madison Avenue, New York, New York 10022 Attn: Internap Network Services Corporation Account Manager, except payments to be made directly to the Issuing Bank or Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.12, 2.13, 2.15 and 10.03 shall be made directly to the Persons entitled thereto and payments pursuant to other Loan Documents shall be made to the Persons specified therein.  The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof.  If any payment under any Loan Document shall be due on a day that is not a Business Day, unless specified otherwise, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.  All payments under each Loan Document shall be made in Dollars.

 

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(b)           If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, Reimbursement Obligations, interest and fees and other amounts then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal and Reimbursement Obligations then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and Reimbursement Obligations then due to such parties, and (iii) third, towards the payment of all other Obligations then due hereunder, ratably among the parties entitled thereto in accordance with the amount of such amounts then due to such parties.  It is understood that the foregoing does not apply to any adequate protection payments under any federal, provincial, state or foreign bankruptcy, insolvency, receivership or similar proceeding, and that the Administrative Agent may, subject to any applicable federal, provincial, state or foreign bankruptcy, insolvency, receivership or similar orders, distribute any adequate protection payments it receives on behalf of the Lenders to the Lenders in its sole discretion (i.e., whether to pay the earliest accrued interest, all accrued interest on a pro rata basis or otherwise).

 

(c)           If any Lender shall, by exercising any right of setoff or counterclaim (including pursuant to Section 10.08) or otherwise (including by exercise of its rights under the Security Documents), obtain payment in respect of any principal of or interest on any of its Revolving Loans, Term Loans or participations in LC Disbursements or Swingline Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Revolving Loans, Term Loans and participations in LC Disbursements and Swingline Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Revolving Loans, Term Loans and participations in LC Disbursements and Swingline Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Revolving Loans, Term Loans and participations in LC Disbursements and Swingline Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this Section 2.14(c) shall not be construed to apply to any payment made by or on behalf of Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Revolving Loans, Term Loans or participations in LC Disbursements or Swingline Loans to any Eligible Assignee or participant, other than to any Company or any Affiliates thereof (as to which the provisions of this Section 2.14(c) shall apply).  Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Legal Requirements, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against each Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of such participation.  If under applicable Insolvency Law any Secured Party receives a secured claim in lieu of a setoff or counterclaim to which this Section 2.14(c) applies, such Secured Party shall to the extent practicable, exercise its rights in respect of such secured claim in a manner consistent with the rights of such Secured Party under this Section 2.14(c) to share in the benefits of the recovery of such secured claim.

 

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(d)           Unless the Administrative Agent shall have received written notice from Borrower before the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that Borrower will not make such payment, the Administrative Agent may assume that Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due.  In such event, if Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules or practices on interbank compensation.

 

(e)           If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.02(c), 2.14(d), 2.17(d), 2.18(d), 2.18(e) or 10.03(e), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender’s obligations under such Sections until all such unsatisfied obligations are fully paid.

 

Section 2.15    Taxes.  (a)  Any and all payments by or on account of any obligation of the Loan Parties hereunder or under any other Loan Document shall be made without setoff, counterclaim or other defense and free and clear of and without deduction, reduction or withholding for any and all Taxes, except as required by applicable Legal Requirements; provided that if any Indemnified Taxes or Other Taxes shall be required by applicable Legal Requirements to be deducted or withheld from such payments, then (i) the sum payable by the relevant Loan Party shall be increased as necessary so that after making all required deductions, reductions or withholdings (including deductions, reductions or withholdings applicable to additional sums payable under this Section 2.15) the Administrative Agent, any Lender or the Issuing Bank, as the case may be, receives an amount equal to the sum it would have received had no such deductions, reductions or withholdings been made, (ii) the relevant Loan Party, if applicable, shall make such deductions, reductions or withholdings and (iii) the relevant Loan Party, if applicable, shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Legal Requirements.

 

(b)           In addition, the Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable Legal Requirements, or at the option of the Administrative Agent timely reimburse it for payment of, any Other Taxes.

 

(c)           The Loan Parties shall jointly and severally indemnify the Administrative Agent, each Lender and the Issuing Bank, within 5 Business Days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid or payable by the Administrative Agent, such Lender or the Issuing Bank, as the case may be, on or with respect to any payment by or on account of any obligation of any Loan Party hereunder or under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.15) and any penalties, interest and expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to Borrower by a Lender or the Issuing Bank (in each case, with a copy delivered concurrently to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender or the Issuing Bank, shall be conclusive absent manifest error.

 

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(d)           Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that a Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.04(e) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error.  Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (d).

 

(e)           As soon as practicable after any payment of Taxes and in any event within 20 Business Days following any such payment being due, by any Loan Party to a Governmental Authority, Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the Tax Return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.  If any Loan Party fails to pay any Indemnified Taxes or Other Taxes when due to the appropriate Governmental Authority or Borrower fails to remit to the Administrative Agent the required receipts or other documentary evidence, the Loan Parties shall jointly and severally indemnify the Administrative Agent, each Lender and the Issuing Bank for any incremental Taxes or expenses that may become payable by the Administrative Agent, such Lender or the Issuing Bank, as the case may be, as a result of any such failure.

 

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(f)           Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which Borrower is resident for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable Legal Requirements, such properly completed and executed documentation prescribed by applicable Legal Requirements or reasonably requested by Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding.  Notwithstanding anything to the contrary in the preceding sentence, the completion, execution, and submission of such documentation shall not be required if in the Foreign Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.  Without limiting the generality of the foregoing, each Foreign Lender shall, to the extent it is legally entitled to do so, (i) furnish to Borrower and the Administrative Agent either (a) two accurate and complete originally executed U.S.  Internal Revenue Service Form W-8BEN (or successor form), (b) two accurate and complete originally executed U.S.  Internal Revenue Service Form W-8ECI (or successor form) (c) two accurate and complete originally executed U.S. Internal Revenue Service Form W-8EXP (or successor form) or (d) two accurate and complete originally executed U.S. Internal Revenue Service Form W-8IMY (or successor form) (with any required attachments), certifying, in each case, to such Foreign Lender’s legal entitlement to an exemption or reduction from U.S. federal withholding tax with respect to all interest payments hereunder, and (ii) to the extent it may lawfully do so at such times, upon reasonable request by Borrower or the Administrative Agent, provide a new Form W-8BEN (or successor form), Form W-8ECI (or successor form), Form W-8EXP (or successor form) or Form W-8IMY (or successor form) upon the expiration or obsolescence of any previously delivered form to reconfirm any complete exemption from, or any entitlement to a reduction in, U.S. federal withholding tax with respect to any interest payment hereunder; provided that any Foreign Lender that is relying on the so-called “portfolio interest exemption” within the meaning of Section 881(c) of the Code shall also furnish a “Non-Bank Certificate” in the form of Exhibit L if it is furnishing a Form W-8BEN.  Any Lender that is not a Foreign Lender shall (i) furnish to Borrower and the Administrative Agent two accurate and complete originally executed U.S. Internal Revenue Service Form W-9 (or successor form), or shall otherwise establish an exemption from U.S. backup withholding and (ii) to the extent it may lawfully do so at such times, upon reasonable request by Borrower or the Administrative Agent, provide a new From W-9 (or successor form) upon the expiration or obsolescence of any previously delivered form.

 

(g)           If a payment made to a Lender hereunder may be subject to U.S. federal withholding tax under FATCA, such Lender shall deliver to Borrower and the Administrative Agent, at the time or times prescribed by law and at such time or times reasonably requested by Borrower or the Administrative Agent, such documentation prescribed by applicable Legal Requirements and such additional documentation reasonably requested by Borrower or the Administrative Agent to comply with its withholding obligations, to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for purposes of this Section 2.15(g), the term “FATCA” shall include any amendments to FATCA after the date hereof.

 

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(h)           If the Administrative Agent or a Lender (or an assignee) determines in its sole discretion exercised in good faith, that it has received a refund of any Indemnified Taxes or Other Taxes as to which it has been indemnified by Borrower or with respect to which Borrower has paid additional amounts pursuant to this Section 2.15, it shall pay over such refund to Borrower (but only to the extent of indemnity payments made, or additional amounts paid, by Borrower under this Section 2.15 with respect to the Indemnified Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of the Administrative Agent or such Lender (or assignee) and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided, however, that if the Administrative Agent or such Lender (or assignee) is required to repay all or a portion of such refund to the relevant Governmental Authority, Borrower, upon the request of the Administrative Agent or such Lender (or assignee), shall repay the amount paid over to Borrower that is required to be repaid (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent or such Lender (or assignee) within 5 Business Days after receipt of written notice that the Administrative Agent or such Lender (or assignee) is required to repay such refund (or a portion thereof) to such Governmental Authority.  Nothing contained in this Section 2.15(h) shall require the Administrative Agent or any Lender (or assignee) to make available its Tax Returns or any other information which it deems confidential or privileged to Borrower or any other Person.  Notwithstanding anything to the contrary, in no event will the Administrative Agent or any Lender (or assignee) be required to pay any amount to Borrower the payment of which would place the Administrative Agent or such Lender (or assignee) in a less favorable net after-tax position than the Administrative Agent or such Lender (or assignee) would have been in if the Indemnified Taxes or Other Taxes subject to indemnification and giving rise to such refund had not been deducted, withheld, or otherwise imposed and the indemnification payments or additional amounts with respect to such Taxes had never been paid.

 

Section 2.16     Mitigation Obligations; Replacement of Lenders.

 

(a)           Mitigation of Obligations.  If any Lender requests compensation under Section 2.12(a) or (b), or if Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.15, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce materially amounts payable pursuant to Section 2.12(a), 2.12(b) or 2.15, as the case may be, in the future, (ii) would not subject such Lender to any unreimbursed cost or expense, (iii) would not require such Lender to take any action inconsistent with legal or regulatory restrictions, and (iv) would not otherwise be disadvantageous to such Lender, whether from an economic, legal, regulatory or reputational standpoint or otherwise.  Borrower shall pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.  A certificate setting forth such costs and expenses submitted by such Lender to the Administrative Agent shall be conclusive and binding absent manifest error.

 

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(b)           Replacement of Lenders.  In the event (i) any Lender or the Issuing Bank delivers a certificate requesting compensation pursuant to Section 2.12(a) or (b), (ii) any Lender or the Issuing Bank delivers a notice described in Section 2.12(e), (iii) Borrower is required to pay any additional amount to any Lender or the Issuing Bank or any Governmental Authority on account of any Lender or the Issuing Bank pursuant to Section 2.15, (iv) any Lender fails to consent to any amendment, waiver or other modification of any Loan Document requested by Borrower that requires the consent of 100% of the Lenders or 100% of all affected Lenders and, which, in each case, has been consented to by all other Lenders or all other affected Lenders, as the case may be, or (v) any Lender or the Issuing Bank defaults in its obligations to make Loans or issue Letters of Credit, as the case may be, or other extensions of credit hereunder, Borrower may, at its sole expense and effort (including with respect to the processing and recordation fee referred to in Section 10.04(b)), upon notice to such Lender or the Issuing Bank and the Administrative Agent, require such Lender or the Issuing Bank to transfer and assign, without recourse (in accordance with and subject to the restrictions contained in Section 10.04), all of its interests, rights and obligations under this Agreement to an Eligible Assignee which shall assume such assigned obligations (which Eligible Assignee may be another Lender, if a Lender accepts such assignment); provided that (w) except in the case of clause (iv) above if the effect of such amendment, waiver or other modification of the applicable Loan Document would cure any Default or Event of Default then ongoing, no such Default or Event of Default shall have occurred and be continuing, (x) such assignment shall not conflict with any applicable Legal Requirement, (y) Borrower shall have received the prior written consent of the Administrative Agent (and, if a Revolving Commitment is being assigned, the prior written consent of the Issuing Bank and the Swingline Lender), which consent shall not unreasonably be withheld or delayed, and (z) Borrower or such assignee shall have paid to the affected Lender or the Issuing Bank in immediately available funds an amount equal to the sum of the principal of and interest and any prepayment premium or penalty (if any) accrued to the date of such payment on the outstanding Loans or LC Disbursements of such Lender or the Issuing Bank, respectively, affected by such assignment plus all Fees and other amounts owing to or accrued for the account of such Lender or such Issuing Bank hereunder (including any amounts under Sections 2.12 and 2.13); provided further that, if before any such transfer and assignment the circumstances or event that resulted in such Lender’s or the Issuing Bank’s claim for compensation under Section 2.12(a) or (b) or notice under Section 2.12(e) or the amounts paid pursuant to Section 2.15, as the case may be, cease to cause such Lender or the Issuing Bank to suffer increased costs or reductions in amounts received or receivable or reduction in return on capital, or cease to have the consequences specified in Section 2.12(e), or cease to result in amounts being payable under Section 2.15, as the case may be (including as a result of any action taken by such Lender or the Issuing Bank pursuant to Section 2.16(a)), or if such Lender or the Issuing Bank shall irrevocably waive its right to claim further compensation under Section 2.12(a) or (b) in respect of such circumstances or event or shall irrevocably withdraw its notice under Section 2.12(e) or shall irrevocably waive its right to further payments under Section 2.15 in respect of such circumstances or event or shall consent to the proposed amendment, waiver, consent or other modification, as the case may be, then such Lender or the Issuing Bank shall not thereafter be required to make any such transfer and assignment hereunder.  Each Lender and the Issuing Bank hereby grants to the Administrative Agent an irrevocable power of attorney (which power is coupled with an interest) to execute and deliver, on behalf of such Lender and the Issuing Bank as assignor, any Assignment and Assumption necessary to effectuate any assignment of such Lender’s or the Issuing Bank’s interests hereunder in the circumstances contemplated by this Section 2.16(b).

 

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(c)           Defaulting Lenders.  Anything contained herein to the contrary notwithstanding, in the event that any Lender becomes a Defaulting Lender, then (i) during any Default Period (as defined below) with respect to such Defaulting Lender, such Defaulting Lender shall be deemed not to be a “Lender”, and the amount of such Defaulting Lender’s Revolving Commitment and Revolving Loans and/or Term Loan Commitments and Term Loans shall be excluded for purposes of voting, and the calculation of voting, on any matters (including the granting of any consents or waivers) with respect to any of the Loan Documents, except that the amount of such Defaulting Lender’s Revolving Commitment and Revolving Loans and/or Term Loan Commitments and Term Loans shall be included for purposes of voting, and the calculation of voting, on the matters set forth in Section 10.02(b)(i)-(x) and Section 10.02(b)(xiii) (including the granting of any consents or waivers); (ii) to the extent permitted by applicable Legal Requirements, until such time as the Default Excess (as defined below) with respect to such Defaulting Lender shall have been reduced to zero, (A) any voluntary prepayment of the Loans pursuant to Section 2.10(a) shall, if Borrower so directs at the time of making such voluntary prepayment, be applied to the Loans and the Revolving Exposure of other Lenders in accordance with Section 2.10(a) as if such Defaulting Lender had no Loans outstanding and the Revolving Exposure of such Defaulting Lender were zero, and (B) any mandatory prepayment of the Loans pursuant to Section 2.10 shall, if Borrower so directs at the time of making such mandatory prepayment, be applied to the Loans and Revolving Exposure of other Lenders (but not to the Loans and Revolving Exposure of such Defaulting Lender) in accordance with Section 2.10 as if such Defaulting Lender had funded all Defaulted Revolving Loans of such Defaulting Lender, it being understood and agreed that Borrower shall be entitled to retain any portion of any mandatory prepayment of the Loans that is not paid to such Defaulting Lender solely as a result of the operation of the provisions of this clause (B); (iii) the amount of such Defaulting Lender’s Revolving Commitment, Revolving Loans and LC Exposure shall be excluded for purposes of calculating the Commitment Fee payable to Revolving Lenders pursuant to Section 2.05(a) in respect of any day during any Default Period with respect to such Defaulting Lender, and such Defaulting Lender shall not be entitled to receive any Commitment Fee pursuant to Section 2.05(a) with respect to such Defaulting Lender’s Revolving Commitment in respect of any Default Period with respect to such Defaulting Lender; (iv) if any Swingline Exposure or LC Exposure exists at the time a Lender becomes a Defaulting Lender then: (A) all or any part of such Swingline Exposure and LC Exposure shall be reallocated among the Revolving Lenders that are not Defaulting Lenders in accordance with their respective Revolving Commitments but, in any case, only to the extent the sum of the Revolving Exposures of all Revolving Lenders that are not Defaulting Lenders does not exceed the total of the Revolving Commitments of all Revolving Lenders that are not Defaulting Lenders; (B) if the reallocation described in clause (A) above cannot, or can only partially, be effected (as reasonably determined by the Administrative agent), Borrower shall within 5 Business Days following notice by the Administrative Agent (x) prepay such Swingline Exposure of such Defaulting Lender and (y) cash collateralize such Defaulting Lender’s LC Exposure (after giving effect to any partial reallocation pursuant to clause (A) above) in accordance with the procedures set forth in Section 2.18(i) for so long as such LC Exposure is outstanding; (C) if Borrower cash collateralizes any portion of such Defaulting Lender’s LC Exposure pursuant to this paragraph (iv), Borrower shall not be required to pay any LC Participation Fee to such Defaulting Lender pursuant to Section 2.05(c) with respect to such Defaulting Lender’s LC Exposure during the period such Defaulting Lender’s LC Exposure is cash collateralized; (D) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to this paragraph (iv), then the fees payable to the Lenders pursuant to Section 2.05 shall be adjusted in accordance with such non-Defaulting Lenders’ reallocated LC Exposure; and (E) if any Defaulting Lender’s LC Exposure is neither cash collateralized nor reallocated pursuant to this paragraph (iv), then, without prejudice to any rights or remedies of the Issuing Banks or any Lender hereunder, all Commitment Fees that otherwise would have been payable to such Defaulting Lender (solely with respect to the portion of such Defaulting Lender’s Commitment that was utilized by such LC Exposure) and LC Participation Fee payable under Section 2.05 with respect to such Defaulting Lender’s LC Exposure shall be payable to the applicable Issuing Banks until such LC Exposure is cash collateralized and/or reallocated; (v) the Revolving Exposure of all Lenders as at any date of determination shall be calculated as if such Defaulting Lender had funded all Defaulted Revolving Loans of such Defaulting Lender; and (vi) so long as any Lender is a Defaulting Lender, the Swingline Lender shall not be required to fund any Swingline Loan and no Issuing Bank shall be required to issue, amend or increase any Letter of Credit, unless it is satisfied that the related exposure will be 100% covered by the Commitments of the non-Defaulting Lenders and/or cash collateral will be provided by Borrower in accordance with paragraph (iv) of this Section 2.16(c), and participating interests in any such newly issued or increased Letter of Credit or newly made Swingline Loan shall be allocated among non-Defaulting Lenders in a manner consistent with paragraph (iv)(A) of this Section 2.16(c) (and Defaulting Lenders shall not participate therein).  In the event that each of the Administrative Agent, Borrower, the Issuing Banks and the Swingline Lender agree that a Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then the Swingline Exposure, LC Exposure and Revolving Exposure of the Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment and on such date such Lender shall purchase at par such of the Loans of the other Lenders (other than Swingline Loans) as the Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its Revolving Commitment.

 

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For purposes of this Agreement, (i) “Funding Default” means, with respect to any Defaulting Lender, the occurrence of any of the events set forth in the definition of “Defaulting Lender,” (ii) “Defaulted Loan” means the Loans of a Defaulting Lender; (iii) “Default Period” means, with respect to any Defaulting Lender, the period commencing on the date of the applicable Funding Default and ending on the earliest of the following dates: (a) the date on which all Commitments are cancelled or terminated and/or the Obligations and the Specified Hedging Agreement Obligations (as defined in the Security Agreement) are declared or become immediately due and payable, (b) with respect to any Funding Default (other than any such Funding Default arising pursuant to clause (e) of the definition of “Defaulting Lender”), the date on which (1) the Default Excess with respect to such Defaulting Lender shall have been reduced to zero (whether by the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting Lender or by the non-pro rata application of any voluntary or mandatory prepayments of the Loans in accordance with the terms hereof or any combination thereof) and (2) such Defaulting Lender shall have delivered to Borrower and the Administrative Agent a written reaffirmation of its intention to honor its obligations under this Agreement with respect to its Commitment(s), and (c) the date on which Borrower, the Administrative Agent and the Required Lenders waive all Funding Defaults of such Defaulting Lender in writing, and (iv) “Default Excess” means, with respect to any Defaulting Lender, the excess, if any, of such Defaulting Lender’s Pro Rata Percentage of the aggregate outstanding principal amount of Loans of all Lenders (calculated as if all Defaulting Lenders (including such Defaulting Lender) had funded all of their respective Defaulted Loans) over the aggregate outstanding principal amount of Loans of such Defaulting Lender.

 

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No amount of the Commitment of any Lender shall be increased or otherwise affected, and, except as otherwise expressly provided in Section 2.16(c), performance by Borrower of its obligations under this Agreement and the other Loan Documents shall not be excused or otherwise modified, as a result of any Funding Default or the operation of Section 2.16(c).  The rights and remedies against a Defaulting Lender under Section 2.16(c) are in addition to other rights and remedies that Borrower may have against such Defaulting Lender with respect to any Funding Default and that the Administrative Agent or any Lender may have against such Defaulting Lender with respect to any Funding Default.

 

Section 2.17     Swingline Loans.

 

(a)           Swingline Commitment.  Subject to the terms and conditions set forth herein, the Swingline Lender agrees to make Swingline Loans to Borrower from time to time on any Business Day during the Revolving Availability Period, in an aggregate principal amount at any time outstanding that will not result in (and upon each such Borrowing of Swingline Loans, Borrower shall be deemed to represent and warrant that such Borrowing will not result in) (i) the aggregate principal amount of outstanding Swingline Loans exceeding the Swingline Commitment or (ii) the sum of the total Revolving Exposures exceeding the total Revolving Commitments; provided that the Swingline Lender shall not be required to make a Swingline Loan to refinance, in whole or in part, an outstanding Swingline Loan.  Within the foregoing limits and subject to the terms and conditions set forth herein, Borrower may borrow, repay and reborrow Swingline Loans.

 

(b)           Swingline Loans.  To request a Swingline Loan, Borrower shall hand deliver or transmit by facsimile transmission (or by other electronic transmission), a duly completed and executed Borrowing Request to the Administrative Agent and the Swingline Lender, not later than 11:00 a.m., New York City time, on the Business Day of a proposed Swingline Loan.  Each such notice shall be irrevocable and shall specify the requested date (which shall be a Business Day), the amount of the requested Swingline Loan, the location and number of Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of Section 2.02(c), and that the conditions set forth in Sections 4.02(b) and (c) are satisfied as of the date of the notice.  Each Swingline Loan shall be (and maintained as) an ABR Loan.  The Swingline Lender shall make each Swingline Loan available to Borrower by means of a credit to the general deposit account of Borrower with the Swingline Lender, if any, or otherwise to an account as directed by Borrower in the applicable Borrowing Request (or, in the case of a Swingline Loan made to finance the reimbursement of an LC Disbursement as provided in Section 2.18(e), by remittance to the Issuing Bank).  The Swingline Lender shall endeavor to fund each Swingline Loan by 3:00 p.m., New York City time and shall in all events fund each Swingline Loan by no later than 5:00 p.m., New York City time, on the requested date of such Swingline Loan.  Borrower shall not request a Swingline Loan if at the time of or immediately after giving effect to the Credit Extension contemplated by such request a Default or Event of Default has occurred and is continuing or would immediately thereafter result therefrom.  Swingline Loans shall be made in minimum amounts of $250,000 and integral multiples of $100,000 above such amount.

 

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(c)           Prepayment.  Borrower shall have the right at any time and from time to time to repay any Swingline Loan, in whole or in part, upon giving written notice to the Swingline Lender and the Administrative Agent before 12:00 p.m., New York City time, on the proposed date of repayment.

 

(d)           Participations.  The Swingline Lender (i) may at any time in its discretion, and (ii) no less frequently than every five Business Days or as directed by the Administrative Agent from time to time on not less than one Business Day’s written notice to the Swingline Lender, shall by written notice given to the Administrative Agent (provided such notice requirements shall not apply if the Swingline Lender and the Administrative Agent are the same entity) not later than 11:00 a.m., New York City time, on the next succeeding Business Day following such notice require the Revolving Lenders to acquire participations on such Business Day in all or a portion of the Swingline Loans then outstanding.  Such notice shall specify the aggregate amount of Swingline Loans in which Revolving Lenders will participate.  Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Revolving Lender, specifying in such notice such Revolving Lender’s Pro Rata Percentage of such Swingline Loan or Loans.  Each Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of the Swingline Lender, such Lender’s Pro Rata Percentage of such Swingline Loan or Loans.  Each Revolving Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this Section 2.17(d) is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or Event of Default, the failure of any condition set forth in Article IV to be satisfied or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever (so long as such payment shall not cause such Lender’s Revolving Exposure to exceed such Lender’s Revolving Commitment).  Each Revolving Lender shall comply with its obligation under this Section 2.17(d) by wire transfer of immediately available funds, in the same manner as provided in Section 2.02(c) with respect to Loans made by such Lender (and Section 2.02 shall apply, mutatis mutandis, to the payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Revolving Lenders (and the Administrative Agent may apply cash collateral provided for this purpose).  The Administrative Agent shall notify Borrower of any participations in any Swingline Loan acquired by the Revolving Lenders pursuant to this Section 2.17(d), and thereafter payments in respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender.  Any amounts received by the Swingline Lender from Borrower (or other party on behalf of Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent.  Any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Revolving Lenders that shall have made their payments pursuant to this Section 2.17(d), as their interests may appear.  The purchase of participations in a Swingline Loan pursuant to this Section 2.17(d) shall not relieve Borrower of any default in the payment thereof.

 

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(e)           Resignation or Removal of the Swingline Lender.  The Swingline Lender may resign as the Swingline Lender hereunder at any time upon at least 30 days’ prior written notice to the Lenders, the Administrative Agent and Borrower.  Following such notice of resignation, the Swingline Lender may be replaced at any time by written agreement among Borrower (with Borrower’s agreement not to be unreasonably withheld, delayed or conditioned), the Administrative Agent and the successor Swingline Lender.  The Administrative Agent shall notify the Lenders of any such replacement of the Swingline Lender.  At the time any such resignation or replacement shall become effective, Borrower shall pay all unpaid fees accrued for the account of the replaced Swingline Lender.  From and after the effective date of any such resignation or replacement, (i) the successor Swingline Lender shall have all the rights and obligations of the Swingline Lender under this Agreement with respect to Swingline Loans to be made by it thereafter and (ii) references herein and in the other Loan Documents to the term “Swingline Lender” shall be deemed to refer to such successor or to any previous Swingline Lender, or to such successor and all previous Swingline Lenders, as the context shall require.  After the resignation or replacement of the Swingline Lender hereunder, the replaced Swingline Lender shall remain a party hereto and shall continue to have all the rights and obligations of the Swingline Lender under this Agreement with respect to Swingline Loans made by it before such resignation or replacement, but shall not be required to make additional Swingline Loans.  Notwithstanding anything to the contrary in this Section 2.17(e) or otherwise, the Swingline Lender may not resign until such time as a successor Swingline Lender has been appointed and has accepted such appointment.

 

Section 2.18     Letters of Credit.

 

(a)           General.  Subject to the terms and conditions set forth herein, Borrower may request the Issuing Bank, and the Issuing Bank agrees, to issue Letters of Credit for its own account or the account of a Wholly Owned Subsidiary, in each case to support payment and performance obligations incurred in the ordinary course of business by Borrower and its Subsidiaries, in a form reasonably acceptable to the Administrative Agent and the Issuing Bank, at any time and from time to time during the Revolving Availability Period (provided that Borrower shall be a co-applicant, and be jointly and severally liable, with respect to each Letter of Credit issued for the account of a Wholly Owned Subsidiary).  The Issuing Bank shall have no obligation to issue, and Borrower shall not request the issuance of, any Letter of Credit at any time if after giving effect to such issuance, the LC Exposure would exceed the LC Commitment or the total Revolving Exposure would exceed the total Revolving Commitments.  In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by Borrower to, or entered into by Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control.

 

(b)           Request for Issuance, Amendment, Renewal, Extension; Certain Conditions.  To request the issuance of a Letter of Credit or the amendment, renewal or extension of an outstanding Letter of Credit, Borrower shall hand deliver or facsimile (or by other electronic communication) an LC Request to the Issuing Bank and the Administrative Agent not later than 11:00 a.m., New York City time, on the third Business Day preceding the requested date of issuance, amendment, renewal or extension (or such later date and time as is acceptable to the Issuing Bank).

 

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A request for an initial issuance of a Letter of Credit shall specify in form and detail reasonably satisfactory to the Issuing Bank:

 

(i)            the proposed issuance date of the requested Letter of Credit (which shall be a Business Day);

 

(ii)           the face amount thereof;

 

(iii)          the expiry date thereof (which shall not be later than the date set forth in Section 2.18(c));

 

(iv)          the name and address of the beneficiary thereof;

 

(v)           whether the Letter of Credit is to be issued for its own account or for the account of one of its Wholly Owned Subsidiaries (provided that Borrower shall be a co-applicant, and be jointly and severally liable, with respect to each Letter of Credit issued for the account of a Wholly Owned Subsidiary);

 

(vi)          the documents to be presented by such beneficiary in connection with any drawing thereunder;

 

(vii)         the full text of any certificate to be presented by such beneficiary in connection with any drawing thereunder; and

 

(viii)        such other matters as the Issuing Bank may require.

 

A request for an amendment, renewal or extension of any outstanding Letter of Credit shall specify in form and detail reasonably satisfactory to the Issuing Bank:

 

(i)            the Letter of Credit to be amended, renewed or extended;

 

(ii)           the proposed date of amendment, renewal or extension thereof (which shall be a Business Day);

 

(iii)          the nature of the proposed amendment, renewal or extension; and

 

(iv)          such other matters as the Issuing Bank may require.

 

If requested by the Issuing Bank, Borrower also shall submit a letter of credit application on the Issuing Bank’s standard form in connection with any request for a Letter of Credit; provided that the provisions of this Section 2.18 shall apply in respect of all such applications.  A Letter of Credit shall be issued, amended, renewed or extended only if (and, upon issuance, amendment, renewal or extension of each Letter of Credit, Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or extension, (i) the LC Exposure shall not exceed the LC Commitment, (ii)the total Revolving Exposures shall not exceed the total Revolving Commitments and (iii) the conditions set forth in Article IV in respect of such issuance, amendment, renewal or extension shall have been satisfied.  Unless the Issuing Bank shall agree otherwise, no Letter of Credit shall be in an initial amount less than $50,000.

 

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(c)           Expiration Date.  Each Letter of Credit shall expire at or before the close of business on the earlier of (x) the date which is one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (y) the Letter of Credit Expiration Date; provided that this Section 2.18(c) shall not prevent any Issuing Bank from agreeing that a Letter of Credit will automatically be extended for one or more successive periods not to exceed one year each (and, in any case, not to extend beyond the Letter of Credit Expiration Date) unless each such Issuing Bank elects not to extend for any such additional period.

 

(d)           Participations.  By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby irrevocably grants to each Revolving Lender, and each Revolving Lender hereby acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Revolving Lender’s Pro Rata Percentage of the aggregate amount available to be drawn under such Letter of Credit.  In consideration and in furtherance of the foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Revolving Lender’s Pro Rata Percentage of each LC Disbursement made by the Issuing Bank and not reimbursed by Borrower on the date due as provided in Section 2.18(e), or of any reimbursement payment required to be refunded to Borrower for any reason.  Each Revolving Lender acknowledges and agrees that its obligation to acquire participations pursuant to this Section 2.18(d) in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Default or Event of Default, the failure of any condition set forth in Article IV to be satisfied or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever (so long as such payment shall not cause such Lender’s Revolving Exposure to exceed such Lender’s Revolving Commitment).

 

(e)           Reimbursement.

 

(i)           If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, Borrower shall reimburse such LC Disbursement by paying to the Issuing Bank an amount equal to such LC Disbursement not later than 1:00 p.m., New York City time, on the date that such LC Disbursement is made if Borrower shall have received notice of such LC Disbursement before 11:00 a.m., New York City time, on such date, or, if such notice has not been received by Borrower before such time on such date, then not later than 1:00 p.m., New York City time, on the Business Day immediately following the day that Borrower receives such notice; provided that Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 that such payment be financed with ABR Revolving Loans in an equivalent amount and, to the extent so financed, Borrower’s obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Loans.

 

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(ii)           If Borrower fails to make such payment when due, or if the amount is not financed pursuant to the proviso to Section 2.18(e)(i), the Issuing Bank shall notify the Administrative Agent and the Administrative Agent shall notify each Revolving Lender of the applicable LC Disbursement, the payment then due from Borrower in respect thereof and such Revolving Lender’s Pro Rata Percentage thereof.  Each Revolving Lender shall pay by wire transfer of immediately available funds to the Administrative Agent not later than 12:00 p.m., New York City time, on such date (or, if such Revolving Lender shall have received such notice later than 12:00 p.m., New York City time, on any day, not later than 11:00 a.m., New York City time, on the immediately following Business Day), an amount equal to such Revolving Lender’s Pro Rata Percentage of the unreimbursed LC Disbursement in the same manner as provided in Section 2.02(c) with respect to Revolving Loans made by such Revolving Lender, and the Administrative Agent will promptly pay to the Issuing Bank the amounts so received by it from the Revolving Lenders.  The Administrative Agent will promptly pay to the Issuing Bank any amounts received by it from Borrower pursuant to the above paragraph before the time that any Revolving Lender makes any payment pursuant to the preceding sentence and any such amounts received by the Administrative Agent from Borrower after the receipt by the Issuing Bank of an amount of immediately available funds equal to 100% of all LC Disbursements that were otherwise unreimbursed will be promptly remitted by the Administrative Agent to the Revolving Lenders that shall have made such payments and to the Issuing Bank, as appropriate.

 

(iii)           If any Revolving Lender shall not have made its Pro Rata Percentage of such LC Disbursement available to the Administrative Agent as provided above, each of Borrower and such Revolving Lender severally agrees to pay interest on such amount, for each day from and including the date such amount is required to be paid in accordance with the foregoing to but excluding the date such amount is paid, to the Administrative Agent for the account of the Issuing Bank at (i) in the case of Borrower, the interest rate applicable to ABR Revolving Loans; provided that, if Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (i) of this Section 2.18(e), then the Default Rate shall apply and (ii) in the case of such Lender, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules or practices on interbank compensation.

 

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(f)           Obligations Absolute.  The Reimbursement Obligation of Borrower as provided in Section 2.18(e) shall be absolute, unconditional and irrevocable, and shall be paid and performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein; (ii) any draft or other document presented under a Letter of Credit being proved to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (iii) prepayment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that fails to comply with the terms of such Letter of Credit; (iv) any other fact, event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section 2.18, constitute a legal or equitable discharge of, or provide a right of setoff against, the obligations of Borrower hereunder; (v) the fact that a Default or Event of Default shall have occurred and be continuing; (vi) any material adverse change in the condition (financial or otherwise), results of operations, assets, liabilities (contingent or otherwise), material agreements, properties, solvency, business, management, prospects or value of any Company; or (vii) any other fact, circumstance or event whatsoever.  None of the Agents, the Lenders, the Issuing Bank or any of their Affiliates shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that the foregoing shall not be construed to excuse the Issuing Bank from liability to Borrower to the extent of any direct damages (as opposed to consequential, exemplary, special, punitive or other indirect damages, claims in respect of which are hereby waived by Borrower to the extent permitted by applicable Legal Requirements) suffered by Borrower that are caused by the Issuing Bank’s failure to exercise the applicable standard of care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof.  The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of the Issuing Bank (as determined by a court of competent jurisdiction in a final non-appealable decision) with respect to such a determination, the Issuing Bank shall be deemed to have exercised care in each such determination.  In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.  The Issuing Bank shall not have any duties or obligations except those expressly set forth in this Agreement.  The Issuing Bank shall not be liable for any action taken or not taken by it in the absence of its own gross negligence or willful misconduct (as finally determined by a court of competent jurisdiction).  The Issuing Bank shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person.  The Issuing Bank also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability for relying thereon.  The Issuing Bank may consult with legal counsel (who may be counsel for any Loan Party) and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel or experts.

 

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(g)           Disbursement Procedures.  The Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit.  The Issuing Bank shall promptly give written notice to the Administrative Agent and Borrower of such demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder; provided that any failure to give or delay in giving such notice shall not relieve Borrower of its Reimbursement Obligation to the Issuing Bank and the Revolving Lenders with respect to any such LC Disbursement (other than with respect to the timing of such Reimbursement Obligation set forth in Section 2.18(e)).

 

(h)           Interim Interest.  If the Issuing Bank shall make any LC Disbursement, then, unless Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is due, the unpaid amount thereof shall bear interest payable on demand, for each day from and including the date such LC Disbursement is due to but excluding the date that Borrower reimburses such LC Disbursement, at the Default Rate.  Interest accrued pursuant to this Section 2.18(h) shall be for the account of the Issuing Bank, except that interest accrued on and after the date of payment by any Revolving Lender pursuant to Section 2.18(e) to reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment.

 

(i)            Cash Collateralization.  If any Event of Default shall occur and be continuing, on the Business Day that Borrower receives notice from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans has been accelerated, Revolving Lenders with LC Exposure representing greater than 50% of the total LC Exposure) demanding the deposit of cash collateral pursuant to this Section 2.18(i), Borrower shall deposit in the Collateral Account, in the name of the Collateral Agent and for the benefit of the Revolving Lenders, an amount in cash equal to 103% of the LC Exposure as of such date plus any accrued and unpaid interest and fees thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to Borrower described in paragraph (g) or (h) of Article VIII.  Funds in the LC Sub-Account shall be applied by the Collateral Agent to reimburse the Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of outstanding Reimbursement Obligations or, if the maturity of the Loans has been accelerated (but subject to the consent of Revolving Lenders with LC Exposure representing greater than 50% of the total LC Exposure), be applied to satisfy other Obligations of Borrower in accordance with Article IX.  If Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount plus any accrued interest with respect to such amounts (to the extent not applied as aforesaid) shall, in accordance with Article IX, be returned to Borrower within ten Business Days after all Defaults and Events of Default have been cured or waived.

 

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(j)            Additional Issuing Banks.  Borrower may, at any time and from time to time, designate one or more additional Revolving Lenders or Affiliates of Revolving Lenders to act as an issuing bank under the terms of this Agreement, with the consent of each of the Administrative Agent (which consent shall not be unreasonably withheld), the Issuing Bank (which consent shall not be unreasonably withheld) and such Revolving Lender(s).  Any Revolving Lender designated as an issuing bank pursuant to this Section 2.18(j) shall be deemed (in addition to being a Revolving Lender) to be the Issuing Bank with respect to Letters of Credit issued or to be issued by such Revolving Lender, and all references herein and in the other Loan Documents to the term “Issuing Bank” shall, with respect to such Letters of Credit, be deemed to refer to such Revolving Lender in its capacity as Issuing Bank, as the context shall require.

 

(k)           Resignation or Removal of the Issuing Bank.  The Issuing Bank may resign as Issuing Bank hereunder at any time upon at least 30 days’ prior written notice to the Lenders, the Administrative Agent and Borrower.  Following such resignation, the Issuing Bank may be replaced at any time by written agreement among Borrower, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.  The Administrative Agent shall notify the Lenders of any such replacement of the Issuing Bank or any such additional Issuing Bank.  At the time any such resignation or replacement shall become effective, Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.05(c).  From and after the effective date of any such resignation or replacement or addition, as applicable, (i) the successor or additional Issuing Bank shall have all the rights and obligations of the Issuing Bank under this Agreement with respect to Letters of Credit to be issued by it thereafter and (ii) references herein and in the other Loan Documents to the term “Issuing Bank” shall be deemed to refer to such successor or such addition or to any previous Issuing Bank, or to such successor or such addition and all previous Issuing Banks, as the context shall require.  In the event that the resigning Issuing Bank is the only Issuing Bank under this Agreement at the time of such resignation, such resigning Issuing Bank agrees to use commercially reasonable efforts to find a successor that is willing to accept such appointment; provided, that if such resigning Issuing Bank is unable to find a successor Issuing Bank that is willing to accept such appointment, the resigning Issuing Bank’s resignation shall nevertheless become effective.  After the resignation or replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it before such resignation or replacement, but shall not be required to issue additional Letters of Credit.  If at any time there is more than one Issuing Bank hereunder, Borrower may, in its discretion, select which Issuing Bank is to issue any particular Letter of Credit.

 

(l)            Other.  The Issuing Bank shall be under no obligation to issue any Letter of Credit if:

 

(i)           any Order of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the Issuing Bank from issuing such Letter of Credit, or any Legal Requirement applicable to the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the Issuing Bank with respect to such Letter of Credit any restriction, reserve, liquidity or Capital Requirement (for which the Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Issuing Bank any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the Issuing Bank deems material to it; or

 

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(ii)           the issuance of such Letter of Credit would violate one or more policies of general application of the Issuing Bank.

 

(m)           The Issuing Bank shall be under no obligation to amend any Letter of Credit if (A) the Issuing Bank would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

 

Section 2.19     Increases of the Term Loan and Revolving Commitments.

 

(a)           Borrower may, not more than five times after the Closing Date, increase, at Borrower’s request to the Administrative Agent, the then effective aggregate principal amount of the Term Loan Commitments and/or Revolving Commitments; provided that:

 

(i)            the cumulative aggregate principal amount of all increases in the Term Loan Commitments and/or Revolving Commitments pursuant to this Section 2.19 shall not exceed $50,000,000 and any requested increase shall be in an integral multiple of $1,000,000 and not less than $5,000,000 (or such lower amount that represents all remaining availability pursuant to this Section 2.19);

 

(ii)           the proceeds of such increases shall be used for working capital and general corporate purposes of Borrower and its Subsidiaries, including Permitted Acquisitions and Dividends permitted under Section 6.08;

 

(iii)          Borrower shall execute and deliver such agreements, instruments and documents and take such other actions as may be reasonably requested by the Administrative Agent in connection with such increases and at the time of any such proposed increase;

 

(iv)          no Default or Event of Default shall have occurred and be continuing or would occur after giving effect to such increase and the application of proceeds therefrom; provided that with respect to any Incremental Term Loan the proceeds of which are used to finance a Permitted Acquisition it shall only be required that (x) no Default or Event of Default shall have occurred prior to or immediately after giving effect to the execution of the acquisition agreement with respect to such Permitted Acquisition and (y) no Specified Event of Default shall have occurred and be continuing at the time of incurrence of such Incremental Term Loan.

 

(v)           Borrower shall be in compliance, on a Pro Forma Basis, with each of the financial covenants specified in Section 6.10, on the date of such increase and as of the last day of the most recently ended fiscal quarter after giving effect to such increase (assuming, for purposes of Section 6.10, that the maximum Total Leverage Ratio permitted in any Test Period pursuant to Section 6.10(a) is 0.25:1.00 lower than the maximum Total Leverage Ratio set forth in Section 6.10(a) for such Test Period); provided that, in no event, shall the Total Leverage Ratio exceed 4.80:1.00 after giving effect to such increase and the application of proceeds therefrom on a Pro Forma Basis;

 

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(vi)           the Incremental Term Loans shall have a maturity date no earlier than the Initial Term Loan Maturity Date and shall have a weighted average life to maturity no shorter than the Initial Term Loans;

 

(vii)          if the Effective Yield applicable to the Incremental Term Loans and/or Revolving Loans made pursuant to this Section 2.19 exceed the Effective Yield applicable to the Initial Term Loans and/or Initial Revolving Loans by more than 50 basis points, then the interest rates set forth in Section 2.06 shall increase by the Yield Differential; and

 

(viii)         (x) the terms and conditions with respect to the Incremental Term Loans that are not consistent with the Initial Term Loans (except as otherwise set forth in this Section 2.19) shall be reasonably satisfactory to the Administrative Agent and (y) the terms and conditions with respect to the Revolving Commitments made pursuant to this Section 2.19 shall be consistent with the Initial Revolving Loans, without any change except as set forth in this Section 2.19.

 

(b)           Any request under this Section 2.19 shall be submitted by Borrower in writing to the Administrative Agent (which shall promptly forward copies to the Lenders).  Borrower may also specify any fees offered to those Lenders (the “Increasing Lenders”) that agree to increase the principal amount of their Term Loan Commitments and/or Revolving Commitments, which fees may be variable based upon the amount by which any such Lender is willing to increase the principal amount of its Term Loan Commitment and/or Revolving Commitment.  No Lender shall have any obligation, express or implied, to offer to increase the aggregate principal amount of its Term Loan Commitment and/or Revolving Commitment.  Only the consent of each Increasing Lender shall be required for an increase in the aggregate principal amount of the Term Loan Commitments and/or Revolving Commitments pursuant to this Section 2.19.  No Lender which declines to increase the principal amount of its Term Loan Commitment and/or Revolving Commitment may be replaced with respect to its existing Term Loan Commitment and/or Revolving Commitment as a result thereof without such Lender’s consent.

 

(c)           Each Increasing Lender shall as soon as reasonably practicable specify in writing the amount of the proposed increase of the Term Loan Commitments and/or Revolving Commitments that it is willing to assume (provided that any Lender not so responding within five Business Days (or such shorter period as may be specified by the Administrative Agent) shall be deemed to have declined such a request).  Borrower may accept some or all of the offered amounts or designate new lenders that are reasonably acceptable to the Administrative Agent as additional Lenders hereunder in accordance with this Section 2.19 (each such new lender being a “New Lender”), which New Lenders may assume all or a portion of the increase in the aggregate principal amount of the applicable Term Loan Commitments and/or Revolving Commitments.  The Administrative Agent, in consultation with Borrower, shall have discretion jointly to adjust the allocation of the increased aggregate principal amount of the Term Loan Commitments and/or Revolving Commitments among Increasing Lenders and New Lenders.

 

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(d)                      Subject to the foregoing, any increase requested by Borrower shall be effective upon (A) delivery to the Administrative Agent of each of the following documents: (i) an originally executed copy of a Joinder Agreement signed by a duly authorized officer of each New Lender; (ii) a notice to the Increasing Lenders and New Lenders, in form and substance reasonably acceptable to the Administrative Agent, signed by a Financial Officer of Borrower; (iii) an Officers’ Certificate of Borrower, in form and substance reasonably acceptable to the Administrative Agent certifying to, among other things, that any increase in the Term Loan Commitments and/or Revolving Commitments pursuant to this Section 2.19 and the making of the Term Loans and/or Revolving Loans under this Section 2.19 is not in violation of the Credit Facilities; (iv) to the extent requested by any New Lender or Increasing Lender, executed Term Notes and/or Revolving Notes issued by Borrower in accordance with Section 2.04(e); (v) an amendment (an “Incremental Loan Amendment”) to this Agreement and, as appropriate, the other Loan Documents, executed by Borrower, each Increasing Lender (if any), each New Lender (if any) and the Administrative Agent; and (vi) any other certificates or documents that the Administrative Agent shall reasonably request, in form and substance reasonably satisfactory to the Administrative Agent, and (B) satisfaction on the effective date of the Incremental Loan Amendment of (x) each of the conditions specified in Section 4.02 (it being understood that all references to “the date of such Credit Extension” or similar language in Section 4.02 shall be deemed to refer to the effective date of the Incremental Loan Amendment), and (y) such other conditions as the parties thereto shall agree, provided with respect to any Incremental Term Loan the proceeds of which are used to finance a Permitted Acquisition, it shall only be required under this Section 2.19(d)(B), that no Specified Event of Default shall be continuing at the time of incurrence and the only representations and warranties which shall be a condition to the availability of the Incremental Term Loans shall be the Specified Representations and the Specified Purchase Agreement Representations (in each case, pursuant to the terms thereof) as a result of the breach of one or more of such representations in such acquisition agreement (it being understood and agreed that, to the extent any of the Specified Representations are qualified or subject to “material adverse effect” (or equivalent term), for purposes of the making of such Specified Representations as of the closing date of such Permitted Acquisition, the definition of “material adverse effect” (or equivalent term), shall be qualified by the same exceptions and qualifications that apply to the definition of “closing date material adverse effect” (or equivalent term defined in the acquisition agreement in connection with such Permitted Acquisition). Any such increase shall be in an aggregate principal amount equal to (A) the principal amount that Increasing Lenders are willing to assume as increases to the principal amount of their Term Loan Commitments and/or Revolving Commitments plus (B) the principal amount offered by New Lenders with respect to the Term Loan Commitments and/or Revolving Commitments, in either case as adjusted by Borrower and the Administrative Agent pursuant to this Section 2.19.  Notwithstanding anything to the contrary in Section 10.02, the Administrative Agent is expressly permitted, without the consent of the other Lenders, to amend the Loan Documents to the extent necessary or appropriate in the reasonable opinion of the Administrative Agent to give effect to any increases pursuant to this Section 2.19.

