Document:

Exhibit 10.1

 

AMENDED
EXHIBIT A TO VEHICLE PURCHASE AGREEMENT 

 

VEHICLE
REQUIREMENTS

 

This
Amended Exhibit A to the Vehicle Purchase Agreement dated June 4, 2014 (the “Vehicle Purchase Agreement”) replaces
and supersedes the Exhibit A originally attached to the Vehicle Purchase Agreement. Capitalized terms used but not defined herein
shall have the meaning assigned to them in the Vehicle Purchase Agreement.

 

This
Amended Exhibit A serves as a commitment on the part of Buyer to purchase from Seller 1,000 (the “Order”) Workhorse
Next Generation all-electric package cars (the “Vehicles” or “NGEVs”). The purchase of the Vehicles will
be subject to the following terms and conditions:

 

Phase
1 – Test Fleet

 

		●	The
Vehicles will be designed and developed with the input from Buyer’s Automotive Engineering team; provided that Seller shall
be solely responsible and liable for the Vehicles being designed and manufactured in compliance with all applicable laws and regulations.

		●	Buyer
will purchase 50 proto-type NGEVs to be deployed as a test fleet. The NGEVs must pass Buyer’s durability testing and all
Vehicle Requirements (as mutually developed by the parties and attached hereto as Attachment 1) as part of the test fleet deployment.

		●	Buyer
will deploy the test fleet in a variety of routes and geographic regions and will evaluate under various climate/weather conditions
for a time period to be determined by Buyer and at Buyer’s sole discretion.

		●	The
price of the 50 NGEV test Vehicles will not exceed $[**] per Vehicle.

 

Phase
2 – Full Deployment

 

		●	Following
Phase 1 testing and deployment, deployment of the balance of the Order will be on a timeframe decided by Buyer at Buyer’s
sole discretion.

		●	Buyer
will determine, at its sole discretion, the level of success of the 50 Vehicle test.

		●	Buyer
may reduce the quantity of the balance of the Order (or cancel the balance of the Order) depending on the level of success achieved
during the phase 1 testing, as determined in Buyer’s sole discretion.

 

Buyer
and its licensors are, and will remain, the sole and exclusive owners of all right, title, and interest in and to the Buyer Materials,
including all intellectual property rights therein. Seller has no right or license to use any Buyer Materials except solely during
the term of the Vehicle Purchase Agreement to the extent necessary to provide the services thereunder to Buyer. All other rights
in and to the Buyer Materials are expressly reserved by Buyer and its licensors. As used herein, “Buyer Materials”
means, collectively, all information in any form or media, including but not limited to documents, data, know-how, ideas, specifications,
software code, and other materials provided to or made available to Seller or otherwise developed, by or on behalf of Buyer hereunder,
without Seller’s assistance, whether or not the same: (a) are owned by Buyer, a third party, or in the public domain; or
(b) qualify for or are protected by any intellectual property.

 

Seller
and its licensors are, and will remain, the sole and exclusive owners of all right, title, and interest in and to the Seller Materials,
including all intellectual property rights therein. Buyer has no right or license to use any Seller Materials except in connection
with Buyer’s use, ownership and possession of the Vehicles. All other rights in and to the Seller Materials are expressly
reserved by Seller and its licensors. As used herein, “Seller Materials” means, collectively, all information in any
form or media, including but not limited to documents, data, know-how, ideas, specifications, software code, and other materials
provided to or made available to Buyer or otherwise developed, by or on behalf of Seller hereunder, without Buyer’s assistance,
whether or not the same: (a) are owned by Seller, a third party, or in the public domain; or (b) qualify for or are protected
by any intellectual property.

 

**
The information omitted is confidential in nature and has been omitted. Workhorse Group Inc. has filed the omitted portion with
the Securities and Exchange Commission requesting confidential treatment.

 

     

     

    

 

This
Exhibit A shall be governed by the terms and conditions of the Vehicle Purchase Agreement, which terms and conditions are incorporated
herein by this reference. The Vehicle Purchase Agreement remains in full force and effect, except as amended by this Amended Exhibit
A.

 

ACCEPTED
BY:

 

	SELLER:	 	BUYER:
	 	 	 
	Workhorse
    Group Inc.	 	United
    Parcel Service, Inc. 
	Formally
    Known as:	 	 	 
	AMP
    Electric Vehicles, Inc.	 	 	 
	 	 	 	 	 