 

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(e)                      Upon each increase in the Revolving Commitments pursuant to this Section 2.19, (i) each Revolving Lender immediately before such increase will automatically and without further act be deemed to have assigned to each Lender providing a portion of any increase in the Revolving Commitments pursuant to this Section 2.19 (any such increase, a “Revolving Commitment Increase” and each such Lender, a “Revolving Increasing Lender”) in respect of such increase, and each such Revolving Increasing Lender will automatically and without further act be deemed to have assumed, a portion of such Revolving Lender’s participations hereunder in outstanding Letters of Credit and Swingline Loans such that, after giving effect to each such deemed assignment and assumption of participations, the percentage of the aggregate outstanding (A) participations hereunder in Letters of Credit and (B) participations hereunder in Swingline Loans held by each Revolving Lender (including each such Revolving Increasing Lender) will equal the percentage of the aggregate Revolving Commitments of all Revolving Lenders represented by such Revolving Lender’s Revolving Commitment and (i) if, on the date of such increase, there are any Revolving Loans outstanding, such Revolving Loans shall on or before the effectiveness of such Revolving Commitment Increase be prepaid from the proceeds of additional Revolving Loans made hereunder (reflecting such increase in Revolving Commitments), which prepayment shall be accompanied by accrued interest on the Revolving Loans being prepaid and any costs incurred by any Lender in accordance with Section 2.13.  The Administrative Agent and the Lenders hereby agree that the minimum borrowing, pro rata borrowing and pro rata payment requirements contained elsewhere in this Agreement shall not apply to the transactions effected pursuant to the immediately preceding sentence.

 

Section 2.20     Amend and Extend Transactions. (a) At any time after the Closing Date, Borrower and any Term Loan Lender (any such Term Loan Lender, an “Extending Lender”) may agree, by notice to the Administrative Agent for further distribution to the Term Loan Lenders (each such notice, an “Extension Notice”), to extend (an “Extension”) the maturity date of such Lender’s Term Loans of a Class (which term, for purposes of this provision, shall also include any Term Loans outstanding hereunder pursuant to a previous amend and extend transaction pursuant to the terms of this Section 2.20 or any Class of Incremental Term Loans) (the “Existing Term Loan Class”) to the extended maturity date specified in such Extension Notice and Extension Amendment (each tranche Term Loans so extended, in each case as well as the original Term Loans not so extended, being deemed a separate Class; any Extended Term Loans shall constitute a separate Class of Term Loans from the Class of Term Loans from which they were converted; any Class of Term Loans the maturity of which shall have been extended pursuant to this Section 2.20, “Extended Term Loans”); provided, that (i) Borrower shall have offered to all Term Loan Lenders under the applicable Term Loan Facility that is the subject of the proposed Extension the opportunity to participate in such Extension on a pro rata basis and on the same terms and conditions to each such Term Loan Lender (each such offer, an “Extension Offer”), (ii) subject to clauses (iv) and (v), the Extended Term Loans shall have the same terms as the Class or Class of Term Loans that was the subject of the Extension Notice; provided that the Extension Offer and/or Extension Amendment may provide for other covenants and terms that apply to any period after the Final Maturity Date then in effect, (iii) any Extended Term Loans may participate on a pro rata basis or on a less than pro rata basis (but not on a greater than pro rata basis) in any mandatory prepayments or commitment reductions hereunder, as specified in the applicable Extension Offer, (iv) the interest rates, rate floors, fees, original issue discounts, premiums, final maturity date, and scheduled amortization (subject to the limitations set forth in clause (v) of this Section 2.20(a)) applicable to any Extended Term Loans shall be determined by Borrower and the Extending Lenders, (v) before the Final Maturity Date then in effect, the amortization of any Extended Term Loans shall not exceed equal quarterly installments in an aggregate annual amount equal to 1% of the original principal amount of the Extended Term Loans and (vi)  all documentation in respect of such Extension Offer (including any Extension Notice any amendment to this Agreement implementing the terms of such Extension Offer (each such amendment, an “Extension Amendment”)) shall be consistent with the foregoing.  In connection with any such Extension, Borrower and the Administrative Agent, with the approval of the Extending Lenders of the applicable Extension Series, may effect such amendments (including any Extension Amendment) to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and Borrower, to implement the terms of any such Extension Offer, including any amendments necessary to establish new Classes, tranches or sub-tranches in respect of the Extended Term Loans and such technical amendments as may be necessary or appropriate in the reasonable opinion of the Administrative Agent and Borrower in connection with the establishment of such new tranches or sub-tranches (including to preserve the pro rata treatment of the extended and non-extended tranches), in each case on terms not inconsistent with this Section 2.20.

 

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(b)           Notwithstanding anything to the contrary contained in this Agreement, on any date on which any Existing Term Loan Class is converted to extend the related scheduled maturity date(s) in accordance with Section 2.20(a) (an “Extension Date”), the aggregate principal amount of the existing Term Loans shall be deemed reduced by an amount equal to the aggregate principal amount of Extended Term Loans so converted by such Lender on such date, and the Extended Term Loans shall be established as a separate Class of Term Loans (together with any other Extended Term Loans so established on such date).  If the aggregate principal amount of Term Loans (calculated on the face amount thereof) in respect of which Extending Lenders shall have accepted the relevant Extension Offer shall exceed the maximum aggregate principal amount of Term Loans offered to be extended by Borrower pursuant to such Extension Offer, then the Term Loans of such Extending Lenders shall be extended ratably up to such maximum amount based on the respective principal amounts (but not to exceed actual holdings of record) with respect to which such Extending Lenders have accepted such Extension Offer.

 

(c)           With respect to all Extensions consummated by Borrower pursuant to this Section 2.20, (i) such Extensions shall not constitute voluntary or mandatory payments or prepayments for purposes of Section 2.10 and (ii) any Extension Offer is required to be in a minimum amount of $30,000,000. Borrower may at its election specify as a condition (a “Minimum Extension Condition”) to consummating any such Extension that a minimum amount (to be determined and specified in the relevant Extension Offer in Borrower’s sole discretion and may be waived by Borrower) of Term Loans of any or all applicable tranches accept the applicable Extension Offer.

 

(d)           In connection with any Extension, Borrower shall provide the Administrative Agent at least ten (10) Business Days’ (or such shorter period as may be agreed by the Administrative Agent) prior written notice thereof, and shall agree to such procedures, if any, as may be established by, or acceptable to, the Administrative Agent, in each case acting reasonably, to accomplish the purposes of this Section 2.20.

 

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(e)           In connection with any Extension Amendment, Borrower shall deliver (i) an opinion of counsel reasonably acceptable to the Administrative Agent as to the enforceability of such Extension Amendment and the Loan Documents as amended thereby, that such Extension Amendment, including the Extended Term Loans provided for therein, does not breach or cause a Default or Event of Default under the terms and provisions of Section 10.02 of this Agreement and such other opinions reasonably requested by the Administrative Agent, (ii) customary reaffirmations and/or such amendments to the Collateral Documents as may be reasonably requested by the Administrative Agent in order to ensure that such Extended Term Loans are provided with the benefit of the applicable Loan Documents and (iii) board resolutions and other closing certificates and documentation to the extent reasonably requested by the Administrative Agent.

 

(f)            In the event that the Administrative Agent determines in its sole discretion that the allocation of Extended Term Loans of a given Extension Series to a given Lender was incorrectly determined as a result of manifest administrative error, then the Administrative Agent, Borrower and such affected Lender may (and hereby are authorized to), in their sole discretion and without the consent of any other Lender, enter into an amendment to this Agreement and the other Loan Documents (each, a “Corrective Extension Amendment”) within 15 days following the effective date of the applicable Extension Amendment, as the case may be, which Corrective Extension Amendment shall (i) provide for the conversion and extension of Term Loans under the Existing Term Loan Class in such amount as is required to cause such Lender to hold Extended Term Loans of the applicable Extension Series into which such other Term Loans were initially converted in the amount such Lender would have held had such administrative error not occurred and had such Lender received the minimum allocation of the applicable Extended Term Loans to which it was entitled under the terms of such Extension Amendment, in the absence of such error, (ii) be subject to the satisfaction of such conditions as the Administrative Agent, Borrower and such Lender may agree (including conditions of the type required to be satisfied for the effectiveness of an Extension Amendment described in Section 2.20(a)), and (iii) effect such other amendments of the type (with appropriate reference and nomenclature changes) described in the penultimate sentence of Section 2.20(a).

 

(g)           This Section 2.20 shall supersede any provisions in 10.02 to the contrary. For the avoidance of doubt, any of the provisions of this Section 2.20 may be amended with the consent of the Required Lenders; provided that no such amendment shall require any Lender to provide any Extended Term Loans without such Lender’s consent.

 

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

 

Each Loan Party represents and warrants to the Administrative Agent, the Collateral Agent, the Issuing Bank and each of the Lenders (with references in this Article III to the Companies being references thereto after giving effect to the Transactions unless otherwise expressly stated) on the Closing Date and upon each Credit Extension thereafter that:

 

Section 3.01     Organization; Powers; Regulatory Licenses

 

.  (a)  Each Company (i) is duly incorporated or organized and validly existing and is in good standing under the laws of the jurisdiction of its incorporation or organization, (ii) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals (including franchises, ordinances and other agreements granting access to public rights of way, issued or granted to any Company by a state or federal agency or commission or other federal, state or local or foreign regulatory bodies regulating competition and telecommunications businesses) (collectively, the “Regulatory Licenses”) to carry on its business as now conducted and as proposed to be conducted and (iii) is qualified, licensed and in good standing (to the extent such concept is applicable in the applicable jurisdiction) to do business in every jurisdiction where such qualification is required, except in such jurisdictions where the failure to so qualify, be licensed or be in good standing could not reasonably be expected to result in a Material Adverse Effect.

 

(b)           Schedule 3.01(b), accurately and completely lists all Regulatory Licenses granted to any Company and that are used in the businesses of the Companies as presently conducted. Each Regulatory License is valid and in full force and effect and has not been, or will not have been, suspended, revoked, cancelled, restricted, terminated, not renewed or adversely modified, except to the extent any failure to be in full force and effect or any suspension, revocation, cancellation, restriction, termination, nonrenewal or modification has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  No Regulatory License is subject to (i) any conditions or requirements that have not been imposed generally upon licenses in the same service, unless such conditions or requirements would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or (ii) any pending regulatory proceeding (other than those affecting the communications industry generally) or judicial review before a Governmental Authority, unless such pending regulatory proceedings or judicial review would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  No Loan Party has knowledge of any event, condition or circumstance that would preclude any Regulatory License from being renewed in the ordinary course (to the extent that such Regulatory License is renewable by its terms), except where the failure to be renewed has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

(c)           The licensee of each Regulatory License is in compliance with each Regulatory License and has fulfilled and performed, or will fulfill or perform, all of its obligations with respect thereto in a timely manner, including with respect to the filing of all reports, notifications and applications required by the Communications Act or the rules, regulations, policies, instructions and orders of the FCC or any PUC, and the payment of all regulatory fees and contributions, except (i) for exemptions, waivers or similar concessions or allowances and (ii) where such failure to be in compliance or to fulfill or perform its obligations or pay such fees or contributions has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

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(d)           One or more Loan Parties owns all of the Equity Interests in, and Controls, all of the voting power and decision-making authority of, each licensee of the Regulatory Licenses.

 

Section 3.02     Authorization; Enforceability.  The Transactions to be entered into by each Loan Party are within such Loan Party’s powers and have been duly authorized by all necessary corporate or other organizational action on the part of each such Loan Party.  This Agreement has been duly executed and delivered by each Loan Party and constitutes, and each other Loan Document to which any Loan Party is to be a party, when executed and delivered by such Loan Party, will constitute, a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally, regardless of whether considered in a proceeding in equity or at law.

 

Section 3.03     No Conflicts; No Default.  The Transactions (a) do not require any consent, exemption, authorization or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect, (ii) filings necessary to perfect or maintain the perfection or priority of the Liens created by the Security Documents and (iii) consents, approvals, exemptions, authorizations, registrations, filings, permits or actions the failure of which to obtain or perform could not reasonably be expected to result in a Material Adverse Effect, (b) will not violate the Organizational Documents of any Company, (c) will not violate or result in a default or require any consent or approval under (x) any indenture, instrument, agreement, or other document binding upon any Company or its property or to which any Company or its property is subject, or give rise to a right thereunder to require any payment to be made by any Company, except for violations, defaults or the creation of such rights that could not reasonably be expected to result in a Material Adverse Effect or (y) any Organizational Document (other than such as have been obtained and are in full force and effect), (d) will not violate any Legal Requirement in any material respect, and (e) will not result in the creation or imposition of any Lien on any property of any Company, except Liens created by the Security Documents and Permitted Liens.  No Default or Event of Default has occurred and is continuing.

 

Section 3.04     Financial Statements; Projections.  (a)  Borrower has heretofore delivered to the Lenders (i) the consolidated balance sheets and related statements of income, stockholders’ equity and cash flows of Borrower (A) as of and for the fiscal years ended December 31, 2012, December 31, 2011, and December 31, 2010, audited by and accompanied by the unqualified opinion of PricewaterhouseCoopers LLP, independent public accountants, and (B) as of and for the nine-month period ended September 30, 2013, and for the comparable period of the preceding fiscal year, in each case, certified by the chief financial officer of Borrower and (ii) the consolidated balance sheets and related statements of income, stockholders’ equity and cash flows of the Target as of and for the fiscal years ended September 30, 2012, and September 30, 2011, audited by and accompanied by the unqualified opinion (except in the case of the Target’s financial statements ended September 30, 2012, which are qualified solely with respect to the fair value of redeemable shares) of Raymond Chabot Grant Thornton (S.E.N.C.R.L.), independent public accountants, in each case, certified by the chief financial officer of Borrower.  Such financial statements and all financial statements delivered pursuant to Sections 5.01(a) and (b) have been prepared in accordance with GAAP (or, in the case of the Target’s financial statements in clause (ii) above, IFRS) consistently applied throughout the applicable period covered, respectively, thereby and present fairly and accurately the financial condition and results of operations, cash flows and stockholders’ equity of Borrower and the Acquired Business, as applicable, as of the dates and for the periods to which they relate (subject to normal year-end audit adjustments and the absence of footnotes).  Except as set forth in such financial statements, there are no material liabilities of any Company of any kind, whether accrued, contingent, absolute, determined, determinable or otherwise, and, to the knowledge of any Loan Party, there is no existing condition, situation or set of circumstances which could reasonably be expected to result in such a liability.

 

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(b)           Borrower has heretofore delivered to the Lenders Borrower’s unaudited pro forma consolidated balance sheet and statements of income (but not a pro forma statement of cash flows) for the twelve-month period ended September 30, 2013, in each case after giving effect to the Transactions as if they had occurred on such date in the case of the balance sheet and as of the beginning of all periods presented in the case of the statements of income and cash flows.  Such pro forma financial statements (A) have been prepared in good faith by the Loan Parties, based upon (i) the assumptions stated therein (which assumptions are believed by the Loan Parties on the date hereof and on the Closing Date to be reasonable), (ii) accounting principles consistent with the historical audited financial statements delivered pursuant to Section 3.04(a) above and (iii) the best information available to the Loan Parties as of the date of delivery thereof, (B) accurately reflect all adjustments required to be made to give effect to the Transactions, (C) have been prepared in accordance with GAAP (subject to normal year-end audit adjustments and the absence of footnotes) consistently applied throughout the applicable period covered, respectively, thereby, and (D) present fairly the pro forma consolidated financial position and results of operations of Borrower as of such date and for such periods, assuming that the Transactions had occurred at such dates.

 

(c)           Borrower has heretofore delivered to the Lenders the forecasts of financial performance of Borrower and its Subsidiaries for the fiscal years 2013 – 2018, including forecasts of financial performance on a quarterly basis for the first eight fiscal quarters occurring after the Closing Date (the “Projections”).  The Projections have been prepared in good faith by the Loan Parties and based upon (i) the assumptions stated therein (which assumptions are believed by the Loan Parties on the date hereof and the Closing Date to be reasonable), (ii) accounting principles consistent with the historical audited financial statements delivered pursuant to Section 3.04(a) above consistently applied throughout the periods covered thereby, and (iii) the best information available to the Loan Parties as of the date hereof and the Closing Date.

 

(d)           Since August 31, 2013, there has been no event, change, circumstance, condition, development or occurrence that has had, or could reasonably be expected to result in, either individually or in the aggregate, a Material Adverse Effect.

 

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Section 3.05     Properties.  Each Company has good and marketable title to, or valid leasehold interests in, all its Property material to its business, free and clear of all Liens and irregularities, deficiencies and defects in title except for Permitted Liens (or, in the case of Collateral, Permitted Collateral Liens) and minor irregularities, deficiencies and defects in title that, individually or in the aggregate, do not, and could not reasonably be expected to, interfere with its ability to conduct its business as currently conducted or to utilize such Property for its intended purpose.  No Company is in default under any provision of any lease agreement to which it is a party with respect to a leasehold interest in Real Property (including the Data Center Leases), where such default could reasonably be expected to result in a Material Adverse Effect.

 

Section 3.06     Intellectual Property.  (a) Each Company owns or is licensed to use, free and clear of all Liens (other than Permitted Liens), all patents and patent applications, trademarks, trade names, service marks, copyrights, domain names and applications for registration thereof, and technology, trade secrets, proprietary information, inventions, know-how and processes, in each case necessary for the conduct of its business as currently conducted (the “Intellectual Property”), except for those the failure to own or license which, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

 

(b)           No claim has been asserted and is pending by any Person challenging or questioning the use of any such Intellectual Property or the ownership, validity, registerability or enforceability of any such Intellectual Property, nor does any Loan Party know of any valid basis for any such claim.  The operation of each Company’s business as currently conducted and proposed to be conducted and the use of such Intellectual Property by each Company does not conflict with, infringe, misappropriate, dilute, misuse or otherwise violate the rights of any Person, except for such claims, infringements and violations which, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.  Except pursuant to licenses and other user agreements entered into by each Company in the ordinary course of business which, in the case of licenses and user agreements in existence on the Closing Date, are listed in Schedule 3.06(a), no Company has done anything to authorize or enable any other Person to use any such Intellectual Property.  Each Company has taken commercially reasonable actions to protect the secrecy, confidentiality and value of all trade secrets used in such Company’s business.

 

(c)           (i) To the knowledge of any Loan Party based on reasonable investigations, there is no violation by others of any right of any Company with respect to any Intellectual Property, other than such violations that, individually or in the aggregate, could not reasonably be expected to materially adversely affect the value or utility of the Intellectual Property or any portion thereof material to the use and operation of the Collateral, (ii) to the knowledge of any Loan Party based on reasonable investigations, no Company is infringing upon or misappropriating any copyright, patent, trademark, trade secret or other intellectual Property right of any other Person, (iii) no Company is in breach of, or in default under, any license of Intellectual Property by any other Person, to such Company, except in any case where such breach or default, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, and (iv) no proceedings have been instituted or are pending against any Company or, to the knowledge of any Loan Party, threatened, and no claim against any Company has been received by any Company, alleging any such infringement or misappropriation, except to the extent that such proceedings or claims, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

 

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(d)           Neither the execution, delivery or performance of this Agreement and the other Loan Documents, nor the consummation of the Transactions and the other transactions contemplated hereby and thereby, will alter, impair or otherwise affect or require the consent, approval or other authorization of any other Person in respect of any right of any Company in any Intellectual Property, except to the extent that such alteration, impairment, effect, consent, approval or other authorization, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

 

(e)           No Company is subject to any settlement, covenant not to sue or other instrument, agreement or other document, or any outstanding Order, which may materially affect the validity or enforceability or restrict in any material manner such Company’s use, licensing or transfer of any of the Intellectual Property.

 

Section 3.07     Equity Interests and Subsidiaries.  (a)  Schedule 3.07(a) sets forth a list of (i) Borrower and each Subsidiary of Borrower and its jurisdiction of incorporation or organization as of the Closing Date and (ii) the number of each class of its Equity Interests authorized, and the number outstanding, on the Closing Date and the number of Equity Interests covered by all outstanding options, warrants, rights of conversion or purchase and similar rights on the Closing Date.  All Equity Interests of each Company are duly and validly issued and are fully paid and non-assessable, and, other than the Equity Interests of Borrower, are owned by Borrower, directly or indirectly, through Wholly Owned Subsidiaries.  Each Loan Party is the record and beneficial owner of, and has good and marketable title to, the Equity Interests pledged by (or purporting to be pledged by) it under the Security Documents, free of any and all Liens, rights or claims of other Persons, except the security interest created by the Security Documents and any Permitted Liens that arise by operation of applicable Legal Requirements and are not voluntarily granted, and, as of the Closing Date, there are no outstanding warrants, options or other rights (including derivatives) to purchase, or shareholder, voting trust or similar agreements outstanding with respect to, or Property that is convertible into, or that requires the issuance or sale of, any such Equity Interests (or any economic or voting interests therein).

 

(b)           Other than consents that have been obtained, no consent of any Person, including any general or limited partner, any other member or manager of a limited liability company, any shareholder, any other trust beneficiary or derivative counterparty, is necessary or reasonably desirable (from the perspective of a secured party) in connection with the creation, perfection or first priority status (or the maintenance thereof) of the security interest of the Collateral Agent in any Equity Interests pledged to the Collateral Agent under the Security Documents or the exercise by the Collateral Agent or any Lender of the voting or other rights provided for in the Security Documents or the exercise of remedies in respect of such Equity Interests (or any economic or voting interest therein).

 

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(c)           An accurate organizational chart, showing the ownership structure of Borrower and each Subsidiary as of the date hereof and as of the Closing Date, and after giving effect to the Transactions, is set forth on Schedule 3.07(c) (which shall be permitted to be updated by Borrower before the Closing Date).

 

Section 3.08     Litigation; Compliance with Legal Requirements.  (a) There are no actions, suits, claims, disputes, proceedings or investigations at law or in equity by or before any Governmental Authority, including the FCC and any PUC, now pending or, to the knowledge of any Loan Party, threatened against or affecting any Company or any business, Property or rights of any Company (i) that purport to affect or involve any Loan Document or any of the Transactions, the ability of any Company to perform its obligations under any Loan Document or any of the Transaction Documents or the ability of any Company to consummate any of the Transactions or (ii) that have resulted, or as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.

 

Section 3.09     Agreements.  No Company is a party to any agreement or instrument or subject to any corporate or other constitutional restriction, or any restriction under its Organizational Documents that has resulted or could reasonably be expected to result in a Material Adverse Effect.  No Company is in default in any manner under any provision of any indenture or other agreement or instrument evidencing Indebtedness, or any other agreement or instrument to which it is a party or by which it or any of its Property is or may be bound, where such default could reasonably be expected to result in a Material Adverse Effect, and, to the knowledge of any Loan Party, no condition exists which, with the giving of notice or the lapse of time or both, would constitute such a default.  Schedule 3.09 attached hereto (as such Schedule may be updated from time to time in accordance with Section 5.01(c)), accurately and completely lists all Material Agreements to which any Company is a party which are in effect on the date hereof (except after the Closing Date such Schedule accurately and completely list all Data Center Leases to which any Company is a party which are in effect on the date of the last Compliance Certificate) in connection with the operation of the business conducted thereby and Borrower has delivered to the Administrative Agent complete and correct copies of all such Material Agreements, including any amendments, supplements or modifications with respect thereto, and all such agreements are in full force and effect.

 

Section 3.10     Federal Reserve Regulations.  (a)  No Company is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing, buying or carrying Margin Stock.

 

(b)           No part of the proceeds of any Credit Extension will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, for any purpose that entails a violation of, or that is inconsistent with, the provisions of the regulations of the Board, including Regulation T, U or X.  The pledge of the Securities Collateral pursuant to the Security Agreement does not violate such regulations.

 

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Section 3.11     Investment Company Act, etc.  No Company is (a) an “investment company” or a company “controlled” by an “investment company,” as defined in, or subject to regulation under, or required to be registered pursuant to, the Investment Company Act of 1940, as amended, or (b) subject to regulation under any Legal Requirement (other than Regulation X) that limits its ability to incur, create, assume or permit to exist Indebtedness or grant any Contingent Obligation in respect of Indebtedness.

 

Section 3.12     Use of Proceeds.  Borrower will use the proceeds of the Initial Term Loans to finance the Transactions and pay any related fees and expenses.  The proceeds of the Revolving Loans and the Swingline Loans are to be used (i) on the Closing Date to pay upfront fees (or original issue discount) and expenses in connection with the Credit Facilities and (ii) after the Closing Date for working capital and general corporate purposes of Borrower and its Subsidiaries, including Permitted Acquisitions and Dividends permitted under Section 6.08.

 

Section 3.13     Taxes.  Each Company has (a) timely filed or caused to be timely filed all federal, state, local and foreign Tax Returns and other materials required to have been filed by it and all such Tax Returns are true and correct in all material respects and (b) duly and timely paid or caused to be duly and timely paid all Taxes (whether or not shown on any Tax Return) due and payable by it and all assessments received by it, except Taxes that are being contested in good faith by appropriate proceedings and for which such Company has set aside on its books adequate reserves in accordance with GAAP.  Each Company has made adequate provision in accordance with GAAP for all Taxes not yet due and payable.  No Company has knowledge (or could reasonably have knowledge upon due inquiry) of any proposed or pending tax assessments, deficiencies, audits or other proceedings and no proposed or pending tax assessments, deficiencies, audits or other proceedings have resulted, or could, individually or in the aggregate, reasonably be expected to result, in a Material Adverse Effect.  No Company has ever “participated” in a “reportable transaction” within the meaning of Treasury Regulation Section 1.6011-4.  No Company is party to any tax sharing or similar agreement.

 

Section 3.14     No Material Misstatements.  Borrower has disclosed to the Lenders all agreements, instruments and corporate and other restrictions to which it or any of its Subsidiaries is subject, and all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.  Neither the Confidential Information Memorandum nor any of the other reports, financial statements, certificates, Borrowing Requests or other information furnished by or on behalf of Borrower to the Administrative Agent or any Lender in connection with the negotiation of any Loan Document or delivered pursuant thereto (as modified or supplemented by other information so furnished) contained or contains any material misstatement of fact or omitted or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading as of the date such information is dated or certified; provided that, with respect to projected financial information, Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.

 

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Section 3.15     Labor Matters.  There are no strikes, lockouts or slowdowns against any Company pending or, to the best of the knowledge of the Loan Parties, threatened that have resulted in, or could reasonably be expected to result in, a Material Adverse Effect.  The hours worked by and payments made to employees of any Company have not been in violation of the Fair Labor Standards Act of 1938, as amended, or any other applicable Legal Requirement dealing with such matters in any manner that has resulted in, or could reasonably be expected to result in, a Material Adverse Effect.  All payments due from any Company, or for which any claim may be made against any Company, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued as a liability on the books of such Company except to the extent that the failure to do so has not resulted in, and could not reasonably be expected to result in, a Material Adverse Effect.  The consummation of the Transactions will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Company is bound.

 

Section 3.16     Solvency.  Both immediately before and immediately after the consummation of the Transactions to occur on the Closing Date and immediately following the making of each Credit Extension and after giving effect to the application of the proceeds of each Credit Extension, (a) the fair value of the properties of each Loan Party will exceed its debts and liabilities, subordinated, contingent or otherwise, (b) the present fair saleable value of the Property of each Loan Party will be greater than the amount that will be required to pay the probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured, (c) each Loan Party will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; (d) each Loan Party will not have unreasonably small capital with which to conduct its business in which it is engaged as such business is now conducted and is proposed, contemplated or about to be conducted following the Closing Date and; and (e) each Loan Party is “solvent” within the meaning given to that term and similar terms under any United States federal or state laws relating to fraudulent transfers and conveyances.

 

Section 3.17     Employee Benefit Plans.  (a)  Each Company and each of its ERISA Affiliates is in material compliance with all applicable Legal Requirements, including all applicable provisions of ERISA and the Code and the regulations and published interpretations thereunder, with respect to all Employee Benefit Plans.  Each Employee Benefit Plan complies in all material respects, and is operated and maintained in compliance in all material respects, with all applicable Legal Requirements, including all applicable provisions of ERISA and the Code and the regulations and published interpretations thereunder.  Each Employee Benefit Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination from the Internal Revenue Service for all required amendments and nothing has occurred which would prevent, or cause the loss of, such qualification.

 

(b)           No ERISA Event has occurred or is expected to occur.  No Pension Plan has any Unfunded Pension Liability.  Within the last six years, no Pension Plan has been terminated, whether or not in a “standard termination” as that term is used in Section 4041 of ERISA, nor has any Pension Plan (determined at any time within the last six years) with an Unfunded Pension Liability been transferred outside of the “controlled group” (within the meaning of Section 4001(a)(14) of ERISA) of any Company or any of its ERISA Affiliates.  Using actuarial assumptions and computation methods consistent with subpart I of subtitle E of Title IV of ERISA, the aggregate liabilities of any Company or any of its ERISA Affiliates to all Multiemployer Plans in the event of a complete withdrawal therefrom, as of the close of the most recent fiscal year of each such Multiemployer Plan, have not resulted in, and could not reasonably be expected to result in, a Material Adverse Effect.

 

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(c)           With respect to Canadian Pension Plans:  (i) as of the Closing Date, no steps have been taken to terminate any Canadian Pension Plan (wholly or in part) which could result in any Company being required to make an additional contribution to the Canadian Pension Plan; (ii) no Canadian Pension Plan is a “defined benefit” pension plan governed by the Pension Benefits Act (Ontario), (iv) all contributions (including employee contributions made by authorized payroll deductions or other withholdings) required to be made in accordance with all applicable Legal Requirements and the terms of each Canadian Pension Plan have been made in accordance with all applicable Legal Requirements and the terms of each Canadian Pension Plan; and (v) each Canadian Pension Plan and Canadian Welfare Plan is maintained in all material respects in compliance with all applicable Legal Requirements.

 

(d)           To the extent applicable, each Foreign Plan has been maintained in substantial compliance with its terms and with the requirements of all Legal Requirements and has been maintained, where required, in good standing with applicable regulatory authorities.  No Company has incurred any material obligation in connection with the termination of or withdrawal from any Foreign Plan.  The present value of the accrued benefit liabilities (whether or not vested) under each Foreign Plan which is funded, determined as of the end of the most recently ended, fiscal year of the respective Company on the basis of actuarial assumptions, each of which is reasonable, did not exceed the current value of the Property of such Foreign Plan, and for each Foreign Plan which is not funded, the obligations of such Foreign Plan are properly accrued.

 

Section 3.18     Environmental Matters.  Except for the matters described on Schedule 3.18 and except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any Environmental Claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.

 

Section 3.19     Insurance.  Schedule 3.19 sets forth a true, complete and accurate description in reasonable detail and in all material respects of all insurance maintained by each Company as of the Closing Date.  Each Company has insurance in such amounts and covering such risks and liabilities as are customary for companies of a similar size engaged in similar businesses in similar locations.  All insurance maintained by the Companies is in full force and effect, all premiums have been duly paid, no Company has received notice of violation, invalidity or cancellation thereof.  All Real Property of each Company, and the use, occupancy and operation thereof, comply in all material respects with all Insurance Requirements, and there exists no default under any Insurance Requirement.

 

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Section 3.20     Mortgages.  Each Mortgage is effective to create, in favor of the Collateral Agent, for its benefit and the benefit of the Secured Parties, legal, valid and enforceable first priority Liens on, and security interests in, all of the Loan Parties’ right, title and interest in and to the Mortgaged Properties thereunder and the proceeds thereof, subject only to Permitted Collateral Liens, and when the Mortgages are filed in the offices specified on Schedule 3.20 (or, in the case of any Mortgage executed and delivered after the date thereof in accordance with the provisions of Section 5.11, 5.12 and Section 5.15, as applicable, when such Mortgage is filed in the offices specified in the local counsel opinion delivered with respect thereto in accordance with the provisions of Section 5.11, 5.12 and Section 5.15, as applicable, the Mortgages shall constitute fully perfected first priority Liens on, and security interests in, all right, title and interest of the Loan Parties in the Mortgaged Properties and the proceeds thereof, in each case prior and superior in right to any other Person, other than Permitted Collateral Liens.

 

Section 3.21     Anti-Terrorism Law; Foreign Corrupt Practices Act.  (a)  No Company and, to the knowledge of each Company, none of its Affiliates is in violation of, or shall use any proceeds of the Loans or the Letters of Credit in violation of, any Legal Requirements relating to (i) terrorism or money laundering (“Anti-Terrorism Laws”), including Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001 (the “Executive Order”), the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (the “Patriot Act”), the Criminal Code (Canada) and the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and, in each case, the regulations promulgated thereunder (collectively, the “Canadian Anti-Terrorism Laws”), and (ii) OFAC and Canadian Sanctions.

 

(b)           No Company and to the knowledge of each Company, no Affiliate or agent of any Company acting or benefiting in any capacity in connection with the making of any Loan or the issuance, renewal or extension of any Letter of Credit, is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”) or to any Canadian economic sanctions, including under the Special Economic Measures Act (Canada), the United Nations Act (Canada), the Freezing Assets of Corrupt Foreign Officials Act (Canada) and the Criminal Code (Canada) and, in each case, the regulations promulgated thereunder (“Canadian Sanctions”); and Borrower will not directly or indirectly use the proceeds of the Loans or the Letters of Credit or otherwise make available such proceeds to any Person or entity, for the purpose of financing the activities of any Person or entity currently subject to any U.S. sanctions administered by OFAC or any Canadian Sanctions.

 

(c)           No Company and, to the knowledge of each Company, no Affiliate or agent of any Company acting in any capacity in connection with the Loans (i) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of any Person described in clause (b) above, (ii) deals in, or otherwise engages in any transaction relating to, any Property or interests in Property blocked or frozen pursuant to the Executive Order or any Canadian Sanctions, or (iii) engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law or any Canadian Sanctions.

 

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(d)           No Company nor any director or officer, nor to the knowledge of the Loan Parties, any agent, employee or other Person acting, directly or indirectly, on behalf of any Company, has, in the course of its actions for, or on behalf of, any Company, directly or indirectly (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977 or the Corruption of Foreign Public Officials Act (Canada); or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

 

Section 3.22     Security Documents.  (a) The Security Agreement is effective to create in favor of the Collateral Agent for the benefit of the Secured Parties, legal, valid and enforceable security interests in, the Security Agreement Collateral and, (i) when financing statements (including fixture filings and transmitting utility filings, as applicable)  and other filings in appropriate form are filed in the offices specified in the Perfection Certificate (as updated in accordance with the terms hereof) and (ii) upon the taking of possession or control by the Collateral Agent of the Security Agreement Collateral with respect to which a security interest may be perfected only by possession or control (which possession or control shall be given to the Collateral Agent to the extent possession or control by the Collateral Agent is required by each Security Document), the Liens created by the Security Agreement shall constitute fully perfected security interests in, all right, title and interest of the grantors thereunder in the Security Agreement Collateral (other than (A) the Intellectual Property constituting Collateral, except to the extent that the filing of a financing statement is sufficient to perfect a Lien in such Intellectual Property, and (B) such Security Agreement Collateral in which a security interest cannot be perfected under the UCC as in effect at the relevant time in the relevant jurisdiction by (x) the filing of the financing statements and other filings referred to in clause (i) of this Section 3.22(a) or (y) the taking of possession or control to the extent required by each Security Document), in each case subject to no Liens other than Permitted Liens.

 

(b)           When (i) the Security Agreement or a short form thereof is filed in the United States Patent and Trademark Office and the United States Copyright Office, and (ii) financing statements (including fixture filings and transmitting utility filings, as applicable) and other filings in appropriate form are filed in the offices specified in the Perfection Certificate (as updated in accordance with the terms hereof), the Liens created by such Security Agreement shall constitute in the United States fully perfected Liens on, and security interests in, all right, title and interest of the grantors thereunder in the Intellectual Property Collateral (as defined in such Security Agreement), in each case, if and to the extent a security interest in such Intellectual Property Collateral can be perfected solely by such filings.

 

Section 3.23     Acquisition Documents; Status of Obligations as Senior Indebtedness, etc. (a) Each of Borrower and Acquiror has the power and authority to enter into the Acquisition Documents to which it is a party and has duly authorized, executed and delivered such Acquisition Documents.  The Acquisition Documents constitute the legal, valid and binding obligations of Borrower and Acquiror party thereto enforceable against Borrower and Acquiror in accordance with its terms (except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ fights generally and by principles of equity).

 

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(b)           All Obligations, including those to pay principal of and interest (including post-petition interest, whether or not allowed as a claim under bankruptcy or similar laws) on the Loans and Reimbursement Obligations, and fees and expenses in connection therewith, constitute “Senior Indebtedness” or similar term with respect to all Subordinated Indebtedness.

 

Section 3.24     License Subsidiaries.

 

Each License Subsidiary has no significant assets (other than the Regulatory Licenses held by it) or material liabilities (other than under the other Loan Documents to which it is a party).

 

ARTICLE IV

CONDITIONS TO CREDIT EXTENSIONS

 

Section 4.01     Conditions to Initial Credit Extension.  The obligation of each Lender and, if applicable, each Issuing Bank to fund the initial Credit Extension requested to be made by it shall be subject to the prior or concurrent satisfaction of each of the conditions precedent set forth in this Section 4.01.

 

(a)           Loan Documents.  All legal matters incident to this Agreement, the Credit Extensions hereunder and the other Loan Documents shall be satisfactory to the Lenders, to the Issuing Bank and to the Administrative Agent and there shall have been delivered to the Administrative Agent a properly executed counterpart of each of the Loan Documents and the Perfection Certificate.

 

(b)           Corporate Documents.  The Administrative Agent shall have received:

 

(i)           a certificate of the secretary or assistant secretary of each Loan Party dated the Closing Date, certifying (A) that attached thereto is a true and complete copy of each Organizational Document of such Loan Party certified (to the extent applicable) as of a recent date by the Secretary of State of the state of its incorporation or organization, as the case may be, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of such Loan Party authorizing the execution, delivery and performance of the Loan Documents to which such Person is a party and, in the case of Borrower, the Credit Extensions hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect and (C) as to the incumbency and specimen signature of each officer executing any Loan Document or any other document delivered in connection herewith on behalf of such Loan Party (together with a certificate of another officer as to the incumbency and specimen signature of the secretary or assistant secretary executing the certificate required by this clause (i));

 

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(ii)          a certificate as to the good standing of each Loan Party (in so-called “long-form” if available) as of a recent date, from such Secretary of State; and

 

(iii)         such other documents, instruments or certificates as the Lenders, the Issuing Bank or the Administrative Agent may reasonably request.

 

(c)           Officers’ Certificate.  The Administrative Agent shall have received a certificate, dated the Closing Date and signed by a Financial Officer of Borrower, confirming compliance with the conditions precedent set forth in this Section 4.01.

 

(d)           Financings and Other Transactions, Etc.  The Transactions shall have been consummated or will be consummated concurrently with or immediately following the borrowing of the Initial Term Loans, and the receipt by the Acquiror of the proceeds of the foregoing, and the Target shall have become, or will contemporaneously on the Closing Date become, a Wholly Owned Subsidiary of Borrower.  The Purchase Agreement shall be in form and substance reasonably satisfactory to Jefferies Finance LLC, as Arranger (acting in consultation with PNC Capital Markets LLC, as Arranger) (and each of the Arrangers hereby agree that the Purchase Agreement provided to it on October 30, 2013 is acceptable to it), and the Purchase Agreement shall not have been amended, modified or waived in any manner materially adverse to the interests of the Lenders or the Arrangers in their respective capacities as such without the consent of Jefferies Finance LLC, as Arranger (acting in consultation with PNC Capital Markets LLC, as Arranger) (it being understood and agreed that (1) any decrease in the per share consideration paid in an amount less than 10% shall be deemed to be adverse to the interest of the Lenders and the Arrangers unless such decrease is utilized to reduce the Term Loan Commitments, (2) any decrease in the per share consideration paid in an amount equal to or greater than 10% shall be deemed to be adverse to the interest of the Lenders and the Arrangers, (3) any change to the definition of “Material Adverse Effect” in the Purchase Agreement or similar definition shall be deemed to be adverse to the interests of the Lenders and the Arrangers, and (4) any modifications to any of the provisions relating to the Administrative Agent’s, the Collateral Agent’s, the Arrangers’ or any Lender’s liability, jurisdiction or status as a third party beneficiary under the Purchase Agreement shall be deemed to be adverse to the interests of the Lenders and the Arrangers).

 

(e)           Refinancing of Existing Debt.  Concurrently with the consummation of the Acquisition, the Refinancing shall have been consummated, all commitments relating thereto shall have been terminated, and all liens or security interests related thereto shall have been (or concurrently with the initial funding of the Credit Facilities will be) terminated or released.  The Administrative Agent shall have received a “pay-off” letter in form and substance reasonably satisfactory to the Administrative Agent with respect to all Indebtedness being refinanced in the Refinancing and the Administrative Agent shall have received from any Person holding any Lien securing any such Indebtedness, such UCC or PPSA (or equivalent) termination statements, mortgage releases, releases of assignments of leases and rents, releases of security interests in Intellectual Property and other instruments, in each case in proper form for recording or filing, as the Administrative Agent shall have reasonably requested to release and terminate of record the Liens securing such Indebtedness.  Immediately after giving effect to the Transactions, no Company shall have outstanding any Indebtedness or Preferred Stock (or direct or indirect guarantee or other credit support in respect thereof) other than (i) the Loans and Credit Extensions hereunder, (ii) the Indebtedness listed on Schedule 6.01(b), (iii) Capital Lease Obligations of Borrower or the Target in existence on October 30, 2013 and reflected in Borrower’s or the Target’s consolidated balance sheets for the fiscal quarter ended September 30, 2013 and (iv) additional Capital Lease Obligations of Borrower incurred after October 30, 2013 in the ordinary course of business in an aggregate amount not to exceed $5,000,000.

 

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(f)           Opinions of Counsel.  The Administrative Agent shall have received, on behalf of itself, the other Agents, the Arrangers, the Lenders and the Issuing Bank, a favorable written opinion of (i) Warner Norcross & Judd LLP, special counsel for the Loan Parties, substantially to the effect set forth in Exhibit N-1 and (ii) Jones Day, special counsel for the Administrative Agent, substantially to the effect set forth in Exhibit N-2, in each case (A) dated the Closing Date, (B) addressed to the Agents, the Issuing Bank and the Lenders and (C) covering such matters relating to the Loan Documents and the Transactions as the Administrative Agent shall reasonably request, and (iii) a copy of each legal opinion delivered under the other Transaction Documents, accompanied by reliance letters from the party delivering such opinion authorizing the Agents, Lenders and the Issuing Bank to rely thereon as if such opinion were addressed to them.

 

(g)           Solvency Certificate.  The Administrative Agent shall have received a solvency certificate (a “Solvency Certificate”) in the form of Exhibit M, dated the Closing Date and signed by the chief executive officer of Borrower.

 

(h)           Notice.  The Administrative Agent shall have received a Borrowing Request as required by Section 2.03.

 

(i)            Representation and Warranties.  As of the Closing Date, each of the representations and warranties relating to any Company other than the Acquired Business set forth in Article III or in any other Loan Document, each of the Specified Purchase Agreement Representations and each of the Specified Representations shall be true and correct in all material respects (other than Section 3.21, which shall be true and correct in all respects) on and as of the Closing Date with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects (or in all respects, as the case may be) on and as of such earlier date); provided that any representation and warranty that is qualified as to “materiality”, “Material Adverse Effect” or similar language shall be true and correct (after giving effect to any qualification therein) in all respects on and as of the Closing Date.

 

(j)            Purchase Agreement MAE.  Since the date of the Purchase Agreement, no Purchase Agreement Material Adverse Effect shall have occurred.

 

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(k)          Fees.  The Arrangers and Administrative Agent shall have received all Fees (including any fees to be paid for the account of any Lender on the Closing Date that Borrower has previously agreed to in writing) and other amounts due and payable on or before the Closing Date, including, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses (including the premiums and recording taxes and fees and the legal fees and expenses of Jones Day and McCarthy Tétrault LLP (Canada), each as special counsel to the Administrative Agent and Jefferies Finance LLC, as Arranger, and the fees and expenses of any local counsel, foreign counsel, appraisers, consultants and other advisors) required to be reimbursed or paid by the Loan Parties hereunder or under any other Loan Document.

 

(l)           Personal Property Requirements.  The Collateral Agent shall have received:

 

(i)            all certificates, agreements or instruments representing or evidencing the Securities Collateral accompanied by instruments of transfer and stock powers undated and endorsed in blank;

 

(ii)            the Intercompany Note executed by and among the Companies, accompanied by an endorsement to the Intercompany Note in the form attached thereto, undated and endorsed in blank by each of the Loan Parties;

 

(iii)           all other certificates, agreements, including control agreements, or instruments necessary to perfect the Collateral Agent’s security interest in all Chattel Paper, all Instruments, all Deposit Accounts identified in Schedule 16 to the Perfection Certificate and all Investment Property of each Loan Party (as each such term is defined in, and to the extent required by, the Security Agreement);

 

(iv)           UCC financing statements (including fixture filings and transmitting utility filings, as applicable) in appropriate form for filing under the UCC, filings with the United States Patent and Trademark Office and United States Copyright Office and such other documents under applicable Legal Requirements in each jurisdiction as may be necessary or appropriate or, in the opinion of the Collateral Agent, desirable to perfect the Liens created, or purported to be created, by the Security Documents and, with respect to all UCC financing statements (including fixture filings and transmitting utility filings, as applicable)  required to be filed pursuant to the Loan Documents, evidence satisfactory to the Collateral Agent that Borrower has retained, at its sole cost and expense, a service provider acceptable to the Collateral Agent for the tracking of all such financing statements and notification to the Collateral Agent, of, among other things, the upcoming lapse or expiration thereof;

 

(v)            certified copies, each as of a recent date, of (w) the UCC searches required by the Perfection Certificate, (x) United States Patent and Trademark Office and United States Copyright Office searches with respect to each Loan Party, (y) tax and judgment lien searches, bankruptcy and pending lawsuit searches or equivalent reports or searches listing all effective lien notices or comparable documents that name any Company as debtor and that are filed in the state and county jurisdictions in which any Company is organized or maintains its principal place of business, and (z) such other searches that the Collateral Agent deems necessary or appropriate;

 

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(vi)           with respect to each location set forth on Schedule 4.01(l)(vi), a Landlord Access Agreement or Bailee Letter, as applicable; and

 

(vii)          evidence reasonably acceptable to the Collateral Agent of payment or arrangements for payment by the Loan Parties of all applicable filing or recording taxes, fees, charges, costs and expenses required for the filing or recording of the Security Documents.