	By:	/s/
    Duane Hughes	 	By:	/s/
    Michael S. Whitlatoh 
	Name:	Duane
    Hughes	 	Name:	Michael
    S. Whitlatoh 
	Title:	President
    & COO	 	Title:
    	Vice
    President	 

 

	May
30, 2018	 	May 22, 2018

 

    	 	2	 

     

    

 

Attachment
1

 

Vehicle
Requirements – Specifications

 

To
be developed

 

    	 	3hninpaexecution002

                                                                    Exhibit 10.1                                                                                                                                                                   EXECUTION VERSION                                     HNI CORPORATION                                     $100,000,000                  $50,000,000 4.22% Senior Notes, Series A, due May 31, 2025                $50,000,000 4.40% Senior Notes, Series B, due May 31, 2028      ______________                               NOTE PURCHASE AGREEMENT                                    ______________                                  Dated May 31, 2018                                                    

 

                                   TABLE OF CONTENTS    SECTION HEADING PAGE   SECTION 1.        AUTHORIZATION OF NOTES ..........................................................................1    SECTION 2.       SALE AND PURCHASE OF NOTES ...................................................................1    SECTION 3.       CLOSING .......................................................................................................1    SECTION 4.       CONDITIONS TO CLOSING ..............................................................................2       Section 4.1.     Representations and Warranties .............................................................2       Section 4.2.     Performance; No Default .......................................................................2       Section 4.3.    Compliance Certificates .........................................................................2       Section 4.4.     Opinions of Counsel ..............................................................................3       Section 4.5.    Purchase Permitted By Applicable Law, Etc .........................................3       Section 4.6.     Sale of Other Notes ................................................................................3       Section 4.7.     Payment of Special Counsel Fees ..........................................................4       Section 4.8.     Private Placement Number ....................................................................4       Section 4.9.    Changes in Corporate Structure .............................................................4       Section 4.10.   Subsidiary Guaranty...............................................................................4       Section 4.11.    Funding Instructions ..............................................................................4       Section 4.12.   Proceedings and Documents ..................................................................4    SECTION 5.       REPRESENTATIONS AND WARRANTIES OF THE COMPANY .............................4       Section 5.1.     Organization; Power and Authority .......................................................4       Section 5.2.     Authorization, Etc ..................................................................................5       Section 5.3.     Disclosure ..............................................................................................5       Section 5.4.    Organization and Ownership of Shares of Subsidiaries; Affiliates .......5       Section 5.5.     Financial Statements; Material Liabilities .............................................6       Section 5.6.     Compliance with Laws, Other Instruments, Etc ....................................6       Section 5.7.     Governmental Authorizations, Etc .........................................................7       Section 5.8.    Litigation; Observance of Agreements, Statutes and Orders .................7       Section 5.9.     Taxes ......................................................................................................7       Section 5.10.    Title to Property; Leases ........................................................................7       Section 5.11.    Licenses, Permits, Etc ............................................................................8       Section 5.12.    Compliance with Employee Benefit Plans ............................................8       Section 5.13.    Private Offering by the Company ..........................................................9       Section 5.14.   Use of Proceeds; Margin Regulations....................................................9       Section 5.15.   Existing Indebtedness; Future Liens ......................................................9       Section 5.16.    Foreign Assets Control Regulations, Etc .............................................10       Section 5.17.    Status under Certain Statutes ...............................................................11       Section 5.18.    Environmental Matters.........................................................................11    SECTION 6.       REPRESENTATIONS OF THE PURCHASERS ....................................................12                                          -i-   \\DC - 047743/000003 - 10986815 v12    

 