 

(m)           Real Property.  The Collateral Agent shall have received:

 

(i)             a Mortgage encumbering each Mortgaged Property in favor of the Collateral Agent, for the benefit of the Secured Parties, duly executed and acknowledged by each Loan Party that is the owner of or holder of any leasehold interest (solely to the extent relating to a “company-controlled” data center) in such Mortgaged Property, and otherwise in form for recording or filing in the recording or filing office of each applicable governmental subdivision where each such Mortgaged Property is situated, together with such certificates, affidavits, questionnaires or returns as shall be required in connection with the recording or filing thereof to create a lien under applicable Legal Requirements, and such financing statements (including fixture filings and transmitting utility filings, as applicable) and any other instruments necessary to grant a mortgage Lien under the laws of any applicable jurisdiction, all of which shall be in form and substance satisfactory to the Collateral Agent;

 

(ii)            with respect to each Mortgaged Property, such consents, approvals, amendments, supplements, estoppels, tenant subordination and non-disturbance agreements, memoranda of leases or other instruments as are necessary to consummate the Transactions or as shall reasonably be deemed necessary by the Collateral Agent in order for the owner or holder of the fee or leasehold interest constituting such Mortgaged Property to grant the Lien contemplated by the Mortgage with respect to such Mortgaged Property;

 

(iii)           with respect to each Mortgage, a policy of title insurance (or marked up title insurance commitment having the effect of a policy of title insurance) insuring the Lien of such Mortgage as a valid first mortgage Lien on the Mortgaged Property and fixtures described therein in the amount equal to not less than 100% of the Fair Market Value of such Mortgaged Property and fixture or other value acceptable to the Collateral Agent, which Fair Market Value (or such other value) as of the Closing Date is set forth on Schedule 4.01(m)(iii), which policy (or such marked-up commitment) (each, a “Title Policy”) shall (A) be issued by the Title Company, (B) to the extent necessary, include such reinsurance arrangements (with provisions for direct access, if necessary) as shall be acceptable to the Collateral Agent, (C) contain a “tie-in” or “cluster” endorsement, if available under applicable Legal Requirements (i.e., policies which insure against losses regardless of location or allocated value of the insured Property up to a stated maximum coverage amount), (D) have been supplemented by such endorsements (or where such endorsements are not available, opinions of special counsel, architects or other professionals reasonably acceptable to the Collateral Agent) as shall be reasonably requested by the Collateral Agent (including endorsements on matters relating to usury, first loss, last dollar, zoning, contiguity, revolving credit, doing business, non-imputation, public road access, variable rate, environmental lien, subdivision, separate tax lot, revolving credit, and so-called comprehensive coverage over covenants and restrictions), and (E) contain no exceptions to title other than exceptions reasonably acceptable to the Collateral Agent;

 

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(iv)           with respect to each Mortgaged Property, such affidavits, certificates, information (including financial data) and instruments of indemnification (including a so-called “gap” indemnification) as shall be required to induce the Title Company to issue the Title Policy/ies and endorsements contemplated above;

 

(v)            evidence reasonably acceptable to the Collateral Agent of payment by Borrower of all Title Policy premiums, search and examination charges, escrow charges and related charges, mortgage recording taxes, fees, charges, costs and expenses required for the recording of the Mortgages and issuance of the Title Policies referred to above;

 

(vi)           with respect to each Real Property or Mortgaged Property, copies of all Leases in which any Loan Party holds the lessor’s interest or other agreements relating to possessory interests, if any.  To the extent any of the foregoing affect any Mortgaged Property, such agreement shall be subordinate to the Lien of the Mortgage to be recorded against such Mortgaged Property, either expressly by its terms or pursuant to a subordination, non-disturbance and attornment agreement, and shall otherwise be reasonably acceptable to the Collateral Agent; and

 

(vii)          with respect to each Real Property or Mortgaged Property, each Loan Party shall have made all notifications, registrations and filings, to the extent required by, and in accordance with, all Governmental Real Property Disclosure Requirements applicable to such Real Property or Mortgaged Property.

 

(n)           Insurance.  The Administrative Agent shall have received a copy of, or a certificate as to coverage under, the insurance policies required by Section 5.04 and the applicable provisions of the Security Documents, each of which shall be endorsed or otherwise amended to include a “standard” or “New York” lender’s loss payable or mortgagee endorsement (as applicable) and shall name the Collateral Agent, on behalf of the Secured Parties, as additional insured, in form and substance satisfactory to the Administrative Agent and the Collateral Agent.

 

(o)           Bank Regulatory Documentation.  The Administrative Agent and the Lenders shall have received, in form and substance satisfactory to them, all documentation and other information required by bank regulatory authorities or reasonably requested by the Administrative Agent or any Lender under or in respect of applicable Anti-Terrorism Laws or “know-your-customer” Legal Requirements, including the Executive Order.

 

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Notwithstanding anything in this Agreement or any other Loan Document to the contrary, to the extent any Collateral (other than to the extent that a Lien on such Collateral may be perfected (x) by the filing of a financing statement under the Uniform Commercial Code, the Personal Property Security Act or the Civil Code of Quebec, (y) by the delivery of stock certificates and stock powers for each of Borrower’s Domestic Subsidiaries and, upon the consummation of the Acquisition, Borrower’s Canadian Subsidiaries which are required to be delivered under the Security Documents or (z) by the filing of a security agreement on the applicable form with the United States Patent and Trademark Office or the United States Copyright Office) is not or cannot be perfected on the Closing Date after the Loan Parties use of commercially reasonable efforts to do so, the perfection of a Lien in such Collateral shall not constitute a condition precedent to the availability of the Credit Facilities and the making of the initial Credit Extensions on the Closing Date, but shall be required to be perfected in accordance with Section 5.15.

 

Section 4.02     Conditions to All Credit Extensions.  The obligation of each Lender and each Issuing Bank to make any Credit Extension (excluding the initial Credit Extension on the Closing Date) shall be subject to, and to the satisfaction of, each of the conditions precedent set forth below.

 

(a)           Notice.  The Administrative Agent shall have received a Borrowing Request as required by Section 2.03 (or such notice shall have been deemed given in accordance with Section 2.03) if Loans are being requested or, in the case of the issuance, amendment, extension or renewal of a Letter of Credit, the Issuing Bank and the Administrative Agent shall have received a notice requesting the issuance, amendment, extension or renewal of such Letter of Credit as required by Section 2.18(b) or, in the case of the Borrowing of a Swingline Loan, the Swingline Lender and the Administrative Agent shall have received a Borrowing Request as required by Section 2.17(b).

 

(b)           No Default.  Borrower and each other Loan Party shall be in compliance in all material respects with all the terms and provisions set forth herein and in each other Loan Document on its part to be observed or performed, and, at the time of and immediately after giving effect to such Credit Extension and the application of the proceeds thereof, no Default or Event of Default shall have occurred and be continuing on such date.

 

(c)           Representations and Warranties.  Each of the representations and warranties made by any Loan Party set forth in Article III or in any other Loan Document shall be true and correct in all material respects (other than Section 3.21, which shall be true and correct in all respects) on and as of the date of such Credit Extension with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects (or in all respects, as the case may be) on and as of such earlier date); provided that any representation and warranty that is qualified as to “materiality”, “Material Adverse Effect” or similar language shall be true and correct (after giving effect to any qualification therein) in all respects on such respective dates.

 

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Each of the delivery of a Borrowing Request or notice requesting the issuance, amendment, extension or renewal of a Letter of Credit and the acceptance by Borrower of the proceeds of such Credit Extension shall constitute a representation and warranty by Borrower and each other Loan Party that on the date of such Credit Extension (both immediately before and after giving effect to such Credit Extension and the application of the proceeds thereof) the conditions contained in this Section 4.02 (and, for Credit Extensions on the Closing Date, Section 4.01) have been satisfied.  Borrower shall provide such information (including calculations in reasonable detail of the covenants in Section 6.10) as the Administrative Agent may reasonably request to confirm that the conditions in Sections 4.01 and 4.02 have been satisfied.  For purposes of determining satisfaction of the conditions specified in Section 4.01 and, after the Closing Date, Section 4.02, by releasing its signature page hereto or to an Assignment and Assumption, each Agent and each Lender that has signed this Agreement or an Assignment and Assumption shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required hereunder to be consented to or approved by or acceptable or satisfactory to such Agent or such Lender, as the case may be.

 

ARTICLE V

AFFIRMATIVE COVENANTS

 

Each Company warrants, covenants and agrees with the Administrative Agent, the Collateral Agent, the Issuing Bank and each Lender that so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest and premium (if any) on each Loan, all Fees and all other expenses or amounts payable under any Loan Document shall have been paid in full and all Letters of Credit have been canceled or have expired and all amounts drawn thereunder have been reimbursed in full, each Loan Party will, and will cause each of its Subsidiaries to:

 

Section 5.01     Financial Statements, Reports, etc.  Furnish to the Administrative Agent for distribution to the Lenders:

 

(a)           Annual Reports.  As soon as available and in any event within 90 days after the end of each fiscal year (but no later than the date on which Borrower would be required to file a Form 10K under the Exchange Act if it were subject to Sections 15 and 13(d) of the Exchange Act), (i) the audited consolidated balance sheet of Borrower and its Subsidiaries (excluding Subsidiaries carried as investments under GAAP) as of the end of such fiscal year and related consolidated statements of income, cash flows and stockholders’ equity for such fiscal year, in comparative form with such financial statements as of the end of, and for, the preceding fiscal year, and notes thereto, all prepared in accordance with GAAP and accompanied by an opinion of PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing reasonably satisfactory to the Administrative Agent (which opinion shall not be qualified as to scope or contain any going concern or other qualification or exemption), stating that such financial statements fairly present, in all material respects, the consolidated financial condition, results of operations and cash flows of Borrower and such Subsidiaries as of the dates and for the periods specified in accordance with GAAP and (ii) a management’s discussion and analysis of the financial condition and results of operations for such fiscal year, as compared to the previous fiscal year and budgeted amounts (including commentary on (x) any material developments or proposals affecting Borrower and its Subsidiaries or their businesses and (y) the reasons for any significant variations from the Projections for such period and the figures for the corresponding period in the previous fiscal year);

 

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(b)           Quarterly Reports.  As soon as available and in any event within 45 days after the end of each of the first three fiscal quarters of each fiscal year (but no later than the date on which Borrower would be required to file a Form 10Q under the Exchange Act if it were subject to Sections 15 and 13(d) of the Exchange Act), (i) the consolidated balance sheet of Borrower and its Subsidiaries (excluding Subsidiaries carried as investments under GAAP) as of the end of such fiscal quarter and related consolidated statements of income and cash flows for such fiscal quarter and for the then elapsed portion of the fiscal year, in comparative form with the consolidated statements of income and cash flows for the comparable periods in the previous fiscal year, and notes thereto, all prepared in accordance with GAAP and accompanied by a certificate of a Financial Officer stating that such financial statements fairly present, in all material respects, the consolidated financial condition, results of operations and cash flows of Borrower and such Subsidiaries as of the date and for the periods specified in accordance with GAAP consistently applied, and on a basis consistent with audited financial statements referred to in clause (a) of this Section 5.01, subject to normal year-end audit adjustments and the absence of footnotes and (ii) a management’s discussion and analysis of the financial condition and results of operations for such fiscal quarter and the then elapsed portion of the fiscal year, as compared to the comparable periods in the previous fiscal year and budgeted amounts (including commentary on (x) any material developments or proposals affecting Borrower and its Subsidiaries or their businesses and (y) the reasons for any significant variations from the Projections for such period and the figures for the corresponding period in the previous quarter year);

 

(c)           Financial Officer’s Certificate.  Concurrently with any delivery of financial statements under Section 5.01(a) or (b) above, a Compliance Certificate (i) certifying that no Default or Event of Default has occurred or, if such a Default or Event of Default has occurred, specifying in reasonable detail the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto, (ii) setting forth computations in reasonable detail satisfactory to the Administrative Agent demonstrating compliance with the covenants contained in Section 6.10 and the Cumulative Credit Availability, (iii) setting forth the total assets of all Immaterial Subsidiaries as of the last day of the most recently ended Test Period and the Consolidated EBITDA attributable to all Immaterial Subsidiaries for such Test Period (iv) containing all updates to Schedule 3.09 with respect to Data Center Leases from the previous Compliance Certificate and (v) in the case of delivery of financial statements under Section 5.01(a) above, setting forth (1) Borrower’s calculation of Excess Cash Flow and Retained Excess Cash Flow and (2) the total assets and total liabilities of each first-tier Foreign Subsidiary, together with its Subsidiaries taken as a whole;

 

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(d)           Financial Officer’s Certificate Regarding Collateral.  Concurrently with any delivery of financial statements under Section 5.01(a) above, a certificate of a Financial Officer certifying that as of the date thereof (i) all UCC financing statements (including fixture filings and transmitting utility filings, as applicable) or other appropriate filings, recordings or registrations, including all refilings, rerecordings and reregistrations, containing a sufficient description of the Collateral have been filed of record in each governmental, municipal or other appropriate office in each jurisdiction necessary to protect, perfect or maintain the perfection or priority of the Liens under the Security Documents for a period of not less than 18 months after the date of such certificate (except as noted therein with respect to any continuation statements to be filed within such period), and (ii) all possessory Collateral required to be delivered to the Collateral Agent or the Administrative Agent pursuant to the Security Documents has been so delivered;

 

(e)           Public Reports.  Promptly after the same become publicly available, copies of all periodic and other reports, proxy statements, notices and other materials or information filed by any Company with the Securities and Exchange Commission, or any Governmental Authority succeeding to any or all of the functions of the Securities and Exchange Commission, or with any national securities exchange, or distributed to holders of its Indebtedness pursuant to the terms of the documentation governing such Indebtedness (or any trustee, agent or other representative therefor), as the case may be;

 

(f)            Management Letters.  Promptly after the receipt thereof by any Company, a copy of any “management letter” or similar document received by any such Person from its certified public accountants and the management’s responses thereto;

 

(g)           Budgets.  As soon as available and in any event within 90 days after the end of each fiscal year of Borrower (but no later than any delivery of financial statements under Section 5.01(a)), a budget in form reasonably satisfactory to the Administrative Agent (including budgeted statements of income for each of Borrower’s and its Subsidiaries’ business units and sources and uses of cash and balance sheets) prepared by Borrower for (i) each fiscal quarter of such fiscal year prepared in detail and (ii) such fiscal year and the immediately two succeeding fiscal years (except that no budget is required to be provided for any fiscal year after the fiscal year in which the Final Maturity Date occurs) in summary form, in each case, of Borrower and its Subsidiaries, with appropriate presentation and discussion in reasonable detail of the principal assumptions upon which such budget is based, accompanied by a certificate of a Financial Officer of Borrower certifying that the budget of Borrower and its Subsidiaries is a reasonable estimate for the period covered thereby; it being agreed that the form of budget most recently delivered to the Administrative Agent prior to the Closing Date is satisfactory to the Administrative Agent for the purposes of this clause (g);

 

(h)           Certification of Public Information.  Borrower and each Lender acknowledges that certain of the Lenders may be Public Lenders and, if documents or notices required to be delivered pursuant to this Section 5.01 or otherwise are being distributed through a Platform, any document or notice that Borrower has not specifically labeled “Public-Contains Only Public Information” shall not be posted on that portion of the Platform designated for such Public Lenders.  If Borrower has not so labeled a document or notice delivered pursuant to this Section 5.01, the Administrative Agent reserves the right to post such document or notice solely on that portion of the Platform designated for Lenders who wish to receive material Non-Public Information with respect to Borrower, its Subsidiaries and their securities.  Notwithstanding anything in any Loan Document to the contrary, documents required to be delivered pursuant to Section 5.01(a)(i) and (b)(i) may be posted on that portion of the Platform designated for Public Lenders regardless of whether Borrower has or has not specifically labeled any such document “Public-Contains Only Public Information;”

 

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(i)            Regulatory Information.  Promptly, from time to time, copies of such reports and written information to and from any Governmental Authority, including the FCC and any PUC, with jurisdiction over the Property or business of any Company, as the Administrative Agent may reasonably request; and

 

(j)            Other Information.  Promptly, from time to time, such other information regarding the operations, business affairs and financial condition of any Company, or compliance with the terms of any Loan Document, or the environmental condition of any Real Property, as the Administrative Agent or any Lender may reasonably request.  Each Lender acknowledges that the Administrative Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to in this Section 5.01, and in any event shall have no responsibility to monitor compliance by Borrower with any such request for delivery, and each Lender shall be solely responsible for requesting delivery (from the Administrative Agent) of or maintaining its copies of such documents.

 

Documents required to be delivered pursuant to Section 5.01(a), (b) or (e) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and shall be deemed to have been delivered on the date (1) on which Borrower posts such documents, or provides a link thereto, on Borrower’s website on the Internet and gives written notice thereof to the Administrative Agent; or (2) on which such documents are posted on a U.S. government website or on Borrower’s behalf on an Internet or intranet website, if any, in each case, to which the Administrative Agent has access (whether a commercial, third-party website or whether sponsored by the Administrative Agent).

 

Section 5.02     Litigation and Other Notices.  Furnish to the Administrative Agent (who shall  distribute to the Lenders) written notice of the following promptly (and, in any event, within 10 Business Days (or, in the case of Section 5.02(a), within 5 Business Days) following the occurrence thereof):

 

(a)           any Default or Event of Default, specifying the nature and extent thereof and the corrective action (if any) taken or proposed to be taken with respect thereto;

 

(b)           the filing or commencement of, or any threat or notice of intention of any Person to file or commence, any action, suit, litigation or proceeding, whether at law or in equity or otherwise by or before any Governmental Authority, (i) against any Company or any Affiliate thereof that has had, or could reasonably be expected to result in, a Material Adverse Effect, (ii) with respect to any Loan Document or (iii) with respect to any of the other Transactions;

 

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(c)           any development that has resulted, or could reasonably be expected to result, in a Material Adverse Effect;

 

(d)           the occurrence of a Casualty Event in excess of $5,000,000 (whether or not covered by insurance);

 

(e)           the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in liability of Borrower and its Subsidiaries in an aggregate amount exceeding $5,000,000;

 

(f)           the receipt by any Company of any notice of any Environmental Claim, Release or violation of or potential liability under, or knowledge by any Company that there exists a condition that has resulted, or could reasonably be expected to result, in an Environmental Claim, Release or a violation of or liability under, any Environmental Law, except for Environmental Claims, Releases, violations and liabilities the consequence of which, in the aggregate, have not subjected and could not be reasonably be expected to subject the Companies collectively to liabilities exceeding $5,000,000; and

 

(g)           (i) the incurrence of any Lien (other than Permitted Collateral Liens) on, or claim asserted against, all or any portion of the Collateral having a Fair Market Value of $5,000,000 or more or (ii) the occurrence of any other event which could reasonably be expected to materially adversely affect the value of the Collateral.

 

Section 5.03     Existence; Businesses and Properties.  (a)  Do or cause to be done all things necessary to preserve, renew and maintain in full force and effect its legal existence and take all commercially reasonable action to maintain all rights and franchises, licenses and permits material to its business, except as otherwise expressly permitted under Section 6.05 or Section 6.06.

 

(b)           Do or cause to be done all things that are commercially reasonable and necessary to maintain or cause to be maintained in good repair, working order and condition, ordinary wear and tear excepted, all material properties used or useful in the business of Borrower and its Subsidiaries and from time to time will make or cause to be made all appropriate repairs, renewals and replacements thereof, consistent with past practice.

 

Section 5.04     Insurance.  (a)  Keep its insurable Property adequately insured at all times by financially sound and reputable insurers; maintain such other insurance, to such extent and against such risks as is customary with companies in the same or similar businesses operating in the same or similar locations, including insurance with respect to Mortgaged Properties and other properties material to the business of the Companies against such casualties and contingencies and of such types and in such amounts with such deductibles and provisions for minimum claim amounts as is customary in the case of similar businesses operating in the same or similar locations, including (i) physical hazard insurance on an “all risk” basis, (ii) commercial general liability against claims for bodily injury, death or Property damage covering any and all insurable claims, (iii) explosion insurance in respect of any boilers, machinery or similar apparatus constituting Collateral, (iv) business interruption insurance, (v) worker’s compensation insurance and such other insurance as may be required by any Legal Requirement and (vi) such other insurance against risks (including “key-man” life insurance) as the Administrative Agent may from time to time require (in each case, such policies to be in such form and amounts and having such coverage as may be reasonably satisfactory to the Administrative Agent and the Collateral Agent); provided that with respect to physical hazard insurance, (x) neither the Collateral Agent nor the applicable Company shall agree to the adjustment of any claim thereunder without the consent of the other (such consent not to be unreasonably conditioned, withheld or delayed), and (y) no consent of any Company shall be required during an Event of Default.

 

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(b)           Notify the Administrative Agent and the Collateral Agent immediately whenever any separate insurance concurrent in form or contributing in the event of loss with that required to be maintained under this Section 5.04 is taken out by any Company; and promptly (and, in any event, within 10 Business Days) deliver to the Administrative Agent and the Collateral Agent a duplicate original copy of such policy or policies.

 

(c)           With respect to each Mortgaged Property, obtain flood insurance (which may take the form of a separate policy or be included as part of Borrower’s casualty insurance policy) in such total amount as the Administrative Agent or the Required Lenders may from time to time reasonably require, if at any time the area in which any improvements located on any Mortgaged Property is designated a “flood hazard area” in any Flood Insurance Rate Map published by the Federal Emergency Management Agency (or any successor agency), and otherwise comply with the National Flood Insurance Program as set forth in the Flood Disaster Protection Act of 1973.

 

(d)           No Loan Party that is an owner of any Mortgaged Property shall take any action that is reasonably likely to be the basis for termination, revocation or denial of any insurance coverage required to be maintained under such Loan Party’s respective Mortgage or that could reasonably be the basis for a defense to any claim under any Insurance Policy maintained in respect of the Premises, and each Loan Party shall otherwise comply in all material respects with all Insurance Requirements in respect of the Premises; provided, however, that each Loan Party may, at its own expense and after written notice to the Administrative Agent, (i) contest the applicability or enforceability of any such Insurance Requirements by appropriate legal proceedings, the prosecution of which does not constitute a basis for cancellation or revocation of any insurance coverage required under this Section 5.04 or (ii) cause the Insurance Policy containing any such Insurance Requirement to be replaced by a new policy complying with the provisions of this Section 5.04.

 

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Section 5.05     Obligations and Taxes.  Pay its Indebtedness and other obligations promptly and in accordance with their terms and pay and discharge promptly when due all Taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in respect of its Property, before the same shall become delinquent or in default, as well as all lawful claims for labor, services, materials and supplies or otherwise that, if unpaid, might give rise to a Lien other than a Permitted Lien upon such properties or any part thereof; provided that such payment and discharge shall not be required with respect to any such Tax, assessment, charge, levy or claim so long as (i) the validity or amount thereof shall be contested in good faith by appropriate proceedings timely instituted and diligently conducted and the applicable Company shall have set aside on its books adequate reserves or other appropriate provisions with respect thereto in accordance with GAAP, and (ii) such contest operates to suspend collection of the contested obligation, Tax, assessment or charge and enforcement of a Lien other than a Permitted Lien.

 

Section 5.06     Employee Benefits.  (a)  Comply in all material respects with all applicable Legal Requirements, including the applicable provisions of ERISA and the Code with respect to all Employee Benefit Plans and (b) furnish to the Administrative Agent (x) as soon as possible after, and in any event within five Business Days after any Responsible Officer of any Company or any ERISA Affiliate of any Company knows or has reason to know that, any ERISA Event or other event with respect to an Employee Benefit Plan has occurred that, alone or together with any other ERISA Event could reasonably be expected to result in liability of the Companies or any of their ERISA Affiliates in an aggregate amount exceeding $2,500,000 or the imposition of a Lien, a statement of a Financial Officer of Borrower setting forth details as to such ERISA Event and the action, if any, that the Companies propose to take with respect thereto, and (y) upon request by the Administrative Agent, copies of (i) any annual report (Form 5500 Series) filed by any Company or any of its ERISA Affiliates with the Employee Benefits Security Administration with respect to each Employee Benefit Plan; (ii) the most recent actuarial valuation report for each Pension Plan or Multiemployer Plan and each annual report for any Multiemployer Plan; (iii) all notices received by any Company or any of its ERISA Affiliates from a Multiemployer Plan sponsor or any Governmental Authority concerning an ERISA Event; and (iv) such other information, documents or governmental reports or filings relating to any Employee Benefit Plan as the Administrative Agent shall reasonably request.

 

(b)           Maintain all Employee Benefit Plans, Canadian Welfare Plans, Canadian Pension Plans and Foreign Plans in compliance in all material respects with all applicable Legal Requirements and ensure that all premiums and payments relating to Employee Benefit Plans, Canadian Welfare Plans, Canadian Pension Plans and Foreign Plans are paid as due; provided, however, that a Loan Party may terminate any such plan in accordance with all applicable Legal Requirements if the aggregate unfunded liability to the Loan Parties is not greater than $5,000,000.

 

Section 5.07     Maintaining Records; Access to Properties and Inspections; Annual Meetings.  (a)  Keep proper books of record and account in which full, true and correct entries in conformity with GAAP and all Legal Requirements are made of all dealings and transactions in relation to its business and activities.  Upon reasonable advance notice, each Company will permit any representatives designated by the Administrative Agent or any Lender to visit and inspect the financial records and the Property of such Company up to four times in any calendar year (or as often as requested upon the occurrence and during the continuance of an Event of Default)  and to make extracts from and copies of such financial records, and permit any representatives designated by the Administrative Agent or any Lender to discuss the affairs, finances, accounts and condition of any Company with the officers and employees thereof and advisors therefor (including independent accountants).

 

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(b)           Within 120 days after the close of each fiscal year of the Companies, at the request of the Administrative Agent or Required Lenders, hold a meeting (at a mutually agreeable location and time or, at the option of the Administrative Agent, a conference call) with all Lenders who choose to attend such meeting or conference call at which meeting or conference call shall be reviewed the financial results of the previous fiscal year and the financial condition of the Companies and the budget presented for the current fiscal year of the Companies.

 

Section 5.08     Use of Proceeds.  Use the proceeds of the Loans only for the purposes set forth in Section 2.19(a)(ii) and Section 3.12 and request the issuance of Letters of Credit only to support payment obligations incurred in the ordinary course of business by Borrower and its Subsidiaries.

 

Section 5.09     Compliance with Environmental Laws; Environmental Reports.  Comply, and use commercially reasonable efforts to cause all lessees and other Persons occupying its properties to comply, in all material respects with all Environmental Laws applicable to its operations and properties; obtain and renew all material environmental permits necessary for its operations and properties; and conduct any remedial action required in accordance with Environmental Laws; provided, however, that none of Borrower or any Subsidiary shall be required to undertake any remedial action required by Environmental Laws to the extent that its obligation to do so is being contested in good faith and by proper proceedings and appropriate reserves are being maintained with respect to such circumstances in accordance with GAAP.

 

Section 5.10     Compliance Policy.  Within 60 days after the Closing Date, adopt and thereafter maintain compliance policies and procedures applicable to each Company that are designed to ensure compliance with Sections 6.18 and 6.19 by each Company, which compliance policies and procedures shall include: (a) take-down policies and procedures for websites paid for or on behalf of Embargoed Persons or otherwise in violation of any Sanctions Law; (b) policies and procedures for screening and otherwise verifying that no Company directly or indirectly accepts as a new customer, maintains a customer relationship with, nor receives any payment from, any Embargoed Person; and (c) policies and procedures for ensuring continued compliance with the Sanctions Laws, including: (i) training all employees, directors and officers of each Company with respect to the Sanctions Laws; (ii) policies and procedures with respect to  resellers, vendors and service providers of each Company (collectively, “Third Parties”) regarding such Third Parties’ compliance with the Sanctions Laws and remedies with respect to any Third Party’s failure to comply with the Sanctions Laws; (iii) timely and appropriately monitoring activities of each Company to ensure compliance with these policies and procedures; (iv) investigating alleged or potential violations of the Sanctions Laws by any Person or entity within any Company; (v) determining the conditions under which voluntary disclosures will be made to Governmental Authorities following the discovery and/or investigation of actual or potential violations of the Sanctions Laws; and (vi) maintaining all records required under the Sanctions Laws.

 

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Section 5.11     Additional Collateral; Additional Guarantors.  (a)  Subject to this Section 5.11, with respect to any Property acquired after the Closing Date by any Loan Party that is intended to be subject to the Lien created by any of the Security Documents but is not so subject (but, in any event, excluding any Equity Interest of a Foreign Subsidiary not required to be pledged pursuant to the last sentence of Section 5.11(b)), promptly (and in any event within 20 Business Days after the acquisition thereof as may be extended with the consent of the Administrative Agent in its sole discretion) (i) execute and deliver to the Administrative Agent and the Collateral Agent such amendments or supplements to the relevant Security Documents or such other documents as the Administrative Agent or the Collateral Agent shall deem necessary or advisable to grant to the Collateral Agent, for its benefit and for the benefit of the other Secured Parties, a Lien on such Property subject to no Liens other than Permitted Collateral Liens and (ii) take all actions necessary to cause such Lien to be duly perfected to the extent required by such Security Documents in accordance with all applicable Legal Requirements, including the filing of financing statements (including fixture filings and transmitting utility filings, as applicable) in such jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent.  Borrower and the other Loan Parties shall otherwise take such actions and execute and/or deliver to the Collateral Agent such documents as the Administrative Agent or the Collateral Agent shall require to confirm the validity, perfection and priority of the Lien of the Security Documents against such after-acquired properties.

 

(b)           With respect to (x) any Person that is or becomes a Wholly Owned Domestic Subsidiary of a Loan Party after the Closing Date (other than an Excluded Subsidiary) or (y) any Wholly Owned Domestic Subsidiary of Borrower that is an Excluded Subsidiary that ceases to be an Excluded Subsidiary (whether pursuant to the definition thereof, the definition of Immaterial Subsidiary or otherwise), promptly (and in any event within 20 Business Days after such Person becomes a Subsidiary as may be extended with the consent of the Administrative Agent in its sole discretion) (i) except to the extent any of the following constitutes Property that is excluded as Collateral under the Security Agreement, deliver to the Collateral Agent the certificates, if any, representing all of the Equity Interests of such Subsidiary owned by a Loan Party, together with undated stock powers or other appropriate instruments of transfer executed and delivered in blank by a duly authorized officer of the holder(s) of such Equity Interests, and all intercompany notes owing from such Subsidiary to any Loan Party together with instruments of transfer executed and delivered in blank by a duly authorized officer of such Loan Party and (ii) cause such new Subsidiary (A) to execute a Joinder Agreement to become a Guarantor and a Pledgor or, in the case of a Foreign Subsidiary, if reasonably requested by the Administrative Agent or the Collateral Agent, execute a security document compatible with the laws of such Foreign Subsidiary’s jurisdiction (and in form and substance reasonably satisfactory to the Collateral Agent) to cause such Subsidiary to become a Guarantor and a Pledgor, (B) deliver opinions of counsel to Borrower in form and substance, and from counsel, reasonably satisfactory to the Administrative Agent, and (C) to take all actions necessary or advisable in the opinion of the Administrative Agent or the Collateral Agent to cause the Lien created by the applicable Security Document to be duly perfected to the extent required by such Security Document in accordance with all applicable Legal Requirements, including the filing of financing statements (including fixture filings and transmitting utility filings, as applicable) or equivalent registrations in such jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent.

 

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(c)           With respect to any Person that is or becomes a Subsidiary of a Loan Party after the Closing Date, promptly (and in any event within 20 Business Days after such Person becomes a Subsidiary as may be extended with the consent of the Administrative Agent in its sole discretion) execute and deliver to the Collateral Agent (i) a counterpart to the Intercompany Note and (ii) if such Subsidiary is a Loan Party, an endorsement to the Intercompany Note (undated and endorsed in blank) in the form attached thereto, endorsed by such Subsidiary.

 

(d)           (A) Promptly grant to the Collateral Agent (and in any event within 20 Business Days of the acquisition thereof as may be extended with the consent of the Administrative Agent in its sole discretion) a security interest in and Mortgage on (i) each Real Property owned in fee by such Loan Party as is acquired by such Loan Party after the Closing Date and that, together with any improvements thereon, individually has a Fair Market Value of at least $1,000,000 and (ii) each leased Real Property of such Loan Party of a “company-controlled” data center (unless the Collateral Agent otherwise consents or the applicable Loan Party shall have used all commercially reasonable efforts to obtain, but failed to obtain, such Mortgage), in each case, as additional security for the Secured Obligations (unless the subject Property is already mortgaged to a third party to the extent permitted by Section 6.02(i)).  Such Mortgages shall be granted pursuant to documentation reasonably satisfactory in form and substance to the Administrative Agent and the Collateral Agent and shall constitute valid and enforceable perfected first priority Liens subject only to Permitted Collateral Liens.  Such Loan Party shall promptly deliver to the Collateral Agent (and in any event within 20 Business Days as may be extended with the consent of the Administrative Agent in its sole discretion) a Landlord Access Agreement with respect to each Data Center Lease (unless the applicable Loan Party shall have used all commercially reasonable efforts to obtain, but failed to obtain, such Landlord Access Agreements). The Mortgages or instruments related thereto shall be duly recorded or filed in such manner and in such places as are required by applicable Legal Requirements to establish, perfect, preserve and protect the Liens in favor of the Collateral Agent required to be granted pursuant to the Mortgages and all taxes, fees and other charges payable in connection therewith shall be paid in full.  Such Loan Party shall otherwise take such actions and execute and/or deliver to the Collateral Agent such documents as the Administrative Agent or the Collateral Agent shall require to confirm the validity, enforceability, perfection and priority of the Lien of any existing Mortgage or new Mortgage against such after-acquired Real Property (including, but not limited to, a Title Policy, a Survey and environmental assessments (only with respect to such Real Property owned in fee by such Loan Party) and local counsel opinion in respect of such Mortgage, in each case, in form and substance reasonably satisfactory to the Administrative Agent and the Collateral Agent).

 

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Section 5.12     Security Interests; Further Assurances.  (a)  Promptly, upon the reasonable request of the Administrative Agent, the Collateral Agent or any Lender, at the Companies’ expense, execute, acknowledge and deliver, or cause the execution, acknowledgment and delivery of, and thereafter register, file or record, or cause to be registered, filed or recorded, in an appropriate governmental office, any document or instrument supplemental to or confirmatory of the Security Documents or otherwise deemed by the Administrative Agent or the Collateral Agent reasonably necessary or desirable for the continued validity, enforceability, perfection and priority of the Liens on the Collateral covered thereby subject to no other Liens except Permitted Liens, or obtain any consents or waivers as may be necessary or appropriate in connection therewith.

 

(b)           Deliver or cause to be delivered to the Administrative Agent and the Collateral Agent from time to time such other documentation, instruments, consents, authorizations, approvals and Orders in form and substance reasonably satisfactory to the Administrative Agent and the Collateral Agent as required by applicable Legal Requirements or as the Administrative Agent and the Collateral Agent shall reasonably deem necessary or advisable to perfect or maintain the validity, enforceability, perfection and priority of the Liens on the Collateral pursuant to the Security Documents.

 

Section 5.13     Information Regarding Collateral.  Concurrently with the delivery of financial statements pursuant to Section 5.01(a), deliver to the Administrative Agent and the Collateral Agent a Perfection Certificate Supplement.

 

Section 5.14     Maintenance of Ratings.  Use commercially reasonable efforts to cause the Loans and Borrower’s corporate credit to continue to be rated by Standard & Poor’s Ratings Group and Moody’s Investors Service Inc. (but not to maintain a specific rating).

 

Section 5.15     Post Closing Matters.  Execute and deliver the documents and complete the tasks set forth in Schedule 5.15, in each case within the time limits specified therein (which may be extended up to the date that is 90 days after the Closing Date with the consent of the Administrative Agent in its sole discretion).

 

ARTICLE VI

NEGATIVE COVENANTS

 

Each Company warrants, covenants and agrees with the Administrative Agent, the Collateral Agent, the Issuing Bank and each Lender that, so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest and premium (if any) on each Loan, all Fees and all other expenses or amounts payable under any Loan Document have been paid in full and all Letters of Credit have been canceled or have expired or have been Cash Collateralized and all amounts drawn thereunder have been reimbursed in full, no Company will, nor will they cause or permit any of their Subsidiaries to:

 

Section 6.01     Indebtedness.  Incur, create, assume or permit to exist, directly or indirectly, any Indebtedness, except:

 

(a)           Indebtedness incurred under this Agreement and the other Loan Documents;

 

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(b)           Indebtedness outstanding on the Closing Date and listed on Schedule 6.01(b);

 

(c)           Indebtedness consisting of Hedging Obligations under Permitted Hedging Agreements, in each case entered into in the ordinary course of business and not for speculative purposes or taking a “market view”; provided that if such Hedging Obligations relate to interest rates, (i) such Hedging Obligations relate to payment obligations on Indebtedness otherwise permitted to be incurred by the Loan Documents and (ii) the notional principal amount of such Hedging Obligations at the time incurred does not exceed the principal amount of the Indebtedness to which such Hedging Obligations relate;

 

(d)           Indebtedness arising from Investments permitted by Section 6.04;

 

(e)           Indebtedness of Borrower and its Subsidiaries in respect of Purchase Money Obligations, Synthetic Lease Obligations and Capital Lease Obligations  in an aggregate amount not to exceed $35,000,000 at any time outstanding; provided, however, that, in the case of Purchase Money Obligations, (i) such Indebtedness is incurred within 30 days after such acquisition, installation, construction or improvement of such fixed or capital assets (including Equity Interests of any Person owning the applicable fixed or capital assets) by such Person and (ii) the amount of such Indebtedness does not exceed 100% of the cost of such acquisition, installation, construction or improvement, as the case may be;

 

(f)            Indebtedness of any Person that becomes a Subsidiary after the date hereof in an aggregate principal amount not to exceed $10,000,000 at any time outstanding for all such Subsidiaries; provided that such Indebtedness (i) exists at the time such Person becomes a Subsidiary, (ii) is not created in anticipation or contemplation of such Person becoming a Subsidiary and (iii) is not directly or indirectly recourse to any of the Companies or any of their respective assets, other than to the Person that becomes a Subsidiary;

 

(g)           Indebtedness in respect of bid, performance or surety bonds issued for the account of any Company in the ordinary course of business, including guarantees or obligations of any Company incurred in the ordinary course of business with respect to letters of credit supporting such bid, performance or surety obligations (in each case other than for an obligation for money borrowed), in an aggregate amount not to exceed $5,000,000 at any time outstanding;

 

(h)           Reserved.

 

(i)            Contingent Obligations of any Company in respect of Indebtedness otherwise permitted under this Section 6.01 (other than Section 6.01(i));

 

(j)            Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within 10 Business Days of incurrence;

 

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(k)           Indebtedness arising in connection with endorsement of instruments for deposit in the ordinary course of business;

 

(l)            Indebtedness of any Foreign Subsidiary in an aggregate outstanding principal amount for all such Foreign Subsidiaries not to exceed $5,000,000 at any time outstanding; provided that such Indebtedness is not directly or indirectly recourse to any of the Companies or of their respective assets, other than to such Foreign Subsidiary;

 

(m)           unsecured Indebtedness of any Company in an aggregate principal amount for all Companies not to exceed $15,000,000 at any time outstanding; provided that no Default or Event of Default shall have occurred and be continuing at the time such unsecured Indebtedness is incurred or would result from the incurrence thereof; and

 

(n)           Indebtedness which represents a refinancing or renewal of any of the Indebtedness described in clauses (b), (e), and (f); provided that (A) any such refinancing Indebtedness is in an aggregate principal amount (or aggregate amount, as applicable) not greater than the aggregate principal amount (or aggregate amount, as applicable) of the Indebtedness being renewed or refinanced, plus the amount of any reasonable premiums required to be paid thereon and reasonable fees and expenses associated therewith, (B) such refinancing Indebtedness has a later or equal final maturity and longer or equal weighted average life to maturity than the Indebtedness being renewed or refinanced, (C) the covenants, events of default, subordination (including lien subordination) and other terms, conditions and provisions thereof (including any guarantees thereof or security documents in respect thereof) shall be, in the aggregate, no less favorable to the Administrative Agent, the Collateral Agent and the Lenders than those contained in the Indebtedness being renewed or refinanced, and (D) no Default or Event of Default has occurred and is continuing or would result therefrom.

 

Section 6.02     Liens.  Create, incur, assume or permit to exist, directly or indirectly, any Lien on any Property now owned or hereafter acquired by it or on any income or revenues or rights in respect of any thereof, except the following (collectively, the “Permitted Liens”):

 

(a)           inchoate Liens for amounts required to be remitted but not yet due with respect to Canadian Pension Plans or for taxes, assessments or governmental charges or levies not yet due and payable or delinquent and Liens for taxes, assessments or governmental charges or levies, which are being contested in good faith by appropriate proceedings promptly initiated and diligently conducted for which adequate reserves have been established in accordance with GAAP, which proceedings (or Orders entered in connection with such proceedings) have the effect of preventing the forfeiture or sale of the Property subject to any such Lien;

 

(b)           Liens in respect of Property of any Company imposed by law, which were incurred in the ordinary course of business and do not secure Indebtedness for borrowed money, such as carriers’, warehousemen’s, materialmen’s, landlords’, workmen’s, suppliers’, repairmen’s and mechanics’ Liens and other similar Liens arising in the ordinary course of business, and (i) which do not in the aggregate materially detract from the value of the Property of the Companies, taken as a whole, or the Loan Parties, taken as a whole, and do not materially impair the use thereof in the operation of the business of the Companies, taken as a whole, or the Loan Parties, taken as a whole, and (ii) which, if they secure obligations that are then due and unpaid, are being contested in good faith by appropriate proceedings promptly initiated and diligently conducted for which adequate reserves have been established in accordance with GAAP, which proceedings (or Orders entered in connection with such proceedings) have the effect of preventing the forfeiture or sale of the Property subject to any such Lien;

 

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(c)           any Lien in existence on the Closing Date and set forth on Schedule 6.02(c) and any Lien granted as a replacement or substitute therefor; provided that any such replacement or substitute Lien (i) except as permitted by Section 6.01(n)(A), does not secure an aggregate amount of Indebtedness or other obligations, if any, greater than that secured on the Closing Date (minus the aggregate amount of any permanent repayments and prepayments thereof since the Closing Date but only to the extent that such repayments and prepayments by their terms cannot be reborrowed or redrawn and do not occur in connection with a refinancing of all or a portion of such Indebtedness) and (ii) does not encumber any Property other than the Property subject thereto on the Closing Date (any such Lien, an “Existing Lien”);

 

(d)           easements, rights-of-way, restrictions (including zoning restrictions), covenants, licenses, encroachments, protrusions, servitudes and other similar charges or encumbrances, and minor title deficiencies, in each case, on or with respect to any Real Property, whether now or hereafter in existence, not (i) securing Indebtedness, (ii) individually or in the aggregate materially impairing the value or marketability of such Real Property or (iii) individually or in the aggregate materially interfering with the ordinary conduct of the business of the Companies at or otherwise with respect to such Real Property;

 

(e)           Liens arising out of judgments, attachments or awards not resulting in a Default or Event of Default and in respect of which such Company shall in good faith be diligently prosecuting an appeal or proceedings for review in respect of which there shall be secured a subsisting stay of execution pending such appeal or proceedings;

 

(f)           Liens (other than any Lien imposed by ERISA or in respect of any Foreign Plan or, except as provided in clause (a) above, any Canadian Pension Plan) (x) imposed by law or deposits made in connection therewith in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security legislation, (y) incurred in the ordinary course of business to secure the performance of tenders, statutory obligations (other than excise taxes), surety, stay, customs and appeal bonds, statutory bonds, bids, leases, government contracts, trade contracts, performance and return of money bonds and other similar obligations (in each case, exclusive of obligations for the payment of Indebtedness) or (z) arising by virtue of deposits made in the ordinary course of business to secure liability for premiums to insurance carriers; provided that (i) with respect to clauses (x), (y) and (z) of this Section 6.02(f), such Liens are for amounts not yet due and payable or delinquent or, to the extent such amounts are so due and payable, such amounts are being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, which proceedings (or Orders entered in connection with such proceedings) have the effect of preventing the forfeiture or sale of the Property subject to any such Lien, and (ii) to the extent such Liens are not imposed by Legal Requirements, such Liens shall in no event encumber any Property other than cash and Cash Equivalents;

 

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(g)           Leases, subleases or licenses of the properties of any Company, in each case entered into in the ordinary course of such Company’s business so long as such Leases do not, individually or in the aggregate, (i) interfere in any material respect with the ordinary conduct of the business of any Company or (ii) materially impair the use (for its intended purposes) or the value of the Property subject thereto;

 

(h)           Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by any Company in the ordinary course of business in accordance with the past practices of such Company;

 

(i)            Liens securing Indebtedness incurred pursuant to Section 6.01(e), provided that (i) any such Liens attach only to the Property being financed pursuant to such Indebtedness, (ii) do not encumber any other Property of any Company and (iii) the principal amount of the Indebtedness secured by any such Lien shall not exceed the lesser of the Fair Market Value or the cost of the Property secured by such Lien;

 

(j)            Liens on property rented to, or leased by, any Company pursuant to a Sale and Leaseback Transaction; provided that (i) such Sale and Leaseback Transaction is permitted by Section 6.03, (ii) such Liens do not encumber any other property of any Company, and (iii) such Liens secure only the Attributable Indebtedness incurred in connection with such Sale and Leaseback Transaction;

 

(k)           Reserved

 

(l)            bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more accounts maintained by any Company, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with respect to Cash Management Services; provided that, unless such Liens are non-consensual and arise by operation of applicable Legal Requirements, in no case shall any such Liens secure (either directly or indirectly) the repayment of any Indebtedness;

 

(m)           Liens on Property of a Person existing at the time such Person is acquired or merged with or into or amalgamated or consolidated with any Company to the extent permitted hereunder; provided that such Liens (i) do not extend to Property not subject to such Liens at the time of such acquisition, merger, consolidation or amalgamation (other than improvements thereon), (ii) are no more favorable to the lienholders than such existing Liens and (iii) are not created in anticipation or contemplation of such acquisition, merger, consolidation or amalgamation;

 

(n)           Liens granted pursuant to the Security Documents to secure the Secured Obligations;

 

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(o)           licenses of Intellectual Property granted by any Company in the ordinary course of business and not interfering in any material respect with the ordinary conduct of business of the Companies;

 

(p)           the filing of UCC or PPSA financing statements (or equivalent) solely as a precautionary measure in connection with operating leases or consignment of goods;

 

(q)           Liens of a collecting bank arising in the ordinary course of business under Section 4-208 of the UCC (or any equivalent provision of the UCC or PPSA) covering only the items being collected upon;

 

(r)            Liens granted by a Company in favor of a Loan Party in respect of Indebtedness owed by such Company to such Loan Party; provided that such Indebtedness is (i) evidenced by the Intercompany Note and (ii) pledged by such Loan Party as Collateral pursuant to the Security Documents; and

 

(s)           other Liens with respect to the property or assets of any Company as to which the aggregate amount at any time outstanding of all obligations secured thereby does not exceed $2,500,000.

 

Section 6.03     Sale and Leaseback Transactions.  Enter into any arrangement, directly or indirectly, with any Person whereby it shall sell or transfer any Property used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such Property or other Property which it intends to use for substantially the same purpose or purposes as the Property being sold or transferred (a “Sale and Leaseback Transaction”) unless (i) the sale of such property is entered into in the ordinary course of business and is made for cash consideration in an amount not less than the Fair Market Value of such property, (ii) the Sale and Leaseback Transaction is permitted by Section 6.06 and Section 6.17 and is consummated within 10 Business Days after the date on which such property is sold or transferred, (iii) any Liens arising in connection with its use of the property are permitted by Section 6.02(j), (iv) the Sale and Leaseback Transaction would be permitted under Section 6.01, assuming the Attributable Indebtedness with respect to the Sale and Leaseback Transaction constituted Indebtedness under Section 6.01 and (v) the Attributable Indebtedness incurred with respect to such Sale and Leaseback Transactions shall not exceed $5,000,000 in the aggregate during the life of this Agreement.

 

Section 6.04     Investments, Loans and Advances.  Directly or indirectly, lend money or credit (by way of guarantee, assumption of debt or otherwise) or make advances to any Person, or purchase or acquire any stock, bonds, notes, debentures or other obligations or securities of, or any other interest in, or make any capital contribution to, any other Person, or purchase or own a futures contract or otherwise become liable for the purchase or sale of currency or other commodities at a future date in the nature of a futures contract (all of the foregoing, collectively, “Investments”), except that the following shall be permitted:

 

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(a)           the Companies may consummate the Transactions in accordance with the provisions of the Transaction Documents;

 

(b)           Investments outstanding on the Closing Date and identified on Schedule 6.04(b);

 

(c)           the Companies may (i) acquire and hold accounts receivables owing to any of them if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary terms, (ii) invest in, acquire and hold cash and Cash Equivalents, (iii) endorse negotiable instruments held for collection in the ordinary course of business or (iv) make lease, utility and other similar deposits in the ordinary course of business;

 

(d)           Hedging Obligations permitted pursuant to Section 6.01(c);

 

(e)           loans and advances to directors, employees and officers of Borrower and the Subsidiaries for bona fide business purposes, in aggregate amount not to exceed $2,000,000 at any time outstanding (calculated without regard to write-downs or write-offs thereof); provided that no loans in violation of Section 402 of the Sarbanes-Oxley Act shall be permitted hereunder;

 

(f)            Investments by (i) Borrower in any Guarantor, (ii) any Company in Borrower or any Guarantor, and (iii) a Subsidiary of Borrower that is not a Guarantor in any other Subsidiary of Borrower that is not a Guarantor; provided that any Investment in the form of a loan or advance shall be evidenced by the Intercompany Note and, in the case of a loan or advance by a Loan Party, pledged by such Loan Party as Collateral pursuant to the Security Documents;

 

(g)           Investments in securities of trade creditors or customers in the ordinary course of business and consistent with such Company’s past practices that are received in settlement of bona fide disputes or pursuant to any plan of reorganization or liquidation or similar arrangement upon the bankruptcy or insolvency of such trade creditors or customers;

 

(h)           mergers, consolidations and amalgamation in compliance with Section 6.05;

 

(i)            Investments made by Borrower or any Subsidiary as a result of consideration received in connection with an Asset Sale made in compliance with Section 6.06;

 

(j)            acquisitions of Property in compliance with Section 6.07 (other than Section 6.07(a));

 

(k)           Dividends in compliance with Section 6.08;

 

(l)            Investments of any Person that becomes a Subsidiary on or after the date hereof; provided that (i) such Investments exist at the time such Person is acquired, (ii) such Investments are not made in anticipation or contemplation of such Person becoming a Subsidiary, and (iii) such Investments are not directly or indirectly recourse to any of the Companies or any of their respective assets, other than to the Person that becomes a Subsidiary; and

 

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(m)           Permitted Acquisitions (including the formation of Subsidiaries for the purpose of consummating Permitted Acquisitions);

 

(n)           other Investments in an aggregate amount not to exceed $15,000,000 on the date such Investments are made; and

 

(o)           Investments in an aggregate amount outstanding not to exceed the Cumulative Credit Availability as of the time such Investments were made; provided, that  Borrower shall have delivered an Officers’ Certificate to the Administrative Agent certifying as to compliance with the foregoing.