       Section 6.1.     Purchase for Investment .......................................................................12      Section 6.2.     Source of Funds ...................................................................................12      Section 6.3.     Fiduciary Status ...................................................................................14      Section 6.4.     Investor Status ......................................................................................14   SECTION 7.       INFORMATION AS TO COMPANY ..................................................................14      Section 7.1.     Financial and Business Information.....................................................14      Section 7.2.     Officer’s Certificate .............................................................................17      Section 7.3.     Visitation ..............................................................................................18      Section 7.4.    Electronic Delivery ..............................................................................18      Section 7.5.     Limitation on Disclosure Obligation. ..................................................19   SECTION 8.       PAYMENT AND PREPAYMENT OF THE NOTES ..............................................19      Section 8.1.     Maturity................................................................................................19      Section 8.2.     Optional Prepayments with Make-Whole Amount ..............................19      Section 8.3.     Allocation of Partial Prepayments .......................................................20      Section 8.4.     Maturity; Surrender, Etc. .....................................................................20      Section 8.5.     Purchase of Notes ................................................................................20      Section 8.7.     Payments Due on Non-Business Days .................................................22      Section 8.8.     Change in Control ................................................................................22   SECTION 9.       AFFIRMATIVE COVENANTS. ........................................................................23      Section 9.1.    Compliance with Laws ........................................................................23      Section 9.2.     Insurance ..............................................................................................23      Section 9.3.     Maintenance of Properties ...................................................................24      Section 9.4.     Payment of Taxes and Claims ..............................................................24      Section 9.5.     Corporate Existence, Etc ......................................................................24      Section 9.6.     Books and Records ..............................................................................24      Section 9.7.    Subsidiary Guarantors ..........................................................................25      Section 9.8.     Priority of Obligations .........................................................................26   SECTION 10.      NEGATIVE COVENANTS. .............................................................................26      Section 10.1.   Transactions with Affiliates .................................................................26      Section 10.2.    Merger, Consolidation, Etc ..................................................................27      Section 10.3.    Sale of Assets .......................................................................................28      Section 10.4.    Line of Business ...................................................................................29      Section 10.5.    Economic Sanctions, Etc .....................................................................30      Section 10.6.    Liens .....................................................................................................30      Section 10.7.    Financial Covenants. ............................................................................32   SECTION 11.      EVENTS OF DEFAULT ..................................................................................33   SECTION 12.      REMEDIES ON DEFAULT, ETC ......................................................................35      Section 12.1.   Acceleration .........................................................................................35                                       -ii-  \\DC - 047743/000003 - 10986815 v12    

 

       Section 12.2.    Other Remedies ....................................................................................36      Section 12.3.    Rescission ............................................................................................36   SECTION 13.      REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES ...............................37      Section 13.1.    Registration of Notes ...........................................................................37      Section 13.2.   Transfer and Exchange of Notes ..........................................................37      Section 13.3.   Replacement of Notes ..........................................................................38   SECTION 14.      PAYMENTS ON NOTES .................................................................................38      Section 14.1.   Place of Payment..................................................................................38      Section 14.2.    Payment by Wire Transfer ...................................................................38      Section 14.3.    FATCA Information ............................................................................39   SECTION 15.      EXPENSES, ETC ...........................................................................................39      Section 15.1.   Transaction Expenses ...........................................................................39      Section 15.2.    Certain Taxes .......................................................................................40      Section 15.3.    Survival ................................................................................................40   SECTION 16.      SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT                   ....................................................................................................................40   SECTION 17.      AMENDMENT AND WAIVER ........................................................................41      Section 17.1.    Requirements .......................................................................................41      Section 17.2.    Solicitation of Holders of Notes ..........................................................41      Section 17.3.    Binding Effect, Etc...............................................................................42      Section 17.4.    Notes Held by Company, Etc ...............................................................42   SECTION  18. NOTICES ......................................................................................................42   SECTION  19. REPRODUCTION OF DOCUMENTS .................................................................43   SECTION  20. CONFIDENTIAL INFORMATION ....................................................................43   SECTION  21. SUBSTITUTION OF PURCHASER ....................................................................44   SECTION 22.      MISCELLANEOUS ........................................................................................44      Section 22.1.   Successors and Assigns ........................................................................44      Section 22.2.   Accounting Terms ................................................................................45      Section 22.3.    Severability ..........................................................................................45      Section 22.4.   Construction, Etc ..................................................................................45      Section 22.5.    Counterparts .........................................................................................46      Section 22.6.   Governing Law ....................................................................................46      Section 22.7.    Jurisdiction and Process; Waiver of Jury Trial ....................................46                                        -iii-  \\DC - 047743/000003 - 10986815 v12    

 

   Signature ..........................................................................................................................................1                                             -iv-  \\DC - 047743/000003 - 10986815 v12    

 

   SCHEDULE A          —        Defined Terms   SCHEDULE 1-A         —    Form of 4.22% Senior Note, Series A, due May 31, 2025   SCHEDULE 1-B         —    Form of 4.40% Senior Note, Series B, due May 31, 2028   SCHEDULE 4.4(a)      —    Form of Opinion of Special Counsel for the Company   SCHEDULE 4.4(b)      —    Form of Opinion of Special Counsel for the Purchasers   SCHEDULE 4.9        —     Changes in Corporate Structure   SCHEDULE 5.3        —     Disclosure Materials   SCHEDULE 5.4         —    Subsidiaries of the Company and Ownership of Subsidiary                            Stock   SCHEDULE 5.5         —    Financial Statements   SCHEDULE 5.7         —    Governmental Authorizations   SCHEDULE 5.15       —     Existing Indebtedness   SCHEDULE 7.2         —    Form of Compliance Certificate   SCHEDULE 9.7         —    Form of Subsidiary Guarantor Joinder   SCHEDULE 10.2(c)     —    Form of Subsidiary Guarantor Reaffirmation   PURCHASER SCHEDULE   —    Information Relating to Purchasers                                                -v-  \\DC - 047743/000003 - 10986815 v12    