 

Section 6.05     Mergers and Consolidations.  Wind up, liquidate or dissolve its affairs or enter into any transaction of merger, consolidation or amalgamation (or agree to do any of the foregoing at any time), except that the following shall be permitted:

 

(a)           the Transactions as contemplated by, and in compliance with, the Transaction Documents;

 

(b)           Dispositions of assets in compliance with Section 6.06 (other than Section 6.06(e) and Section 6.06(f));

 

(c)           Permitted Acquisitions;

 

(d)           any solvent Company (other than Borrower) may merge, consolidate or amalgamate with or into Borrower or any Guarantor (as long as Borrower or a Guarantor is the surviving Person in such merger, consolidation or amalgamation and, in the case of any Guarantor, remains a Wholly Owned Subsidiary of Borrower); provided that the Lien on and security interest in such Property granted or to be granted in favor of the Collateral Agent under the Security Documents shall be maintained or created in accordance with the provisions of Section 5.11 or Section 5.12, as applicable;

 

(e)           any Wholly Owned Subsidiary of Borrower that is not a Guarantor may merge, consolidate or amalgamate with or into any other Wholly Owned Subsidiary of Borrower that is not a Guarantor; and

 

(f)           any Immaterial Subsidiary may dissolve, liquidate or wind up its affairs at any time if such dissolution, liquidation or winding up is not disadvantageous to any Agent or Lender in any material respect.

 

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To the extent the requisite Lenders under Section 10.02(b) waive the provisions of this Section 6.05 with respect to the sale of any Collateral, or any Collateral is sold as permitted by this Section 6.05, such Collateral (unless sold to a Company or any Affiliate thereof), but not the proceeds thereof, shall be sold free and clear of the Liens created by the Security Documents, and, so long as Borrower shall have previously provided to the Collateral Agent and the Administrative Agent such certifications or documents as the Collateral Agent and/or the Administrative Agent shall reasonably request in order to demonstrate compliance with this Section 6.05, the Collateral Agent shall take all actions it deems appropriate in order to effect the foregoing.

 

Section 6.06     Asset Sales.  Effect any Disposition of any Property, or agree to effect any Disposition of any Property, except that the following shall be permitted:

 

(a)           Dispositions of obsolete Property by Borrower or any of its Subsidiaries in the ordinary course of business and the abandonment or other Disposition of Intellectual Property that is, in the reasonable good faith judgment of Borrower, no longer economically practicable to maintain or useful in the conduct of the business of the Companies taken as a whole;

 

(b)           other Dispositions of Property; provided that (i) the aggregate consideration received in respect of all Dispositions of Property pursuant to this clause (b) shall not exceed $10,000,000 in any period of 12 consecutive months, (ii) such Dispositions of Property are made for Fair Market Value and on an arms-length commercial basis, and (iii) at least 90% of the consideration payable in respect of such Disposition of Property is in the form of cash or Cash Equivalents;

 

(c)           leases and subleases of real or personal Property in the ordinary course of business and in accordance with the applicable Security Documents;

 

(d)           the Transactions as contemplated by, and in compliance with, the Transaction Documents;

 

(e)           Investments in compliance with Section 6.04;

 

(f)            mergers, consolidations and amalgamations in compliance with Section 6.05;

 

(g)           Dividends in compliance with Section 6.08;

 

(h)           sales of inventory in the ordinary course of business and Dispositions of cash and Cash Equivalents in the ordinary course of business;

 

(i)            any Disposition of Property that constitutes a Casualty Event;

 

(j)            any Disposition of Property by any Subsidiary of Borrower to Borrower or any of its Wholly Owned Subsidiaries; provided that if the transferor of such Property is a Guarantor, the transferee thereof must be Borrower or a Guarantor; and

 

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(k)           any Disposition of one or more Immaterial Subsidiaries and, in the event that the “Funio” division of iWeb Technologies Inc. would qualify as an Immaterial Subsidiary at the time of such Disposition if determined on a stand-alone basis, the “Funio” division of iWeb Technologies Inc.

 

To the extent the requisite Lenders under Section 10.02(b) waive the provisions of this Section 6.06, with respect to the sale of any Collateral, or any Collateral is sold as permitted by this Section 6.06, such Collateral (unless sold to a Company or any Affiliate thereof), but not the proceeds thereof, shall be sold free and clear of the Liens created by the Security Documents, and, so long as Borrower shall have previously provided to the Collateral Agent and the Administrative Agent such certifications or documents as the Collateral Agent and/or the Administrative Agent shall reasonably request in order to demonstrate compliance with this Section 6.06, the Collateral Agent shall take all actions it deems appropriate in order to effect the foregoing.

 

Section 6.07     Acquisitions.  Directly or indirectly purchase or otherwise acquire (in one or a series of related transactions) any part of the Property of any Person (or agree to do any of the foregoing at any time), except that the following shall be permitted:

 

(a)           Investments in compliance with Section 6.04;

 

(b)           Capital Expenditures by Borrower and the Subsidiaries to the extent permitted by Section 6.10(c);

 

(c)           purchases and other acquisitions of inventory, materials, equipment and intangible Property in the ordinary course of business;

 

(d)           leases or licenses of real or personal Property in the ordinary course of business and in accordance with this Agreement and the applicable Security Documents;

 

(e)           the Transactions as contemplated by, and in compliance with, the Transaction Documents;

 

(f)            Permitted Acquisitions;

 

(g)           mergers, consolidations and amalgamations in compliance with Section 6.05; and

 

(h)           Dividends in compliance with Section 6.08.

 

provided that the Lien on and security interest in such Property granted or to be granted in favor of the Collateral Agent under the Security Documents shall be maintained or created in accordance with the provisions of Section 5.11 or Section 5.12, as applicable.

 

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Section 6.08     Dividends.  Authorize, declare or pay, directly or indirectly, any Dividends with respect to any Company (including pursuant to any Synthetic Purchase Agreement) or incur any obligation (contingent or otherwise) to do so, except that the following shall be permitted:

 

(a)            Dividends by any Company that is a Wholly Owned Subsidiary of Borrower to Borrower or any Guarantor that is a Wholly Owned Subsidiary of Borrower shall be permitted; and

 

(b)           payments by Borrower to repurchase or redeem Qualified Capital Stock of Borrower held by officers, directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of any Company, upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate amount of payments to Borrower shall not exceed, in any period of 12 consecutive months, $2,000,000 and, in the aggregate, $6,000,000.

 

Section 6.09     Transactions with Affiliates.  Enter into, directly or indirectly, any transaction or series of related transactions, whether or not in the ordinary course of business, with any Affiliate of any Company (other than (x) between or among the Loan Parties, (y) between and among the Companies that are not Loan Parties or (z) between and among the Companies so long as such transactions are immaterial as a whole to the Loan Parties), other than on terms and conditions at least as favorable to such Company as would reasonably be obtained by such Company at that time in a comparable arm’s-length transaction with a Person other than an Affiliate, except that the following shall be permitted:

 

(a)           Dividends permitted by Section 6.08;

 

(b)           Investments permitted by Sections 6.04(e) and (f);

 

(c)           reasonable and customary director, officer and employee compensation (including bonuses) and other benefits (including retirement, health, stock option and other benefit plans) and indemnification arrangements, in each case approved by the Board of Directors of the applicable Company; and

 

(d)           the Transactions as contemplated by, and in accordance with, the Transaction Documents.

 

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Section
6.10        Financial Covenants.

 

(a)          Maximum Total Leverage Ratio.  Permit the Total Leverage Ratio, as of the last day of any Test Period set forth in the table below, to exceed the ratio set forth opposite such Test Period in the table below:

 

	
Test Period End Date

 

	
Total Leverage Ratio

	
3/31/14

 

	
6.00 to 1.00

	
6/30/14

 

	
6.00 to 1.00

	
9/30/14

 

	
6.00 to 1.00

	
12/31/14

 

	
6.00 to 1.00

	
3/31/15

 

	
6.00 to 1.00

	
6/30/15

 

	
5.75 to 1.00

	
9/30/15

 

	
5.50 to 1.00

	
12/31/15

 

	
5.25 to 1.00

	
3/31/16

 

	
5.00 to 1.00

	
6/30/16

 

	
4.75 to 1.00

	
9/30/16

 

	
4.50 to 1.00

	
12/31/16

 

	
4.25 to 1.00

	
3/31/17

 

	
4.00 to 1.00

	
6/30/17

 

	
3.75 to 1.00

	
9/30/17

 

	
3.50 to 1.00

	
12/31/17

 

	
3.25 to 1.00

	
3/31/18

 

	
3.00 to 1.00

	
6/30/18

 

	
3.00 to 1.00

	
9/30/18

 

	
3.00 to 1.00

	
12/31/18

 

	
3.00 to 1.00

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(b)           Minimum Consolidated Interest Coverage Ratio.  Permit the Consolidated Interest Coverage Ratio, as of the last day of any Test Period set forth in the table below, to be less than the ratio set forth opposite such Test Period in the table below:

 

	
Test Period End Date

 

	
Consolidated Interest Coverage Ratio

	
3/31/14

 

	
2.45 to 1.00

	
6/30/14

 

	
2.45 to 1.00

	
9/30/14

 

	
2.45 to 1.00

	
12/31/14

 

	
2.55 to 1.00

	
3/31/15

 

	
2.70 to 1.00

	
6/30/15

 

	
2.80 to 1.00

	
9/30/15

 

	
2.95 to 1.00

	
12/31/15

 

	
3.05 to 1.00

	
3/31/16

 

	
3.20 to 1.00

	
6/30/16

 

	
3.35 to 1.00

	
9/30/16

 

	
3.50 to 1.00

	
12/31/16

 

	
3.65 to 1.00

	
3/31/17

 

	
3.90 to 1.00

	
6/30/17

 

	
4.00 to 1.00

	
9/30/17

 

	
4.00 to 1.00

	
12/31/17

 

	
4.00 to 1.00

	
3/31/18

 

	
4.00 to 1.00

	
6/30/18

 

	
4.00 to 1.00

	
9/30/18

 

	
4.00 to 1.00

	
12/31/18

 

	
4.00 to 1.00

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(c)           Limitation on Capital Expenditures.  Permit the aggregate amount of Capital Expenditures made in any period set forth below (a “Base Period”), to exceed the amount set forth below (the “Base Amount”) opposite such period below:

 

	
Base Period

 

	
Base Amount

	
12/31/14

 

	
$91,000,000

	
12/31/15

 

	
$103,000,000

	
12/31/16

 

	
$80,000,000

	
12/31/17

 

	
$88,250,000

	
12/31/18

 

	
$102,000,000

 

provided, however, that (i) if the aggregate amount of Capital Expenditures made in any Base Period shall be less than the Base Amount for such Base Period (before giving effect to any carryover), then an amount of such shortfall not exceeding 50% of the Base Amount in the immediately preceding Base Period (without giving effect to clause (iii) below) may, so long as no Default or Event of Default has occurred and is then continuing, be added to the Base Amount for the immediately succeeding (but not any other) Base Period, (ii) in determining whether any amount is available for carryover, the amount expended in any Base Period shall first be deemed to be expended from the Base Amount (before giving effect to any carryover) and (iii) the Base Amount for any Base Period shall be increased by the then applicable Cumulative Credit Availability.

 

Section 6.11     Prepayments of Other Indebtedness; Modifications of Organizational Documents, Acquisition and Certain Other Documents, etc.  Directly or indirectly:

 

(a)           (including pursuant to any Synthetic Purchase Agreement) make or offer to make (or give any notice in respect thereof) any voluntary or optional payment or prepayment on or redemption, retirement, defeasance, or acquisition for value of, or any prepayment or redemption as a result of any asset sale, change of control or similar event of, any Indebtedness outstanding under any Subordinated Indebtedness;

 

(b)           waive, amend, supplement or modify, or permit the waiver, amendment, supplementation or modification of, any provision of any Transaction Document or any Material Indebtedness in any manner that is, or could reasonably be expected to be, adverse in any material respect to the interests of any Agent or Lender; or

 

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(c)           terminate, amend, waive, modify (including electing to treat any Pledged Interests (as defined in the Security Agreement) as a “security” under Section 8-103 of the UCC) or change any of its Organizational Documents (including by the filing or modification of any certificate of designation) or any agreement to which it is a party with respect to its Equity Interests (including any stockholders’ agreement), or enter into any new agreement with respect to its Equity Interests, other than any such terminations, amendments, waivers, modifications or changes or such new agreements which are not, and could not reasonably be expected to be, adverse in any material respect to the interests of any Agent or Lender.

 

Section 6.12     Limitation on Certain Restrictions on Subsidiaries.  Directly or indirectly, create or otherwise cause or suffer to exist or become effective any encumbrance, restriction or condition on the ability of any Subsidiary to (i) pay Dividends or make any other distributions on its Equity Interests or any other interest or participation in its profits owned by any Company, or pay any Indebtedness owed to any Company, (ii) make loans or advances to any Company or (iii) transfer any of its properties to any Company, except for such encumbrances, restrictions or conditions existing under or by reason of:

 

(a)            applicable mandatory Legal Requirements;

 

(b)           this Agreement and the other Loan Documents;

 

(c)           customary provisions restricting subletting or assignment of any lease governing a leasehold interest of a Subsidiary;

 

(d)           customary provisions restricting assignment of any agreement entered into by a Subsidiary in the ordinary course of business; or

 

(e)           customary restrictions and conditions contained in any agreement relating to the sale or other Disposition of any Property pending the consummation of such sale; provided that (i) such restrictions and conditions apply only to the Property to be sold, and (ii) such sale or other Disposition is permitted hereunder.

 

Section 6.13     Limitation on Issuance of Capital Stock.  (a)           With respect to Borrower, issue any Equity Interest that is Disqualified Capital Stock.

 

(b)           With respect to any Subsidiary of Borrower, issue any Equity Interest (including by way of sales of treasury stock) or any options or warrants to purchase, or securities convertible into, any Equity Interest, except (i) for stock splits, stock dividends and additional issuances of Equity Interests which do not decrease the percentage ownership of Borrower or any Subsidiaries in any class of the Equity Interests of such Subsidiary and (ii) Subsidiaries of Borrower formed or acquired after the Closing Date in accordance with Section 6.14 may issue Equity Interests to Borrower or the Wholly Owned Subsidiary of Borrower which is to own such Equity Interests.  All Equity Interests issued in accordance with this Section 6.13(b) shall, to the extent required by Sections 5.11 and 5.12 or any Security Document, be delivered to the Collateral Agent for pledge pursuant to the applicable Security Document.

 

Section 6.14     Business.  Engage (directly or indirectly) in any businesses other than those businesses in which Borrower and its Subsidiaries are engaged on the Closing Date as described in the Confidential Information Memorandum (or which are substantially related thereto or are reasonable extensions thereof).

 

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Section 6.15     Limitation on Accounting Changes.  Make or permit, any change in accounting policies or reporting practices, without the consent of the Required Lenders, which consent shall not be unreasonably withheld, except (a) changes that are required or permitted by GAAP or (b) to implement IFRS (in each case of clauses (a) and (b), subject in each case to the provisions of Section 1.04).

 

Section 6.16     Fiscal Periods.  Change its fiscal year-end and fiscal quarter-ends to dates other than December 31 and the last day of each March, June, September and December, respectively.

 

Section 6.17     No Further Negative Pledge.  Enter into any agreement, instrument, deed or lease which prohibits or limits the ability of any Company to create, incur, assume or suffer to exist any Lien upon any of its properties or revenues, whether now owned or hereafter acquired, or which requires the grant of any Lien for an obligation if security is granted for another obligation, except the following:  (a) this Agreement and the other Loan Documents; (b) covenants in documents creating Liens permitted by Section 6.02 prohibiting further Liens (other than Liens permitted under Section 6.02(n)) on the properties encumbered thereby; and (c) any prohibition or limitation that (i) exists pursuant to applicable Legal Requirements, or (ii) consists of customary restrictions and conditions contained in any agreement relating to the Disposition of any Property pending the consummation of such Disposition; provided that (1) such restrictions apply only to the Property to be sold and such sale is permitted hereunder, and (2) such Disposition is permitted hereunder, or (iii) restricts subletting or assignment of any lease governing a leasehold interest of Borrower or any of its Subsidiaries.

 

Section 6.18     Anti-Terrorism Law; Anti-Money Laundering.  (a)           Directly or indirectly, (i) conduct any business or engage in making or receiving any contribution of funds, goods or services to or for the benefit of any Person described in Section 3.21, (ii) deal in, or otherwise engage in any transaction relating to, any Property or interests in Property blocked pursuant to the Executive Order or any other Anti-Terrorism Law or Canadian Anti-Terrorism Law, or (iii) engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law or Canadian Anti-Terrorism Law (and the Loan Parties shall deliver to the Lenders any certification or other evidence requested from time to time by any Lender in its reasonable discretion, confirming the Companies’ compliance with this Section 6.18).

 

(b)           Cause or permit any of the funds of such Loan Party that are used to repay the Credit Extensions to be derived from any unlawful activity with the result that the making of the Credit Extensions would be in violation of Legal Requirements.

 

Section 6.19     Embargoed Person.  Directly or indirectly (a) cause or permit any of the funds or properties of the Loan Parties that are used to repay the Loans or other Credit Extensions to constitute Property of, or be beneficially owned directly or indirectly by, any Embargoed Person, (b) cause or permit any Embargoed Person to have any direct or indirect interest, of any nature whatsoever in the Loan Parties, with the result that the investment in the Loan Parties (whether directly or indirectly) is prohibited by applicable Legal Requirements or the Credit Extensions are in violation of applicable Legal Requirements, or (c) cause or permit any Company to conduct any business or engage in any action that is in violation of any of any Sanctions Law.

 

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Section 6.20     Compliance with Canadian Pension Plans.  Directly or indirectly (a) establish any new defined benefit Canadian Pension Plan, (b) permit its unfunded pension fund and other employee benefit plan obligation and liabilities to remain unfunded other than in accordance with applicable law, or (c) terminate or wind-up any defined benefit Canadian Pension Plan, except as otherwise permitted under Section 5.06(b).

 

Section 6.21     Permitted Activities of License Subsidiaries.No License Subsidiary shall (a) incur, directly or indirectly, any Indebtedness other than the Indebtedness under this Agreement and the other Loan Documents; (b) create, or suffer to exist any Lien upon any property or assets now owned or hereafter acquired by it other than the Liens created under the Security Documents to which it is a party and Permitted Liens; (c) engage in any business or activity or own any assets other than (i) holding the Regulatory Licenses and (ii) performing its obligations and activities incidental thereto under the Loan Documents; (d) consolidate with or merge or amalgamate with or into, or convey, transfer or lease all or substantially all its assets to, any Person other than a License Subsidiary and in accordance with the provisions of this Agreement; (e) sell or otherwise dispose of any Equity Interests of any of its Subsidiaries other than to a License Subsidiary and in accordance with the other provisions of this Agreement; (f) create or acquire any Subsidiary or make or own any Investment in any Person; or (g) fail to hold itself out to the public as a legal entity separate and distinct from all other Persons.

 

Section 6.22     Regulatory Licenses.No Loan Party shall, or shall permit any of its Subsidiaries to, operate its businesses other than in accordance with applicable Legal Requirements with respect to, and the terms and conditions of, the Regulatory Licenses, unless such failure to do so would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  No Loan Party shall fail, or shall permit any of its Subsidiaries to fail, to file any report or application or pay any regulatory or filing fee pertaining to its businesses which is required to be filed with or paid to any Governmental Authority pursuant to applicable Legal Requirements, unless such failure to file a report or pay any regulatory or filing fee would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  No Loan Party shall, or shall permit any of its Subsidiaries to, take any action that could reasonably be expected to result in a Governmental Authority instituting any proceedings for the cancellation, revocation, non-renewal, short-term renewal or adverse modification of any Regulatory License, unless such proceedings would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect or take or permit to be taken any other action within its control that could reasonably be expected to result in non-compliance in any respect with applicable Legal Requirements with respect to any Regulatory License, except where the failure to be in compliance would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  Each Loan Party shall ensure that no Company other than a License Subsidiary that is a Loan Party shall own any interest in any Regulatory License.

 

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ARTICLE VII

GUARANTEE

 

Section 7.01     The Guarantee.  The Guarantors hereby, jointly and severally, guarantee, as primary obligors and not as sureties, to each Secured Party and their respective successors and assigns, the prompt payment and performance in full when due (whether at stated maturity, by required prepayment, declaration, demand, by acceleration or otherwise) of the principal of, and premium and interest (including any interest, fees, costs or charges that would accrue but for the provisions of the Bankruptcy Code after any bankruptcy or insolvency petition under the Bankruptcy Code) on the Loans made by the Lenders to, and the Notes held by each Lender of, Borrower, and all other Secured Obligations from time to time owing to the Secured Parties by any Loan Party in each case strictly in accordance with the terms thereof (such obligations being herein collectively called the “Guaranteed Obligations”).  The Guarantors hereby jointly and severally agree that if Borrower or any other Guarantor(s) shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors will promptly pay the same in cash, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal.

 

Section 7.02     Obligations Unconditional.  The obligations of the Guarantors under Section 7.01 shall constitute a guaranty of payment and performance and not of collection and to the fullest extent permitted by applicable Legal Requirements, are primary, absolute, irrevocable and unconditional, joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the Guaranteed Obligations under this Agreement, the Notes, if any, or any other agreement or instrument referred to herein or therein, or any substitution, release or exchange of any other guarantee of or security for any of the Guaranteed Obligations, and, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or Guarantor (except for payment in full of the Guaranteed Obligations with respect to the Secured Obligations set forth in clauses (a) and (b) of the definition thereof).  Without limiting the generality of the foregoing, it is agreed that the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantors hereunder which shall remain absolute, irrevocable and unconditional under any and all circumstances as described above:

 

(a)                      at any time or from time to time, without notice to the Guarantors, the time for any performance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived;

 

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(b)                      any of the acts mentioned in any of the provisions of this Agreement, the other Loan Documents or the Notes, if any, or any other agreement or instrument referred to herein or therein shall be done or omitted;

 

(c)                      the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the Guaranteed Obligations shall be amended in any respect, or any right under the Loan Documents or any other agreement or instrument referred to herein or therein shall be amended or waived in any respect or any other guarantee of any of the Guaranteed Obligations or any security therefor shall be released or exchanged in whole or in part or otherwise dealt with;

 

(d)                      any Lien or security interest granted to, or in favor of, any Secured Party as security for any of the Guaranteed Obligations shall fail to be valid, perfected or to have the priority required under the Loan Documents; or

 

(e)                      the release of any other Guarantor pursuant to Section 7.09.

 

The Guarantors hereby expressly waive diligence, presentment, demand of payment, protest and all notices whatsoever, and any requirement that any Secured Party exhaust any right, power or remedy or proceed against Borrower or any Guarantor under this Agreement or the Notes, if any, or any other agreement or instrument referred to herein or therein, or against any other Person under any other guarantee of, or security for, any of the Guaranteed Obligations.  The Guarantors waive any and all notice of the creation, renewal, extension, waiver, termination or accrual of any of the Guaranteed Obligations and notice of or proof of reliance by any Secured Party upon this Guarantee or acceptance of this Guarantee, and the Guaranteed Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred in reliance upon this Guarantee, and all dealings between Borrower and the Secured Parties shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guarantee.  This Guarantee shall be construed as a continuing, absolute, irrevocable and unconditional guarantee of payment and performance without regard to any right of offset with respect to the Guaranteed Obligations at any time or from time to time held by the Secured Parties, and the obligations and liabilities of the Guarantors hereunder shall be primary and shall not be conditioned or contingent upon the pursuit by the Secured Parties or any other Person at any time of any right or remedy against Borrower or against any other Person which may be or become liable in respect of all or any part of the Guaranteed Obligations or against any collateral security or guarantee therefor or right of offset with respect thereto.  This Guarantee shall remain in full force and effect and be binding in accordance with and to the extent of its terms upon the Guarantors and their respective successors and assigns, and shall inure to the benefit of the Secured Parties, and their respective successors and assigns, notwithstanding that from time to time during the term of this Agreement there may be no Guaranteed Obligations outstanding.

 

Section 7.03     Reinstatement.  The obligations of the Guarantors under this Article VII shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of Borrower or other Loan Party in respect of the Guaranteed Obligations is rescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise.

 

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Section 7.04     Subrogation; Subordination.  Each Guarantor hereby agrees that until the indefeasible payment and satisfaction in full in cash of all Guaranteed Obligations and the expiration and termination of the Commitments of the Lenders under this Agreement it shall waive any claim and shall not exercise any right or remedy, direct or indirect, arising by reason of any performance by it of its guarantee in Section 7.01, whether by subrogation or otherwise, against Borrower or any other Guarantor of any of the Guaranteed Obligations or any security for any of the Guaranteed Obligations.  Any Indebtedness of any Loan Party permitted pursuant to Section 6.04(f) shall be subordinated to such Loan Party’s Secured Obligations in the manner set forth in the Intercompany Note evidencing such Indebtedness.

 

Section 7.05     Remedies.  The Guarantors jointly and severally agree that, as between the Guarantors and the Lenders, the obligations of Borrower under this Agreement and other Loan Documents may be declared to be forthwith due and payable as provided in Article VIII (and shall be deemed to have become automatically due and payable in the circumstances provided in Article VIII) for purposes of Section 7.01, notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against Borrower and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by Borrower) shall forthwith become due and payable by the Guarantors for purposes of Section 7.01.

 

Section 7.06     Instrument for the Payment of Money.  Each Guarantor hereby acknowledges that the guarantee in this Article VII constitutes an instrument for the payment of money, and consents and agrees that any Lender or Agent, at its sole option, in the event of a dispute by such Guarantor in the payment of any moneys due hereunder, shall have the right to bring a motion-action under New York CPLR Section 3213.

 

Section 7.07     Continuing Guarantee.  The guarantee in this Article VII is a continuing guarantee of payment and performance, and shall apply to all Guaranteed Obligations whenever arising.

 

Section 7.08     General Limitation on Guarantee Obligations.  In any action or proceeding involving any state corporate limited partnership or limited liability company law, or any applicable state, federal or foreign bankruptcy, insolvency or reorganization law or other Legal Requirement affecting the rights of creditors generally, if the obligations of any Guarantor under Section 7.01 would otherwise be held or determined to be void, voidable, invalid or unenforceable, or subordinated to the claims of any other creditors, on account of the amount of its liability under Section 7.01, then, notwithstanding any other provision to the contrary, the amount of such liability shall, without any further action by such Guarantor, any other Loan Party or any other Person, be automatically limited and reduced to the highest amount (after giving effect to the rights of subrogation and contribution established in Sections 7.04 and 7.10, respectively) that is valid and enforceable, not void or voidable and not subordinated to the claims of other creditors as determined in such action or proceeding.

 

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Section 7.09     Release of Guarantors.  If, in compliance with the terms and provisions of the Loan Documents, (i) all of the Equity Interests or (ii) all or substantially all of the Property of any Guarantor are sold or otherwise transferred (a “Transferred Guarantor”) to a Person or Persons (other than any Company or any Affiliate thereof), such Transferred Guarantor shall, upon the consummation of such sale or transfer, be automatically released from its obligations under this Agreement (including under Section 10.03) and its obligations to pledge and grant any Collateral owned by it pursuant to any Security Document and, in the case of the sale of all of the Equity Interests of the Transferred Guarantor, the pledge of such Equity Interests to the Collateral Agent pursuant to the Security Documents shall be automatically released, and, so long as Borrower shall have previously provided the Collateral Agent and the Administrative Agent such certifications or documents the Collateral Agent and/or the Administrative Agent as shall reasonably request, the Collateral Agent shall take, and the Lenders hereby irrevocably authorize the Collateral Agent to take, such actions as are necessary to effect each release described in this Section 7.09 in accordance with the relevant provisions of the Security Documents.

 

Section 7.10     Right of Contribution.  Each Guarantor hereby agrees that to the extent that a Guarantor shall have paid more than its proportionate share of any payment made hereunder, such Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment.  Each Guarantor’s right of contribution shall be subject to the terms and conditions of Section 7.04.  The provisions of this Section 7.10 shall in no respect limit the obligations and liabilities of any Guarantor to the Administrative Agent, the Issuing Bank, the Swingline Lender and the Lenders, and each Guarantor shall remain liable to the Administrative Agent, the Issuing Bank, the Swingline Lender and the Lenders for the full amount guaranteed by such Guarantor hereunder.

 

Section 7.11     Qualified ECP Guarantors.  Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of its obligations under this Article VII in respect of Hedging Obligations that constitute Secured Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 7.11 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 7.11, or otherwise under this Article VII, voidable under applicable Legal Requirements relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount).  The obligations of each Qualified ECP Guarantor under this Section 7.11 shall remain in full force and effect until the Termination Time.  Each Qualified ECP Guarantor intends that this Section 7.11 constitute, and this Section 7.11 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

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ARTICLE VIII

EVENTS OF DEFAULT

 

Section 8.01     Events of Default.  Upon the occurrence and during the continuance of any of the following events (each, an “Event of Default”):

 

(a)           default shall be made in the payment of any principal of any Loan or any Reimbursement Obligation when and as the same shall become due and payable, whether at the due date thereof (including a Term Loan Repayment Date) or at a date fixed for repayment thereof or by acceleration thereof or otherwise;

 

(b)          default shall be made in the payment of any interest on any Credit Extension or any Fee or any other amount (other than an amount referred to in paragraph (a) above) due under any Loan Document, when and as the same shall become due and payable, whether at the due date thereof (including an Interest Payment Date) or at a date fixed for prepayment (whether optional or mandatory) or by acceleration or demand thereof or otherwise, and such default shall continue unremedied for a period of three Business Days;

 

(c)           any representation or warranty made or deemed made in or in connection with any Loan Document or the borrowings of Loans or issuances of Letters of Credit hereunder, or any representation, warranty, statement or information contained in any report, certificate, financial statement or other instrument furnished in connection with or pursuant to any Loan Document, shall prove to have been false or misleading in any material respect (or in any respect, in the case of any representation or warranty that is (x) qualified as to “materiality”, “Material Adverse Effect” or similar language or (y) made pursuant to Section 3.21) when so made, deemed made or furnished;

 

(d)           default shall be made in the due observance or performance by any Company of any covenant, condition or agreement contained in Sections 5.01, 5.02, 5.03(a) 5.08, 5.10, 5.11 or 5.15 or in Article VI;

 

(e)           default shall be made in the due observance or performance by any Company of any covenant, condition or agreement contained in any Loan Document (other than those specified in paragraphs (a), (b) or (d) immediately above) and such default shall continue unremedied or shall not be waived for a period of 10 Business Days (or three Business Days in the case of the Fee Letter) after the occurrence thereof;

 

(f)           any Company shall (i) fail to pay any principal or interest, regardless of amount, due in respect of any Indebtedness (other than the Obligations), when and as the same shall become due and payable beyond any applicable grace period, or (ii) fail to observe or perform any other term, covenant, condition or agreement contained in any agreement or instrument evidencing or governing any such Indebtedness if the effect of any failure referred to in this clause (ii) is to cause, or to permit the holder or holders of such Indebtedness or a trustee or other representative on its or their behalf (with or without the giving of notice, the lapse of time or both) to cause, such Indebtedness to become due before its stated maturity or become subject to a mandatory offer to purchase by the obligor; provided that it shall not constitute an Event of Default pursuant to this paragraph (f) unless the aggregate amount of all such Indebtedness referred to in clauses (i) and (ii) exceeds $10,000,000 at any one time;

 

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(g)           Other than with respect to an Immaterial Subsidiary, an Insolvency Proceeding shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (i) relief in respect of any Company or of a substantial part of the Property of any Company, under any Insolvency Laws, (ii) the appointment of a receiver, receiver and manager, interim receiver, trustee, custodian, sequestrator, conservator, liquidator, rehabilitator or similar official for any Company or for a substantial part of the Property of any Company, or (iii) the winding-up or liquidation of any Company; and such proceeding or petition shall continue undismissed for 60 days or an Order approving or ordering any of the foregoing shall be entered;

 

(h)           Other than with respect to an Immaterial Subsidiary, any Company shall (i) voluntarily commence any proceeding or file any petition seeking relief any Insolvency Laws, (ii)consent to the institution of, or fail to contest in a timely and appropriate manner, any Insolvency Proceeding or the filing of any petition described in clause (g) above, (iii) apply for or consent to the appointment of a receiver, receiver and manager, interim receiver, trustee, custodian, sequestrator, conservator, liquidator, rehabilitator or similar official for any Company or for a substantial part of the Property of any Company, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors, (vi) become unable, admit in writing its inability or fail generally to pay its debts as they become due, (vii) wind up or liquidate, or (viii) take any action for the purpose of effecting any of the foregoing;

 

(i)            one or more Orders for the payment of money in an aggregate amount in excess of $10,000,000 (that are not covered by insurance from an unaffiliated insurance company with an A.M.  Best financial strength rating of at least A-, it being understood that even if such amounts are covered by insurance from such an insurance company, such amounts shall count against such basket if responsibility for such amounts has been denied by such insurance company or such insurance company has not been promptly notified of such amounts or such insurance company is not participating in the defense thereof with customary diligence (as reasonably determined by the Administrative Agent)) shall be rendered against any Company or any combination thereof and the same shall remain undischarged, unvacated or unbonded for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to levy upon properties of any Company to enforce any such Order;

 

(j)            one or more ERISA Events or noncompliance with respect to Canadian Pension Plans or Foreign Plans shall have occurred that, in the opinion of the Required Lenders, when taken together with all other such ERISA Events and noncompliance with respect to Canadian Pension Plans or Foreign Plans that have occurred, could reasonably be expected to result in liability of any Company or any of its ERISA Affiliates in an aggregate amount exceeding $10,000,000 or the imposition of a Lien on any properties of a Company that is not a Permitted Lien;

 

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(k)           any security interest and Lien purported to be created by any Security Document shall cease to be in full force and effect, or shall cease to give the Collateral Agent, for the benefit of the Secured Parties, the Liens, rights, powers and privileges purported to be created and granted under such Security Documents with respect to any material portion of the Collateral (including a valid, enforceable, perfected first priority security interest in and Lien on, such portion of the Collateral thereunder (except as otherwise expressly provided in this Agreement or such Security Document)) in favor of the Collateral Agent, or shall be asserted by or on behalf of any Company not to be, a valid, enforceable, perfected, first priority (except as otherwise expressly provided in this Agreement or such Security Document) security interest in or Lien on the Collateral covered thereby;

 

(l)            any material provision of any Loan Document (or any Loan Document as a whole) shall at any time and for any reason be declared by a court of competent jurisdiction to be null and void, or a proceeding shall be commenced by or on behalf of any Loan Party or any other Person, or by any Governmental Authority, seeking to establish the invalidity or unenforceability thereof (exclusive of questions of interpretation of any provision thereof), or any Company (directly or indirectly) shall repudiate, revoke, terminate or rescind (or purport to do any of the foregoing) or deny any portion of its liability or obligation for the Obligations; or

 

(m)          there shall have occurred a Change in Control;

 

(n)           there shall have occurred the termination of, or the receipt by any Company of notice of the termination of, or the occurrence of any event or condition which would, with the passage of time or the giving of notice or both, constitute an event of default under or permit the termination of, any one or more Material Agreements (other than Data Center Leases) of any Company, provided that it shall not constitute an Event of Default pursuant to this paragraph (n): (i) unless the amount of such Material Agreements in this paragraph (n) individually or in the aggregate exceeds $10,000,000 at any one time or (ii) if the termination of such Material Agreement occurs as a result of (A) the expiration of any such Material Agreement on the stated expiration date or (B) any Company terminating any such Material Agreement in accordance with its terms in the absence of any default thereunder by any party thereto; or

 

(o)           there shall have occurred the termination of, or the receipt by any Company of notice of the termination of, or the occurrence of any event or condition which would, with the passage of time or the giving of notice or both, constitute an event of default under or permit the termination of, any one or more Data Center Leases of any Company, provided that it shall not constitute an Event of Default pursuant to this paragraph (o): (i) unless the impact of the termination of any such affected Data Center Leases, individually or in the aggregate, reduces or could reasonably be expected to reduce the Consolidated EBITDA of Borrower and its Subsidiaries for the Test Period commencing from the first full fiscal quarter following any such termination by at least 15% below the amount it would have been had all such terminations not occurred, (ii) if the termination of such Data Center Lease occurs as a result of (A) the expiration of any such Data Center Lease on the stated expiration date or (B)  any Company terminating such Data Center Lease in accordance with its terms in the absence of any default thereunder by any party thereto or (iii) for a Loan Party to terminate the Data Center Leases set forth on Schedule 8.01(o);

 

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then, and in every such event (other than an event with respect to Borrower described in paragraph (g) or (h) above), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to Borrower, take any or all of the following actions, at the same or different times:  (i) terminate forthwith the Commitments; (ii) declare the Loans and Reimbursement Obligations then outstanding to be forthwith due and payable in whole or in part, whereupon the principal of the Loans and Reimbursement Obligations so declared to be due and payable, together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Loan Parties accrued hereunder and under any other Loan Document, shall become forthwith due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Loan Parties, anything contained herein or in any other Loan Document or otherwise to the contrary notwithstanding; and (iii) exercise any and all of its other rights and remedies under applicable Legal Requirements, hereunder and under the other Loan Documents; and in any event with respect to Borrower described in paragraph (g) or (h) above, the Commitments shall automatically terminate and the principal of the Loans and Reimbursement Obligations then outstanding, together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Loan Parties accrued hereunder and under any other Loan Document, shall automatically become due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Loan Parties, anything contained herein or in any other Loan Document or otherwise to the contrary notwithstanding.

 

In addition, without limiting the foregoing, in the event of a foreclosure (or other similar exercise of remedies) by Collateral Agent on any of the Collateral pursuant to a public or private sale or other Disposition, the Collateral Agent, the Administrative Agent or any Secured Party may be the purchaser of any or all of such Collateral at any such sale or other Disposition and, in addition, the Collateral Agent or the Administrative Agent, as agent for and representative of all of Secured Parties (but not any Lender or Lenders in its or their respective individual capacities unless Required Lenders shall otherwise agree in writing) shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such sale or other Disposition, to use and apply any of the Obligations as a credit on account of the purchase price for any Collateral payable by Collateral Agent at such sale.

 

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Section 8.02     Rescission.  If at any time after termination of the Commitments or acceleration of the maturity of the Loans, the Loan Parties shall pay all arrears of interest and all payments on account of principal of the Loans and Reimbursement Obligations owing by them that shall have become due otherwise than by acceleration (with interest on principal and, to the extent permitted by law, on overdue interest, at the rates specified herein) and all Defaults (other than non-payment of principal of and accrued interest on the Loans due and payable solely by virtue of acceleration) shall be remedied or waived pursuant to Section 10.02, then upon the written consent of the Required Lenders (which may be given or withheld in their sole discretion) and written notice to Borrower, the termination of the Commitments or the acceleration and their consequences may be rescinded and annulled; but such action shall not affect any subsequent Default or Event of Default or impair any right or remedy consequent thereon.  The provisions of the preceding sentence are intended merely to bind the Lenders, the Issuing Bank and the other Secured Parties to a decision that may be made at the election of the Required Lenders, and such provisions are not intended to benefit Borrower or any of the other Loan Parties and do not give Borrower and/or any of the Loan Parties the right to require the Lenders to rescind or annul any acceleration hereunder, even if the conditions set forth herein are met.

 

Section 8.03     Borrower’s Right to Cure.  Notwithstanding anything to the contrary contained in Section 8.01, for purposes of determining whether an Event of Default has occurred under any financial covenant set forth in Section 6.10, any equity contribution (in the form of Qualified Capital Stock) made to Borrower after the last day of any Fiscal Quarter and on or before the day that is 10 days after the day on which financial statements are required to be delivered for that Fiscal Quarter will, at the request of Borrower, be included in the calculation of Consolidated EBITDA solely for the purposes of determining compliance with the financial covenants at the end of such Fiscal Quarter and any subsequent period that includes such Fiscal Quarter (any such equity contribution, a “Specified Equity Contribution”); provided that (a) Borrower shall not be permitted to so request that a Specified Equity Contribution be included in the calculation of Consolidated EBITDA with respect to any Fiscal Quarter unless, after giving effect to such requested Specified Equity Contribution, there will be a period of at least two consecutive Fiscal Quarters in the Relevant Four Fiscal Quarter Period in which no Specified Equity Contribution has been made, (b) the amount of any Specified Equity Contribution and the use of proceeds therefrom will be no greater than the amount required to cause Borrower to be in compliance with the financial covenants, (c) no more than four Specified Equity Contributions may be made during the term of the Credit Facilities, (d) all Specified Equity Contributions and the use of proceeds therefrom will be disregarded for all other purposes under the Loan Documents (including calculating Consolidated EBITDA for purposes of determining basket levels, Applicable Revolving Loan Margin, Applicable Term Loan Margin, and other items governed by reference to Consolidated EBITDA, and for purposes of the Dividends covenant in Section 6.08).  To the extent that the proceeds of the Specified Equity Contribution are used to repay Indebtedness, such Indebtedness shall not be deemed to have been repaid for purposes of calculating any financial covenant set forth in Section 6.10 for the Relevant Four Fiscal Quarter Period.  For purposes of this paragraph, the term “Relevant Four Fiscal Quarter Period” means, with respect to any requested Specified Equity Contribution, the four Fiscal Quarter period ending on (and including) the Fiscal Quarter in which Consolidated EBITDA will be increased as a result of such Specified Equity Contribution.

 

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Section 8.04     Application of Proceeds.  The proceeds received by the Collateral Agent in respect of any sale of, collection from or other realization upon all or any part of the Collateral pursuant to the exercise by the Collateral Agent of its remedies shall be applied, in full or in part, together with any other sums then held by the Collateral Agent pursuant to this Agreement or any other Loan Document, promptly by the Collateral Agent as follows:

 

(a)           First, to the indefeasible payment in full in cash of all costs and expenses, fees, commissions and taxes of such sale, collection or other realization (including compensation to the Collateral Agent, the Administrative Agent and their respective agents and counsel, and all expenses, liabilities and advances made or incurred by the Collateral Agent and the Administrative Agent in connection therewith and all amounts for which the Collateral Agent and the Administrative Agent is entitled to indemnification pursuant to the provisions of any Loan Document), together with interest on each such amount at the highest rate then in effect under this Agreement from and after the date such amount is due, owing or unpaid until paid in full;

 

(b)           Second, to the indefeasible payment in full in cash of all other reasonable costs and expenses of such sale, collection or other realization (including compensation to the other Secured Parties and their agents and counsel and all costs, liabilities and advances made or incurred by the other Secured Parties in connection therewith), together with interest on each such amount at the highest rate then in effect under this Agreement from and after the date such amount is due, owing or unpaid until paid in full;

 

(c)           Third, without duplication of amounts applied pursuant to clauses (a) and (b) above, to the indefeasible payment in full in cash, pro rata, of interest and other amounts constituting Obligations in respect of the Credit Facilities (other than principal, Reimbursement Obligations and obligations to Cash Collateralize Letters of Credit) in each case equally and ratably in accordance with the respective amounts thereof then due and owing (it being agreed that, for purposes of applying this clause (c), all interest and all other amounts described herein will be deemed payable in accordance with this Agreement regardless of whether such claims are allowed in any proceeding described in Section 8.01(g) or (h));

 

(d)           Fourth, to the indefeasible payment in full in cash of Secured Obligations of the type specified in clause (b) or (c) of the definition of Secured Obligations then due and owing and the principal amount of the Obligations in respect of the Credit Facilities (including Reimbursement Obligations and obligations to Cash Collateralize Letters of Credit), pro rata;

 

(e)           Fifth, to the indefeasible payment in full in cash of the remaining Secured Obligations then due and owing, pro rata; and

 

(f)            Sixth, the balance, if any, to the Person lawfully entitled thereto (including the applicable Loan Party or its successors or assigns) or as a court of competent jurisdiction may direct.

 

In the event that any such proceeds are insufficient to pay in full the items described in clauses (a) through (f) above, the Loan Parties shall remain liable, jointly and severally, for any deficiency.

 

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ARTICLE IX

THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT

 

Section 9.01     Appointment.  (a)           Each Lender and the Issuing Bank hereby irrevocably designates and appoints each of the Administrative Agent and the Collateral Agent as an agent of such Lender under this Agreement and the other Loan Documents and the Administrative Agent and the Collateral Agent hereby accept such designations and appointments.  Each Lender and each Issuing Bank irrevocably authorizes each Agent, in such capacity, through its agents or employees, to take such actions on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are delegated to such Agent by the terms of this Agreement and the other Loan Documents, together with such actions and powers as are reasonably incidental thereto.  The provisions of this Article IX are solely for the benefit of the Agents, the Lenders and the Issuing Bank, and no Loan Party shall have rights as a third party beneficiary of any such provisions.  Without limiting the generality of the foregoing, the Agents are hereby expressly authorized to execute any and all documents (including releases) with respect to the Collateral and any rights of the Secured Parties with respect thereto as contemplated by and in accordance with the provisions of this Agreement and the other Loan Documents.  In performing its functions and duties hereunder, each Agent shall act solely as an agent of the Lenders and does not assume and shall not be deemed to have assumed any obligation towards or relationship of agency or trust with or for Borrower or any of its Subsidiaries.  Without limiting the generality of the foregoing, the use of the term “agent” in this Agreement with reference to the Administrative Agent or the Collateral Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law.  Instead, such term is used merely as a matter of market custom and is intended to create or reflect only an administrative relationship between independent contracting parties.

 

(b)           Each Lender and the Issuing Bank hereby irrevocably authorizes the Administrative Agent, based upon the instruction of the Required Lenders, to credit bid and purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral at any sale thereof conducted by Collateral Agent under the provisions of the UCC or PPSA, including pursuant to Sections 9-610 or 9-620 of the UCC (or any equivalent provision of the UCC or the PPSA), at any sale thereof conducted under the provisions of the Bankruptcy Code, including Section 363 of the Bankruptcy Code, or at any other sale or foreclosure conducted by Collateral Agent (whether by judicial action or otherwise) in accordance with applicable Legal Requirements.

 

(c)           Each Lender irrevocably appoints each other Lender as its agent and bailee for the purpose of perfecting Liens (whether pursuant to Section 8-301(a)(2) of the UCC or otherwise), for the benefit of the Secured Parties, in assets in which, in accordance with the UCC or any other applicable Legal Requirement a security interest can be perfected by possession or control.  Should any Lender (other than the Collateral Agent) obtain possession or control of any such Collateral, such Lender shall notify the Collateral Agent thereof, and, promptly following the Collateral Agent’s request therefor, shall deliver such Collateral to the Collateral Agent or otherwise deal with such Collateral in accordance with the Collateral Agent’s instructions.

 

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Section 9.02     Agent in Its Individual Capacity.  Each Person serving as an Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not an Agent, and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as an Agent hereunder in its individual capacity.  Such Person and its Affiliates may accept deposits from, lend money to, act as financial advisor or in any other advisory capacity for, and generally engage in any kind of business with, any Company or Affiliate thereof as if it were not an Agent hereunder and without duty to account therefor to the Lenders or the Issuing Bank.