 

 HNI CORPORATION                                          Note Purchase Agreement                                     HNI CORPORATION                               408 EAST SECOND STREET                               MUSCATINE, IOWA 52761                                                           $50,000,000 4.22% Senior Notes, Series A, due May 31, 2025                 $50,000,000 4.40% Senior Notes, Series B, due May 31, 2028                                                                      May 31, 2018    TO EACH OF THE PURCHASERS LISTED IN         THE PURCHASER SCHEDULE HERETO:    Ladies and Gentlemen:          HNI Corporation, an Iowa corporation (the “Company”), agrees with each of the   Purchasers as follows:    SECTION 1.    AUTHORIZATION OF NOTES.         The Company will authorize the issue and sale of (i) $50,000,000 aggregate principal  amount of its 4.22% Senior Notes, Series A, due May 31, 2025 (the “Series A Notes”), and (ii)  $50,000,000 aggregate principal amount of its 4.40% Senior Notes, Series B, due May 31, 2028   (the “Series B Notes” and together with the Series A Notes, the “Notes”, such term to include any   such notes as amended, restated or otherwise modified from time to time pursuant to Section 17   and including any such notes issued in substitution therefor pursuant to Section 13).  The Series A   Notes and the Series B Notes shall be substantially in the form set out on Schedule 1-A and   Schedule 1-B, respectively.  Certain capitalized and other terms used in this Agreement are defined   in Schedule A and, for purposes of this Agreement, the rules of construction set forth in   Section 22.4 shall govern.    SECTION 2.    SALE AND PURCHASE OF NOTES .          Subject to the terms and conditions of this Agreement, the Company will issue and sell to   each Purchaser and each Purchaser will purchase from the Company, at the Closing provided for   in Section 3, Notes in the principal amount specified opposite such Purchaser’s name in the   Purchaser Schedule at the purchase price of 100% of the principal amount thereof.  The Purchasers’   obligations hereunder are several and not joint obligations and no Purchaser shall have any liability   to any Person for the performance or non-performance of any obligation by any other Purchaser   hereunder.    SECTION 3.    CLOSING.          The sale and purchase of the Notes to be purchased by each Purchaser shall occur at the  offices of Chapman and Cutler LLP, 111 West Monroe Street, Chicago, Illinois 60603, at 10:00     \\DC - 047743/000003 - 10986815 v12    

 

     a.m., Central time, at a closing (the “Closing”) on May 31, 2018 or on such other Business Day   thereafter on or prior to April 5, 2018, as may be agreed upon by the Company and the Purchasers.    At the Closing the Company will deliver to each Purchaser the Notes to be purchased by such   Purchaser in the form of a single Note (or such greater number of Notes in denominations of at   least $100,000 as such Purchaser may request) dated the date of the Closing and registered in such   Purchaser’s name (or in the name of its nominee), against delivery by such Purchaser to the   Company or its order of immediately available funds in the amount of the purchase price therefor   by wire transfer of immediately available funds for the account of the Company set forth in the  Funding Instructions provided to each Purchaser pursuant to Section 4.11.  If at the Closing the  Company shall fail to tender such Notes to any Purchaser as provided above in this Section 3, or  any of the conditions specified in Section 4 shall not have been fulfilled to such Purchaser’s  satisfaction, such Purchaser shall, at its election, be relieved of all further obligations under this  Agreement, without thereby waiving any rights such Purchaser may have by reason of such failure  by the Company to tender such Notes or any of the conditions specified in Section 4 not having  been fulfilled to such Purchaser’s satisfaction.   SECTION 4.     CONDITIONS TO CLOSING.          Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such Purchaser   at the Closing is subject to the fulfillment to such Purchaser’s satisfaction, prior to or at the Closing,   of the following conditions:        Section 4.1.  Representations and Warranties.       (a) Representations and Warranties of the Company.  The representations and warranties   of the Company in this Agreement shall be correct when made and at the time of the Closing.     (b) Representations and Warranties of the Subsidiary Guarantors.  The representations   and warranties of the Subsidiary Guarantors in the Subsidiary Guaranty shall be correct when made   and at the time of the Closing.        Section 4.2.  Performance; No Default.  The Company and each Subsidiary Guarantor   shall have performed and complied with all agreements and conditions contained in this   Agreement and the Subsidiary Guaranty required to be performed or complied with by it prior to   or at the Closing.  Before and after giving effect to the issue and sale of the Notes (and the   application of the proceeds thereof as contemplated by Section 5.14), no Default or Event of   Default shall have occurred and be continuing.  Neither the Company nor any Subsidiary shall   have entered into any transaction since the date of the Memorandum that would have been   prohibited by Section 10 had such Section applied since such date.        Section 4.3.  Compliance Certificates.     (a) Officer’s Certificate of the Company.  The Company shall have delivered to such   Purchaser an Officer’s Certificate, dated the date of the Closing, certifying that the conditions   specified in Sections 4.1(a), 4.2 and 4.9 have been fulfilled.                                         -2-   \\DC - 047743/000003 - 10986815 v12    

 

      (b) Secretary’s Certificate of the Company.  The Company shall have delivered to such   Purchaser a certificate of its Secretary or Assistant Secretary, dated the date of the Closing,   certifying as to (i) the resolutions attached thereto and other corporate proceedings relating to the  authorization, execution and delivery of the Notes and this Agreement and (ii) the Company’s  organizational documents as then in effect.    (c) Officer’s Certificate of the Subsidiary Guarantors.  Each Subsidiary Guarantor shall  have delivered to such Purchaser an Officer’s Certificate, dated the Closing Date, certifying that  the conditions specified in Sections 4.1(b), 4.2 and 4.9 have been fulfilled.    (d) Secretary’s Certificate of the Subsidiary Guarantors.  Each Subsidiary Guarantor  shall have delivered to such Purchaser a certificate, dated the Closing Date, certifying as to (i) the  resolutions attached thereto and other corporate proceedings relating to the authorization,  execution and delivery of the Subsidiary Guaranty and (ii) such Subsidiary Guarantor’s  organizational documents as then in effect.        Section 4.4.  Opinions of Counsel.  Such Purchaser shall have received opinions in form  and substance satisfactory to such Purchaser, dated the date of the Closing (a) from Hogan Lovells  US LLP, counsel for the Company and the Subsidiary Guarantors, covering the matters set forth  in Schedule 4.4(a) (and the Company and Subsidiary Guarantors hereby instructs its counsel to   deliver such opinion to the Purchasers), (b) from in-house counsel of the Company with respect to   the Subsidiary Guarantors formed in Iowa and Illinois, covering the matters set forth in Schedule   4.4(a) with respect to such Subsidiary Guarantors (and the Company and Subsidiary Guarantors   hereby instructs such counsel to deliver such opinion to the Purchasers) and (c) from Chapman   and Cutler LLP, the Purchasers’ special counsel in connection with such transactions, substantially   in the form set forth in Schedule 4.4(b) and covering such other matters incident to such   transactions as such Purchaser may reasonably request.        Section 4.5.  Purchase Permitted By Applicable Law, Etc.  On the date of the Closing   such Purchaser’s purchase of Notes shall (a) be permitted by the laws and regulations of each   jurisdiction to which such Purchaser is subject, without recourse to provisions (such as   section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance   companies without restriction as to the character of the particular investment, (b) not violate any   applicable law or regulation (including Regulation T, U or X of the Board of Governors of the   Federal Reserve System) and (c) not subject such Purchaser to any tax, penalty or liability under   or pursuant to any applicable law or regulation, which law or regulation was not in effect on the   date hereof.  If requested by such Purchaser, such Purchaser shall have received an Officer’s   Certificate certifying as to such matters of fact regarding the Company and its Subsidiaries as such   Purchaser may reasonably specify to enable such Purchaser to determine whether such purchase   is so permitted.        Section 4.6.  Sale of Other Notes.  Contemporaneously with the Closing the Company   shall sell to each other Purchaser and each other Purchaser shall purchase the Notes to be purchased   by it at the Closing as specified in the Purchaser Schedule.                                          -3-   \\DC - 047743/000003 - 10986815 v12    

 