 

Section 9.03     Exculpatory Provisions.  No Agent shall have any duties or obligations except those expressly set forth in the Loan Documents.  Without limiting the generality of the foregoing, (a) no Agent shall be subject to any fiduciary or other implied duties, regardless of whether a Default or Event of Default has occurred and is continuing, (b) no Agent shall have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated by the Loan Documents that such Agent is required to exercise in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 10.02); provided that no Agent shall be required to take any action that, in its opinion or the opinion of its counsel, may expose such Agent to liability, if the Agent is not indemnified to its satisfactory, or that is contrary to any Loan Document or applicable Legal Requirements including, for the avoidance of doubt any action that may be in violation of the automatic stay under any Insolvency Law or that may effect a foreclosure, modification or termination of Property of a Defaulting Lender under any Debtor Relief Law, and (c) except as expressly set forth in the Loan Documents, no Agent shall have any duty to disclose or shall be liable for the failure to disclose, any information relating to any Company or any of its Affiliates that is communicated to or obtained by the Person serving as such Agent or any of its Affiliates in any capacity.  No Agent shall be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as any Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 10.02) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by a final and nonappealable judgment.  No Agent shall be deemed to have knowledge of any Default or Event of Default unless and until written notice thereof describing such Default or Event of Default is given to such Agent by Borrower, a Lender, or the Issuing Bank, and no Agent shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth in any Loan Document or the occurrence of any Default or Event of Default, (iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere in any Loan Document.  Each party to this Agreement acknowledges and agrees that the Administrative Agent may from time to time use one or more outside service providers for the tracking of all UCC financing statements (and/or other collateral related filings and registrations from time to time) required to be filed or recorded pursuant to the Loan Documents and the notification to the Administrative Agent, of, among other things, the upcoming lapse or expiration thereof, and that each of such service providers will be deemed to be acting at the request and on behalf of Borrower and the other Loan Parties.  No Agent shall be liable for any action taken or not taken by any such service provider.  Neither any Agent nor any of its officers, partners, directors, employees or agents shall be liable to the Lenders for any action taken or omitted by any Agent under or in connection with any of the Loan Documents.

 

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Section 9.04     Reliance by Agent.  Each Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent, or otherwise authenticated by a proper Person.  Each Agent also may rely upon any statement made to it orally and believed by it to be made by a proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the Issuing Bank, each Agent may presume that such condition is satisfactory to such Lender or the Issuing Bank unless each Agent shall have received written notice to the contrary from such Lender or the Issuing Bank before the making of such Loan or the issuance of such Letter of Credit.  Each Agent may consult with legal counsel (who may be counsel for Borrower), independent accountants and other advisors selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or advisors.

 

Section 9.05     Delegation of Duties.  Each Agent may perform any and all of its duties and exercise its rights and powers under this Agreement or under any other Loan Document by or through, or delegate any and all such rights and powers to, any one or more sub-agents appointed by such Agent and, so long as no Default or Event of Default has occurred and is continuing, Borrower consent (not to be unreasonably withheld or delayed) shall be required for (i) any delegation of a material portion of the duties of such Agent (taken as a whole) or (ii) any delegation that could reasonably be expected to have a material adverse effect on Borrower; provided, however, if Borrower fails to reply to any delegation request pursuant to this Section 9.05 within 2 Business Days, Borrower shall be deemed to have given its consent to such request; provided, further, Borrower consent shall not be required if such delegation is, in the opinion of such Agent, necessary or advisable to create, maintain, or perfect the security interest in or Lien on the Collateral.  Each Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Affiliates.  The exculpatory, indemnification and other provisions of the preceding paragraphs shall apply to any such sub-agent and to the Affiliates of each Agent and any such sub-agent, and shall apply, without limiting the foregoing, to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Agent.  The Agents shall not be responsible for the negligence or misconduct of any sub-agent except to the extent that a court of competent jurisdiction determines in a final and nonappealable judgment that such Agent acted with gross negligence or willful misconduct in the selection of such sub-agent.

 

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Section 9.06     Successor Agent.  Each Agent may resign as such at any time upon at least 10 days’ prior notice to the Lenders, the Issuing Bank and Borrower.  Upon any such resignation, the Required Lenders shall have the right, in consultation with Borrower, to appoint a successor Agent from among the Lenders.  If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 10 days after the retiring Agent gives notice of its resignation, then the retiring Agent may, on behalf of the Lenders and the Issuing Bank, appoint a successor Agent, which successor shall be (i) a commercial banking institution organized under the laws of the United States (or any State thereof) or a United States branch or agency of a commercial banking institution, in each case, having combined capital and surplus of at least $500,000,000, or an Affiliate of such institution, or (ii) another entity satisfactory to the Required Lenders; provided that if such retiring Agent is unable to find a successor Agent that is willing to accept such appointment and which meets the qualifications set forth above, the retiring Agent’s resignation shall nevertheless thereupon become effective and the retiring (or retired) Agent shall be discharged from its duties and obligations under the Loan Documents, and the Required Lenders shall assume and perform all of the duties of the Agent under the Loan Documents until such time, if any, as the Required Lenders appoint a successor Agent.  Any such resignation by an Agent hereunder shall also constitute, to the extent applicable, its resignation as an Issuing Bank and as Swingline Lender, in which case such resigning Agent (a) shall not be required to issue any further Letters of Credit or make any additional Swingline Loans hereunder and (b) shall maintain all of its rights as Issuing Bank or Swingline Lender, as the case may be, with respect to any Letters of Credit issued by it, or Swingline Loans made by it, prior to the date of such resignation.

 

Upon the acceptance of its appointment as an Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent, and the retiring (or retired) Agent shall be discharged from its duties and obligations under the Loan Documents.  The fees payable by Borrower to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between Borrower and such successor.  After an Agent’s resignation hereunder, the provisions of this Article IX, Section 10.03 and Sections 10.08 to 10.10 shall continue in effect for the benefit of such retiring Agent, its sub-agents and their respective Affiliates in respect of any actions taken or omitted to be taken by any of them while it was acting as Agent.

 

Section 9.07     Non-Reliance on Agent and Other Lenders.  Each Lender and the Issuing Bank acknowledges that it has, independently and without reliance upon any Agent or any other Lender or any of their respective Affiliates and based on such documents and information as it has deemed appropriate, conducted its own independent investigation of the financial condition and affairs of the Loan Parties and their Subsidiaries and made its own credit analysis and decision to enter into this Agreement.  Each Lender further represents and warrants that it has reviewed the Confidential Information Memorandum and each other document made available to it on the Platform in connection with this Agreement and has acknowledged and accepted the terms and conditions applicable to the recipients thereof (including any such terms and conditions set forth, or otherwise maintained, on the Platform with respect thereto).  Each Lender and the Issuing Bank also acknowledges that it will, independently and without reliance upon any Agent or any other Lender or any of their respective Affiliates and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or related agreement or any document furnished hereunder or thereunder.

 

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Section 9.08     Name Agents.  The parties hereto acknowledge that the Arrangers, the Book Managers, the Documentation Agent and the Syndication Agent hold such titles in name only, and that such titles confer no additional rights or obligations relative to those conferred on any Lender or the Issuing Bank hereunder.

 

Section 9.09     Indemnification.  The Lenders severally agree to indemnify each Agent in its capacity as such and each of its Related Persons (to the extent not reimbursed by Borrower or the Guarantors and without limiting the obligation of Borrower or the Guarantors to do so), ratably according to their respective outstanding Loans and Commitments in effect on the date on which indemnification is sought under this Section 9.09 (or, if indemnification is sought after the date upon which all Commitments shall have terminated and the Loans and Reimbursement Obligations shall have been paid in full, ratably in accordance with such outstanding Loans and Commitments as in effect immediately before such date), from and against any and all liabilities, obligations, losses, damages, fines, penalties, actions, claims, suits, judgments, litigations, investigations, inquiries or proceedings, costs, expenses or disbursements of any kind whatsoever that may at any time (whether before or after the payment of the Loans and Reimbursement Obligations) be imposed on, incurred by or asserted against such Agent or Related Person in any way relating to or arising out of, the Commitments, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein, the Transactions or any of the other transactions contemplated hereby or thereby or any action taken or omitted by such Agent or Related Person under or in connection with any of the foregoing (IN ALL CASES, WHETHER OR NOT CAUSED OR ARISING, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF ANY AGENT OR RELATED PERSON); provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, claims, suits, judgments, litigations, investigations, inquiries or proceedings, costs, expenses or disbursements that are found by a final and nonappealable judgment of a court of competent jurisdiction to have directly resulted solely and directly from such Agent’s or Related Person’s, as the case may be, gross negligence or willful misconduct.  The agreements in this Section 9.09 shall survive the payment of the Loans and all other amounts payable hereunder.

 

Section 9.10     Reserved.

 

Section 9.11     Lender Action.  Each Lender agrees that it shall not take or institute any actions or proceedings, judicial or otherwise, for any right or remedy against any Loan Party or any other obligor under any of the Loan Documents (including the exercise of any right of setoff, rights on account of any banker’s lien or similar claim or other rights of self-help), or institute any actions or proceedings, or otherwise commence any remedial procedures or cause any of the foregoing (through Affiliates or otherwise), with respect to any Collateral or any other Property of any such Loan Party, without the prior written consent of the Administrative Agent.  Without limiting the foregoing, each Lender agrees that, except as otherwise provided in any Loan Documents or with the written consent of the Administrative Agent, it will not take any enforcement action, accelerate Obligations under any Loan Documents, or exercise any right that it might otherwise have under applicable Legal Requirements to credit bid or purchase any portion of the Collateral at any sale or foreclosure thereof referred to in Section 9.01(b); provided that nothing contained in this Section shall affect any Lender’s right to credit bid its pro rata share of the Obligations pursuant to Section 363(k) of the Bankruptcy Code.

 

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Section 9.12     Withholding Taxes.  To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax.  If the Internal Revenue Service or any other Governmental Authority asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Lender because the appropriate form was not delivered or was not properly executed or because such Lender failed to notify the Administrative Agent of a change in circumstance which rendered the exemption from, or reduction of, withholding Tax ineffective or for any other reason, or if Administrative Agent reasonably determines that a payment was made to a Lender pursuant to this Agreement without deduction of applicable withholding tax from such payment, such Lender shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred.

 

Section 9.13     Lender’s Representations, Warranties and Acknowledgements.  (a) Each Lender represents and warrants that it has made its own independent investigation of the financial condition and affairs of Borrower and its Subsidiaries in connection with Credit Extensions hereunder and that it has made and shall continue to make its own appraisal of the creditworthiness of Borrower and its Subsidiaries.  No Agent shall have any duty or responsibility, either initially or on a continuing basis, to make any such investigation or any such appraisal on behalf of Lenders or to provide any Lender with any credit or other information with respect thereto, whether coming into its possession before the making of the Loans or at any time or times thereafter, and no Agent shall have any responsibility with respect to the accuracy of or the completeness of any information provided to the Lenders.  Each Lender and Issuing Bank acknowledges that no Agent or Related Person of any Agent has made any representation or warranty to it.  Except for documents expressly required by any Loan Document to be transmitted by an Agent to the Lenders or Issuing Bank, no Agent shall have any duty or responsibility (either express or implied) to provide any Lender or Issuing Bank with any credit or other information concerning any Loan Party, including the business, prospects, operations, Property, financial and other condition or creditworthiness  of any Loan Party or any Affiliate of a Loan Party, that may come in to the possession of an Agent or any of its Related Persons.

 

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(b)           Each Lender, by delivering its signature page to this Agreement or an Assignment and Assumption and funding its Loan, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan Document and each other document required to be approved by any Agent, the Required Lenders or the Lenders, as applicable, on the Closing Date.

 

Section 9.14     Security Documents and Guarantee.

 

(a)           Agents under Security Documents and Guarantee.  Each Secured Party hereby further authorizes the Administrative Agent or the Collateral Agent, as applicable, on behalf of and for the benefit of the Secured Parties, to be the agent for and representative of the Secured Parties with respect to the Guarantee, the Collateral and the Loan Documents; provided that neither the Administrative Agent nor the Collateral Agent shall owe any fiduciary duty, duty of loyalty, duty of care, duty of disclosure or any other obligation whatsoever to any holder of Secured Obligations with respect to any Permitted Hedging Agreement.  Subject to Section 10.02, without further written consent or authorization from any Secured Party, the Administrative Agent or the Collateral Agent, as applicable, may execute any documents or instruments necessary to (i) in connection with a sale or Disposition of assets permitted by this Agreement, release any Lien encumbering any item of Collateral that is the subject of such sale or other Disposition of assets, release any Lien encumbering any item of Collateral owned by any Guarantor that becomes an Excluded Subsidiary or to which the Required Lenders (or such other Lenders as may be required to give such consent under Section 10.02) have otherwise consented or (ii) release any Guarantor from the Guarantee pursuant to Section 7.09, or to the extent such Guarantor becomes an Excluded Subsidiary, or with respect to which the Required Lenders (or such other Lenders as may be required to give such consent under Section 10.02) have otherwise consented.

 

(b)           Right to Realize on Collateral and Enforce Guarantee.  Anything contained in any of the Loan Documents to the contrary notwithstanding, Borrower, the Administrative Agent, the Collateral Agent and each Secured Party hereby agree that (i) no Secured Party shall have any right individually to realize upon any of the Collateral or to enforce the Guarantee, it being understood and agreed that all powers, rights and remedies hereunder and under any of the Loan Documents may be exercised solely by the Administrative Agent or the Collateral Agent, as applicable, for the benefit of the Secured Parties in accordance with the terms hereof and thereof and all powers, rights and remedies under the Security Documents may be exercised solely by the Collateral Agent for the benefit of the Secured Parties in accordance with the terms thereof, and (ii) in the event of a foreclosure or similar enforcement action by the Collateral Agent on any of the Collateral pursuant to a public or private sale or other Disposition (including, without limitation, pursuant to Section 363(k), Section 1129(b)(2)(a)(ii) or otherwise of the Bankruptcy Code), the Collateral Agent (or any Lender, except with respect to a “credit bid” pursuant to Section 363(k), Section 1129(b)(2)(a)(ii) or otherwise of the Bankruptcy Code) may be the purchaser or licensor of any or all of such Collateral at any such sale or other Disposition and the Collateral Agent, as agent for and representative of the Secured Parties (but not any Lender or Lenders in its or their respective individual capacities) shall be entitled, upon instructions from the Required Lenders, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such sale or Disposition, to use and apply any of the Obligations as a credit on account of the purchase price for any collateral payable by the Collateral Agent at such sale or other Disposition.

 

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(c)           Release of Collateral and Guarantees, Termination of Loan Documents.

 

(i)           Notwithstanding anything to the contrary contained herein or in any other Loan Document, the Administrative Agent shall (without notice to, or vote or consent of, any Lender, or any Affiliate of any Lender that is a party to any Hedging Agreement) take such actions as shall be required to release its security interest in any Collateral subject to any Disposition permitted by the Loan Documents, and to release any guarantee obligations under any Loan Document of any Person subject to such Disposition, to the extent necessary to permit consummation of such Disposition in accordance with the Loan Documents, to release any guarantee obligations under any Loan Document of any Guarantor that becomes an Excluded Subsidiary and to release its security interest in any Collateral owned by any Guarantor that becomes an Excluded Subsidiary.

 

(ii)          Notwithstanding anything to the contrary contained herein or any other Loan Document, when all Secured Obligations under clauses (a) and (b) of the definition thereof (other than contingent expense reimbursement and indemnity obligations that are not then due and payable) have been paid in full and all Commitments have terminated or expired, upon request of Borrower, the Administrative Agent and the Collateral Agent shall (without notice to, or vote or consent of, any Lender, or any other Secured Party) take such actions as shall be required to release its security interest in all Collateral, and to release all guarantee obligations provided for in any Loan Document, whether or not on the date of such release there may be outstanding Secured Obligations under clause (c) of the definition thereof.  Any such release of guarantee obligations shall be deemed subject to the provision that such guarantee obligations shall be reinstated if after such release any portion of any payment in respect of the Obligations guaranteed thereby shall be rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Borrower or any Guarantor or any substantial part of its Property, or otherwise, all as though such payment had not been made.

 

(d)           The Collateral Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of the Collateral Agent’s Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall the Collateral Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.

 

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Section 9.15      Administrative Agent May File Bankruptcy Disclosure and Proofs of Claim.  In case of the pendency of any proceeding under any Debtor Relief Laws relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

 

(a)           to file a verified statement pursuant to rule 2019 of the Federal Rules of Bankruptcy Procedure that, in its sole opinion, complies with such rule’s disclosure requirements for entities representing more than one creditor;

 

(b)           to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its respective agents and counsel and all other amounts due the Administrative Agent under Sections 2.03 and 10.03) allowed in such judicial proceeding; and

 

(c)           to collect and receive any monies or other Property payable or deliverable on any such claims and to distribute the same;

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under this Agreement.  To the extent that the payment of any such compensation, expenses, disbursements and advances of the Administrative Agent, its agents and counsel, and any other amounts due the Administrative Agent under this Agreement out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Lenders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise.

 

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

 

ARTICLE X

MISCELLANEOUS

 

Section 10.01      Notices.  (a)           Generally.  Notices and other communications provided for herein shall, except as provided in Section 10.01(b), be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile, as follows:

 

(i)                        if to any Loan Party, to Borrower at One Ravinia Drive, Suite 1300, Atlanta, Georgia 30346, Attention:  Chief Financial Officer, Facsimile No.:  (404) 302-9920;

 

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(ii)                       if to the Administrative Agent, the Collateral Agent, the Swingline Lender or the Issuing Bank, to it at: Jefferies Finance LLC, 520 Madison Avenue, New York, New York  10022, Attention:  Account Officer Internap Network Services Corporation, Facsimile No.:  (212) 284-3444; and

 

(iii)                      if to a Lender, to it at its address (or facsimile number) set forth on Annex I or in the Assignment and Assumption  pursuant to which such Lender shall have become a party hereto.

 

Notices and other communications to the Lenders and the Issuing Bank hereunder may (subject to Section 10.01(b)) be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent.  Any party hereto may change its address, facsimile number or e-mail address for notices and other communications hereunder by notice to the other parties hereto.  The Administrative Agent or Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications.  Unless the Administrative Agent otherwise prescribes, (A) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgment from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgment), provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient, and (B) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (A) of notification that such notice or communication is available and identifying the website address therefor.

 

(b)           Posting.  Each Loan Party hereby agrees that it will provide to the Administrative Agent all information, documents and other materials that it is obligated to furnish to the Administrative Agent pursuant to this Agreement and any other Loan Document, including all notices, requests, financial statements, financial and other reports, certificates and other information materials, but excluding any such communication that (i) relates to a request for a new, or a conversion of an existing, Borrowing or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due under this Agreement before the scheduled date therefor, (iii) provides notice of any Default or Event of Default under this Agreement or (iv) is required to be delivered to satisfy any condition precedent to the effectiveness of this Agreement and/or any Borrowing or other Credit Extension hereunder (all such non-excluded communications, collectively, the “Communications”), by (x) transmitting the Communications in an electronic/soft medium in a format reasonably acceptable to the Administrative Agent at the e-mail address(es) provided to Borrower by the Administrative Agent from time to time or in such other form, including hard copy delivery thereof, as the Administrative Agent shall require  or (y) pursuant to the last paragraph of Section 5.01.  In addition, each Loan Party agrees to continue to provide the Communications to the Administrative Agent in the manner specified in this Agreement or any other Loan Document or in such other form, including hard copy delivery thereof, as the Administrative Agent shall require.  Nothing in this Section 10.01 shall prejudice the right of the Agents, any Lender, the Issuing Bank or any Loan Party to give any notice or other communication pursuant to this Agreement or any other Loan Document in any other manner specified in this Agreement or any other Loan Document or as any such Agent shall require..

 

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(c)           To the extent consented to by the Administrative Agent in writing from time to time, the Administrative Agent agrees that receipt of the Communications by the Administrative Agent at its e-mail address(es) set forth above shall constitute effective delivery of the Communications to the Administrative Agent for purposes of the Loan Documents.

 

(d)           Each Loan Party further agrees that the Administrative Agent may make the Communications available to the other Agents, the Lenders or the Issuing Bank by posting the Communications on a Platform.  The Platform and any Approved Electronic Communications are provided “as is” and “as available.”  The Agents do not warrant the accuracy or completeness of the Communications, or the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Platform and the Approved Electronic Communications.  No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by any Agent in connection with the Communications or the Platform.  In no event shall any Agent have any liability to any Loan Party, any Lender or any other Person for damages of any kind, whether or not based on strict liability and including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in contract, tort or otherwise) arising out of or related to any Loan Party’s or any Agent’s transmissions of Communications through Internet (including the Platform).  Notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.  Each Loan Party understands that the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution and agrees and assumes the risks associated with such electronic distribution, except to the extent caused by the willful misconduct or gross negligence of the Administrative Agent, as determined by a final, non-appealable judgment of a court of competent jurisdiction.

 

(e)           The Administrative Agent agrees that the receipt of the Communications by the Administrative Agent at its e-mail address shall constitute effective delivery of the Communications to the Administrative Agent for purposes of the Loan Documents.  Each Lender agrees that receipt of notice to it (as provided in the next sentence) specifying that the Communications have been posted to the Platform shall constitute effective delivery of the Communications to such Lender for purposes of the Loan Documents.  Each Lender agrees to notify the Administrative Agent in writing (including by electronic communication) from time to time of such Lender’s e-mail address to which the foregoing notice may be sent by electronic transmission and that the foregoing notice may be sent to such e-mail address.  Nothing herein shall prejudice the right of the Administrative Agent or any Lender to give any notice or other communication pursuant to any Loan Document in any other manner specified in such Loan Document.

 

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(f)           Each Loan Party, each Lender and each Agent agrees that the Administrative Agent may, but shall not be obligated to, store any Approved Electronic Communications on the Platform in accordance with the Administrative Agent’s customary document retention procedures and policies.

 

(g)           Each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable law, including United States federal and state securities laws, to make reference to information that is not made available through the “Public Side Information” portion of the Platform and that may contain Non-Public Information with respect to Borrower, its Subsidiaries or their securities for purposes of United States federal or state securities laws.  In the event that any Public Lender has determined for itself to not access any information disclosed through the Platform or otherwise, such Public Lender acknowledges that (i) other Lenders may have availed themselves of such information and (ii) neither the Borrower nor the Administrative Agent has any responsibility for such Public Lender’s decision to limit the scope of the information it has obtained in connection with this Agreement and the other Loan Documents.

 

Section 10.02      Waivers; Amendment.  (a)  No failure or delay by any Agent, the Issuing Bank or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.  The rights and remedies of each Agent, the Issuing Bank and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of any Loan Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless the same shall be permitted by Section 10.02(b), and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default or Event of Default, regardless of whether any Agent, any Lender or the Issuing Bank may have had notice or knowledge of such Default or Event of Default at the time.  No notice or demand on Borrower or any other Loan Party in any case shall entitle Borrower or any other Loan Party to any other or further notice or demand in similar or other circumstances.

 

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(b)          Subject to Section 2.16(c) and Section 10.02(c) and (d), neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended, supplemented or modified except, in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by Borrower and the Required Lenders or, in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by the Administrative Agent, the Collateral Agent (in the case of any Security Document) and the Loan Party or Loan Parties that are parties thereto, in each case with the written consent of the Required Lenders; provided that no such agreement shall:

 

(i)                        increase or extend the expiry date of the Commitment of any Lender without the written consent of such Lender (it being understood that no amendment, modification, termination, waiver or consent with respect to any condition precedent, covenant or Default or Event of Default (or any definition used, respectively, therein) shall constitute an increase in or extension of the expiry date of the Commitment of any Lender for purposes of this clause (i));

 

(ii)                       reduce the principal amount or premium, if any, of any Loan or LC Disbursement or reduce the rate of interest thereon (other than interest pursuant to Section 2.06(c)), or reduce any Fees payable hereunder, or change the form or currency of payment of any Obligation, without the written consent of each Lender directly affected thereby (it being understood that any amendment or modification to the financial definitions in this Agreement shall not constitute a reduction in the rate of interest or fees for purposes of this clause (ii));

 

(iii)                      postpone or extend the maturity of any Loan, or any scheduled date of payment of or the installment otherwise due on the principal amount of any Term Loan under Section 2.09, or the required date of payment of any Reimbursement Obligation, or any date for the payment of any interest or fees payable hereunder, or reduce the amount of, waive or excuse any such payment (other than a waiver of any increase in the interest rate pursuant to Section 2.06(c)), or postpone the scheduled date of expiration of any Commitment or postpone the scheduled date of expiration of any Letter of Credit beyond the Letter of Credit Expiration Date, without the written consent of each Lender directly affected thereby;

 

(iv)                       change Section 2.14(b) or (c) or Section 9.02 in a manner that would alter the order of or the pro rata sharing of payments or setoffs required thereby, without the written consent of each Lender;

 

(v)                       change the percentage set forth in the definition of “Required Lenders” or “Majority Revolving Lenders” or any other provision of any Loan Document (including this Section 10.02) specifying the number or percentage of Lenders (or Lenders of any Class) required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder, without the written consent of each Lender (or each Lender of such Class, as the case may be);

 

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(vi)                      release all or substantially all of the Guarantors from their respective Guarantees (except as expressly provided in Article VII), or limit their liability in respect of such Guarantees, without the written consent of each Lender;

 

(vii)                     except as expressly permitted in this Agreement or any Security Document, release all or substantially all of the Collateral from the Liens of the Security Documents or alter the relative priorities of the Secured Obligations entitled to the Liens of the Security Documents (except in connection with securing additional Secured Obligations equally and ratably with the other Secured Obligations), in each case without the written consent of each Lender;

 

(viii)                   change any provisions of any Loan Document in a manner that by its terms adversely and directly affects the rights in respect of payments due to Lenders holding Loans of any Class materially differently than those holding Loans of any other Class, without the written consent of Lenders holding a majority in interest of the outstanding Loans and unused Commitments of each directly affected Class;

 

(ix)                      change Section 10.04(h) without the consent of each Granting Lender all or any part of whose Loans are being funded by any SPC at the time of any such amendment, waiver or other modification;

 

(x)                       change the order of application of prepayments among Term Loans and Revolving Commitments under Section 2.10(h) or change the application of prepayments of Term Loans set forth in Section 2.10(h) in each case without the consent of the Required Lenders and Term Loan Lenders holding more than 50% of the principal amount of the outstanding Term Loans,

 

(xi)                       change Section 10.04(b) in a manner which further restricts assignments thereunder without the written consent of each Lender;

 

(xii)                     permit assignments by any Loan Party of its rights or obligations under the Credit Facilities without the written consent of each Lender, the Administrative Agent, the Collateral Agent, the Swingline Lender and the Issuing Bank; or

 

(xiii)                    subordinate the Obligations under the Loan Documents to any other Indebtedness;

 

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provided, further, that (1) no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent, the Collateral Agent, the Issuing Bank or the Swingline Lender without the prior written consent of the Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may be, (2) any waiver, amendment or modification of this Agreement that by its terms directly affects the rights or duties under this Agreement of the Revolving Lenders (but not the Term Loan Lenders), or the Term Loan Lenders (but not the Revolving Lenders) may be effected by an agreement or agreements in writing entered into by Borrower and the requisite percentage in interest of the affected Class of Lenders that would be required to consent thereto under this Section 10.02 if such Class of Lenders were the only Class of Lenders hereunder at the time, (3) any waiver, amendment or modification of this Agreement that by its terms results in (at the time of such waiver, amendment or modification or any time thereafter) Borrower satisfying any condition to a Revolving Borrowing contained in Section 4.02 hereof (which, but for such waiver, amendment or modification would not otherwise be satisfied), without the consent of the Majority Revolving Lenders, and (4) any waiver, amendment or modification before the achievement of a successful syndication of the credit facilities provided herein (as determined by the Arrangers in their sole discretion) may not be effected without the written consent of the Arrangers (or, if the Fee Letter only requires the written consent of either Arranger, such Arranger).  Notwithstanding the foregoing, any provision of this Agreement may be amended by an agreement in writing entered into by Borrower, the Required Lenders and the Administrative Agent (and, if their rights or obligations are affected thereby, the Issuing Bank and the Swingline Lender) if (x) by the terms of such agreement the Commitment of each Lender not consenting to the amendment provided for therein shall terminate upon the effectiveness of such amendment, (y) at the time such amendment becomes effective, each Lender not consenting thereto receives payment in full of the principal of, premium, if any, and interest accrued on each Loan made by it and all other amounts owing to it or accrued for its account under this Agreement, and (z) Section 2.16(b) is complied with.

 

(c)           Without the consent of any other Person, the applicable Loan Party or Loan Parties and the Administrative Agent and/or Collateral Agent may (in its or their respective sole discretion, or shall, to the extent required by any Loan Document) enter into any amendment or waiver of any Loan Document, or enter into any new agreement or instrument, to effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional Property to become Collateral for the benefit of the Secured Parties, or as required by applicable Legal Requirements to give effect to, or protect any security interest for the benefit of the Secured Parties, in any Property or assets so that the security interests therein comply with applicable Legal Requirements.

 

(d)           Notwithstanding the foregoing, (x) this Agreement may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent and Borrower (a) to add one or more additional credit facilities to this Agreement and to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents with the Term Loans and Revolving Loans and the accrued interest and fees in respect thereof and (b) to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders and (y) Borrower and the Administrative Agent may enter into amendments to this Agreement and the other Loan Documents in accordance with the provisions of Section 2.19 and Section 2.20.

 

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Section 10.03      Expenses; Indemnity; Damage Waiver.  (a)           The Loan Parties agree, jointly and severally, to pay, promptly upon demand:

 

(i)                       all reasonable and documented out-of-pocket costs and expenses incurred by the Arrangers, the Administrative Agent, the Collateral Agent, the Swingline Lender and the Issuing Bank, including the reasonable fees, charges and disbursements of Advisors for the Arrangers, the Administrative Agent, the Collateral Agent, the Swingline Lender and the Issuing Bank, in connection with the syndication of the Loans and Commitments, the preparation, negotiation, execution and delivery of the Loan Documents, the administration of the Credit Extensions and Commitments, the perfection and maintenance of the Liens securing the Collateral (including, without limitation, conducting Collateral audits from time to time) and any actual or proposed amendment, supplement or waiver of any of the Loan Documents (whether or not the transactions contemplated hereby or thereby shall be consummated);

 

(ii)                      all reasonable and documented out-of-pocket costs and expenses incurred by the Administrative Agent or the Collateral Agent, including the fees, charges and disbursements of Advisors for the Administrative Agent and the Collateral Agent, in connection with any action, claim, suit, litigation, investigation, inquiry or proceeding affecting the Collateral or any part thereof, in which action, claim, suit, litigation, investigation, inquiry or proceeding the Administrative Agent or the Collateral Agent is made a party or participates or in which the right to use the Collateral or any part thereof is threatened, or in which it becomes necessary in the judgment of the Administrative Agent or the Collateral Agent to defend or uphold the Liens granted by the Security Documents (including any action, claim, suit, litigation, investigation, inquiry or proceeding to establish or uphold the compliance of the Collateral with any Legal Requirements);

 

(iii)                      all reasonable and documented out-of-pocket costs and expenses incurred by the Arrangers, the Administrative Agent, the Collateral Agent, any other Agent, the Swingline Lender, the Issuing Bank or any Lender, including the fees, charges and disbursements of Advisors for any of the foregoing (but limited, in the case of legal fees and expenses, to one firm for the Arrangers, Administrative Agent and Collateral Agent and one firm for the Lenders taken as a whole (and, if reasonably necessary, of one local counsel in any relevant jurisdiction and one special regulatory counsel in respect of any relevant regulations, in each case, for all such Persons and, solely in the case of any conflict of interest, one additional counsel in each relevant jurisdiction to each group of affected Persons similarly situated, taken as a whole)), incurred in connection with the enforcement or protection of its rights under the Loan Documents, including its rights under this Section 10.03(a), or in connection with the Loans made or Letters of Credit issued hereunder and the collection of the Secured Obligations, including all such costs and expenses incurred during any workout, restructuring or negotiations in respect of the Secured Obligations; and

 

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(iv)                      all Other Taxes in respect of the Loan Documents.

 

(b)           The Loan Parties agree, jointly and severally, to indemnify the Agents, each Lender, the Issuing Bank and the Swingline Lender and each of their respective Related Persons (each such Person being called an “Indemnitee”) against, and to hold each Indemnitee harmless from, all reasonable out-of-pocket costs and any and all losses, claims, damages, liabilities, fees, fines, penalties, actions, judgments, suits and related expenses, including reasonable Advisors fees, charges and disbursements (collectively, “Claims”), incurred by, imposed on or asserted against any Indemnitee, directly or indirectly, arising out of, in any way connected with, or as a result of (i) the execution, delivery, performance, administration or enforcement of the Loan Documents or any agreement or instrument contemplated thereby or the performance by the parties thereto of their respective obligations thereunder, (ii) any actual or proposed use of the proceeds of the Loans or issuance of Letters of Credit, (iii) any claim, litigation, investigation or proceeding relating to any of the foregoing, whether or not any Indemnitee is a party thereto, (iv) any actual or alleged presence or Release or threatened Release of Hazardous Materials, on, at, under or from any Property owned, leased or operated by any Company at any time, or any Environmental Claim or threatened Environmental Claim related in any way to any Company, (v) any past, present or future non-compliance with, or violation of, Environmental Laws  or Environmental Permits applicable to any Company, or any Company’s business, or any Property presently or formerly owned, leased, or operated by any Company or their predecessors in interest, (vi) the environmental condition of any Property owned, leased, or operated by any Company at any time, or the applicability of any Legal Requirements relating to such Property, whether or not occasioned wholly or in part by any condition, accident or event caused by any act or omission of any Company, (vii) the imposition of any environmental Lien encumbering any Real Property, (viii) the consummation of the Transactions and the other transactions contemplated hereby (including the syndication of the Credit Facilities) or (ix) any actual or prospective action, claim, suit, litigation, investigation, inquiry or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by any Loan Party or otherwise, and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, apply (x)  to disputes solely between or among the Indemnitees or disputes solely between or among Indemnitees and their respective Affiliates, other than disputes arising out of any act or omission on the part of Borrower or its Subsidiaries or the Acquired Business, it being understood and agreed that the indemnification in this Agreement shall extend to disputes between or among the Arrangers, on the one hand, and one or more Lenders, or one or more of their Affiliates, on the other hand or (y) to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final judgment to have directly resulted solely from the gross negligence or willful misconduct of such Indemnitee.

 

(c)           The Loan Parties agree, jointly and severally, that, without the prior written consent of the Administrative Agent and any affected Issuing Bank or Lender, which consent(s) will not be unreasonably withheld, the Loan Parties will not enter into any settlement of a Claim in respect of the subject matter of clauses (i) through (ix) of Section 10.03(b) unless such settlement includes an explicit and unconditional release from the party bringing such Claim of all Indemnitees.

 

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(d)           The provisions of this Section 10.03 shall remain operative and in full force and effect regardless of the expiration of the term of this Agreement, the consummation of the Transactions and the other transactions contemplated hereby, the repayment of the Loans, Reimbursement Obligations and any other Secured Obligations, the release of any Guarantor or of all or any portion of the Collateral, the expiration of the Commitments, the expiration of any Letter of Credit, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of the Agents, the Issuing Bank or any Lender.  All amounts due under this Section 10.03 shall be accompanied by reasonable documentation with respect to any reimbursement, indemnification or other amount requested.

 

(e)           To the extent that the Loan Parties fail to indefeasibly pay any amount required to be paid by them to the Agents, the Issuing Bank or the Swingline Lender under Sections 10.03(a) or (b) in accordance with Section 9.03(g), each Lender severally agrees to pay to the Agents, the Issuing Bank or the Swingline Lender, as the case may be, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount (such indemnity shall be effective whether or not the related losses, claims, damages, liabilities and related expenses are incurred or asserted by any party hereto or any third party); provided that the unreimbursed Claim was incurred by or asserted against any of the Agents, the Issuing Bank or the Swingline Lender in its capacity as such.  For purposes of this Section 10.03(e), a Lender’s “pro rata share” shall be determined based upon its share of the sum of the total Revolving Exposure, outstanding Term Loans and unused Commitments at the time.

 

(f)            To the fullest extent permitted by applicable Legal Requirements, no Loan Party shall assert, and each Loan Party hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, exemplary, consequential, or punitive damages (including any loss of profits, business or anticipated savings) arising out of, in connection with, or as a result of, any Loan Document or any agreement or instrument contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.  No Indemnitee shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with the Loan Documents or the transactions contemplated hereby or thereby.

 

(g)           All amounts due under this Section 10.03 shall be payable not later than 10 days after demand therefor.

 

Section 10.04      Successors and Assigns.  (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of the Issuing Bank that issues any Letter of Credit), except that the Loan Parties may not assign or otherwise transfer any of their respective rights or obligations hereunder without the prior written consent of the Administrative Agent, the Collateral Agent, the Issuing Bank, the Swingline Lender, and each Lender, which consent may be withheld in their respective sole discretion (and any attempted assignment or transfer by any Loan Party without such consent shall be null and void).  Nothing in this Agreement or any other Loan Document, express or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of the Issuing Bank that issues any Letter of Credit), Participants to the extent expressly provided in Section 10.04(e) and, to the extent expressly contemplated hereby, the other Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement or any other Loan Document.

 

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(b)           Any Lender shall have the right at any time to assign to one or more assignees (other than any Company or any Affiliate thereof except as provided in Section 10.04(j) below or a natural person) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it); provided that:

 

(i)                       except in the case of (A) an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, (B) contemporaneous assignments to related Approved Funds that equal at least the amount specified in this Section 10.04(b)(i) in the aggregate, (C) any assignment made in connection with the primary syndication of the Commitments and Loans by the Arrangers or (D) an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans, the amount of the Term Loan Commitment or Term Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $1,000,000 and the amount of the Revolving Commitment or Revolving Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $2,500,000; provided that the foregoing amounts may be reduced with the consent of the Administrative Agent and, so long as no Default or Event of Default has occurred and is continuing, Borrower (not to be unreasonably withheld or delayed);

 

(ii)                      each partial assignment shall be made as an assignment of a proportionate part of all of the assigning Lender’s rights and obligations under this Agreement, except that this clause (ii) shall not be construed to prohibit the assignment of a proportionate part of all the assigning Lender’s rights and obligations in respect of one Class of Commitments or Loans;

 

(iii)                     the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500; provided that such fee shall not be payable in the case of an assignment by any Lender to an Affiliate or an Approved Fund of such Lender;

 

(iv)                     the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire;

 

(v)                      in the case of an assignment of all or a portion of a Revolving Commitment or any Revolving Lender’s obligations in respect of its LC Exposure or Swingline Exposure, the Issuing Bank and the Swingline Lender must give its prior written consent to such assignment (which consent shall not be unreasonably withheld, delayed or conditioned);

 

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(vi)                     the Administrative Agent must give its prior written consent to such assignment (which consent shall not be unreasonably withheld, delayed or conditioned); and

 

(vii)                    in the case of an assignment of all or a portion of a Revolving Commitment, a Revolving Loan or any Revolving Lender’s obligations in respect of its LC Exposure or Swingline Exposure (except in the case of (A) an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, or (B) any assignment made in connection with the primary syndication of the Commitments and Loans by the Arranger), Borrower must give its prior written consent to such assignment (which consent shall not be unreasonably withheld, delayed or conditioned); provided that Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within 10 Business Days after having received notice thereof.

 

Notwithstanding the foregoing, if a Default or an Event of Default has occurred and is continuing (i) any consent of Borrower otherwise required under this paragraph shall not be required, and (ii) any consent of the Issuing Bank and the Swingline Lender required under this Section 10.04(b) may be withheld by such Person in its sole discretion.  Subject to acceptance and recording thereof pursuant to Section 10.04(d), from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement (provided that any liability of Borrower to such assignee under Section 2.12, 2.13 or 2.15 shall be limited to the amount, if any, that would have been payable thereunder by Borrower in the absence of such assignment, except to the extent any such amounts are attributable to a Change in Law occurring after the date of such assignment), and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.12, 2.13, 2.15 and 10.03).

 

(c)           The Administrative Agent, acting for this purpose as an agent of Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amount of and stated interest on the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive and binding in the absence of manifest error, and Borrower, the Administrative Agent, the Issuing Bank and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.  The Register shall be available for inspection by Borrower, the Issuing Bank, the Collateral Agent, the Swingline Lender and any Lender (with respect to its own interest only), at any reasonable time and from time to time upon reasonable prior notice.

 

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(d)           Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in Section 10.04(b) and any written consent to such assignment required by Section 10.04(b), the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register.  No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this Section 10.04(b).  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with the requirements of this Section 10.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 10.04(e).

 

(e)           Any Lender shall have the right at any time, without the consent of, or notice to Borrower, the Administrative Agent, the Issuing Bank, or the Swingline Lender or any other Person to sell participations to any Person (other than any Company or any Affiliate thereof or a natural person) (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) Borrower, the Administrative Agent, the Collateral Agent, the Issuing Bank and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce the Loan Documents and to approve any amendment, modification or waiver of any provision of the Loan Documents; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver that (1) is described in clauses (i), (ii) or (iii) of the proviso to Section 10.02(b) and (2) directly affects such Participant.  Subject to Section 10.04(f), each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.15 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.04(b) (it being understood that the documentation required under Section 2.15(e) shall be delivered to the participating Lender, if such Participant would be a Foreign Lender if it were a Lender).  To the extent permitted by Legal Requirements, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender; provided that such Participant agrees in writing to be subject to Section 2.14(c) as though it were a Lender.  Each Lender that sells a participation shall, acting for this purpose as an agent of Borrower, maintain at one of its offices a register for the recordation of the names and addresses of its Participants, the principal amounts of and stated interest on, and terms of, its participations (the “Participant Register”).  The entries in the Participant Register shall be conclusive and binding absent manifest error, and such Lender (and Borrower, to the extent that the Participant requests payment from Borrower) shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.  No Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) except to the extent that such disclosure is necessary to establish that such commitment, loan, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

 

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(f)           A Participant shall not be entitled to receive any greater payment under Sections 2.12, 2.13 or 2.15 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the prior written consent of Borrower (which consent shall not be unreasonably withheld, delayed or conditioned) or the greater payment results from a Change in Law after the date the participation was sold to the Participant.

 

(g)           Any Lender may at any time, without the consent of Borrower or the Administrative Agent, pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank or any other central bank, and this Section 10.04(g) shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.  Without limiting the foregoing, in the case of any Lender that is a fund that invests in bank loans or similar extensions of credit, such Lender may, without the consent of Borrower, the Issuing Bank, the Swingline Lender, the Administrative Agent or any other Person, collaterally assign or pledge all or any portion of its rights under this Agreement, including the Loans and Notes or any other instrument evidencing its rights as a Lender under this Agreement, to any holder of, trustee for, or any other representative of holders of, obligations owed or securities issued, by such fund, as security for such obligations or securities.

 

(h)           Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”) may grant to a special purpose funding vehicle (an “SPC”), identified as such in writing from time to time by the Granting Lender to the Administrative Agent and Borrower, the option to provide to Borrower all or any part of any Loan that such Granting Lender would otherwise be obligated to make to such Borrower pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan and (ii) if an SPC elects not to exercise such option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof; provided further that nothing herein shall make the SPC a “Lender” for the purposes of this Agreement, obligate Borrower or any other Loan Party or the Administrative Agent to deal with such SPC directly, obligate Borrower or any other Loan Party in any manner to any greater extent than they were obligated to the Granting Lender, or increase costs or expenses of Borrower.  The Loan Parties and the Administrative Agent shall be entitled to deal solely with, and obtain good discharge from, the Granting Lender and shall not be required to investigate or otherwise seek the consent or approval of any SPC, including for the approval of any amendment, waiver or other modification of any provision of any Loan Document.  The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Loan were made by such Granting Lender.  Each party hereto hereby agrees that no SPC shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender).  In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, before the date that is one year and one day after the payment in full of all outstanding commercial paper or other senior indebtedness of any SPC, it will not institute against, or join any other Person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under the laws of the United States of America or any state thereof.  In addition, notwithstanding anything to the contrary contained in this Section 10.04(h), any SPC may (i) with notice to, but without the prior written consent of, Borrower and the Administrative Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Loans to the Granting Lender or to any financial institutions (consented to by Borrower and the Administrative Agent) providing liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans and (ii) disclose on a confidential basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC.

 

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(i)            The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Legal Requirement, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

 

(j)            Certain Permitted Term Loan Repurchases.

 

Notwithstanding anything to the contrary contained in this Section 10.04(j) or any other provision of this Agreement, so long as no Default or Event of Default has occurred and is continuing or would result therefrom, Borrower may repurchase outstanding Term Loans on the following basis:

 

(i)   Borrower may conduct one or more modified Dutch auctions (each, an “Auction”) to repurchase all or any portion of the Term Loans  (such Term Loans, the “Offer Loans”) of Lenders, provided that, (A) Borrower delivers a notice of the Term Loans that will be subject to such Auction to Administrative Agent (for distribution to the Lenders) no later than noon (New York City time) at least five Business Days in advance of a proposed consummation date of such Auction indicating (1) the date on which the Auction will conclude, (2) the maximum principal amount of Term Loans Borrower is willing to purchase in the Auction and (3) the range of discounts to par at which Borrower would be willing to repurchase the Offer Loans; (B) the maximum dollar amount of the Auction shall be no less than an aggregate $1,000,000 or an integral multiple of $500,000 in excess thereof; (C) Borrower shall hold the Auction open for a minimum period of two Business Days; (D) a Lender who elects to participate in the Auction may choose to tender all or part of such Lender’s Offer Loans; (E) the Auction shall be made to Lenders holding the Offer Loans on a pro rata basis; and (F) the Auction shall be conducted pursuant to such procedures as the Administrative Agent may establish which are consistent with this Section 10.04(j), that a Lender must follow in order to have its Offer Loans repurchased;

 

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(ii)    the purchase consideration for such assignment shall in no event, be funded directly or indirectly with the proceeds of Revolving Loans;

 

(iii)   Borrower shall represent that, as of the launch date of the related Auction and the effective date of any Assignment and Assumption, it is not in possession of any material non-public information regarding Borrower, its Subsidiaries, or their assets or securities, that (x) has not been disclosed generally to the Lenders which are not “public side” Lenders before such date and (y) could reasonably be expected to have a material effect upon, or otherwise be material to, a Lender’s decision to assign Loans to such Person;

 

(iv)   after giving effect to any purchase or assignment of Term Loans pursuant to this Section 10.04(j), the sum of (x) all unrestricted cash and Cash Equivalents of the Loan Parties and (y) the undrawn and available portion of the Revolving Commitments shall not be less than $25,000,000.

 

(v)    at the time of the consummation of each purchase and assignment of Term Loans pursuant to this Section 10.04(j), Borrower shall have delivered to the Administrative Agent an Officers’ Certificate as to compliance with the preceding clauses (iii) and (iv).

 

(vi)   With respect to all repurchases made by Borrower pursuant to this Section 10.04(j), (A) Borrower shall pay to the applicable assigning Lender all accrued and unpaid interest, if any, on the repurchased Term Loans to the date of repurchase of such Term Loans, (B) the repurchase of such Term Loans by Borrower shall not be taken into account in the calculation of Excess Cash Flow, (C) notwithstanding anything to the contrary contained herein (including in the definitions of “Consolidated Net Income” and “Consolidated EBITDA”) any noncash gains in respect of “cancellation of indebtedness” resulting from the cancellation of any Term Loans purchased by Borrower shall be excluded from the determination of Consolidated Net Income and Consolidated EBITDA, and (D) such repurchases shall not be deemed to be voluntary prepayments or mandatory prepayment pursuant to Section 2.10 except that the amount of the Loans so repurchased shall be applied on a pro rata basis to reduce the scheduled remaining Installments of principal on such Term Loan; and

 

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(vii)   Following repurchase by Borrower pursuant to this Section 10.04(j), the Term Loans so repurchased shall, without further action by any Person, be deemed cancelled for all purposes and no longer outstanding (and may not be resold by Borrower), for all purposes of this Agreement and all other Loan Documents, including, but not limited to (A) the making of, or the application of, any payments to the Lenders under this Agreement or any other Loan Document, (B) the making of any request, demand, authorization, direction, notice, consent or waiver under this Agreement or any other Loan Document or (C) the determination of Required Lenders, or for any similar or related purpose, under this Agreement or any other Loan Document.

 

In connection with any Term Loans repurchased and cancelled pursuant to this Section 10.04(j), Administrative Agent is authorized to make appropriate entries in the Register to reflect any such cancellation.