         Section 4.7.  Payment of Special Counsel Fees.  Without limiting Section 15.1, the   Company shall have paid on or before the Closing the fees, charges and disbursements of the   Purchasers’ special counsel referred to in Section 4.4 to the extent reflected in a statement of such   counsel rendered to the Company at least one Business Day prior to the Closing.        Section 4.8.  Private Placement Number.  A Private Placement Number issued by   Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO) shall have been obtained   for each Series of Notes.        Section 4.9.  Changes in Corporate Structure.  Neither the Company nor any Subsidiary  Guarantor shall have changed its jurisdiction of incorporation or organization, or, except as  reflected in Schedule 4.9, been a party to any merger or consolidation or succeeded to all or any  substantial part of the liabilities of any other entity, at any time following the date of the most  recent financial statements referred to in Schedule 5.5.         Section 4.10.  Subsidiary  Guaranty.  The Subsidiary Guaranty shall have been duly  authorized, executed and delivered by each Subsidiary Guarantor, shall constitute the legal, valid  and binding contract and agreement of each Subsidiary Guarantor and such Purchaser shall have  received a true, correct and complete copy thereof.    Section 4.11. Funding Instructions.  At least three Business Days prior to the date of the  Closing, each Purchaser shall have received written instructions (the “Funding Instructions”)  signed by a Responsible Officer on letterhead of the Company providing (i) the name and address  of the transferee bank, (ii) such transferee bank’s ABA number and (iii) the account name and  number into which the purchase price for the Notes is to be deposited.       Section 4.12.  Proceedings and Documents.  All corporate and other proceedings in  connection with the transactions contemplated by this Agreement and all documents and  instruments incident to such transactions shall be reasonably satisfactory to such Purchaser and its  special counsel, and such Purchaser and its special counsel shall have received all such counterpart  originals or certified or other copies of such documents as such Purchaser or such special counsel  may reasonably request.   SECTION 5.     REPRESENTATIONS AND WARRANTIES OF THE COMPANY.          As of the date hereof, the Company represents and warrants to each Purchaser that:        Section 5.1.  Organization; Power and Authority.  The Company is a corporation duly   organized, validly existing and in good standing under the laws of its jurisdiction of incorporation,   and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which   such qualification is required by law, other than those jurisdictions as to which the failure to be so   qualified or in good standing could not, individually or in the aggregate, reasonably be expected   to have a Material Adverse Effect.  The Company has the corporate power and authority to own   or hold under lease the properties it purports to own or hold under lease, to transact the business it  transacts and proposes to transact, to execute and deliver this Agreement and the Notes and to  perform the provisions hereof and thereof.                                         -4-   \\DC - 047743/000003 - 10986815 v12    

 

         Section 5.2.  Authorization,  Etc.  This Agreement and the Notes have been duly au-  thorized by all necessary corporate action on the part of the Company, and this Agreement   constitutes, and upon execution and delivery thereof each Note will constitute, a legal, valid and   binding obligation of the Company enforceable against the Company in accordance with its terms,  except as such enforceability may be limited by (i) applicable bankruptcy, insolvency,   reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights   generally and (ii) general principles of equity (regardless of whether such enforceability is  considered in a proceeding in equity or at law).        Section 5.3.  Disclosure.  The Company, through its agents, Merrill Lynch, Pierce, Fenner  & Smith Incorporated and Sun Trust, have delivered to each Purchaser a copy of a Private  Placement Memorandum, dated February, 2018 (the “Memorandum”), relating to the  transactions contemplated hereby.  The Memorandum fairly describes, in all material respects, the  general nature of the business of the Company and its Subsidiaries.  This Agreement, the  Memorandum, the financial statements referenced in Schedule 5.5, and the documents, certificates  or other writings delivered to the Purchasers by or on behalf of the Company prior to February 27,  2018 in connection with the transactions contemplated hereby and identified in Schedule 5.3 (this  Agreement, the Memorandum and such documents, certificates or other writings and such  financial statements delivered to each Purchaser being referred to, collectively, as the “Disclosure  Documents”), taken as a whole, together with any SEC filings made by the Company on or after  February 27, 2018, do not contain any untrue statement of a material fact or omit to state any  material fact necessary to make the statements therein not materially misleading in light of the  circumstances under which they were made provided that, with respect to projections, estimates  and other forward-looking information, the Company represents only that such information was  prepared in good faith based upon assumptions believed to be reasonable at the time.  Except as  disclosed in the Disclosure Documents or as may be disclosed in the Company’s SEC filings after  February 27, 2018, since December 30, 2017, there has been no change in the financial condition,  operations, business or properties of the Company and its Subsidiaries, taken as a whole, except  changes that could not, individually or in the aggregate, reasonably be expected to have a Material  Adverse Effect.  There is no fact known to the Company that could reasonably be expected to have  a Material Adverse Effect that has not been set forth herein, in the Disclosure Documents or in the  Company’s SEC filings after February 27, 2018.        Section 5.4.  Organization and Ownership of Shares of Subsidiaries; Affiliates.    (a) Schedule 5.4 contains (except as noted therein) complete and correct lists of (i) the Company’s   Subsidiaries, showing, as to each Subsidiary, the name thereof, the jurisdiction of its organization,  the percentage of shares of each class of its capital stock or similar Equity Interests outstanding  owned by the Company and each other Subsidiary and whether such Subsidiary is a Subsidiary  Guarantor, (ii) the Company’s Affiliates, other than Subsidiaries, and (iii) the Company’s directors  and senior officers.         (b)  All of the outstanding shares of capital stock or similar Equity Interests of each  Subsidiary shown in Schedule 5.4 as being owned by the Company and its Subsidiaries have been  validly issued, are fully paid and non-assessable and are owned by the Company or another   Subsidiary free and clear of any Lien that is prohibited by this Agreement.                                         -5-   \\DC - 047743/000003 - 10986815 v12    

 

          (c)  Each Subsidiary is a corporation or other legal entity duly organized, validly existing  and, where applicable, in good standing under the laws of its jurisdiction of organization, and is  duly qualified as a foreign corporation or other legal entity and, where applicable, is in good  standing in each jurisdiction in which such qualification is required by law, other than those  jurisdictions as to which the failure to be so qualified or in good standing could not, individually  or in the aggregate, reasonably be expected to have a Material Adverse Effect.  Each such  Subsidiary has the corporate or other power and authority to own or hold under lease the properties  it purports to own or hold under lease and to transact the business it transacts and proposes to  transact.         (d)  No Subsidiary is subject to any contractual restriction (other than the agreements  listed on Schedule 5.4 and customary limitations imposed by corporate law or similar statutes, and  provisions in agreements or instruments which prohibit the payment of dividends or distributions  with respect to any class of Equity Interests other than on a pro rata basis) restricting the ability of   such Subsidiary to pay dividends out of profits or make any other similar distributions of profits   to the Company or any of its Subsidiaries that owns outstanding shares of capital stock or similar   Equity Interests of such Subsidiary.        Section 5.5.  Financial Statements; Material Liabilities.  The Company has made   available to each Purchaser the Company’s annual reports on Form 10-K for the fiscal years ended   2013 through 2017 and its quarterly report on Form 10-Q for the quarterly period ended March 31,   2018, each of which contains the consolidated financial statements of the Company and its   Subsidiaries listed on Schedule 5.5.  All of such financial statements (including in each case the   related schedules and notes) fairly present in all material respects the consolidated financial   position of the Company and its Subsidiaries as of the respective dates specified in such Schedule   and the consolidated results of their operations and cash flows for the respective periods so   specified and have been prepared in accordance with GAAP consistently applied throughout the   periods involved except as set forth in the notes thereto (subject, in the case of any interim financial   statements, to normal year-end adjustments and the absence of footnotes).  The Company and its   Subsidiaries do not have any Material liabilities that are not disclosed on such financial statements   or otherwise disclosed in the Disclosure Documents.        Section 5.6.  Compliance with Laws, Other Instruments, Etc.  The execution, delivery   and performance by the Company of this Agreement and the Notes will not (i) contravene, result   in any breach of, or constitute a default under, or result in the creation of any Lien in respect of   any property of the Company or any Subsidiary under, (A) any indenture, mortgage, deed of trust,   loan, purchase or credit agreement, or any other Material agreement or instrument in any Material   respect, or (B) the corporate charter or by-laws or shareholders agreement, in each case of the   foregoing, to which the Company or any Subsidiary is bound or by which the Company or any   Subsidiary or any of their respective properties may be bound or affected, (ii) conflict with or result   in a breach of any of the terms, conditions or provisions of any order, judgment, decree or ruling   of any court, arbitrator or Governmental Authority applicable to the Company or any Subsidiary   or (iii) violate any provision of any statute or other rule or regulation of any Governmental   Authority applicable to the Company or any Subsidiary.                                          -6-   \\DC - 047743/000003 - 10986815 v12    

 