 

Section 10.05      Survival of Agreement.  All covenants, agreements, representations and warranties made by the Loan Parties in the Loan Documents and in the reports, certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Agents, the Issuing Bank or any Lender may have had notice or knowledge of any Default or Event of Default, failure of any condition set forth in Article IV to be satisfied or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as any Obligation or any Letter of Credit is outstanding (or Cash Collateralized) and so long as the Commitments have not expired or terminated.  The provisions of Article IX and Sections 2.12 to 2.15, 9.06, 10.03 and 10.08 to 10.10 shall survive and remain in full force and effect regardless of the consummation of the Transactions and the other transactions contemplated hereby, the repayment of the Loans, the payment of the Reimbursement Obligations, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any provision hereof.

 

Section 10.06      Counterparts; Integration; Effectiveness.  This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent and/or the Arrangers, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.  Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic transmission shall be effective as delivery of a manually executed counterpart of this Agreement.

 

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Section 10.07      Severability.  Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

 

Section 10.08      Right of Setoff; Marshalling; Payments Set Aside.  If an Event of Default shall have occurred and be continuing, each Lender, the Issuing Bank and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable Legal Requirements, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, the Issuing Bank or any such Affiliate to or for the credit or the account of any Loan Party against any and all of the obligations of any Loan Party now or hereafter existing under this Agreement or any other Loan Documents held by such Lender or the Issuing Bank, irrespective of whether or not such Lender shall have made any demand under this Agreement or any other Loan Document and although such obligations may be contingent or unmatured or are owed to a branch or office of such Lender or the Issuing Bank different from the branch or office holding such deposit or obligated on such indebtedness.  The rights of each Lender under this Section 10.08 are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.  None of any Agent, any Lender or any Issuing Bank shall be under any obligation to marshal any assets in favor of any Loan Party or any other Person or against or in payment of any or all of the Obligations.  To the extent that any Loan Party makes a payment or payments to Administrative Agent, Issuing Bank or Lenders (or to Administrative Agent, on behalf of Lenders or Issuing Bank), or any Agent, Issuing Bank or Lender enforces any security interests or exercises any right of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any Debtor Relief Law or any equitable cause, then, to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, shall be revived and continued in full force and effect as if such payment or payments had not been made or such enforcement or setoff had not occurred.

 

Section 10.09      Governing Law; Jurisdiction; Consent to Service of Process.  (a) This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether sounding in contract, tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be governed by, and construed in accordance with, the law of the State of New York without giving effect to any choice of law principles that would apply the laws of another jurisdiction (except that the definition of Purchase Agreement Material Adverse Effect shall be governed by, and construed in accordance with, the laws applicable in the Province of Québec and the federal Laws of Canada applicable therein).

 

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(b)           Each Loan Party hereby irrevocably and unconditionally submits, for itself and its Property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to any Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding shall be heard and determined in such New York State court or, to the extent permitted by applicable Legal Requirements, in such federal court.  Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable Legal Requirements.  Nothing in this Agreement or any other Loan Document or otherwise shall affect any right that the Administrative Agent, any other Agent, the Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Loan Party or its properties in the courts of any jurisdiction.

 

(c)           Each Loan Party hereby irrevocably and unconditionally waives, to the fullest extent permitted by applicable Legal Requirements, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in Section 10.09(b).  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable Legal Requirements, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

(d)           Each party to this Agreement irrevocably consents to service of process in any action or proceeding arising out of or relating to any Loan Document, in the manner provided for notices (other than facsimile or email) in Section 10.01.  Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by applicable Legal Requirements.

 

Section 10.10      Waiver of Jury Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LEGAL REQUIREMENTS, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT, THE TRANSACTIONS OR THE OTHER TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.10.

 

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Section 10.11      Headings.  Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

 

Section 10.12      Confidentiality.  Each of the Administrative Agent, the Issuing Bank and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ and Approved Funds’ directors, officers, employees, agents, advisors and other representatives, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential pursuant to the terms hereof), (b) to the extent requested by any regulatory authority or any quasi-regulatory authority (such as the National Association of Insurance Commissioners), (c) to the extent required by applicable Legal Requirements or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies under the Loan Documents or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section 10.12, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to Borrower and its obligations, or (iii) any actual or prospective investor in an SPC, (g) with the consent of Borrower, (h) to any rating agency when required by it, (i) to an investor or prospective investor in securities issued by an Approved Fund of any Lender that also agrees that Information shall be used solely for the purpose of evaluating an investment in such securities issued by an Approved Fund of any Lender or to a trustee, collateral manager, servicer, backup servicer, noteholder or secured party in securities issued by an Approved Fund of any Lender in connection with the administration, servicing and reporting on the assets serving as collateral for securities issued by such Approved Fund, (j) to any assignee or pledge under Section 10.04(g), or (k) to the extent such Information (x) is publicly available at the time of disclosure or becomes publicly available other than as a result of a breach of this Section 10.12 or (y) becomes available to the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis from a source other than Borrower or any Subsidiary.  In addition, each of the Administrative Agent, the Issuing Bank and the Lenders may disclose the existence of this Agreement and the information about this Agreement to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the Loans, market data collectors, similar service providers to the lending industry, and service providers to the Administrative Agent, the Issuing Bank and the Lenders in connection with the administration and management of this Agreement and the other Loan Documents.  For the purposes of this Section 10.12, “Information” means all information received from Borrower relating to Borrower or any of its Subsidiaries or its business unless (x) it is clearly labeled “Public-Contains Only Public Information,” or (y) any such information is available to the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis before disclosure by Borrower.  Any Person required to maintain the confidentiality of Information as provided in this Section 10.12 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

    	177

    	 

    
 

 

Section 10.13      Interest Rate Limitation.  Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively, the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable Legal Requirements, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section 10.13 shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.

 

Section 10.14      Assignment and Assumption.  Each Lender to become a party to this Agreement (other than the Administrative Agent and any other Lender that is a signatory hereto) shall do so by delivering to the Administrative Agent an Assignment and Assumption duly executed by each of the Persons required to be party thereto.

 

Section 10.15      Obligations Absolute.  To the fullest extent permitted by applicable law, all obligations of the Loan Parties hereunder shall be absolute and unconditional irrespective of:

 

(a)           any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of any Loan Party;

 

(b)           any lack of validity or enforceability of any Loan Document or any other agreement or instrument relating thereto against any Loan Party;

 

(c)           any change in the time, manner or place of payment of, or in any other term of, all or any of the Secured Obligations, or any other amendment or waiver of or any consent to any departure from any Loan Document or any other agreement or instrument relating thereto;

 

(d)          any exchange, release or non-perfection or loss of priority of any Liens on any or all of the Collateral, or any release or amendment or waiver of or consent to any departure from any guarantee, for all or any of the Secured Obligations;

 

(e)           any exercise or non-exercise, or any waiver of any right, remedy, power or privilege under or in respect hereof or any Loan Document; or

 

(f)           any other circumstances which might otherwise constitute a defense available to, or a discharge of, the Loan Parties.

 

    	178

    	 

    
 

 

Section 10.16      Waiver of Defenses; Absence of Fiduciary Duties.  (a)           Each of the Loan Parties hereby waives any and all suretyship defenses available to it as a Guarantor arising out of the joint and several nature of its respective duties and obligations hereunder (including any defense contained in Article VII).

 

(b)           Each Agent, each Lender and their Affiliates (collectively, solely for purposes of this paragraph, the “Lenders”), may have economic interests that conflict with those of the Loan Parties, their stockholders and/or their affiliates.  Each Loan Party agrees that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between any Lender, on the one hand, and such Loan Party, its stockholders or its affiliates, on the other.  The Loan Parties acknowledge and agree that (i) the transactions contemplated by the Loan Documents (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions between the Lenders, on the one hand, and the Loan Parties, on the other, and (ii) in connection therewith and with the process leading thereto, (x) no Lender has assumed an advisory or fiduciary responsibility in favor of any Loan Party, its stockholders or its affiliates with respect to the transactions contemplated hereby or the exercise of rights or remedies with respect thereto) or the process leading thereto (irrespective of whether any Lender has advised, is currently advising or will advise any Loan Party, its stockholders or its Affiliates on other matters) or any other obligation to any Loan Party except the obligations expressly set forth in the Loan Documents and (y) each Lender is acting solely as principal and not as the agent or fiduciary of any Loan Party, its management, stockholders, creditors or any other Person.  Each Loan Party acknowledges and agrees that it has consulted its own legal and financial advisors to the extent it deemed appropriate and that it is responsible for making its own independent judgment with respect to such transactions and the process leading thereto.  Each Loan Party agrees that it will not claim that any Lender has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to such Loan Party, in connection with such transaction or the process leading thereto.

 

Section 10.17      Reinstatement.  To the extent that any payments on the Indebtedness or proceeds of any Collateral are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, debtor in possession, receiver, receiver and manager, interim receiver or other Person under any bankruptcy law or other Insolvency Law, common law or equitable cause, then to such extent, the Indebtedness so satisfied shall be revived and continue as if such payment or proceeds had not been received and the Secured Parties’ Liens, security interests, rights, powers and remedies under this Agreement and each Loan Document shall continue in full force and effect.  In such event, each Loan Document shall be automatically reinstated and each Loan Party shall take (and shall cause each other Loan Party to take) such action as may be requested by the Administrative Agent, the Collateral Agent or the Required Lenders to effect such reinstatement.

 

    	179

    	 

    
 

 

Section 10.18      USA Patriot Act.  Each Lender hereby notifies each Loan Party that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name, address and taxpayer identification number of each Loan Party and other information that will allow such Lender to identify such Loan Party in accordance with the Patriot Act.

 

    	180

    	 

    
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed by their respective authorized officers or other authorized signatories as of the day and year first above written.

	  	  	  
	  	
INTERNAP NETWORK SERVICES

CORPORATION, as Borrower

	  	  	  
	  	
By

	
/s/ J. Eric. Cooney

	  	
Name:

	
J. Eric Cooney

	  	
Title:

	
Chief Executive Officer

	  	  	  
	  	
VOXEL HOLDINGS, INC., as a Guarantor

	  	  	  
	  	
By

	
/s/ John D. Maggard

	  	
Name:

	
John D. Maggard

	  	
Title:

	
President and Treasurer

	  	  	  
	  	
VOXEL DOT NET, INC., as a Guarantor

	  	  	  
	  	
By

	
/s/ John D. Maggard

	  	
Name:

	
John D. Maggard

	  	
Title:

	
President and Treasurer

	  	  	  
	  	
UBERSMITH, INC., as a Guarantor

	  	  	  
	  	
By

	
/s/ John D. Maggard

	  	
Name:

	
John D. Maggard

	  	
Title:

	
President and Treasurer

	  	  	  
	  	
INTERNAP CONNECTIVITY LLC, as a Guarantor

	  	  	  
	  	
By

	
/s/ John D. Maggard

	  	
Name:

	
John D. Maggard

	  	
Title:

	
President and Treasurer

 

    	Annex I-1

    	 

    
 

 

	  	
JEFFERIES FINANCE LLC, as Administrative 

Agent, Collateral Agent, Arranger and Book 

Manager

	  	  	  
	  	
By

	/s/ Brian Buoye
	  	
Name:

	
Brian Buoye

	  	
Title:

	
Managing Director

	  	  	  
	  	
JEFFERIES FINANCE LLC,

	  	
as Term Lender, as Revolving Lender, as Swingline Lender and as Issuing Bank

	  	  	  
	  	
By

	/s/ Brian Buoye
	  	
Name:

	
Brian Buoye

	  	
Title:

	
Managing Director

 

    	2

    	 

    
 

	  	
PNC CAPITAL MARKETS LLC,

	  	
as Arranger and Book Manager

	  	  	  
	  	
By

	
/s Ralph A. Phillips

	  	
Name:

	
Ralph A. Phillips

	  	
Title:

	
Managing Director

	  	  	  
	  	
PNC BANK, NATIONAL ASSOCIATION,

	  	
as Revolving Lender and as Syndication Agent

	  	  	  
	  	
By

	
/s/ Brendan T. McGuire

	  	
Name:

	
Brendan T. McGuire

	  	
Title:

	
Senior Vice President

 

    	3

    	 

    
 

 

	  	
ING CAPITAL LLC,

	  	
as Documentation Agent

	  	  	  
	  	
By

	
/s Stephen M. Nettler

	  	
Name:

	
Stephen M. Nettler

	  	
Title:

	
Managing Director

	  	  	  
	  	
ING CAPITAL LLC,

	  	
as Revolving Lender

	  	  	  
	  	
By

	
/s/ Stephen M. Nettler

	  	
Name:

	
Stephen M. Nettler

	  	
Title:

	
Managing Director

    	4Execution Copy

	 

 

SECURITY AGREEMENT

 

By

 

INTERNAP NETWORK SERVICES CORPORATION,

as Borrower,

 

and

 

THE GUARANTORS PARTY HERETO,

as Pledgors,

 

and

 

JEFFERIES FINANCE LLC,

as Collateral Agent

 

Dated as of November 26, 2013

	 

 

    	  

    	 

    
 

 

TABLE OF CONTENTS

	  	  	  	  	  	  
	  	  	  	  	  	
Page(s)

	  	  	  	  	  	  
	
ARTICLE I

	
DEFINITIONS AND INTERPRETATION

	  	
1

	  	  	  	  
	  	
Section 1.1

	  	
Definitions

	  	
1

	  	  	  	  	  	  
	  	
Section 1.2

	  	
Interpretation

	  	
9

	  	  	  	  	  	  
	  	
Section 1.3

	  	
Resolution of Drafting Ambiguities

	  	
9

	  	  	  	  	  	  
	  	
Section 1.4

	  	
Perfection Certificate

	  	
9

	  	  	  	  	  	  
	
ARTICLE II

	
GRANT OF SECURITY AND SECURED OBLIGATIONS

	  	
9

	  	  	  	  
	  	
Section 2.1

	  	
Grant of Security Interest

	  	
9

	  	  	  	  	  	  
	  	
Section 2.2

	  	
Filings

	  	
11

	  	  	  	  	  	  
	
ARTICLE III

	
PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES; USE OF COLLATERAL

	  	12
	  	  	  	  
	  	
Section 3.1

	  	
Delivery of Certificated Securities Collateral

	  	
12

	  	  	  	  	  	  
	  	
Section 3.2

	  	
Perfection of Uncertificated Securities Collateral

	  	
12

	  	  	  	  	  	  
	  	
Section 3.3

	  	
Financing Statements and Other Filings; Maintenance of Perfected Security Interest

	  	
13

	  	  	  	  	  	  
	  	
Section 3.4

	  	
Other Actions

	  	
14

	  	  	  	  	  	  
	  	
Section 3.5

	  	
Joinder of Additional Pledgors

	  	
17

	  	  	  	  	  	  
	  	
Section 3.6

	  	
Supplements; Further Assurances

	  	
18

	  	  	  	  	  	  
	
ARTICLE IV

	
REPRESENTATIONS, WARRANTIES AND COVENANTS

	  	
19

	  	  	  	  
	  	
Section 4.1

	  	
Title

	  	
19

	  	  	  	  	  	  
	  	
Section 4.2

	  	
Validity of Security Interest

	  	
19

	  	  	  	  	  	  
	  	
Section 4.3

	  	
Pledgor Defense of Claims; Transferability of Collateral

	  	
19

	  	  	  	  	  	  
	  	
Section 4.4

	  	
Other Financing Statements

	  	
20

	  	  	  	  	  	  
	  	
Section 4.5

	  	
Chief Executive Office; Change of Name; Jurisdiction of Organization, etc

	  	
20

	  	  	  	  	  	  
	  	
Section 4.6

	  	
Location of Inventory and Equipment

	  	
21

	  	  	  	  	  	  
	  	
Section 4.7

	  	
Corporate Names; Prior Transactions

	  	
21

	  	  	  	  	  	  
	  	
Section 4.8

	  	
Due Authorization and Issuance

	  	
21

	  	  	  	  	  	  
	  	
Section 4.9

	  	
Consents, etc

	  	
21

	  	  	  	  	  	  
	  	
Section 4.10

	  	
Collateral

	  	
22

	  	  	  	  	  	  
	  	
Section 4.11

	  	
Insurance

	  	
22

	  	  	  	  	  	  
	  	
Section 4.12

	  	
Intellectual Property

	  	
22

 

    	  

    	 

    
 

 

	  	
Section 4.13

	  	
Payment of Taxes; Compliance with Legal Requirements; Contesting Liens; Charges

	  	
24

	  	  	  	  	  	  
	  	
Section 4.14

	  	
Access to Collateral, Books and Records; Other Information

	  	
24

	 	 	 	 	 	 
	
ARTICLE V

	CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL	 	24
	 	 	 	 	 	 
	  	
Section 5.1

	  	
Pledge of Additional Securities Collateral

	  	
24

	  	  	  	  	  	  
	  	
Section 5.2

	  	
Voting Rights; Distributions; etc

	  	
25

	  	  	  	  	  	  
	  	
Section 5.3

	  	
Default

	  	
26

	  	  	  	  	  	  
	  	
Section 5.4

	  	
Certain Agreements of Pledgors as Issuers and Holders of Equity Interests

	  	26
	  	  	  	  	  	  
	
ARTICLE VI

	
CERTAIN PROVISIONS CONCERNING INTELLECTUAL PROPERTY COLLATERAL

	  	27
	  	  	  	  
	  	
Section 6.1

	  	
Grant of License

	  	
27

	  	  	  	  	  	  
	  	
Section 6.2

	  	
Registration

	  	
27

	  	  	  	  	  	  
	  	
Section 6.3

	  	
Protection of Collateral Agent’s Security

	  	
27

	  	  	  	  	  	  
	
ARTICLE VII

	
CERTAIN PROVISIONS CONCERNING ACCOUNTS

	  	
30

	  	  	  	  
	  	
Section 7.1

	  	
Special Representation and Warranties

	  	
30

	  	  	  	  	  	  
	  	
Section 7.2

	  	
Maintenance of Records

	  	
31

	  	  	  	  	  	  
	  	
Section 7.3

	  	
Legend

	  	
31

	  	  	  	  	  	  
	  	
Section 7.4

	  	
Modification of Terms, etc

	  	
31

	  	  	  	  	  	  
	  	
Section 7.5

	  	
Collection

	  	
31

	  	  	  	  	  	  
	
ARTICLE VIII

	
TRANSFERS

	  	
32

	  	  	  	  	  	  
	  	
Section 8.1

	  	
Transfers of Collateral

	  	
32

	  	  	  	  	  	  
	
ARTICLE IX

	
REMEDIES

	  	
32

	  	  	  	  
	  	
Section 9.1

	  	
Remedies

	  	
32

	  	  	  	  	  	  
	  	
Section 9.2

	  	
Notice of Sale

	  	
35

	  	  	  	  	  	  
	  	
Section 9.3

	  	
Waiver of Notice and Claims; Other Waivers; Marshalling

	  	
35

	  	  	  	  	  	  
	  	
Section 9.4

	  	
Standards for Exercising Rights and Remedies

	  	
36

	  	  	  	  	  	  
	  	
Section 9.5

	  	
No Waiver; Cumulative Remedies

	  	
37

	  	  	  	  	  	  
	  	
Section 9.6

	  	
Certain Additional Actions Regarding Intellectual Property

	  	
38

	  	  	  	  	  	  
	
ARTICLE X

	
PROCEEDS OF CASUALTY EVENTS AND COLLATERAL DISPOSITIONS; APPLICATION OF PROCEEDS

	  	38
	  	  	  	  
	  	
Section 10.1

	  	
Proceeds of Casualty Events and Collateral Dispositions

	  	
38

	  	  	  	  	  	  
	  	
Section 10.2

	  	
Application of Proceeds

	  	
38

 

    	  

    	 

    
 

 

	
ARTICLE XI

	
MISCELLANEOUS

	  	
39

	  	  	  	  
	  	
Section 11.1

	  	
Concerning Collateral Agent

	  	
39

	  	  	  	  	  	  
	  	
Section 11.2

	  	
Collateral Agent May Perform; Collateral Agent Appointed Attorney-in-Fact

	  	
40

	  	  	  	  	  	  
	  	
Section 11.3

	  	
Continuing Security Interest; Assignment

	  	
40

	  	  	  	  	  	  
	  	
Section 11.4

	  	
Termination; Release; Reinstatement

	  	
40

	  	  	  	  	  	  
	  	
Section 11.5

	  	
Modification in Writing

	  	
41

	  	  	  	  	  	  
	  	
Section 11.6

	  	
Notices

	  	
41

	  	  	  	  	  	  
	  	
Section 11.7

	  	
Governing Law, Consent to Jurisdiction and Service of Process; Waiver of Jury Trial

	  	
41

	  	  	  	  	  	  
	  	
Section 11.8

	  	
Severability of Provisions

	  	
43

	  	  	  	  	  	  
	  	
Section 11.9

	  	
Execution in Counterparts

	  	
43

	  	  	  	  	  	  
	  	
Section 11.10

	  	
Business Days

	  	
43

	  	  	  	  	  	  
	  	
Section 11.11

	  	
Waiver of Stay

	  	
43

	  	  	  	  	  	  
	  	
Section 11.12

	  	
No Credit for Payment of Taxes or Imposition

	  	
43

	  	  	  	  	  	  
	  	
Section 11.13

	  	
No Claims Against Collateral Agent

	  	
44

	  	  	  	  	  	  
	  	
Section 11.14

	  	
No Release

	  	
44

	  	  	  	  	  	  
	  	
Section 11.15

	  	
Overdue Amounts

	  	
44

	  	  	  	  	  	  
	  	
Section 11.16

	  	
Obligations Absolute

	  	
44

	  	  	  	  	  	  
	
SCHEDULES

	  	  	  	  
	Schedule 1	
Filings, Registrations and Recordings

	  	  
	  	  	  	  	  
	
EXHIBITS

	  	  	  	  
	  	  	  	  	  	  
	Exhibit 1	
Form of Issuer’s Acknowledgment

	  	  
	Exhibit 2	
Form of Pledge Amendment

	  	  
	Exhibit 3	
Form of Joinder Agreement

	  	  
	Exhibit 4	
Form of Securities Account Control Agreement

	  	  
	Exhibit 5	
Form of Deposit Account Control Agreement

	  	  
	Exhibit 6	
Form of Copyright Security Agreement

	  	  
	Exhibit 7	
Form of Patent Security Agreement

	  	  
	Exhibit 8	
Form of Trademark Security Agreement

	  	  

 

    	  

    	 

    
 

 

SECURITY AGREEMENT

 

This SECURITY AGREEMENT, dated as of November 26, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the provisions hereof, this “Agreement”), made by Internap Network Services Corporation, a Delaware corporation (“Borrower”), and the Subsidiaries of Borrower from time to time party hereto by execution of this Agreement or otherwise by execution of a Joinder Agreement (the “Guarantors”) (Borrower, together with the Guarantors, as pledgors, assignors and debtors and together with any successors, the “Pledgors,” and each, a “Pledgor”), in favor of Jefferies Finance LLC, in its capacity as collateral agent pursuant to the Credit Agreement (as hereinafter defined), as pledgee, assignee and secured party (in such capacities and together with any successors in such capacities, the “Collateral Agent”).

 

R E C I T A L S:

 

A.           Borrower, the Guarantors, the Collateral Agent, the other Agents party thereto and the lending institutions from time to time party thereto as lenders (the “Lenders”) have entered into that certain Credit Agreement, dated as of November 26, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”).

 

B.           The Guarantors have, pursuant to the Credit Agreement, unconditionally guaranteed the Secured Obligations.

 

C.           Each Pledgor will receive substantial benefits from the execution, delivery and performance of the Secured Obligations under the Credit Agreement and the other Loan Documents and is, therefore, willing to enter into this Agreement.

 

D.           Each Pledgor is, or as to Collateral acquired by such Pledgor after the date hereof, will be, the legal and/or beneficial owner of the Collateral pledged by it hereunder.

 

E.           This Agreement is given by each Pledgor in favor of the Collateral Agent for the benefit of the Secured Parties to secure the payment and performance of all of the Secured Obligations.

 

F.           It is a condition to the obligations of the Lenders to make the Loans under the Credit Agreement and the Secured Parties to provide the other Secured Obligations  that each Pledgor executes and delivers the applicable Loan Documents, including this Agreement.

 

A G R E E M E N T:

 

NOW THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Pledgor and the Collateral Agent hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS AND INTERPRETATION

 

Section 1.1            Definitions.

 

(a)           Unless otherwise defined herein or in the Credit Agreement, capitalized terms used herein that are defined in the UCC have the meanings assigned to them in the UCC.

  

    	 1

    	 

    
 

 

(b)           Terms used but not otherwise defined herein that are defined in the Credit Agreement have the meanings given to them in the Credit Agreement.  In addition, the following terms shall have the following meanings:

 

“Additional Pledged Interests” means, collectively, with respect to each Pledgor, (a) all options, warrants, rights, agreements, additional membership, partnership or other Equity Interests of whatever class of any issuer of Initial Pledged Interests or any interest in any such issuer, together with all rights, privileges, authority and powers of such Pledgor relating to such interests in each such issuer or under any Organizational Document of any such issuer, and the certificates, instruments and agreements representing such membership, partnership or other Equity Interests and any and all interest of such Pledgor in the entries on the books of any financial intermediary pertaining to such membership, partnership or other Equity Interests from time to time acquired by such Pledgor in any manner and (b) all membership, partnership or other Equity Interests, as applicable, of each limited liability company, partnership or other entity (other than a corporation) hereafter acquired or formed by such Pledgor and all options, warrants, rights, agreements, additional membership, partnership or other Equity Interests of whatever class of such limited liability company, partnership or other entity, together with all rights, privileges, authority and powers of such Pledgor relating to such interests or under any Organizational Document of any such issuer, and the certificates, instruments and agreements representing such membership, partnership or other Equity Interests and any and all interest of such Pledgor in the entries on the books of any financial intermediary pertaining to such membership, partnership or other Equity Interests, from time to time acquired by such Pledgor in any manner.

 

“Additional Pledged Shares” means, collectively, with respect to each Pledgor, (a) all options, warrants, rights, Equity Interests, agreements, additional shares of capital stock of whatever class of any issuer of the Initial Pledged Shares or any other Equity Interest in any such issuer, together with all rights, privileges, authority and powers of such Pledgor relating to such interests issued by any such issuer under any Organizational Document of any such issuer, and the certificates, instruments and agreements representing such interests and any and all interest of such Pledgor in the entries on the books of any financial intermediary pertaining to such interests, from time to time acquired by such Pledgor in any manner and (b) all the issued and outstanding shares of capital stock of each corporation hereafter acquired or formed by such Pledgor and all options, warrants, rights, agreements or additional shares of capital stock of whatever class of such corporation, together with all rights, privileges, authority and powers of such Pledgor relating to such shares or under any Organizational Document of such corporation, and the certificates, instruments and agreements representing such shares and any and all interest of such Pledgor in the entries on the books of any financial intermediary pertaining to such shares, from time to time acquired by such Pledgor in any manner.

 

“Agreement” has the meaning assigned to such term in the Preamble hereof.

 

“Bailee Letter” has the meaning assigned to such term in Section 3.4(h).

 

“Borrower” has the meaning assigned to such term in the Preamble.

 

“Charges” means any and all property and other taxes, assessments and special assessments, levies, fees and all other governmental charges imposed upon or assessed against, and all claims (including any landlords’, carriers’, mechanics’, workmen’s, repairmen’s, laborers’, materialmen’s, suppliers’ and warehousemen’s Liens and other charges arising by operation of law) against, all or any portion of the Collateral.

 

“Collateral” has the meaning assigned to such term in Section 2.1.

 

    	2

    	 

    
 

 

“Collateral Account” means any collateral account or sub-account established by the Collateral Agent for the purpose of serving as a collateral account under this Agreement and all property from time to time on deposit in the Collateral Account.

 

“Collateral Agent” has the meaning assigned to such term in the Preamble hereof.

 

“Commodity Account Control Agreement” means a commodity account control agreement in a form that is reasonably satisfactory to the Collateral Agent.

 

“Computer Hardware” means all rights (including rights as licensee and lessee) with respect to (a) computer and other electronic data processing hardware, including all integrated computer systems, central processing units, memory units, display terminals, computer elements, card readers, tape drives, hard and soft disc drives, cables, electrical supply hardware, generators, power equalizers, accessories, peripheral devices and other related computer hardware; and (b) any documentation for hardware, software and firmware described in clause (a), including flow charts, logic diagrams, manuals, specifications, training materials, charts and pseudo codes; and all rights with respect thereto, including any and all licenses, options, warrants, service contracts, program services, test rights, maintenance rights, support rights, improvement rights, renewal rights and indemnifications, and any substitutions, replacements, additions, new versions or model conversions of any of the foregoing.

 

“Computer Software” means all rights (including rights as licensee and lessee) with respect to all computer software, software programs and databases designed for use on or in connection with Computer Hardware (including source code, object code and all related applications and data files) and including (a) all operating system software, utilities and application programs in any form; (b) any firmware associated with any of the foregoing; (c) any tangible embodiments of and any documentation for the software, programs, databases and firmware described in clauses (a), and (b) above, including flow charts, logic diagrams, manuals, specifications, training materials, charts and pseudo codes; and (d) all rights with respect any of the foregoing, including any and all licenses, options, warrants, service contracts, program services, test rights, maintenance rights, support rights, improvement rights, renewal rights and indemnifications, and any substitutions, replacements, additions, new versions or model conversions of any of the foregoing, (e) all income, fees, royalties, damages, claims and payments now or hereafter due and/or payable with respect to any of the foregoing.

 

“Contracts” means, collectively, with respect to each Pledgor, all contracts, agreements and grants (in each case, whether written or oral, or third party or intercompany), to which such Pledgor is a party, and all assignments, amendments, restatements, supplements, extensions, renewals, replacements or modifications thereof.

 

“Control” means (a) in the case of each Deposit Account, “control,” as such term is defined in Section 9-104 of the UCC, and (b) in the case of any Security Entitlement, “control,” as such term is defined in Section 8-106 of the UCC and (c) in the case of any Commodity Contract, “control,” as such term is defined in Section 9-106 of the UCC.

 

“Control Agreements” means, collectively, the Deposit Account Control Agreement(s), the Securities Account Control Agreement(s) and the Commodity Account Control Agreement(s).

 

“Copyright Security Agreement” means an agreement substantially in the form of Exhibit 6 hereto.

 

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“Copyrights” means, collectively, all works of authorship (whether or not protected by statutory or common law copyright, whether established or registered in the United States or any other country or any political subdivision thereof, whether registered or unregistered and whether published or unpublished) and all copyright registrations and applications, together with any and all (a) tangible embodiments of any of the foregoing, (b) rights and privileges arising under applicable Legal Requirements with respect to the use of such copyrights, (c) reissues, renewals, continuations, modifications and extensions thereof and derivative works, (d) income, fees, royalties, damages, claims and payments now or hereafter due and/or payable with respect thereto, including damages and payments for past, present or future infringements thereof, (e) rights corresponding thereto throughout the world and (f) rights to sue for past, present or future infringements thereof.

 

“Credit Agreement” has the meaning assigned to such term in Recital A hereof.

 

“Deposit Account Control Agreement” means an agreement substantially in the form of Exhibit 5 hereto or such other form that is reasonably satisfactory to the Collateral Agent.

 

“Deposit Accounts” means, collectively, with respect to each Pledgor, (a) all “deposit accounts” as such term is defined in the UCC, each Collateral Account and all accounts and sub-accounts relating to any of the foregoing accounts and (b) all cash, funds, checks, notes and instruments from time to time on deposit in any of the accounts or sub-accounts described in clause (a) of this definition.

 

“Distributions” means, collectively, with respect to each Pledgor, all dividends, cash, options, warrants, rights, instruments, distributions, returns of capital or principal, income, interest, profits and other property, interests (debt or equity) or proceeds, including as a result of a split, revision, reclassification or other like change of the Pledged Securities, from time to time received, receivable or otherwise distributed to such Pledgor in respect of or in exchange for any or all of the Pledged Securities or Intercompany Notes.

 

“Excluded Accounts” means, as to any Pledgor, all Deposit Accounts that are maintained in the ordinary course of business and used exclusively (x) as a payroll account for the employees of such Pledgor (provided that the amount contained in such account shall at no time exceed the total amount of payroll payable to the employees of such Pledgor within the immediately succeeding 30 days), or (y) as tax withholding accounts that contain an aggregate amount that does not exceed the aggregate amount required to be withheld for tax purposes by Legal Requirements.

 

“Excluded Property” means the following property of any Pledgor, whether now owned or hereafter acquired or arising:

 

(1)           any governmental licenses or state or local franchises, charters and authorizations (A) that prohibits or requires the consent of any Person other than Borrower or any of its Affiliates as a condition to the creation by any Pledgor of a Lien on any right, title or interest in licenses, franchises, charters or authorizations or (B) to the extent that any Legal Requirement applicable thereto prohibits the creation of a Lien thereon, but only, with respect to the prohibition in (A) and (B), to the extent, and for as long as, such prohibition is not terminated or rendered unenforceable or otherwise deemed ineffective by the UCC or any other Legal Requirement;

 

(2)           any lease, license or any similar contract or agreement entered into by any Pledgor or any property owned by any Pledgor that is subject to a Purchase Money Obligation or a Capital Lease Obligation permitted to be incurred pursuant to the provisions of the Credit Agreement if and for so long as, but only for so long as and solely to the extent that, a grant of a security interest therein would (A) violate or invalidate such lease, license or similar contract or agreement or Purchase Money Obligation or Capital Lease Obligation or (B) create a right of termination in favor of any other party thereto (other than Borrower or a Pledgor), but only, with respect to the prohibition in (A) and (B), to the extent, and for as long as, such prohibition is not terminated or rendered unenforceable or otherwise deemed ineffective by the UCC or any other Legal Requirement); provided that each Pledgor shall, and shall cause each of its Subsidiaries to, make all commercially reasonable efforts to prevent any lease, license or other similar contract or agreement from constituting Excluded Property;

 

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(3)           intent-to-use trademark applications prior to the filing of a “statement of use” with respect thereto, to the extent and for so long as creation by any Pledgor of a security interest therein would result in the abandonment, invalidation or unenforceability thereof;

 

(4)           Motor Vehicles and other goods subject to certificates of title or ownership to the extent that a security interest cannot be perfected solely by filing a UCC-1 financing statement or similar instrument;

 

(5)           the Excluded Accounts;

 

(6)           (x) voting Equity Interests in excess of 65% of all outstanding voting Equity Interests of any Foreign Subsidiary that is a controlled foreign corporation (within the meaning of Section 957(a) of the Internal Revenue Code) and (y) any Equity Interest of a Foreign Subsidiary that is an Immaterial Subsidiary;

 

(7)            any Excluded Regulatory Collateral; and

 

(8)           those assets as to which the Collateral Agent and the Borrower reasonably agree in writing that the cost of obtaining a security interest in or perfection thereof is excessive in relation to the benefit to the Secured Parties of the security to be afforded thereby;

 

provided that notwithstanding anything to the contrary contained in clauses (1) through (8) above to the contrary, Excluded Property shall not include any Proceeds of Property described in clauses (1) through (8) above; provided, further, that at such time as any of the foregoing Property no longer constitutes Excluded Property (including, in the case of Excluded Regulatory Collateral, at such time as the approval of the applicable Governmental Authority has been obtained), such Property shall immediately and automatically constitute Collateral and a Lien on and security interest in and to all of the right, title and interest of the applicable Pledgor in, to and under such Property shall immediately attach thereto as provided herein.

 

“Excluded Regulatory Collateral” means any rights or interests now held or hereafter acquired by any Pledgor in any Regulatory License or other franchise, license, certificate, authorization, registration, permit or operating right authorizing or relating to such Pledgor’s business, including, without limitation, those issued by the FCC, or any PUC or Governmental Authority, solely to the extent the grant by such Pledgor of a security interest in such assets is prohibited by applicable Legal Requirements as a result of the inability to obtain the approval of the applicable Governmental Authority.

 

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“General Intangibles” means, collectively, with respect to each Pledgor, all “general intangibles,” as such term is defined in the UCC, now owned or hereafter acquired by such Pledgor and, in any event, shall include (a) all of such Pledgor’s rights, title and interest in, to and under all insurance policies and coverages and Contracts, (b) all of such Pledgor’s interest in know-how and warranties relating to any of the Collateral or any Mortgaged Property, (c) any and all other rights, claims, choses-in-action and causes of action of such Pledgor against any other Person and the benefits of any and all collateral or other security given by any other Person in connection therewith, (d) all guarantees, endorsements and indemnifications on, or of, any of the Collateral or any Mortgaged Property, (e) all of Pledgor’s interest in lists, books, records, correspondence, ledgers, printouts, files (whether in printed form or stored electronically), tapes and other papers or materials containing information relating to any of the Collateral or any Mortgaged Property, including all customer or tenant lists, identification of suppliers, data, plans, blueprints, specifications, designs, drawings, appraisals, recorded knowledge, surveys, studies, engineering reports, test reports, manuals, standards, processing standards, performance standards, catalogs, research data, computer and automatic machinery software and programs and the like, field repair data, accounting information pertaining to such Pledgor’s operations or any of the Collateral or any Mortgaged Property and all media in which or on which any of the information or knowledge or data or records may be recorded or stored and all computer programs used for the compilation or printout of such information, knowledge, records or data, (f) all licenses, consents, permits, variances, certifications, authorizations and approvals, however characterized, of any Governmental Authority (or any Person acting on behalf of a Governmental Authority) now or hereafter acquired or held by such Pledgor pertaining to operations now or hereafter conducted by such Pledgor or any of the Collateral or any Mortgaged Property, including building permits, certificates of occupancy, environmental certificates, industrial permits or licenses and certificates of operation, and (g) all rights to reserves, payment intangibles, deferred payments, deposits, refunds, indemnification of claims to the extent the foregoing relate to any Collateral or any Mortgaged Property and claims for tax or other refunds against any Governmental Authority relating to any Collateral or any Mortgaged Property.

 

“Goodwill” means, collectively, with respect to each Pledgor, the goodwill connected with such Pledgor’s business including (a) all goodwill connected with the use of and symbolized by any Intellectual Property Collateral in which such Pledgor has any interest, (b) all of Pledgor’s interest in know-how, trade secrets, customer and supplier lists, proprietary information, inventions, methods, plans, policies, procedures, formulae, descriptions, compositions, technical data, drawings, specifications, name plates, catalogs, confidential information and the right to limit the use or disclosure thereof by any Person, pricing and cost information, business and marketing plans and proposals, consulting agreements, engineering contracts and such other assets which relate to such goodwill and (c) all product lines of such Pledgor’s business.

 

“Guarantors” has the meaning assigned to such term in the Preamble hereof.

 

“Initial Pledged Interests” means, with respect to each Pledgor, all membership, partnership or other Equity Interests (other than in a corporation), as applicable, in each issuer described on Schedule 11 to the Perfection Certificate (other than Borrower), together with all rights, privileges, authority and powers of such Pledgor in and to each such issuer or under any Organizational Document of each such issuer, and the certificates, instruments and agreements representing such membership, partnership or other Equity Interests and any and all interests of such Pledgor in the entries on the books of any financial intermediary pertaining to such membership, partnership or other Equity Interests.

 

“Initial Pledged Shares” means, collectively, with respect to each Pledgor, the issued and outstanding shares of capital stock in each issuer that is a corporation described on Schedule 11 to the Perfection Certificate (other than Borrower), together with all rights, privileges, authority and powers of such Pledgor relating to such shares of capital stock in each such issuer or under any Organizational Document of each such issuer, and the certificates, instruments and agreements representing such shares of capital stock and any and all interest of such Pledgor in the entries on the books of any financial intermediary pertaining to the Initial Pledged Shares.

 

“Instruments” means, collectively, with respect to each Pledgor, all “instruments,” as such term is defined in Article 9, rather than Article 3, of the UCC, and shall include all promissory notes, drafts, bills of exchange or acceptances.

 

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“Intellectual Property Collateral” means, collectively, all (i) Patents, Trademarks, Copyrights, Computer Software and Trade Secrets now owned or hereafter created or acquired by or assigned to such Pledgor, including, without limitation, the Patents, Trademarks (including Internet domain names) and Copyrights that are Registered and listed on Schedule 14 to the Perfection Certificate, (ii) License Agreements to which any Pledgor is now or hereafter becomes a party or beneficiary, including, without limitation, the License Agreements listed on Schedule 14 to the Perfection Certificate and (iii) Goodwill.

 

“Intercompany Notes” means, with respect to each Pledgor, the Intercompany Note, all other intercompany notes listed on Schedule 12 to the Perfection Certificate and any intercompany notes hereafter acquired by such Pledgor, and all certificates, instruments or agreements evidencing any intercompany note and such other intercompany notes, and all assignments, amendments, restatements, supplements, extensions, renewals, replacements or modifications thereof.

 

“Investment Property” means any Security, whether certificated or uncertificated, Security Entitlement, Securities Account, Commodity Contract or Commodity Account, excluding, however, the Securities Collateral.

 

“Joinder Agreement” means an agreement substantially in the form of Exhibit 3 hereto.

 

“Lenders” has the meaning assigned to such term in Recital A hereof.

 

“License Agreements” means, collectively, all agreements, permits, consents, orders, franchises and covenants not to sue relating to the license, development, use or disclosure of any Patent, Trademark, Copyright or Trade Secret, together with any and all (a) renewals, extensions, supplements and continuations thereof, (b) income, fees, royalties, damages, claims and payments now and hereafter due and/or payable thereunder and with respect thereto including damages and payments for past, present or future infringements or violations thereof, (c) rights to sue for past, present or future infringements or violations thereof and (d) other rights to use, exploit or practice any or all of the Patents, Trademarks, Copyrights or Trade Secrets.

 

“Motor Vehicles” means motor vehicles, tractors, trailers and other like property, whether or not the title thereto is governed by a certificate of title or ownership.

 

“Patent Security Agreement” means an agreement substantially in the form of Exhibit 7 hereto.

 

“Patents” means, collectively, all patents, patent applications, utility models and statutory invention registrations (whether established or registered or recorded in the United States or any other country or any political subdivision thereof), together with any and all (a) rights and privileges arising under applicable Legal Requirements with respect to the use of any patents, (b) inventions and improvements described and charged therein, (c) reissues, divisions, continuations, renewals, extensions, modifications and continuations-in-part thereof, (d) income, fees, royalties, damages, claims and payments now or hereafter due and/or payable thereunder and with respect thereto including damages and payments for past, present or future infringements thereof, (e) rights corresponding thereto throughout the world and (f) rights to sue for past, present or future infringements thereof.

 

“Perfection Certificate” means the perfection certificate dated as of the date hereof, executed and delivered by each Pledgor party thereto in favor of the Collateral Agent for the benefit of the Secured Parties, and each other Perfection Certificate and any supplement thereto (which shall be in form and substance reasonably acceptable to the Collateral Agent) executed and delivered by the applicable Pledgor in favor of the Collateral Agent for the benefit of the Secured Parties contemporaneously with the execution and delivery of each Joinder Agreement executed in accordance with Section 3.5, in each case, as the same may be amended, amended and restated, supplemented or otherwise modified from time to time by a Perfection Certificate Supplement or otherwise in accordance with the Credit Agreement.

 

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“Pledge Amendment” has the meaning assigned to such term in Section 5.1.

 

“Pledged Interests” means, collectively, the Initial Pledged Interests and the Additional Pledged Interests.

 

“Pledged Securities” means, collectively, the Pledged Interests, the Pledged Shares and the Successor Interests.

 

“Pledged Shares” means, collectively, the Initial Pledged Shares and the Additional Pledged Shares.

 

“Pledgor” has the meaning assigned to such term in the preamble hereof.

 

“Registered” means issued by, registered with, renewed by or the subject of a pending application before any Governmental Authority or Internet domain name registrar.

 

“Secured Obligations” has the meaning assigned to such term in the Credit Agreement.

 

“Secured Parties” has the meaning assigned to such term in the Credit Agreement.

 

“Securities Account Control Agreement” means an agreement substantially in the form of Exhibit 4 hereto or such other form that is reasonably satisfactory to the Collateral Agent.

 

“Securities Collateral” means, collectively, the Pledged Securities, the Intercompany Notes and the Distributions.

 

“Successor Interests” means, collectively, with respect to each Pledgor, all shares of each class of the capital stock of the successor corporation or interests or certificates of the successor limited liability company, partnership or other entity owned by such Pledgor (unless such successor is such Pledgor itself) formed by or resulting from any consolidation or merger in which any Person listed on Schedule 1(a) to the Perfection Certificate is not the surviving entity.

 

“Trade Secrets” means, collectively, (a) all know-how, trade secrets and confidential or proprietary information, including customer and supplier lists, proprietary information, inventions, methods, plans, policies, procedures, formulae, descriptions, compositions, technical data, drawings, specifications, name plates, catalogs, pricing and cost information and business and marketing plans and proposals, (b) all tangible embodiments of any of the foregoing, (c) the right to limit the use or disclosure of any of the foregoing by any Person, (d) all rights and privileges arising under applicable Legal Requirements with respect to the use of any such information, (e) income, fees, royalties, damages and payments now and hereafter due and/or payable thereunder and with respect thereto, including damages, claims and payments for past, present or future infringements or misappropriations thereof, (f) rights corresponding thereto throughout the world and (g) rights to sue for past, present or future infringements thereof.

 

“Trademark Security Agreement” means an agreement substantially in the form of Exhibit 8 hereto.

 

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“Trademarks” means, collectively, all trademarks, service marks, slogans, logos, certification marks, trade dress, uniform resource locations (URL’s), domain names, corporate names and trade names, whether registered or unregistered, and all registrations and applications for the foregoing (whether statutory or common law and whether established or registered in the United States or any other country or any political subdivision thereof), together with any and all (a) rights and privileges arising under applicable Legal Requirements with respect to the use of any trademarks, (b) goodwill associated therewith or symbolized thereby, (c) reissues, continuations, extensions and renewals thereof, (d) income, fees, royalties, damages and payments now and hereafter due and/or payable thereunder and with respect thereto, including damages, claims and payments for past, present or future infringements thereof, (e) rights corresponding thereto throughout the world and (f) rights to sue for past, present or future infringements thereof.

 

“Transferable Record” has the meaning assigned to that term in Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or in Section 16 of the Uniform Electronic Transactions Act as in effect in any relevant jurisdiction.

 

“UCC” means the Uniform Commercial Code as in effect on the date hereof in the State of New York; provided, however, that if by reason of mandatory provisions of applicable Legal Requirements, any or all of the attachment, perfection or priority of the Collateral Agent’s and the other Secured Parties’ security interest in any item or portion of the Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, the term “UCC” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection or priority and for purposes of definitions relating to such provisions.

 

Section 1.2            Interpretation.  The rules of interpretation specified in the Credit Agreement (including Section 1.03 of the Credit Agreement) shall be applicable to this Agreement.

 

Section 1.3            Resolution of Drafting Ambiguities.  Each Pledgor acknowledges and agrees that it was represented by counsel in connection with the execution and delivery hereof, that it and its counsel reviewed and participated in the preparation and negotiation hereof and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party (i.e., the Collateral Agent) shall not be employed in the interpretation hereof.

 

Section 1.4            Perfection Certificate.  Each of the Persons from time to time party hereto agrees that the Perfection Certificate and all descriptions of Collateral, schedules, amendments and supplements thereto are and shall at all times remain a part of this Agreement.

 

ARTICLE II

 

GRANT OF SECURITY AND SECURED OBLIGATIONS

 

Section 2.1            Grant of Security Interest.  As collateral security for the prompt and complete payment and performance in full of all the Secured Obligations, each Pledgor hereby pledges, hypothecates and grants to the Collateral Agent for the benefit of the Secured Parties, a Lien on and security interest in and to all of the right, title and interest of such Pledgor in, to and under the following property, wherever located, whether now existing or hereafter arising or acquired from time to time (collectively, the “Collateral”):

 

(a)           all Accounts;

 

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(b)          all cash and Cash Equivalents;

 

(c)           all Chattel Paper;

 

(d)          all Collateral Accounts;

 

(e)          all Commercial Tort Claims, including those described on Schedule 15 to the Perfection Certificate;

 

(f)           all Computer Hardware;

 

(g)          all Deposit Accounts;

 

(h)          all Documents;

 

(i)           all Equipment (including Motor Vehicles) and Fixtures;

 

(j)           all General Intangibles;

 

(k)          all Goods;

 

(l)           all Instruments;

 

(m)         all Intellectual Property Collateral;

 

(n)          all Inventory;

 

(o)          all Investment Property;

 

(p)          all letters of credit and Letter-of-Credit Rights (whether or not the letter of credit is evidenced by a writing);

 

(q)          all Securities Collateral;

 

(r)           all Supporting Obligations;

 

(s)           all insurance claims;

 

(t)           all books and records pertaining to the Collateral; and

 

(u)         to the extent not covered by clauses (a) through (t) above, all choses in action and other personal property, whether tangible or intangible;

 

(v)         all Proceeds and products of each of the foregoing and all accessions to, substitutions and replacements for, and rents, profits and products of, each of the foregoing, and any and all Proceeds of any insurance, indemnity, warranty or guaranty payable to such Pledgor from time to time with respect to any of the foregoing.

 

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Notwithstanding anything to the contrary contained in clauses (a) through (v) above or in any other provision of any Loan Document, (x) the security interest created by this Agreement shall not extend to, and the term “Collateral” shall not include, any Excluded Property (but shall include the Proceeds and products of Excluded Property and each other item set forth in clause (v) above with respect to Excluded Property, in each case, to the extent that such Proceeds, products and other items do not themselves constitute Excluded Property)  and (y) (i) the Pledgors shall from time to time at the request of the Collateral Agent give written notice to the Collateral Agent identifying in reasonable detail any Excluded Property and shall provide to the Collateral Agent such other information regarding the Excluded Property as the Collateral Agent may reasonably request and (ii) from and after the Closing Date, no Pledgor shall permit to become effective in any document creating, governing or providing for any permit, lease or license, a provision that would prohibit the creation of a Lien on such permit, lease or license in favor of the Collateral Agent.

 

Section 2.2            Filings.

 

(a)           Each Pledgor hereby irrevocably authorizes the Collateral Agent at any time and from time to time to file or record in any relevant jurisdiction any initial financing statements (including fixture filings and transmitting utility filings, as applicable), continuation statements and amendments thereto that contain the information required by Article 9 of the UCC of each applicable jurisdiction for the filing of any financing statement, continuation statement or amendment relating to the Collateral, including (i) whether such Pledgor is an organization, the type of organization and any organizational identification number issued to such Pledgor, and (ii) in the case of a financing statement filed as a fixture filing or a transmitting utility filing or covering Collateral constituting minerals or the like to be extracted or timber to be cut, a sufficient description of the real property to which such Collateral relates. Each Pledgor agrees to provide all information described in the immediately preceding sentence to the Collateral Agent promptly upon request.  Such financing statements may describe the Collateral in the same manner as described herein or may contain a description of Collateral that describes such property in any other manner as the Collateral Agent may determine, in its sole discretion, is necessary, advisable or prudent to ensure the perfection or priority of the security interest in the collateral granted to the Collateral Agent in connection herewith, including, describing such property as “all assets whether now owned or hereafter acquired” or “all personal property whether now owned or hereafter acquired” (regardless of whether any particular asset comprised in the Collateral falls within the scope of Article 9 of the UCC).

 

(b)           Each Pledgor hereby ratifies its authorization for the Collateral Agent to file in any relevant jurisdiction any initial financing statements or amendments thereto relating to the Collateral if filed prior to the date hereof.

 

(c)           Each Pledgor hereby further authorizes the Collateral Agent to file and/or record with the United States Patent and Trademark Office, the United States Copyright Office, any applicable successor office and any other similar office or Governmental Authority in any other country, as applicable, this Agreement, the Copyright Security Agreement, the Patent Security Agreement, the Trademark Security Agreement, and any other documents determined by the Collateral Agent in its sole discretion to be necessary, advisable or prudent for the purpose of recording, perfecting, confirming, continuing, enforcing or protecting the pledge and security interest or the priority thereof granted by such Pledgor hereunder, with or without the signature of such Pledgor, and naming such Pledgor, as debtor, and the Collateral Agent, as secured party.

 

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ARTICLE III

 

PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES;

USE OF COLLATERAL

 

Section 3.1            Delivery of Certificated Securities Collateral.  Each Pledgor represents and warrants that all certificates, agreements or instruments representing or evidencing the Securities Collateral in existence on the date hereof have been delivered to the Collateral Agent in suitable form for transfer by delivery or accompanied by duly executed instruments of transfer or assignment in blank and that the Collateral Agent has a valid and enforceable  perfected first priority security interest therein and in the Securities Collateral and, with respect to any certificates or agreements (if any) delivered to the Collateral Agent representing or evidencing Pledged Securities or Distributions, such Pledgor shall take, and shall cause the issuer to take, such action as the Collateral Agent deems to be necessary, advisable or prudent to ensure that such certificates shall constitute Securities (as defined in Article 8 of the UCC).  Each Pledgor hereby agrees that all certificates, agreements or instruments representing or evidencing Securities Collateral acquired by such Pledgor after the date hereof shall promptly (and in any event within ten Business Days or such longer period as may be agreed to in writing by the Collateral Agent in its sole discretion) upon receipt thereof by such Pledgor be delivered to and held by or on behalf of the Collateral Agent pursuant hereto and such Pledgor shall promptly (and in any event within ten Business Days or such longer period as may be agreed to in writing by the Collateral Agent in its sole discretion) upon receipt thereof take, and shall cause the issuer to take, such action as the Collateral Agent deems to be necessary, advisable or prudent to ensure that such certificates representing or evidencing Pledged Securities or Distributions shall constitute Securities (as defined in Article 8 of the UCC).  All certificated Securities Collateral shall be in suitable form for transfer by delivery or shall be accompanied by duly executed instruments of transfer or assignment in blank (including, to the extent reasonably requested by the Collateral Agent, applicable local law instruments of transfer or assignments in blank), all in form and substance satisfactory to the Collateral Agent.  The Collateral Agent shall have the right, at any time upon the occurrence and during the continuance of any Event of Default, to endorse, assign or otherwise transfer to or to register in the name of the Collateral Agent or any of its nominees or endorse for negotiation any or all of the Securities Collateral, without any indication that such Securities Collateral is subject to the security interest hereunder.  In addition, the Collateral Agent shall have the right, at any time, to exchange certificates representing or evidencing Securities Collateral for certificates of smaller or larger denominations.

 

Section 3.2            Perfection of Uncertificated Securities Collateral.  Each Pledgor represents and warrants that the Collateral Agent has a valid and enforceable perfected first priority security interest in all uncertificated Pledged Securities pledged by it hereunder that are in existence on the date hereof.  Each Pledgor shall ensure that the issuer of any membership, partnership or other Equity Interests constituting uncertificated Pledged Securities does not issue any certificate representing such interest or take any step to ‘opt in’ or have such uncertificated Pledged Securities treated as “securities” within the meaning of Section 8-102(a)(15) of the UCC without the prior written consent of the Collateral Agent.  Each Pledgor hereby agrees that if any issuer of Pledged Securities is organized in a jurisdiction that does not permit the use of certificates to evidence equity ownership or any of the Pledged Securities are at any time not evidenced by certificates of ownership, then each applicable Pledgor shall, if the Collateral Agent deems it necessary, advisable or prudent to perfect a first priority security interest in such Pledged Securities, (i) cause such pledge to be recorded on the equityholder register or the books of the issuer, (ii) cause the issuer to execute and deliver to the Collateral Agent an acknowledgment of the pledge of such Pledged Securities substantially in the form of Exhibit 1 hereto or such other form reasonably acceptable to the Collateral Agent, execute any customary pledge forms or other documents that the Collateral Agent deems to be necessary, advisable or prudent to complete the pledge and give the Collateral Agent the right to transfer such Pledged Securities under the terms hereof and, upon the Collateral Agent’s request, provide to the Collateral Agent an opinion of counsel, in form and substance reasonably satisfactory to the Collateral Agent, confirming such pledge and perfection thereof and (iii) cause such Pledged Securities to become certificated and delivered to the Collateral Agent in accordance with the provisions of Section 3.1.

 

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Section 3.3            Financing Statements and Other Filings; Maintenance of Perfected Security Interest.  Each Pledgor represents and warrants that the only filings, registrations and recordings necessary to perfect the security interest granted by each Pledgor to the Collateral Agent in respect of the Collateral are listed on Schedule 1 hereto.  All such filings, registrations and recordings have been delivered to the Collateral Agent in completed and, to the extent necessary, advisable or prudent, duly executed form for filing in each applicable governmental, municipal or other office specified on Schedule 1 hereto.  Each Pledgor agrees that at the sole cost and expense of the Pledgors, (i) such Pledgor will maintain the security interest created by this Agreement in the Collateral as a valid and enforceable perfected first priority security interest (subject to Permitted Liens) and shall defend such security interest against the claims and demands of all Persons, (ii) such Pledgor shall furnish to the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as the Collateral Agent may reasonably request, all in reasonable detail and (iii) at any time and from time to time, upon the written request of the Collateral Agent, such Pledgor shall promptly (and in any event within three Business Days or such longer period as may be agreed to in writing by the Collateral Agent in its sole discretion) and duly execute and deliver, and file and have recorded, such further instruments and documents and take such further action as the Collateral Agent may reasonably request for the purpose of obtaining or preserving the full benefits of this Agreement and the rights and powers herein granted, including the filing of any financing statements and amendments thereof, continuation statements and other documents (including this Agreement) under the UCC (or other similar laws) in effect in any jurisdiction with respect to the security interest created hereby, the execution of one or more security documents compatible with applicable local law and the execution and delivery of Control Agreements, all in form reasonably satisfactory to the Collateral Agent and in such offices (including the United States Patent and Trademark Office and the United States Copyright Office) wherever required by or applicable under applicable Legal Requirements to perfect (to the extent a security interest in such Collateral may be so perfected under applicable Legal Requirements), continue and maintain a valid, enforceable, first priority security interest (subject to Permitted Liens) in the Collateral as provided herein and to preserve the other rights and interests granted to the Collateral Agent hereunder, as against third parties, with respect to the Collateral.

 

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Section 3.4            Other Actions.  In order to further ensure the attachment, perfection and priority of, and the ability of the Collateral Agent to enforce, the Collateral Agent’s security interest in the Collateral, each Pledgor represents and warrants and covenants as follows, in each case at such Pledgor’s own expense, to take the following actions with respect to the following Collateral:

 

(a)           Instruments and Tangible Chattel Paper.  As of the date hereof, each Pledgor hereby represents and warrants that (i) no amounts individually or in the aggregate in excess of $100,000 payable under or in connection with any of the Collateral are evidenced by any Instrument or Tangible Chattel Paper other than such Instruments and Tangible Chattel Paper listed on Schedule 12 to the Perfection Certificate, (ii) the Intercompany Note has been properly assigned and delivered to the Collateral Agent, accompanied by an endorsement to the Intercompany Note in the form attached thereto duly executed in blank by each Pledgor and (iii) each such Instrument and each such item of Tangible Chattel Paper individually or in the aggregate in excess of $100,000 has been properly endorsed, assigned and delivered to the Collateral Agent, accompanied by instruments of transfer or assignment duly executed in blank.  If any amount individually or in the aggregate in excess of $100,000 then payable under or in connection with any of the Collateral shall be evidenced by any Instrument or Tangible Chattel Paper, the Pledgor acquiring such Instrument or Tangible Chattel Paper shall promptly and in any event within ten Business Days (or such longer period as may be agreed to in writing by the Collateral Agent in its sole discretion), endorse, assign and deliver the same to the Collateral Agent, accompanied by such instruments of transfer or assignment duly executed in blank as the Collateral Agent may from time to time specify (including, to the extent reasonably requested by the Collateral Agent, applicable local law instruments of transfer or assignments in blank).

 

(b)           Deposit Accounts.  Each Pledgor hereby represents and warrants that (i) as of the date hereof, such Pledgor has neither opened nor maintains any Deposit Accounts other than the accounts listed on Schedule 16 to the Perfection Certificate, (ii) such Pledgor and each applicable Bank has executed and delivered, or, to the extent it has not already done so on the date hereof, shall execute and deliver in accordance with Section 5.15 of the Credit Agreement, a Control Agreement substantially in the form set forth in Exhibit 5 hereto or such other form that is reasonably satisfactory to the Collateral Agent with respect to each Deposit Account of such Pledgor listed on Schedule 16 to the Perfection Certificate other than Excluded Accounts, and (iii) the Collateral Agent has a valid and enforceable perfected first priority security interest (subject to Permitted Liens) in each such Deposit Account by Control.  No Pledgor shall hereafter establish and maintain any Deposit Account with respect to which such Pledgor is required to enter into a Control Agreement hereunder or under the Credit Agreement unless (A) the applicable Pledgor shall have given the Collateral Agent at least 30 days’ (or such shorter period as may be agreed to in writing by the Collateral Agent in its sole discretion) prior written notice of its intention to establish such new Deposit Account with a Bank, (B) such Bank shall be reasonably acceptable to the Collateral Agent and (C) such Bank and such Pledgor shall have duly executed and delivered to the Collateral Agent a Deposit Account Control Agreement (or an amendment to an existing Deposit Account Control Agreement) with respect to such Deposit Account.  The provisions of this Section 3.4(b) shall not apply to (x) any Excluded Accounts or (y) any Collateral Account or any other Deposit Accounts for which the Collateral Agent is the Bank.  No Pledgor has granted or shall grant Control of any Deposit Account to any Person other than the Collateral Agent.

 

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(c)           Securities Accounts and Commodity Accounts. Each Pledgor hereby represents and warrants that (i) as of the date hereof, it has neither opened nor maintains any Securities Accounts or Commodity Accounts other than those listed on Schedule 16 to the Perfection Certificate, (ii) such Pledgor and each applicable Securities Intermediary or Commodity Intermediary has executed and delivered a Securities Account Control Agreement or Commodity Account Control Agreement, as applicable, for each Securities Account or Commodity Account of such Pledgor listed on Schedule 16 to the Perfection Certificate, (iii) the Collateral Agent has a valid and enforceable perfected first priority security interest (subject to Permitted Liens) in each such Securities Account and Commodity Account by Control, and (iv) it does not hold, own or have any interest in any certificated securities or uncertificated securities other than those constituting Pledged Securities and those maintained in Securities Accounts or Commodity Accounts listed on Schedule 16 of the Perfection Certificate or in respect of which the Collateral Agent has Control.

 

(d)           Investment Property.  If any Pledgor shall at any time acquire any certificated securities constituting Investment Property, such Pledgor shall promptly, and in any event within ten Business Days of acquiring such security (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion), (i) endorse, assign and deliver the same to the Collateral Agent, accompanied by such instruments of transfer or assignment duly executed in blank, all in form and substance reasonably satisfactory to the Collateral Agent or (ii) deliver such securities into a Securities Account with respect to which a Securities Account Control Agreement is in effect in favor of the Collateral Agent.  If any securities now or hereafter acquired by any Pledgor constituting Investment Property are uncertificated and are issued to such Pledgor or its nominee directly by the issuer thereof, such Pledgor shall promptly, and in any event within ten Business Days of acquiring such security (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion), notify the Collateral Agent thereof and pursuant to an agreement in form and substance reasonably satisfactory to the Collateral Agent, either (i) cause the issuer to agree to comply with Entitlement Orders or other instructions from the Collateral Agent as to such securities, without further consent of any Pledgor or such nominee, (ii) cause a Security Entitlement with respect to such uncertificated security to be held in a Securities Account with respect to which the Collateral Agent has Control or (iii) arrange for the Collateral Agent to become the registered owner of the securities.  The Pledgors shall not hereafter establish and maintain any Securities Account or Commodity Account with any Securities Intermediary or Commodity Intermediary unless (1) the applicable Pledgor shall have given the Collateral Agent at least 30 days’ (or such shorter period as may be agreed to in writing by the Collateral Agent in its sole discretion) prior written notice of its intention to establish such new Securities Account or Commodity Account with such Securities Intermediary or Commodity Intermediary, (2) such Securities Intermediary or Commodity Intermediary shall be reasonably acceptable to the Collateral Agent and (3) such Securities Intermediary or Commodity Intermediary, as the case may be, and such Pledgor shall have duly executed and delivered a Control Agreement with respect to such Securities Account or Commodity Account, as the case may be.  The Collateral Agent shall not give any Entitlement Orders or instructions or directions to any issuer of uncertificated securities, Securities Intermediary or Commodity Intermediary, and shall not withhold its consent to the exercise of any withdrawal or dealing rights by such Pledgor, unless an Event of Default has occurred and is continuing or, after giving effect to any such withdrawal or dealing rights, would occur.  The provisions of this Section 3.4(d) shall not apply to any Financial Assets credited to a Securities Account for which the Collateral Agent is the Securities Intermediary.  No Pledgor shall grant Control over any Investment Property to any Person other than the Collateral Agent, and each Pledgor shall promptly (and in any event within ten Business Days) notify the Collateral Agent if any issuer of Pledged Interests takes any action to have any Pledged Interests issued by it treated as Securities under Article 8 of the UCC and such Pledgor shall take all steps deemed necessary, advisable or prudent by the Collateral Agent in order to grant Control of such Pledged Interests in favor of the Collateral Agent.  As between the Collateral Agent and the Pledgors, the Pledgors shall bear the investment risk with respect to the Investment Property and Pledged Securities, and the risk of loss of, damage to, or the destruction of the Investment Property and Pledged Securities, whether in the possession of, or maintained as a security entitlement or deposit by, or subject to the control of, the Collateral Agent, a Securities Intermediary, Commodity Intermediary, any Pledgor or any other Person; provided, however, that nothing contained in this Section 3.4(d) shall release or relieve any Securities Intermediary or Commodity Intermediary of its duties and obligations to the Pledgors or any other Person under any Control Agreement or under applicable Legal Requirements.  Each Pledgor shall promptly pay all Charges and fees of whatever kind or nature with respect to the Investment Property and Pledged Securities pledged by it under this Agreement.  In the event any Pledgor shall fail to make such payment contemplated in the immediately preceding sentence, the Collateral Agent may do so for the account of such Pledgor and the Pledgors shall promptly reimburse and indemnify the Collateral Agent in accordance with Section 10.03 of Credit Agreement from all costs and expenses incurred by the Collateral Agent under this Section 3.4(d).

 

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(e)           Electronic Chattel Paper and Transferable Records.  If any amount, individually or in the aggregate, in excess of $100,000 or payable under or in connection with any of the Collateral is evidenced by any Electronic Chattel Paper or any Transferable Record, the Pledgor acquiring such Electronic Chattel Paper or Transferable Record shall promptly and in any event within ten Business Days of the acquisition thereof (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion) notify the Collateral Agent thereof and shall take such action as the Collateral Agent may reasonably request to vest in the Collateral Agent control under Section 9-105 of the UCC of such Electronic Chattel Paper or control under Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or, as the case may be, Section 16 of the Uniform Electronic Transactions Act, as so in effect in such jurisdiction, of such Transferable Record.  The Collateral Agent agrees with such Pledgor that the Collateral Agent will arrange, pursuant to procedures reasonably satisfactory to the Collateral Agent and so long as such procedures will not result in the Collateral Agent’s loss of control, for the Pledgor to make alterations to the Electronic Chattel Paper or Transferable Record permitted under Section 9-105 of the UCC or, as the case may be, Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or Section 16 of the Uniform Electronic Transactions Act for a party in control to allow without loss of control, unless an Event of Default has occurred and is continuing or would occur after giving effect to any such alterations.

 

(f)           Letter-of-Credit Rights.  If any Pledgor is at any time a beneficiary under a Letter of Credit now or hereafter issued in favor of such Pledgor, other than (i) a Letter of Credit issued pursuant to the Credit Agreement or (ii) a Letter of Credit that is a “supporting obligation” (as defined in Section 9-102 of the UCC) with respect to other Collateral in which the Collateral Agent has a valid, enforceable, perfected first priority security interest (subject to Permitted Collateral Liens), in an amount individually in excess of $100,000 or in the aggregate in excess of $250,000, such Pledgor shall promptly (and in any event within ten Business Days of becoming a beneficiary thereunder (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion)) notify the Collateral Agent thereof and such Pledgor shall, at the request of the Collateral Agent, pursuant to an agreement in form and substance reasonably satisfactory to the Collateral Agent, either (i) arrange for the issuer and any confirmer or other nominated Person of such Letter of Credit to consent to an assignment to the Collateral Agent of the proceeds of any drawing under the Letter of Credit or (ii) arrange for the Collateral Agent to become the transferee beneficiary of such Letter of Credit, with the Collateral Agent agreeing, in each case, that the proceeds of any drawing under the Letter of Credit are to be applied as provided in the Credit Agreement.

 

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(g)           Commercial Tort Claims.  As of the date hereof, each Pledgor hereby represents and warrants that it holds no Commercial Tort Claims having a book value or Fair Market Value, individually, in excess of $100,000, or in the aggregate in excess of $250,000, other than those listed on Schedule 15 to the Perfection Certificate.  If any Pledgor shall at any time hold or acquire a Commercial Tort Claim having a book value or Fair Market Value, individually, in excess of $100,000, or in the aggregate in excess of $250,000, such Pledgor shall promptly (and in any event within ten Business Days of acquiring such Commercial Tort Claim (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion)) notify the Collateral Agent in writing signed by such Pledgor of the brief details thereof and grant to the Collateral Agent in such writing a security interest therein and in the Proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to the Collateral Agent.

 

(h)           Collateral in the Possession of a Third Party.  If any Equipment or Inventory  is in possession or control of any third party, including any warehouseman, landlord, lessor, bailee or agent, the Pledgors shall notify the Collateral Agent thereof and notify the third party of the Collateral Agent’s security interest therein and use commercially reasonable efforts to obtain an acknowledgment (a “Bailee Letter”) from such third party that (i) it is holding the Equipment and Inventory for the benefit of the Collateral Agent, (ii) waiving all right, title and interest in such Equipment and/or Inventory and (ii) such party will comply with instructions from the Collateral Agent with respect to such Collateral, without further consent of any Pledgors.

 

(i)             Landlord’s Access Agreements.  Upon the reasonable request of the Collateral Agent, each Pledgor shall use its commercially reasonable efforts to obtain as soon as practicable with respect to any location set forth in Section 5.11(d) of the Credit Agreement a Landlord Access Agreement.

 

Section 3.5            Joinder of Additional Pledgors.  The Pledgors shall cause each Subsidiary of Borrower which, from time to time, after the date hereof shall be required to pledge any assets to the Collateral Agent for the benefit of the Secured Parties pursuant to the Credit Agreement,  to execute and deliver to the Collateral Agent (i) a Joinder Agreement substantially in the form of Exhibit 3 hereto, (ii) a Perfection Certificate, in each case, within ten Business Days after the date on which it was acquired or created (or such later date as may be agreed by the Collateral Agent in its sole discretion) and (iii) such other documentation as the Collateral Agent shall reasonably requested, and upon such execution and delivery, such Subsidiary shall constitute a “Pledgor” for all purposes hereunder with the same force and effect as if originally named as a Pledgor herein.  The execution and delivery of such Joinder Agreement shall not require the consent of any Pledgor hereunder.  The rights and obligations of each Pledgor hereunder shall remain in full force and effect notwithstanding the addition of, or failure to add, any new Pledgor as a party to this Agreement or any other Loan Document.

 

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Section 3.6            Supplements; Further Assurances.  Each Pledgor shall take such further actions, and execute and deliver to the Collateral Agent such additional assignments, agreements, supplements, powers and instruments, as the Collateral Agent may deem necessary, advisable or prudent, wherever required by applicable Legal Requirements, in order to perfect, preserve and protect the security interest and the priority thereof in the Collateral as provided herein and the rights and interests granted to the Collateral Agent hereunder, to carry into effect the purposes hereof or better to assure and confirm unto the Collateral Agent the Collateral or permit the Collateral Agent to exercise and enforce its rights, powers and remedies hereunder with respect to any Collateral.  Without limiting the generality of the foregoing, (a) each Pledgor shall make, execute, endorse, acknowledge, file or refile and/or deliver to the Collateral Agent from time to time upon reasonable request such lists, descriptions and designations of the Collateral, copies of warehouse receipts, receipts in the nature of warehouse receipts, bills of lading, documents of title, vouchers, invoices, schedules, confirmatory assignments, supplements, additional security agreements (including local law security agreements), conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments as the Collateral Agent shall reasonably request and (b) each Pledgor that owns or acquires material Excluded Regulatory Collateral after the date hereof shall use commercially reasonable efforts to obtain approval of the applicable Governmental Authority with respect to the grant by such Pledgor of a security interest in such Excluded Regulatory Collateral unless such Pledgor determines in good faith that such approval is unobtainable.  If an Event of Default has occurred and is continuing, the Collateral Agent may institute and maintain, in its own name or in the name of any Pledgor, such suits and proceedings as the Collateral Agent may be advised by counsel shall be necessary, advisable or prudent to prevent any impairment of the security interest in the Collateral or the perfection or priority thereof.  If (x) an Event of Default has occurred and is continuing or (y) a landlord of any Pledgor shall provide notice of default under or termination of any lease to which a Pledgor is a party such Pledgor shall use commercially reasonable efforts to cause such landlord to agree (in a writing addressed to the Collateral Agent) to extend the time period provided by such landlord for the removal of Collateral from the leased premises for a period, and otherwise on terms and conditions, reasonably satisfactory to the Collateral Agent; provided that, in connection therewith, no Pledgor shall agree, directly or indirectly, with any landlord to abandon any Collateral or waive or limit such Pledgor’s rights in any Collateral.  All of the foregoing shall be at the sole cost and expense of the Pledgors and shall be paid in accordance with Section 10.03 of the Credit Agreement.

 

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ARTICLE IV

 

REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Each Pledgor represents, warrants and covenants as follows (it being acknowledged and agreed that each reference in the representations and warranties of this Article IV to a Schedule of the Perfection Certificate, shall be taken as a reference to such Schedule as contained in the most recently updated or supplemented Perfection Certificate in effect at the time such representation and warranty is made):

 

Section 4.1            Title.  Except for the security interest granted to the Collateral Agent for the benefit of the Secured Parties pursuant to this Agreement and Permitted Liens, such Pledgor owns (or either owns or has a license to, in the case of Intellectual Property Collateral) and, as to Collateral acquired by it from time to time after the date hereof, will own (or either own or have a License to, in the case of Intellectual Property Collateral) the rights in each item of Collateral pledged by it hereunder free and clear of any and all Liens or claims of others.  Such Pledgor has not filed, nor authorized any third party to file a financing statement or other public notice with respect to all or any part of the Collateral on file or of record in any public office, except such as have been filed in favor of the Collateral Agent pursuant to this Agreement, filed in favor of the holder of a Permitted Lien, permitted by the Credit Agreement or financing statements or public notices relating to the termination statements listed on Schedule 9(a) to the Perfection Certificate.  No Person other than the Collateral Agent has, or will have, control or possession of all or any part of the Collateral, except to the extent not prohibited by the Loan Documents.

 

Section 4.2            Validity of Security Interest.  The security interest in and Lien on the Collateral granted to the Collateral Agent for the benefit of the Secured Parties hereunder constitutes (a) a legal and valid security interest in all the Collateral securing the payment and performance of the Secured Obligations, and (b) (i) in the case of all Collateral in which a security interest may be perfected by filing a financing statement under the UCC, subject to the filings and other actions described on Schedule 1 hereto, a valid and enforceable perfected first priority security interest (subject to Permitted Liens) in all such Collateral to the extent required by this Agreement and (ii) with respect to certificated Securities Collateral, Instruments, Tangible Chattel Paper, Deposit Accounts, Securities Accounts, Commodities Accounts, certificated Investment Property, Electronic Chattel Paper, Transferable Records and Letter-of-Credit Rights, subject to the deliveries contemplated pursuant to Section 3.1 and Section 3.4 and the filings contemplated pursuant to Section 3.3, a valid and enforceable perfected first priority security interest (with respect to the perfected first priority security interest contemplated by Section 3.3, subject to Permitted Liens) in all such Collateral to the extent required by this Agreement.  The security interest and Lien granted to the Collateral Agent for the benefit of the Secured Parties pursuant to this Agreement in and on the Collateral will at all times constitute a valid and enforceable perfected, continuing first priority security interest therein to the extent required by this Agreement, subject only to clause (b) of the preceding sentence and Permitted Liens.

 

Section 4.3            Pledgor Defense of Claims;  Transferability of Collateral.  Each Pledgor shall, at its own cost and expense, defend title to the Collateral pledged by it hereunder and the security interest therein granted to the Collateral Agent and the priority thereof required hereunder against all claims and demands of all Persons, at its own cost and expense, at any time claiming any interest therein adverse to the Collateral Agent or any other Secured Party.  There is no agreement that restricts the transferability of any material portion of the Collateral or impairs or conflicts with such Pledgor’s obligations or the rights of the Collateral Agent hereunder, and no Pledgor shall enter into any such agreement or take any other action that would have any such effect.

 

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Section 4.4            Other Financing Statements.  No Pledgor has filed, nor authorized any third party to file (nor will there be) any valid or effective financing statement (or similar statement or instrument of registration under the law of any jurisdiction) covering or purporting to cover any interest of any kind in the Collateral other than financing statements and other statements and instruments filed in favor of the Collateral Agent, or relating to Permitted Liens, or as otherwise permitted by the Credit Agreement or financing statements or public notices relating to the termination statements listed on Schedule 9(a) to the Perfection Certificate.  Prior to the payment in full of the Secured Obligations, no Pledgor shall execute, authorize or permit to be filed in any public office any financing statement (or similar statement or instrument of registration under the law of any jurisdiction) relating to any Collateral, except financing statements and other statements and instruments filed or to be filed in respect of and covering the security interests granted by such Pledgor in favor of the Collateral Agent, or any holder of Permitted Liens, or as otherwise permitted by the Credit Agreement.

 

Section 4.5            Chief Executive Office; Change of Name; Jurisdiction of Organization, etc.

 

(a)           The exact legal name, jurisdiction of organization, organizational identification number and tax identification number, if any, of each Pledgor is set forth on Schedule 1(a) to the Perfection Certificate, and the chief executive office of each Pledgor is set forth on Schedule 2(a) to the Perfection Certificate.

 

(b)           No Pledgor shall effect any change (i) in any Pledgor’s legal name, (ii) in the location of any Pledgor’s chief executive office, (iii) in any Pledgor’s organizational structure, (iv) in any Pledgor’s Federal Taxpayer Identification Number or organizational identification number, if any (except as may be required by applicable Legal Requirements, in which case, Borrower shall promptly notify the Collateral Agent of such change), or (v) in any Pledgor’s jurisdiction of organization (in each case, including by merging with or into any other entity, reorganizing, dissolving, liquidating, reorganizing or organizing in any other jurisdiction), until (A) it shall have given the Collateral Agent not less than ten Business Days’ prior written notice (in the form of an Officers’ Certificate), of its intention so to do, clearly describing such change and providing such other information in connection therewith as the Collateral Agent may reasonably request and (B) it shall have taken all action necessary or advisable to maintain the validity, enforceability, perfection and priority of the security interest of the Collateral Agent for the benefit of the Secured Parties in the Collateral, if applicable.  Each Pledgor shall promptly provide the Collateral Agent with certified Organizational Documents reflecting any of the changes described in the preceding sentence.  Each Pledgor shall promptly notify the Collateral Agent in writing of any change in the location of any office in which it maintains books or records relating to Collateral owned by it or any office or facility at which Collateral is located (including the establishment of any such new office or any such facility), other than changes in location to a Mortgaged Property or a leased Property subject to a Landlord Access Agreement in favor of the Collateral Agent.

 

(c)           If such Pledgor does not have an organizational identification number or tax identification number and later obtains one, such Pledgor shall within ten Business Days notify the Collateral Agent in writing of such organizational identification number or tax identification number, as the case may be.  If any Pledgor fails to provide information to the Collateral Agent about such changes on a timely basis, the Collateral Agent shall not be liable or responsible to any party for any failure to maintain a valid, enforceable, and perfected security interest with the priority required hereunder in such Pledgor’s property constituting Collateral, for which the Collateral Agent needed to have information relating to such changes. The Collateral Agent shall have no duty to inquire about such changes if any Pledgor does not inform the Collateral Agent of such changes, the parties acknowledging and agreeing that it would not be feasible or practical for the Collateral Agent to search for information on such changes if such information is not provided by any Pledgor.

 

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(d)           Each Pledgor shall comply with the provisions of Section 5.13 of the Credit Agreement.

 

Section 4.6            Location of Inventory and Equipment.  As of the date hereof, all Equipment and Inventory of such Pledgor with a fair market value in excess of $250,000, for each individual location, and $1,000,000, in the aggregate for all locations with less than $250,000 of such Collateral, is located at the chief executive office or such other location listed on Schedule 2(d) to the Perfection Certificate.  Such Pledgor will (a) provide the Collateral Agent with not less than 30 days’ prior written notice of its intention to move any Equipment or Inventory (other than Equipment and Inventory of such Pledgor with a fair market value of less than $250,000, for each individual location, and $1,000,000, in the aggregate) from such location to another location, and will provide the Collateral Agent with such other information in connection with such location as the Collateral Agent may reasonably request for purposes of maintaining the perfection and priority of the security interest of the Collateral Agent in such Equipment and Inventory and (b) take all other actions reasonably requested by the Collateral Agent to maintain the perfection and priority of the security interest of the Collateral Agent in such Equipment and Inventory for the benefit of the Secured Parties.

 

Section 4.7            Corporate Names; Prior Transactions.  Such Pledgor has not, during the past five years, been known by or used any other corporate or fictitious name or been party to any merger or consolidation, or acquired all or substantially all of the assets of any Person, in each case other than as set forth on Schedules 1(b) and 1(c) to the Perfection Certificate.

 

Section 4.8            Due Authorization and Issuance.  All of the Initial Pledged Shares have been, and to the extent any Pledged Shares are hereafter issued, such Pledged Shares will be, upon such issuance, duly authorized, validly issued and fully paid and non-assessable.  All of the Initial Pledged Interests have been fully paid for, and there is no amount or other obligation owing by any Pledgor to any issuer of the Initial Pledged Interests in exchange for or in connection with the issuance of the Initial Pledged Interests or any Pledgor’s status as a partner or a member of any issuer of the Initial Pledged Interests.

 

Section 4.9            Consents, etc.  No consent of any party (including, without limitation, equity holders or creditors of such Pledgor) and no consent, authorization, approval, license or other action by, and no notice to or filing with, any Governmental Authority or regulatory body or other Person is required (a) for the exercise by the Collateral Agent of the voting or other rights provided for in this Agreement or (b) for the exercise by the Collateral Agent of the remedies in respect of the Collateral pursuant to this Agreement.  If the Collateral Agent desires to exercise any remedies, voting or consensual rights or attorney-in-fact powers set forth in this Agreement and determines it necessary to obtain any approvals or consents of any Governmental Authority or any other Person therefor, then, upon the request of the Collateral Agent, each Pledgor agrees to use its commercially reasonable efforts to assist and aid the Collateral Agent to obtain as soon as practicable any necessary approvals or consents for the exercise of any such remedies, rights and powers.

 

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Section 4.10          Collateral.  All information set forth herein, including the schedules annexed hereto, and all information contained in any documents, schedules and lists heretofore delivered to any Secured Party, including the Perfection Certificate and the schedules thereto, in connection with this Agreement, in each case, relating to the Collateral, is accurate and complete in all material respects.

 

Section 4.11          Insurance.

 

(a)           The Pledgors shall take all actions necessary to obtain and maintain such insurance as is required pursuant to the Credit Agreement.  In the event that the proceeds of any insurance claim are paid after the Collateral Agent has exercised its right to foreclose after an Event of Default, such Net Cash Proceeds shall be paid to the Collateral Agent to satisfy any deficiency remaining after such foreclosure.  The Collateral Agent shall retain its interest in the insurance policies and coverages required to be maintained pursuant to the Credit Agreement during any redemption period.

 

(b)           Pledgor shall provide that no cancellation, material reduction in amount or material change in coverage thereof shall be effective until at least 30 days after receipt by the Collateral Agent of written notice thereof.

 

(c)           All such insurance shall (i) name the Collateral Agent as mortgagee (in the case of property insurance) or additional insured on behalf of the Secured Parties (in the case of liability insurance) or lender’s loss payee (in the case of property insurance), as applicable, (ii) if reasonably requested by the Collateral Agent, include a breach of warranty clause and (iii) be reasonably satisfactory in all other material respects to the Collateral Agent.

 

Section 4.12          Intellectual Property.

 

(a)           The operation of such Pledgor’s business as currently conducted or as contemplated to be conducted and the use of the Intellectual Property Collateral in connection therewith does not conflict with, infringe, misappropriate, dilute, misuse or otherwise violate the intellectual property rights of any third party.

 

(b)           Such Pledgor is licensed to use or is the exclusive owner of all right, title and interest in and to the Intellectual Property Collateral that is material to its business, and is entitled to use such Intellectual Property Collateral subject only to the terms of the License Agreements.

 

(c)           The Intellectual Property Collateral set forth on Schedule 14 to the Perfection Certificate includes all of the following that are owned by such Pledgor (or in the case of License Agreements, to which such Pledgor is a party) as of the date hereof:  Patents that are Registered, Trademarks that are Registered, Copyrights that are Registered and License Agreements.

 

(d)           The Registered Intellectual Property Collateral is subsisting and has not been adjudged invalid or unenforceable in whole or part, and to the knowledge of such Pledgor, is valid and enforceable.  Such Pledgor is not aware of any uses of any item of Intellectual Property Collateral that could be expected to lead to such item becoming invalid or unenforceable.

 

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(e)           Such Pledgor has made or performed all filings, recordings and other acts and has paid all required fees and taxes to maintain and protect its interest in each and every item of material Registered Intellectual Property Collateral in full force and effect throughout the world, and to protect and maintain its interest therein including, without limitation, recordations of any of its interests in the Patents and Trademarks that are Registered with the United States Patent and Trademark Office and in corresponding national and international patent and trademark offices, and recordation of any of its interests in the Copyrights that are Registered with the United States Copyright Office and in corresponding national and international copyright offices.  Such Pledgor has used proper statutory notice in connection with its use of each Patent, Trademark and Copyright in the Intellectual Property Collateral.

 

(f)           No claim, action, suit, investigation, litigation or proceeding has been asserted or is pending or, to the knowledge of such Pledgor, threatened against such Pledgor (i) based upon or challenging or seeking to deny or restrict the Pledgor’s rights in or use of any of the Intellectual Property Collateral, (ii) alleging that the Pledgor’s rights in or use of the Intellectual Property Collateral or that any services provided by, processes used by, or products manufactured or sold by, such Pledgor infringe, misappropriate, dilute, misuse or otherwise violate any patent, trademark, copyright or any other proprietary right of any third party, or (iii) alleging that the Intellectual Property Collateral is being licensed or sublicensed in violation or contravention of the terms of any license or other agreement.  No Person is engaging in any activity that infringes, misappropriates, dilutes, misuses or otherwise violates the Intellectual Property Collateral or the Pledgor’s rights in or use thereof.  Except as set forth on Schedule 14 to the Perfection Certificate, such Pledgor has not granted any license, release, covenant not to sue, non-assertion assurance, or other right to any Person with respect to any part of the Intellectual Property Collateral.  The consummation of the transactions contemplated by the Loan Documents will not result in the termination or impairment of any of the Intellectual Property Collateral.

 

(g)           With respect to each License Agreement: (i) such License Agreement is valid and binding and in full force and effect and represents the entire agreement between the respective parties thereto with respect to the subject matter thereof; (ii) such License Agreement will not cease to be valid and binding and in full force and effect on terms identical to those currently in effect as a result of the rights and interest granted herein, nor will the grant of such rights and interest constitute a breach or default under such License Agreement or otherwise give any party thereto a right to terminate such License Agreement; (iii) such Pledgor has not received any notice of termination or cancellation under such License Agreement; (iv) such Pledgor has not received any notice of a breach or default under such License Agreement, which breach or default has not been cured; (v) such Pledgor has not granted to any other third party any rights, adverse or otherwise, under such License Agreement; and (vi) neither such Pledgor nor any other party to such License Agreement is in breach or default thereof in any material respect, and no event has occurred that, with notice or lapse of time or both, would constitute such a breach or default or permit termination, modification or acceleration under such License Agreement.

 

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(h)           To the knowledge of such Pledgor, (i) none of the Trade Secrets of such Pledgor has been used, divulged, disclosed or appropriated to the detriment of such Pledgor for the benefit of any other Person other than such Pledgor; (ii) no employee, independent contractor or agent of such Pledgor has misappropriated any trade secrets of any other Person in the course of the performance of his or her duties as an employee, independent contractor or agent of such Pledgor; and (iii) no employee, independent contractor or agent of such Pledgor is in default or breach of any term of any employment agreement, non-disclosure agreement, assignment of inventions agreement or similar agreement or contract relating in any way to the protection, ownership, development, use or transfer of such Pledgor’s Intellectual Property Collateral.

 

(i)           No Pledgor or Intellectual Property Collateral is subject to any outstanding consent, settlement, agreement, decree, order, injunction, judgment or ruling restricting the use of any Intellectual Property Collateral or that would impair the validity or enforceability of such Intellectual Property Collateral.

 

Section 4.13          Payment of Taxes; Compliance with Legal Requirements; Contesting Liens; Charges.  Each Pledgor may at its own expense contest the validity, amount or applicability of any Charges so long as the contest thereof shall be conducted in accordance with, and not prohibited pursuant to the provisions of, the Credit Agreement.  Notwithstanding the foregoing sentence, (a) no contest of any such obligation may be pursued by such Pledgor if such contest could reasonably be expected to expose the Collateral Agent or any other Secured Party to (i) any possible criminal liability or (ii) any additional civil liability for failure to comply with such obligations unless such Pledgor shall have furnished a bond or other security therefor satisfactory to the Collateral Agent, or such Secured Party, as the case may be, and (b) if at any time payment or performance of any obligation contested by such Pledgor pursuant to this Section 4.13 shall become reasonably necessary to prevent the imposition of remedies because of non-payment, such Pledgor shall pay or perform the same in sufficient time to prevent the imposition of remedies in respect of such default or prospective default.

 

Section 4.14          Access to Collateral, Books and Records; Other Information.  Each Pledgor shall permit representatives of the Collateral Agent or any Secured Party upon reasonable notice to visit and inspect any of its properties, including to conduct any environmental assessments, sampling, testing or monitoring of the Mortgaged Property, or assets and examine and make abstracts from any of its books and records (including insurance policies) at any reasonable time and upon reasonable notice.  Such Pledgor shall, at any and all times, within a reasonable time after written request by the Collateral Agent, furnish or cause to be furnished to the Collateral Agent, in such manner and in such detail as may be reasonably requested by the Collateral Agent, additional information with respect to the Collateral.  If a Default occurs and is continuing, the Collateral Agent shall have the right, but not the obligation, to access any Mortgaged Property to undertake any Response that the Collateral Agent in its sole discretion deems appropriate at the sole cost and expense of the Pledgors.

 

ARTICLE V

 

CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL

 

Section 5.1            Pledge of Additional Securities Collateral.  Each Pledgor shall, upon obtaining any Pledged Securities or Intercompany Notes of any Person, accept the same in trust for the benefit of the Collateral Agent and promptly, and in any event within ten Business Days thereafter (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion), deliver to the Collateral Agent a pledge amendment, duly executed by such Pledgor, in substantially the form of Exhibit 2 hereto (each, a “Pledge Amendment”), and the certificates and other documents required under Section 3.1 and Section 3.2 in respect of such additional Pledged Securities or Intercompany Notes that are to be pledged pursuant to this Agreement, and confirming the grant of the Lien created hereby in respect of such additional Pledged Securities or Intercompany Notes.  Each Pledgor hereby authorizes the Collateral Agent to attach each Pledge Amendment to this Agreement and agrees that all Pledged Securities or Intercompany Notes listed on any Pledge Amendment delivered to the Collateral Agent shall for all purposes hereunder be considered Collateral.

 

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Section 5.2            Voting Rights; Distributions; etc.

 

(a)           So long as no Event of Default shall have occurred and be continuing:

 

(i)           Each Pledgor shall be entitled to exercise any and all voting and other consensual rights pertaining to the Securities Collateral or any part thereof for any purpose not inconsistent with the terms or purposes hereof, the other Loan Documents or any other document evidencing the Secured Obligations; provided, however, that no Pledgor shall in any event exercise such rights in any manner that could reasonably be expected to (x) have a material adverse effect on the value thereof or (y) be disadvantageous to any Secured Party in any material respect.

 

(ii)           Each Pledgor shall be entitled to receive and retain, and to utilize free and clear of the Lien hereof, any and all Distributions, but only if and to the extent made in accordance with the provisions of the Credit Agreement; provided, however, that any and all such Distributions consisting of rights or interests in the form of Pledged Securities or Intercompany Notes shall promptly, and in any event within ten Business Days after receipt thereof (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion), be delivered to the Collateral Agent to hold as Collateral and shall, if received by any Pledgor, be received in trust for the benefit of the Collateral Agent, be segregated from the other property or funds of such Pledgor and be forthwith delivered to the Collateral Agent as Collateral in the same form as so received (with any necessary, advisable or reasonably requested endorsement).

 

(b)           Upon the occurrence and during the continuance of any Event of Default, the Collateral Agent may implement either or both of the following remedies:

 

(i)           All rights of each Pledgor to exercise the voting and other consensual rights it would otherwise be entitled to exercise pursuant to Section 5.2(a)(i) shall cease, and all such rights shall thereupon become vested in the Collateral Agent, which, shall thereupon have the sole right to exercise such voting and other consensual rights.

 

(ii)           All rights of each Pledgor to receive Distributions that it would otherwise be authorized to receive and retain pursuant to Section 5.2(a)(ii) without further action shall cease and all such rights shall thereupon become vested in the Collateral Agent, which, shall thereupon have the sole right to receive and hold as Collateral such Distributions.

 

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(c)           Each Pledgor shall, at its sole cost and expense, from time to time execute and deliver to the Collateral Agent appropriate instruments as the Collateral Agent may request in order to permit the Collateral Agent to exercise the voting and other rights which it may be entitled to exercise pursuant to Section 5.2(b)(i) and to receive all Distributions which it may be entitled to receive under Section 5.2(b)(ii).  If the Collateral Agent duly exercises its right to vote any of such Pledged Securities, each Pledgor appoints the Collateral Agent, such Pledgor’s true and lawful attorney-in-fact and grants the Collateral Agent an irrevocable proxy to vote such Pledged Securities in any manner the Collateral Agent deems advisable for or against all matters submitted or which may be submitted to a vote of shareholders, partners or members, as the case may be.  The power-of-attorney and proxy granted hereby is coupled with an interest and shall be irrevocable.

 

(d)           All Distributions that are received by any Pledgor contrary to the provisions of Section 5.2(b)(ii) shall be received in trust for the benefit of the Collateral Agent, shall be segregated from the other funds of such Pledgor and shall immediately be paid over to the Collateral Agent as Collateral in the same form as so received (with any necessary, advisable or reasonably requested endorsement).

 

Section 5.3            Default.  Such Pledgor is not in default or violation under any agreement to which such Pledgor is a party relating to the Pledged Securities pledged by it (including with respect to the payment of any portion of any mandatory capital contribution, if any, required to be made thereunder).  No Securities Collateral pledged by such Pledgor is subject to any defense, offset or counterclaim, nor, to the knowledge of such Pledgor, have any of the foregoing been asserted or alleged against such Pledgor by any Person with respect thereto, and as of the date hereof, there are no certificates, instruments, documents or other writings (other than the Organizational Documents of such Pledgor and certificates, if any, delivered to the Collateral Agent) which evidence any Pledged Securities of such Pledgor.

 

Section 5.4            Certain Agreements of Pledgors as Issuers and Holders of Equity Interests.

 

(a)           In the case of each Pledgor that is an issuer of Securities Collateral, such Pledgor agrees to be bound by the terms of this Agreement relating to the Securities Collateral issued by it and will comply with such terms insofar as such terms are applicable to it.

 

(b)           In the case of each Pledgor that is a partner, member or holder of any Equity Interests in a partnership, limited liability company or other entity, such Pledgor hereby consents to the extent required by the applicable Organizational Documents of such Pledgor to the pledge by each other Pledgor, pursuant to the terms hereof, of the Pledged Interests in such partnership, limited liability company or other entity and, upon the occurrence and during the continuance of an Event of Default, to the transfer of such Pledged Interests to the Collateral Agent or its nominee and to the substitution of the Collateral Agent or its nominee as a substituted partner, member or holder of Equity Interests in such partnership, limited liability company or other entity with all the rights, powers and duties of a general partner, limited partner, member or holder of Equity Interests, as the case may be.

 

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ARTICLE VI

 

CERTAIN PROVISIONS CONCERNING INTELLECTUAL

PROPERTY COLLATERAL

 

Section 6.1            Grant of License.  For the purpose of enabling the Collateral Agent, during the continuance of an Event of Default, to exercise rights and remedies under Article IX at such time as the Collateral Agent shall be lawfully entitled to exercise such rights and remedies, and for no other purpose, each Pledgor hereby grants to the Collateral Agent, to the extent licensable, an irrevocable, non-exclusive worldwide license (exercisable without payment of royalty or other compensation to such Pledgor) to use, assign, license sublicense or otherwise dispose of the Intellectual Property Collateral now owned or hereafter acquired by such Pledgor, wherever the same may be located.  Such license shall include access to all media in which any of the Intellectual Property Collateral may be recorded or stored and to all computer programs used for the compilation or printout hereof.

 

Section 6.2            Registration.  Except pursuant to licenses and other agreements entered into by any Pledgor in the ordinary course of business, on and as of the date hereof (i) each Pledgor owns and/or possesses the right to use, and has done nothing to authorize or enable any other Person to use, any Copyright, Patent or Trademark listed on Schedule 14 to the Perfection Certificate, and (ii) to the knowledge of Pledgor, all registrations listed on Schedule 14 of the Perfection Certificate are valid and in full force and effect.

 

Section 6.3            Protection of Collateral Agent’s Security.

 

(a)           With respect to each item of its Intellectual Property Collateral, each Pledgor agrees, on a continuing basis, to take, at its sole cost and expense, all necessary steps, including, without limitation, in the United States Patent and Trademark Office, the United States Copyright Office and any other Governmental Authority, to (i) maintain the validity and enforceability of such Intellectual Property Collateral and maintain such Intellectual Property Collateral in full force and effect, and (ii) pursue the registration and maintenance of each Patent, Trademark, or Copyright registration or application, now or hereafter included in such Intellectual Property Collateral of such Pledgor, including, without limitation, the payment of required fees and taxes, the filing of responses to office actions issued by the United States Patent and Trademark Office, the United States Copyright Office or other Governmental Authorities, the filing of applications for renewal or extension, the filing of affidavits under Sections 8 and 15 of the U.S. Trademark Act, the filing of divisional, continuation, continuation-in-part, reissue and renewal applications or extensions, the payment of maintenance fees and the participation in interference, reexamination, opposition, cancellation, infringement and misappropriation proceedings.  No Pledgor shall, without the written consent of the Collateral Agent, discontinue use of or otherwise abandon any Intellectual Property Collateral, or abandon any right to file an application for any Patent, Trademark, or Copyright, unless such Pledgor shall have previously determined that such use or the pursuit or maintenance of such Intellectual Property Collateral is no longer desirable in the conduct of such Pledgor’s business and that the loss thereof would not be reasonably likely to materially adversely affect the operation of such Pledgor’s business, in which case, such Pledgor will give prompt notice of any such abandonment to the Collateral Agent.

 

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(b)           Each Pledgor agrees, on a continuing basis, promptly (and in any event within ten Business Days) to notify the Collateral Agent if such Pledgor becomes aware (i) that any item of the Intellectual Property Collateral may have become abandoned, placed in the public domain, invalid or unenforceable, or of any adverse determination or development regarding such Pledgor’s ownership of any of the Intellectual Property Collateral or its right to register the same or to keep and maintain and enforce the same, or (ii) of any adverse determination or the institution of any proceeding (including, without limitation, the institution of any proceeding in the United States Patent and Trademark Office or any court) regarding any item of the Intellectual Property Collateral.

 

(c)           In the event that any Pledgor becomes aware that any item of the Intellectual Property Collateral is being infringed or misappropriated by a third party, such Pledgor shall promptly (and in any event within ten Business Days)  notify the Collateral Agent and shall take such actions, at its expense, as such Pledgor or the Collateral Agent deems reasonable and appropriate under the circumstances to protect or enforce such Intellectual Property Collateral, including, without limitation, suing for infringement or misappropriation and for an injunction against such infringement or misappropriation.  Without limiting the foregoing, upon such Pledgor obtaining knowledge thereof, Pledgor shall promptly (and in any event within ten Business Days) notify the Collateral Agent in writing of any event that may be reasonably expected to materially and adversely affect the value or utility any item of Intellectual Property Collateral, the ability of such Pledgor or the Collateral Agent to dispose of such Intellectual Property Collateral or any portion thereof or the rights and remedies of the Collateral Agent in relation thereto, including a levy or written threat of levy or any legal process against such Intellectual Property Collateral or any portion thereof.

 

(d)           Each Pledgor agrees, on a continuing basis, to use proper statutory notice in connection with its use of each item of its Intellectual Property Collateral.  No Pledgor shall do or permit any act or knowingly omit to do any act whereby any of its Intellectual Property Collateral may lapse or become invalid or unenforceable or placed in the public domain.  No Pledgor will settle or compromise any pending or future litigation or administrative proceeding with respect to any Intellectual Property Collateral without the prior written consent of the Collateral Agent.

 

(e)           Except as otherwise permitted by this Article VI, each Pledgor agrees, on a continuing basis, to take all steps which it or the Collateral Agent deems reasonable and appropriate under the circumstances to preserve and protect each item of its Intellectual Property Collateral, including, without limitation, maintaining the quality of any and all products or services used or provided in connection with any of the Trademarks, consistent with the quality of the products and services as of the date hereof, and taking all steps necessary to ensure that all licensed users of any of the Trademarks use such consistent standards of quality.

 

(f)           No Pledgor shall (i) license any  Intellectual Property Collateral other than pursuant to License Agreements entered into by such Pledgor in, or incidental to, the ordinary course of its business, or (ii) amend or permit the amendment of any License Agreement in a manner that materially and adversely affects the right to receive payments thereunder, or in any manner that would materially impair the value of any Intellectual Property Collateral or the Lien on and security interest in the Intellectual Property Collateral intended to be granted to the Collateral Agent for the benefit of the Secured Parties, in each case (i) and (ii), without the consent of the Collateral Agent.

 

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(g)           Each Pledgor agrees, on a continuing basis, diligently keep adequate records respecting the Intellectual Property Collateral and  furnish to the Collateral Agent from time to time upon the Collateral Agent’s reasonable request therefor reasonably detailed statements and amended schedules further identifying and describing the Intellectual Property Collateral and such other materials evidencing or reports pertaining to the Intellectual Property Collateral as the Collateral Agent may from time to time request.

 

(h)           During the continuance of an Event of Default, within three Business Days after written notice from the Collateral Agent, make available to the Collateral Agent, to the extent within such Pledgor’s power and authority, such personnel in such Pledgor’s employ on the date of such Event of Default as the Collateral Agent may reasonably designate, by name, title or job responsibility, to permit such Pledgor to continue, directly or indirectly, to produce, advertise and sell the products and services sold or delivered by such Pledgor under or in connection with the Intellectual Property Collateral, and each Pledgor shall use commercially reasonable efforts to ensure that such Persons shall be available to perform their prior functions on the Collateral Agent’s behalf if compensated at Pledgor’s expense on a per diem, pro rata basis consistent with the salary and benefits structure applicable to each as of the date of such Event of Default.

 

(i)           With respect to its Intellectual Property Collateral, each Pledgor agrees to execute or otherwise authenticate agreements, as applicable, the Copyright Security Agreement,  Patent Security Agreement and Trademark Security Agreement in substantially the forms set forth in Exhibits 6, 7 and 8 hereto or otherwise in form and substance satisfactory to the Collateral Agent for recording the security interest granted hereunder to the Collateral Agent in such Intellectual Property Collateral with the United States Patent and Trademark Office, the United States Copyright Office and any other Governmental Authorities necessary to perfect the security interest hereunder in such Intellectual Property Collateral.

 

If any Pledgor shall, at any time before the payment in full of the Secured Obligations, (a) obtain any rights to any additional Intellectual Property Collateral or (b) become entitled to the benefit of any additional Intellectual Property Collateral or any renewal or extension thereof, including any reissue, division, continuation, or continuation-in-part of any Intellectual Property Collateral, or any improvement on any Intellectual Property Collateral, the provisions of this Agreement shall automatically apply thereto and any such item enumerated in clause (a) or (b) of this Section 6.3 with respect to such Pledgor shall automatically constitute Intellectual Property Collateral if such item would have constituted Intellectual Property Collateral at the time of execution hereof and be subject to the Lien and security interest created by this Agreement without further action by any party (excluding any Intellectual Property Collateral that constitutes Excluded Property).  Each Pledgor shall promptly (i) provide to the Collateral Agent written notice of any of the foregoing and (ii) confirm the attachment of the Lien and security interest created by this Agreement to any rights described in clauses (a) and (b) of the immediately preceding sentence of this Section 6.3 by execution of an instrument in form reasonably acceptable to the Collateral Agent and the filing of any instruments or statements as shall be deemed necessary, advisable or prudent by the Collateral Agent to preserve, protect or perfect the Collateral Agent’s security interest or the priority thereof in such Intellectual Property Collateral to the extent such security interest in such Intellectual Property Collateral may be perfected under applicable Legal Requirements.  Further, each Pledgor authorizes the Collateral Agent to modify this Agreement by amending Schedules 14(a) (b) and (c) to the Perfection Certificate to include any Intellectual Property Collateral acquired or arising after the date hereof of such Pledgor.

 

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Unless there shall occur and be continuing any Event of Default, each Pledgor shall have the right to commence and prosecute in its own name, as the party in interest, for its own benefit and at the sole cost and expense of the Pledgors, such applications for protection of the Intellectual Property Collateral and suits, proceedings or other actions to prevent the infringement, counterfeiting, unfair competition, dilution, diminution in value or other damage as are necessary, advisable or prudent to protect the Intellectual Property Collateral.  Upon the occurrence and during the continuance of any Event of Default, the Collateral Agent shall have the right but shall in no way be obligated to file applications for protection of the Intellectual Property Collateral and/or bring suit in the name of any Pledgor, the Collateral Agent or the Secured Parties to enforce the Intellectual Property Collateral and any license thereunder.  In the event of such suit, each Pledgor shall, at the reasonable request of the Collateral Agent, do any and all lawful acts and execute any and all documents requested by the Collateral Agent in aid of such enforcement and the Pledgors shall promptly reimburse and indemnify the Collateral Agent in accordance with Section 10.03 of the Credit Agreement for all costs and expenses incurred by the Collateral Agent in the exercise of its rights under this Section 6.3.  In the event that the Collateral Agent shall elect not to bring such suit to enforce the Intellectual Property Collateral, each Pledgor agrees, at the reasonable request of the Collateral Agent, to take all actions necessary, advisable or prudent, whether by suit, proceeding or other action, to prevent the infringement, counterfeiting, unfair competition, dilution, diminution in value of or other damage to any of the Intellectual Property Collateral by others and for that purpose agrees to diligently maintain any suit, proceeding or other action against any Person so infringing necessary to prevent such infringement.

 

ARTICLE VII

 

CERTAIN PROVISIONS CONCERNING ACCOUNTS

 

Section 7.1            Special Representation and Warranties.  As of the time when each of its Accounts arises, each Pledgor shall be deemed to have represented and warranted that such Account and all records, papers and documents relating thereto (i) are genuine and correct and in all material respects what they purport to be, (ii) to the Pledgor’s knowledge, represent the legal, valid and binding obligation of the account debtor, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally or by equitable principles relating to enforceability, evidencing indebtedness unpaid and owed by such account debtor, arising out of the performance of labor or services or the sale, lease, license, assignment or other disposition and delivery of the goods or other property listed therein or out of an advance or a loan, (iii) will, in the case of an Account, except for the original or duplicate original invoice sent to purchase evidencing such purchaser’s account, be the only original writing evidencing and embodying such obligation of the account debtor named therein and (iv) are in all material respects in compliance and conform with all applicable Legal Requirements.

 

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Section 7.2            Maintenance of Records.  Each Pledgor shall keep and maintain at its own cost and expense complete records of each Account, in a manner consistent with prudent business practices, including records of all payments received, all credits granted thereon, all merchandise returned and all other documentation relating thereto.  Each Pledgor shall, at such Pledgor’s sole cost and expense, upon the Collateral Agent’s demand made at any time after the occurrence and during the continuance of any Event of Default, deliver all tangible evidence of Accounts, including all documents evidencing Accounts and any books and records relating thereto to the Collateral Agent or to its representatives (copies of which evidence and books and records may be retained by such Pledgor).  Upon the occurrence and during the continuance of any Event of Default, the Collateral Agent may transfer a full and complete copy of any Pledgor’s books, records, credit information, reports, memoranda and all other writings relating to the Accounts to and for the use by any Person that has acquired or is contemplating acquisition of an interest in the Accounts or the Collateral Agent’s security interest therein without the consent of any Pledgor.

 

Section 7.3            Legend.  At the request of the Collateral Agent and in form and manner satisfactory to the Collateral Agent, each Pledgor shall legend the Accounts and the other books, records and documents of such Pledgor evidencing or pertaining to the Accounts with an appropriate reference to the fact that the Accounts have been assigned to the Collateral Agent for the benefit of the Secured Parties and that the Collateral Agent has a security interest therein.

 

Section 7.4            Modification of Terms, etc.  No Pledgor shall rescind or cancel any obligations evidenced by any Account or modify any term thereof or make any adjustment with respect thereto except in the ordinary course of business in a manner consistent with prudent business practices, or extend or renew any such obligations except in the ordinary course of business consistent with prudent business practices or compromise or settle any dispute, claim, suit or legal proceeding relating thereto or sell any Account or interest therein except in the ordinary course of business in a manner consistent with prudent business practices without the prior written consent of the Collateral Agent.  Each Pledgor shall timely fulfill all obligations on its part to be fulfilled under or in connection with the Accounts.

 

Section 7.5            Collection.  Each Pledgor shall cause to be collected from the account debtor of each of the Accounts, as and when due in the ordinary course of business and consistent with prudent business practices (including Accounts that are delinquent, such Accounts to be collected in accordance with generally accepted commercial collection procedures), any and all amounts owing under or on account of such Account, and apply forthwith upon receipt thereof all such amounts as are so collected to the outstanding balance of such Account, except that any Pledgor may, with respect to an Account, allow in the ordinary course of business (i) a refund or credit due as a result of returned or damaged or defective merchandise and (ii) such extensions of time to pay amounts due in respect of Accounts and such other modifications of payment terms or settlements in respect of Accounts as shall be commercially reasonable in the circumstances, all in accordance with such Pledgor’s ordinary course of business consistent with its collection practices as in effect from time to time.  The costs and expenses (including attorneys’ fees) of collection, in any case, whether incurred by any Pledgor, the Collateral Agent or any Secured Party, shall be paid by the Pledgors in accordance with Section 10.03 of the Credit Agreement.

 

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ARTICLE VIII

 

TRANSFERS

 

Section 8.1            Transfers of Collateral.  No Pledgor shall (a) sell, convey, assign or otherwise dispose of, or grant any option with respect to, any of the Collateral pledged by it hereunder except to the extent not prohibited by and otherwise subject to the requirements of the Credit Agreement or (b) create or permit to exist any Lien upon or with respect to any of the Collateral pledged by it hereunder other than Permitted Liens.

 

ARTICLE IX

 

REMEDIES

 

Section 9.1            Remedies.  Upon the occurrence and during the continuance of any Event of Default, the Collateral Agent may from time to time exercise in respect of the Collateral, in addition to the other rights and remedies provided for herein or otherwise available to it, the following remedies:

 

(a)           Personally, or by agents or attorneys, immediately take possession of the Collateral or any part thereof, from any Pledgor or any other Person who then has possession of any part thereof with or without notice or process of law, and for that purpose may enter upon any Pledgor’s premises where any of the Collateral is located, remove such Collateral, remain present at such premises to receive copies of all communications and remittances relating to the Collateral and use in connection with such removal and possession any and all services, supplies, aids and other facilities of any Pledgor;

 

(b)           Demand, sue for, collect or receive any money or property at any time payable or receivable in respect of the Collateral including instructing the obligor or obligors on any agreement, instrument or other obligation constituting part of the Collateral to make any payment required by the terms of such agreement, instrument or other obligation directly to the Collateral Agent, and in connection with any of the foregoing, compromise, settle, extend the time for payment and make other modifications with respect thereto; provided, however, that in the event that any such payments are made directly to any Pledgor, prior to receipt by any such obligor of such instruction, such Pledgor shall segregate all amounts received pursuant thereto in trust for the benefit of the Collateral Agent and shall promptly but in no event later than three Business Days after receipt thereof (or such later date as may be agreed to in writing by the Collateral Agent in its sole discretion) pay such amounts to the Collateral Agent;

 

(c)           Sell, assign, grant a license to use or otherwise liquidate, or direct any Pledgor to sell, assign, grant a license to use or otherwise liquidate, any and all investments made in whole or in part with the Collateral or any part thereof, and take possession of the proceeds of any such sale, assignment, license or liquidation;

 

(d)           Take possession of the Collateral or any part thereof, by directing any Pledgor in writing to deliver the same to the Collateral Agent at any place or places so designated by the Collateral Agent, in which event such Pledgor shall at its own expense:  (i) forthwith cause the same to be moved to the place or places designated by the Collateral Agent and therewith delivered to the Collateral Agent, (ii) store and keep any Collateral so delivered to the Collateral Agent at such place or places pending further action by the Collateral Agent and (iii) while the Collateral shall be so stored and kept, provide such security and maintenance services as shall be necessary to protect the same and to preserve and maintain them in good condition.  Each Pledgor’s obligation to deliver the Collateral as contemplated in this Section 9.1(d) is of the essence hereof.  Upon application to a court of equity having jurisdiction, the Collateral Agent shall be entitled to a decree requiring specific performance by any Pledgor of such obligation;

 

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(e)           Withdraw all moneys, instruments, securities and other property in any bank, financial securities, deposit or other account of any Pledgor constituting Collateral for application to the Secured Obligations as provided in Article X;

 

(f)           Retain and apply the Distributions to the Secured Obligations as provided in Article X;

 

(g)           Exercise any and all rights as beneficial and legal owner of the Collateral, including perfecting assignment of and exercising any and all voting, consensual and other rights and powers with respect to any Collateral; and

 

(h)           All the rights and remedies of a secured party on default under the UCC (whether or not the UCC applies to the affected Collateral), and the Collateral Agent may also in its sole discretion, without notice except as specified in Section 9.2, sell, assign, transfer or grant a license to use the Collateral or any part thereof in one or more parcels at public or private sale, at any exchange, broker’s board or at any of the Collateral Agent’s offices or elsewhere, for cash, on credit or for future delivery, and at such price or prices and upon such other terms as the Collateral Agent may deem commercially reasonable.  The Collateral Agent or any other Secured Party or any of their respective Affiliates may be the purchaser, licensee, assignee or recipient of any or all of the Collateral at any such sale and shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold, assigned or licensed at such sale, to use and apply any of the Secured Obligations owed to such Person as a credit on account of the purchase price of any Collateral payable by such Person at such sale.  Each purchaser, assignee, licensee or recipient at any such sale shall acquire the property sold, assigned or licensed absolutely free from any claim or right on the part of any Pledgor, and each Pledgor hereby waives, to the fullest extent permitted by applicable Legal Requirements, all rights of redemption, stay and/or appraisal that it now has or may at any time in the future have under any Legal Requirement now existing or hereafter enacted.  The Collateral Agent shall not be obligated to make any sale of Collateral regardless of notice of sale having been given.  The Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned.  Each Pledgor hereby waives, to the fullest extent permitted by applicable Legal Requirements, any claims against the Collateral Agent arising by reason of the fact that the price at which any Collateral may have been sold, assigned or licensed at such a private sale was less than the price which might have been obtained at a public sale, even if the Collateral Agent accepts the first offer received and does not offer such Collateral to more than one offeree.

 

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Notwithstanding anything to the contrary contained in this Agreement, the Credit Agreement, or any other Loan Document or in any other agreement, instrument or document executed by any Pledgor and delivered to the Collateral Agent or any Lender, and without waiving or limiting any obligations of the Pledgors hereunder, neither the Collateral Agent nor any Lender or other Secured Party, nor any receiver appointed by the exercise of remedies hereunder, (i) will take any action pursuant to this Agreement, the Credit Agreement, or any other Loan Document or any other document referred to above which would constitute or result in any assignment or change of control of any Regulatory License issued by the FCC, any PUC, or any other Governmental Authority if any such assignment or change of control would require, under any Legal Requirements, the prior approval of the FCC, any PUC, or any other Governmental Authority without first obtaining such prior approval of the FCC, such PUC, or such other Governmental Authority.

 

In connection with the enforcement by the Collateral Agent of any remedies pursuant to this Section 9.1 that would require the approval of the FCC, a PUC or any Governmental Authority, and subject to the terms and conditions set forth herein, each Pledgor agrees that it shall join and cooperate fully with, at the request of the Collateral Agent, any receiver referred to below and/or the successful bidder or bidders at any foreclosure sale in a filing of an application (and furnishing any additional information that may be required in connection with such application or which the Collateral Agent may believe relevant to such application) with the FCC, any PUC and all other applicable Governmental Authorities, requesting their prior approval of the transfer of control of any Pledgor or assignment of all licenses, certificates, Governmental Approvals, approvals and permits, issued to any Pledgor by the FCC, any PUC or any such Governmental Authorities with respect to the Collateral and the operation thereof, to the Collateral Agent, the receiver or to the successful bidder or bidders. In connection with the foregoing, each Pledgor shall take such further actions, and execute all such instruments, as the Collateral Agent reasonably deems necessary or advisable.

 

If the Pledgors fail to reasonably cooperate with the Collateral Agent in its enforcement of any remedies permitted hereunder that would require the approval of the FCC, a PUC, or any Governmental Authority, and subject to the terms and conditions set forth herein, (i) each Pledgor agrees that the Collateral Agent may enforce any obligation of any such Pledgor as set forth in this section by an action for specific performance; and (ii) each Pledgor, subject to the rules and regulations of the FCC, a PUC, or any Governmental Authority, hereby irrevocably constitutes and appoints the Collateral Agent and any agent or officer thereof (which appointment is coupled with an interest) as its true and lawful attorney-in-fact with full irrevocable power and authority and in the place and stead of such Pledgor and in the name of such Pledgor or in its own name, after the occurrence and during the continuance of an Event of Default and in connection with the foregoing, for the purpose of executing on behalf and in the name of such Pledgor any and all of the above-referenced instruments and to take any and all appropriate action in furtherance of the foregoing. The exercise of any rights or remedies hereunder or under any other Loan Document by the Collateral Agent or any other Person acting on its behalf that may require FCC, any PUC or any other Governmental Authority approval, shall be subject to obtaining such approval and shall at all times be consistent in all material respects with the rules and regulations of the FCC, any PUC, or any Governmental Authority. Pending the receipt of any FCC, any PUC or any  Governmental Authority approval, no Pledgor shall do anything to delay, hinder, interfere or obstruct the exercise of the Collateral Agent’s rights or remedies hereunder in obtaining such approvals. Notwithstanding anything to the contrary in this Agreement, neither the Collateral Agent nor any other Person acting on its behalf shall take any action which would reasonably be expected to cause the revocation, suspension or material adverse modification of any of the regulatory licenses, permits, or franchises of any Pledgor.

 

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In connection with the exercise of its remedies under this Agreement that require the approval of the FCC, a PUC, or any Governmental Authority, the Collateral Agent may, upon the occurrence and during the continuation of an Event of Default, obtain the appointment of a receiver or trustee to assume upon receipt of all necessary judicial, FCC, any PUC or other Governmental Authority consents or approvals, control of or ownership of any of the Governmental Approvals. Such receiver or trustee shall have all rights and powers provided to it by law or by court order or provided to the Collateral Agent under this Agreement. Upon the appointment of such trustee or receiver, each Pledgor agrees to cooperate, to the extent necessary or advisable, in the expeditious preparation, execution and filing of an application to the FCC, any PUC or any other Governmental Authority or for consent to the transfer or control or assignment of any Pledgor’s Governmental Approvals to the receiver or trustee.

 

Section 9.2            Notice of Sale.  Each Pledgor acknowledges and agrees that, to the extent notice of sale or other disposition of Collateral shall be required by any Legal Requirement, 10 days’ prior notice to such Pledgor of the time and place of any public sale or of the time after which any private sale or other intended disposition is to take place shall be commercially reasonable notification of such matters, unless the Collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market (in which case no such prior notice shall be required).  No notification need be given to any Pledgor if it has signed, after the occurrence of an Event of Default, a statement renouncing or modifying any right to notification of sale or other intended disposition.

 

Section 9.3            Waiver of Notice and Claims; Other Waivers; Marshalling.

 

(a)           Each Pledgor hereby waives, to the fullest extent permitted by applicable Legal Requirements, notice of judicial hearing in connection with the Collateral Agent’s taking possession or the Collateral Agent’s disposition of any of the Collateral, including any and all prior notice and hearing for any prejudgment remedy or remedies and any such right which such Pledgor would otherwise have under any Legal Requirement, and each Pledgor hereby further waives, to the fullest extent permitted by applicable Legal Requirements (i) all damages occasioned by such taking of possession, (ii) all other requirements as to the time, place and terms of sale or other requirements with respect to the enforcement of the Collateral Agent’s rights hereunder and (iii) all rights of redemption, appraisal, valuation, stay, extension or moratorium now or hereafter in force under any applicable Legal Requirements.  The Collateral Agent shall not be liable for any incorrect or improper payment made pursuant to this Article IX except to the extent resulting solely from the Collateral Agent’s gross negligence or willful misconduct as finally determined by a court of competent jurisdiction.  Any sale of, or the grant of options to purchase, or any other realization upon, any Collateral shall operate to divest all right, title, interest, claim and demand, either at law or in equity, of the applicable Pledgor therein and thereto, and shall be a perpetual bar both at law and in equity or otherwise against such Pledgor and against any and all Persons claiming or attempting to claim the Collateral so sold, optioned or realized upon, or any part thereof, from, through or under such Pledgor.

 

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(b)           Each Pledgor hereby waives demand, notice, protest, notice of acceptance of this Agreement, notice of Credit Extensions, Collateral received or delivered or any other action taken in reliance hereon and all other demands and notices of any description.

 

(c)           The Collateral Agent shall not be required to marshal any present or future collateral security (including the Collateral) for, or other assurances of payment of, the Secured Obligations or any of them or to resort to such collateral security or other assurances of payment in any particular order.  To the maximum extent permitted by applicable Legal Requirements, each Pledgor hereby agrees that it will not invoke any Legal Requirement relating to the marshalling of collateral and hereby irrevocably waives the benefits of all such Legal Requirements.

 

Section 9.4            Standards for Exercising Rights and Remedies.  (a)  To the extent that applicable Legal Requirements impose duties on the Collateral Agent to exercise remedies in a commercially reasonable manner, each Pledgor acknowledges and agrees that it is not commercially unreasonable for the Collateral Agent (i) to fail to incur expenses reasonably deemed significant by the Collateral Agent to prepare Collateral for disposition or otherwise to fail to complete raw material or work in process into finished goods or other finished products for disposition, (ii) to fail to obtain third party consents for access to Collateral to be disposed of, or to obtain or to fail to obtain consents for Governmental Authorities or third parties for the collection or disposition of Collateral to be collected or disposed of, (iii) to fail to exercise collection remedies against account debtors or other Persons obligated on Collateral or to fail to remove liens or encumbrances on or any adverse claims against Collateral, (iv) to exercise collection remedies against account debtors and other Persons obligated on Collateral directly or through the use of collection agencies and other collection specialists, (v) to advertise dispositions of Collateral through publications or media of general circulation, whether or not the Collateral is of a specialized nature, (vi) to contact other Persons, whether or not in the same business as any Pledgor, for expressions of interest in acquiring all or any portion of the Collateral, (vii) to hire one or more professional auctioneers to assist in the disposition of Collateral, whether or not the collateral is of a specialized nature, (viii) to dispose of Collateral by utilizing internet sites that provide for the auction of assets of the types included in the Collateral or that have the reasonable capability of doing so, or that match buyers and sellers of assets, (ix) to dispose of assets in wholesale rather than retail markets, (x) to disclaim or modify disposition warranties, (xi) to purchase insurance or credit enhancements to insure the Collateral Agent against risks of loss, collection or disposition of Collateral or to provide to the Collateral Agent a guaranteed return from the collection or disposition of Collateral, or (xii) to the extent deemed appropriate by the Collateral Agent, to obtain the services of other brokers, investment bankers, consultants and other professionals to assist the Collateral Agent in the collection or disposition of any of the Collateral.  The Pledgors acknowledge that the purpose of this Section 9.4 is to provide non-exhaustive indications of what actions or omissions by the Collateral Agent would fulfill the Collateral Agent’s duties under the UCC or other Legal Requirement of the State or any other relevant jurisdiction in the Collateral Agent’s exercise of remedies against the Collateral and that other actions or omissions by the Collateral Agent shall not be deemed to fail to fulfill such duties solely on account of not being indicated in this Section 9.4.  Without limiting the foregoing, nothing contained in this Section 9.4 shall be construed to grant any rights to any Pledgor or to impose any duties on the Collateral Agent that would not have been granted or imposed by this Agreement or by applicable Legal Requirements in the absence of this Section 9.4.

 

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(a)           Each Pledgor recognizes that, by reason of certain prohibitions contained in Legal Requirements, the Collateral Agent may be compelled, with respect to any sale of all or any part of the Collateral, to limit purchasers to those who meet the requirements of a Governmental Authority.  Each Pledgor acknowledges that any such sales may be at prices and on terms less favorable to the Collateral Agent than those obtainable through a public sale without such restrictions, and, notwithstanding such circumstances, agrees that any such restricted sale shall be deemed to have been made in a commercially reasonable manner and that, except as may be required by applicable Legal Requirements, the Collateral Agent shall have no obligation to engage in public sales.

 

(b)           Each Pledgor recognizes that, by reason of certain prohibitions contained in the Securities Act of 1933, as amended (the “Securities Act”), and applicable state or foreign securities laws, the Collateral Agent may be compelled, with respect to any sale or disposition of all or any part of the Securities Collateral and Investment Property, to limit purchasers to Persons who will agree, among other things, to acquire such Securities Collateral or Investment Property for their own account, for investment and not with a view to the distribution or resale thereof.  Each Pledgor acknowledges that any such private sales may be at prices and on terms less favorable to the Collateral Agent than those obtainable through a public sale without such restrictions (including a public offering made pursuant to a registration statement under the Securities Act), and, notwithstanding such circumstances, agrees that any such private sale shall be deemed to have been made in a commercially reasonable manner and that the Collateral Agent shall have no obligation to engage in public sales and no obligation to delay the sale of any Securities Collateral or Investment Property for the period of time necessary to permit the issuer thereof to register it for a form of public sale requiring registration under the Securities Act or under applicable state or foreign securities laws, even if such issuer would agree to do so.

 

(c)           If the Collateral Agent determines to exercise its right to sell any or all of the Securities Collateral or Investment Property, upon written request, the applicable Pledgor shall, and shall cause each issuer of Securities Collateral and Investment Property to be sold hereunder to, from time to time furnish to the Collateral Agent all such information as the Collateral Agent may reasonably request in order to determine the number and nature or interest, of securities or other instruments included in the Securities Collateral or Investment Property which may be sold by the Collateral Agent as exempt transactions under the Securities Act and the rules of the Securities and Exchange Commission thereunder, as the same are from time to time in effect.

 

(d)           Each Pledgor further agrees that a breach of any of the covenants contained in this Section 9.5 will cause irreparable injury to the Collateral Agent and other Secured Parties, that the Collateral Agent and the other Secured Parties have no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 9.5 shall be specifically enforceable against such Pledgor, and such Pledgor hereby waives and agrees not to assert any defenses against an action for specific performance of such covenants.

 

Section 9.5            No Waiver; Cumulative Remedies.

 

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(i)           No failure on the part of the Collateral Agent to exercise, no course of dealing with respect to, and no delay on the part of the Collateral Agent in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any such right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy; nor shall the Collateral Agent be required to look first to, enforce or exhaust any other security, collateral or guaranties.  The remedies herein provided are cumulative and are not exclusive of any remedies provided by applicable Legal Requirements, in equity or otherwise.

 

(ii)           In the event that the Collateral Agent shall have instituted any proceeding to enforce any right, power or remedy under this Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Collateral Agent, then and in every such case, the Pledgors, the Collateral Agent and each other Secured Party shall be restored to their respective former positions and rights hereunder with respect to the Collateral, and all rights, remedies and powers of the Collateral Agent and the other Secured Parties shall continue as if no such proceeding had been instituted.

 

Section 9.6            Certain Additional Actions Regarding Intellectual Property.  If any Event of Default shall have occurred and be continuing, upon the written demand of the Collateral Agent, each Pledgor shall execute and deliver to the Collateral Agent an assignment or assignments of the Intellectual Property Collateral that is Registered or such other documents as are necessary, advisable or prudent to carry out the intent and purposes hereof.

 

ARTICLE X

 

PROCEEDS OF CASUALTY EVENTS AND COLLATERAL DISPOSITIONS;

APPLICATION OF PROCEEDS

 

Section 10.1          Proceeds of Casualty Events and Collateral Dispositions.  The Pledgors shall take all actions required by the Credit Agreement with respect to any Net Cash Proceeds of any Casualty Event or from the sale or disposition of any Collateral.

 

Section 10.2          Application of Proceeds.  The proceeds received by the Collateral Agent in respect of any sale of, collection from or other realization upon all or any part of the Collateral pursuant to the exercise by the Collateral Agent of its remedies shall be applied, together with any other sums then held by the Collateral Agent pursuant to this Agreement, in accordance with the Credit Agreement.

 

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ARTICLE XI

 

MISCELLANEOUS

 

Section 11.1           Concerning Collateral Agent.

 

(i)            The Collateral Agent has been appointed as collateral agent pursuant to the  Credit Agreement.  The actions of the Collateral Agent hereunder are subject to the provisions of the Credit Agreement.  The Collateral Agent shall have the right hereunder to make demands, to give notices, to exercise or refrain from exercising any rights, and to take or refrain from taking action (including the release or substitution of the Collateral), in accordance with this Agreement and the Credit Agreement.  Each Secured Party, by its acceptance of the benefits hereof, agrees that it shall have no right individually to realize upon any of the Collateral hereunder, it being understood and agreed by such Secured Party that all rights and remedies hereunder may be exercised solely by the Collateral Agent for the benefit of the Secured Parties in accordance with the terms of this Agreement.  The Collateral Agent may employ agents and attorneys-in-fact in connection herewith and shall not be liable for the negligence or misconduct of any such agents or attorneys-in-fact selected by it in good faith.  The Collateral Agent may resign and a successor Collateral Agent may be appointed in the manner provided in the Credit Agreement.  Upon the acceptance of any appointment as the Collateral Agent by a successor Collateral Agent, that successor Collateral Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Collateral Agent under this Agreement, and the retiring Collateral Agent shall thereupon be discharged from its duties and obligations under this Agreement.  After any retiring Collateral Agent’s resignation, the provisions hereof shall inure to its benefit as to any actions taken or omitted to be taken by it under this Agreement while it was the Collateral Agent.

 

(ii)           Except for the exercise of reasonable care in the custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Collateral Agent shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.  The Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession from time to time if such Collateral is accorded treatment substantially equivalent to that which the Collateral Agent, in its individual capacity, accords its own property consisting of similar instruments or interests; provided that neither the Collateral Agent nor any of the other Secured Parties nor any of their respective directors, officers, employees or agents shall have responsibility for (x) ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relating to any Securities Collateral, whether or not the Collateral Agent or any other Secured Party has or is deemed to have knowledge of such matters (y) failing to demand, collect or realize upon all or any part of the Collateral or for any delay in doing so or (z) failing to take any necessary steps to preserve rights against any Person with respect to any Collateral.

 

(iii)           The Collateral Agent shall be entitled to rely upon any written notice, statement, certificate, order or other document or any telephone message believed by it to be genuine and correct and to have been signed, sent or made by the proper Person, and, with respect to all matters pertaining to this Agreement and its duties hereunder, upon advice of counsel selected by it.

 

(iv)           If any item of Collateral also constitutes collateral granted to the Collateral Agent under any other deed of trust, mortgage, security agreement, pledge or instrument of any type, in the event of any conflict between the provisions hereof and the provisions of such other deed of trust, mortgage, security agreement, pledge or instrument of any type in respect of such collateral, the Collateral Agent, in its sole discretion, shall determine which provisions shall control.

 

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Section 11.2          Collateral Agent May Perform; Collateral Agent Appointed Attorney-in-Fact.  If any Pledgor shall fail to perform any covenants contained in this Agreement (including such Pledgor’s covenants to (i) pay the premiums in respect of all required insurance policies hereunder, (ii) pay Charges, (iii) make repairs, (iv) discharge Liens or (v) pay or perform any obligations of such Pledgor under any Collateral) or if any representation or warranty on the part of any Pledgor contained herein shall be breached, the Collateral Agent may (but shall not be obligated to) do the same or cause it to be done or remedy any such breach, and may expend funds for such purpose; provided, however, that the Collateral Agent shall in no event be bound to inquire into the validity of any Charges, Lien, imposition or other obligation which such Pledgor fails to pay or perform as and when required hereby and which such Pledgor does not contest in accordance with the provisions of Section 4.14.  Any and all amounts so expended by the Collateral Agent shall be paid by the Pledgors in accordance with the provisions of Section 10.03 of the Credit Agreement.  Neither the provisions of this Section 11.2 nor any action taken by the Collateral Agent pursuant to the provisions of this Section 11.2 shall prevent any such failure to observe any covenant contained in this Agreement nor any breach of representation or warranty from constituting an Event of Default.  Each Pledgor hereby appoints the Collateral Agent its attorney-in-fact, with full authority in the place and stead of such Pledgor and in the name of such Pledgor, or otherwise, from time to time in the Collateral Agent’s discretion to take any action and to execute any instrument consistent with the terms of the Credit Agreement, this Agreement and the other Loan Documents which the Collateral Agent may deem necessary, advisable or prudent to accomplish the purposes hereof.  The foregoing grant of authority is a power of attorney coupled with an interest and such appointment shall be irrevocable for the term hereof.  Each Pledgor hereby ratifies all that such attorney shall lawfully do or cause to be done by virtue hereof.

 

Section 11.3          Continuing Security Interest; Assignment.  This Agreement shall create a continuing security interest in the Collateral and shall (i) be binding upon the Pledgors, their respective successors and assigns and (ii) inure, together with the rights and remedies of the Collateral Agent hereunder, to the benefit of the Collateral Agent and the other Secured Parties and each of their respective successors, transferees and assignees (including permitted assignees pursuant to Section 10.04 of the Credit Agreement).  No other Persons (including any other creditor of any Pledgor) shall have any interest herein or any right or benefit with respect hereto.  Without limiting the generality of the foregoing clause (ii), any Secured Party may assign or otherwise transfer any obligations held by it secured by this Agreement to any other Person, and such other Person shall thereupon become vested with all the benefits in respect thereof granted to such Secured Party, herein or otherwise, subject however, to the provisions of the Credit Agreement.

 

Section 11.4          Termination; Release; Reinstatement.  Collateral shall be released if and to the extent so provided in Section 9.14(c) of the Credit Agreement.  Each Pledgor agrees that, if any payment made by any Loan Party or other Person and applied to the Secured Obligations is at any time annulled, avoided, set aside, rescinded, invalidated, declared to be fraudulent or preferential or otherwise required to be refunded or repaid, or the proceeds of any Collateral are required to be returned by any Secured Party to such Loan Party, its estate, trustee, receiver or any other party, including any Pledgor, under any bankruptcy law, state or federal law, common law or equitable cause, then, to the extent of such payment or repayment, any Lien or other Collateral securing such liability shall be and remain in full force and effect, as fully as if such payment had never been made.  If, prior to any of the foregoing, any Lien or other Collateral securing such Pledgor’s liability hereunder shall have been released or terminated by virtue of the foregoing, such Lien, other Collateral or provision shall be reinstated in full force and effect and such prior release, termination, cancellation or surrender shall not diminish, release, discharge, impair or otherwise affect the obligations of any such Pledgor in respect of any Lien or other Collateral securing such obligation or the amount of such payment.

 

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Section 11.5          Modification in Writing.  No amendment, modification, supplement, termination or waiver of or to any provision hereof, nor consent to any departure by any Pledgor therefrom, shall be effective unless the same shall be made in accordance with the terms of the Credit Agreement and unless in writing and signed by the Collateral Agent.  Any amendment, modification or supplement of or to any provision hereof, any waiver of any provision hereof and any consent to any departure by any Pledgor from the terms of any provision hereof shall be effective only in the specific instance and for the specific purpose for which made or given.  Except where notice is specifically required by this Agreement, no notice to or demand on any Pledgor in any case shall entitle any Pledgor to any other or further notice or demand in similar or other circumstances.

 

Section 11.6          Notices.  Unless otherwise provided herein or in the Credit Agreement, any notice or other communication herein required or permitted to be given shall be given in the manner and become effective as set forth in the Credit Agreement, as to any Pledgor, addressed to it at the address of Borrower set forth in the Credit Agreement and as to the Collateral Agent, addressed to it at the address set forth in the Credit Agreement, or in each case at such other address as shall be designated by such party in a written notice to the other party complying as to delivery with the terms of this Section 11.6.

 

Section 11.7          Governing Law, Consent to Jurisdiction and Service of Process; Waiver of Jury Trial.

 

(a)           THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION, EXCEPT TO THE EXTENT THAT THE UCC PROVIDES THAT PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK, IN WHICH CASE THE LAWS OF SUCH JURISDICTION SHALL GOVERN WITH RESPECT TO THE PERFECTION OF THE SECURITY INTEREST IN, OR THE REMEDIES WITH RESPECT TO, SUCH PARTICULAR COLLATERAL.

 

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(b)           EACH PLEDGOR HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY APPLICABLE LEGAL REQUIREMENTS, IN SUCH FEDERAL COURT.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY APPLICABLE LEGAL REQUIREMENTS.  NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR OTHERWISE SHALL AFFECT ANY RIGHT THAT THE COLLATERAL AGENT, ANY OTHER AGENT, ANY LENDER OR OTHER SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY PLEDGOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(c)           EACH PLEDGOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LEGAL REQUIREMENTS, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN SECTION 11.7(b).  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LEGAL REQUIREMENTS, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(d)           EACH PARTY TO THIS AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT, IN THE MANNER PROVIDED FOR NOTICES (OTHER THAN FACSIMILE TRANSMISSION OR ELECTRONIC MEANS AND DISREGARDING ANY PERSON TO WHOM SUCH NOTICE SI REQUIRED TO BE COPIED) IN SECTION 11.6.  NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LEGAL REQUIREMENTS.

 

(e)           EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LEGAL REQUIREMENTS, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT, THE TRANSACTIONS OR THE OTHER TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.7.

 

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Section 11.8          Severability of Provisions.  Any provision hereof which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

 

Section 11.9          Execution in Counterparts.  This Agreement and any amendments, waivers, consents or supplements hereto may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all such counterparts together shall constitute one and the same agreement.  Delivery of an executed counterpart of a signature page of this Agreement by facsimile transmission or other electronic means shall be effective as delivery of a manually executed counterpart of this Agreement.

 

Section 11.10        Business Days.  In the event any time period or any date provided in this Agreement ends or falls on a day other than a Business Day, then such time period shall be deemed to end and such date shall be deemed to fall on the next succeeding Business Day, and performance herein may be made on such Business Day, with the same force and effect as if made on such other day.

 

Section 11.11        Waiver of Stay.  Each Pledgor covenants that in the event that such Pledgor or any property or assets of such Pledgor shall hereafter become the subject of a voluntary or involuntary proceeding under the Bankruptcy Code or such Pledgor shall otherwise be a party to any federal, state or foreign bankruptcy, insolvency, moratorium or similar proceeding to which the provisions relating to the automatic stay under Section 362 of the Bankruptcy Code or any similar provision in any such Legal Requirement is applicable, then, in any such case, whether or not the Collateral Agent has commenced foreclosure proceedings under this Agreement, such Pledgor shall not, and each Pledgor hereby expressly waives its right to (to the extent it may lawfully do so) at any time insist upon, plead or in any whatsoever, claim or take the benefit or advantage of any such automatic stay or such similar provision as it relates to the exercise of any of the rights and remedies (including any foreclosure proceedings) available to the Collateral Agent as provided in this Agreement, in any other Security Document or any other document evidencing the Secured Obligations.  Each Pledgor further covenants that it will not hinder, delay or impede the execution of any power granted herein to the Collateral Agent, but will suffer and permit the execution of every such power as though no law relating to any stay or similar provision had been enacted.

 

Section 11.12        No Credit for Payment of Taxes or Imposition.  No Pledgor shall be entitled to any credit against the principal, premium, if any, or interest payable under the Credit Agreement, and such Pledgor shall not be entitled to any credit against any other sums which may become payable under the terms thereof or hereof, by reason of the payment of any Tax on the Collateral or any part thereof.

 

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Section 11.13        No Claims Against Collateral Agent.  Nothing contained in this Agreement shall constitute any consent or request by the Collateral Agent, express or implied, for the performance of any labor or services or the furnishing of any materials or other property in respect of the Collateral or any part thereof, nor as giving any Pledgor any right, power or authority to contract for or permit the performance of any labor or services or the furnishing of any materials or other property in such fashion as would permit the making of any claim against the Collateral Agent in respect thereof or any claim that any Lien based on the performance of such labor or services or the furnishing of any such materials or other property is prior to the Lien hereof.

 

Section 11.14        No Release.  Nothing set forth in this Agreement shall relieve any Pledgor from the performance of any term, covenant, condition or agreement on such Pledgor’s part to be performed or observed under or in respect of any of the Collateral or from any liability to any Person under or in respect of any of the Collateral or shall impose any obligation on the Collateral Agent or any other Secured Party to perform or observe any such term, covenant, condition or agreement on such Pledgor’s part to be so performed or observed or shall impose any liability on the Collateral Agent or any other Secured Party for any act or omission on the part of such Pledgor relating thereto or for any breach of any representation or warranty on the part of such Pledgor contained in this Agreement, the Credit Agreement or the other Loan Documents, or under or in respect of the Collateral or made in connection herewith or therewith.  The obligations of each Pledgor contained in this Section 11.14 shall survive the termination and release of the Liens hereunder and the discharge of such Pledgor’s other obligations under this Agreement, the Credit Agreement and the other Loan Documents.

 

Section 11.15        Overdue Amounts.  Until paid, all amounts due and payable under this Agreement shall constitute Secured Obligations and shall bear interest, whether before or after judgment, at the Default Rate.

 

Section 11.16        Obligations Absolute.  All obligations of each Pledgor hereunder shall be absolute and unconditional irrespective of:

 

(i)           any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of any Pledgor;

 

(ii)          any lack of validity or enforceability of any Loan Document, or any other agreement or instrument relating thereto against any Pledgor;

 

(iii)         any change in the time, manner or place of payment of, or in any other term of, all or any of the Secured Obligations, or any other amendment or waiver of or any consent to any departure from any Loan Document or any other agreement or instrument relating thereto;

 

(iv)         any pledge, exchange, release or non-perfection or loss of priority of any other collateral, or any release or amendment or waiver of or consent to any departure from any guarantee, for all or any of the Secured Obligations;

 

(v)          any exercise, non-exercise or waiver of any right, remedy, power or privilege under or in respect hereof, or any Loan Document; or

 

(vi)         any other circumstances which might otherwise constitute a defense available to, or a discharge of, any Pledgor.

 

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[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the Pledgors and the Collateral Agent have caused this Security Agreement to be duly executed and delivered by their duly authorized officers as of the date first above written.

	 	 
	 	INTERNAP NETWORK SERVICES

CORPORATION , as Pledgor
	 	 	 
	
 

	
By 

	          /s/ J. Eric Cooney
	 	Name:	J. Eric Cooney
	 	Title:	Chief Executive Officer
	 	 	 
	 	
VOXEL HOLDINGS, INC., as Pledgor

	 	 	 
	 	By	          /s/ John D. Maggard
	 	Name:	John D. Maggard
	 	Title:	President and Treasurer
	 	 	 
	 	
VOXEL DOT NET, INC., as Pledgor

	 	 	 
	 	By 	          /s/ John D. Maggard
	 	Name:	John D. Maggard
	 	Title:	President and Treasurer
	 	 	 
	 	UBERSMITH, INC., as Pledgor
	 	 	 
	 	By 	          /s/ John D. Maggard
	 	Name:	John D. Maggard
	 	Title:	President and Treasurer
	 	 	 
	 	
INTERNAP CONNECTIVITY LLC, as Pledgor

	 	 	 
	 	By 	          /s/ John D. Maggard
	 	Name:	John D. Maggard
	 	Title:	President and Treasurer

           

[Signature Page to Security Agreement]

 

    	  

    	 

    
 

 

	 	
JEFFERIES FINANCE LLC, as Collateral Agent

	 	 	 
	
 

	
By

	          /s/ Brian Buoye
	 	Name: 	Brian Buoye
	 	Title: 	Managing Director

 

[Signature Page to Security Agreement]

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