         Section 5.7.  Governmental Authorizations, Etc.  Except for filings on Form 8-K   required to be filed with the SEC as a result of the execution of this Agreement and for the filings   described on Schedule 5.7, no consent, approval or authorization of, or registration, filing or  declaration with, any Governmental Authority is required in connection with the execution,  delivery or performance by the Company of this Agreement, any Subsidiary Guaranty or the Notes.        Section 5.8.  Litigation; Observance of Agreements, Statutes and Orders.  (a) There  are no actions, suits, governmental investigations or proceedings pending or, to the knowledge of  the Company, threatened against or affecting the Company or any Subsidiary or any property of  the Company or any Subsidiary in any court or before any arbitrator of any kind or before or by   any Governmental Authority that could, individually or in the aggregate, reasonably be expected   to have a Material Adverse Effect.         (b)  Neither the Company nor any Subsidiary is (i) in default under any agreement or   instrument to which it is a party or by which it is bound, (ii) in violation of any order, judgment,   decree or ruling of any court, any arbitrator of any kind or any Governmental Authority or (iii) in   violation of any applicable law, ordinance, rule or regulation of any Governmental Authority   (including Environmental Laws, the USA PATRIOT Act or any of the other laws and regulations   that are referred to in Section 5.16), which default or violation could, individually or in the   aggregate, reasonably be expected to have a Material Adverse Effect.        Section 5.9.  Taxes.  The Company and its Subsidiaries have filed all income tax and other   Material tax returns that are required to have been filed in any jurisdiction, and have paid all taxes   shown to be due and payable on such returns and all other taxes and assessments levied upon them   or their properties, assets, income or franchises, to the extent such taxes and assessments have   become due and payable and before they have become delinquent, except for any taxes and   assessments (i) the amount of which, individually or in the aggregate, is not Material or (ii) the   amount, applicability or validity of which is currently being contested in good faith by appropriate   proceedings and with respect to which the Company or a Subsidiary, as the case may be, has   established adequate reserves in accordance with GAAP.  The Company knows of no basis for any   other tax or assessment that could, individually or in the aggregate, reasonably be expected to have   a Material Adverse Effect.  The charges, accruals and reserves on the books of the Company and   its Subsidiaries in respect of U.S. federal, state or other taxes for all fiscal periods are adequate.   The U.S. federal income tax liabilities of the Company and its Subsidiaries have been finally  determined (whether by reason of completed audits or the statute of limitations having run) for all  fiscal years up to and including the fiscal year ended December 28, 2013.       Section 5.10.  Title to Property; Leases.  The Company and its Subsidiaries have good and  sufficient title to their respective properties which the Company and its Subsidiaries own or purport  to own that individually or in the aggregate are Material, including all such properties reflected in  the most recent audited balance sheet referred to in Section 5.5 or purported to have been acquired  by the Company or any Subsidiary after such date (except as sold or otherwise disposed of in the  ordinary course of business or as otherwise permitted under any Material Credit Facility), except  for such defects in title as could not, individually or in the aggregate, reasonably be expected to  have a Material Adverse Effect, in each case free and clear of Liens prohibited by this Agreement.   All leases that individually or in the aggregate are Material are valid and subsisting and are in full                                         -7-   \\DC - 047743/000003 - 10986815 v12    

 

     force and effect, except where the failure of which could not, individually or in the aggregate,   reasonably be expected to have a Material Adverse Effect.       Section 5.11.  Licenses, Permits, Etc.      Except as could not reasonably be expected to have a Material Adverse Effect:    (a) The Company and its Subsidiaries own or possess all licenses, permits, franchises,   authorizations, patents, copyrights, proprietary software, service marks, trademarks and trade   names, or rights thereto without known conflict with the rights of others;         (b)  No product or service of the Company or any of its Subsidiaries infringes any license,  permit, franchise, authorization, patent, copyright, proprietary software, service mark, trademark,  trade name or other right owned by any other Person; and         (c)  There is no violation by any Person of any right of the Company or any of its  Subsidiaries with respect to any license, permit, franchise, authorization, patent, copyright,   proprietary software, service mark, trademark, trade name or other right owned or used by the   Company or any of its Subsidiaries.       Section 5.12.  Compliance with Employee Benefit Plans.  (a) The Company and each   ERISA Affiliate have operated and administered each Plan in compliance with all applicable laws   except for such instances of noncompliance as have not resulted in and could not, individually or  in the aggregate, reasonably be expected to result in a Material Adverse Effect.  Neither the  Company nor any ERISA Affiliate has incurred any liability pursuant to Title I or IV of ERISA or  the penalty or excise tax provisions of the Code relating to employee benefit plans (as defined in   section 3 of ERISA), and no event, transaction or condition has occurred or exists that could,   individually or in the aggregate, reasonably be expected to result in the incurrence of any such   liability by the Company or any ERISA Affiliate, or in the imposition of any Lien on any of the   rights, properties or assets of the Company or any ERISA Affiliate, in either case pursuant to Title I   or IV of ERISA or to section 430(k) of the Code or to any such penalty or excise tax provisions   under the Code or federal law or section 4068 of ERISA or by the granting of a security interest in   connection with the amendment of a Plan, other than such liabilities or Liens as would not be   individually or in the aggregate Material.         (b)  The present value of the aggregate benefit liabilities under each of the Plans (other   than Multiemployer Plans), determined as of the end of such Plan’s most recently ended plan year   on the basis of the actuarial assumptions specified for funding purposes in such Plan’s most recent   actuarial valuation report, did not exceed the aggregate current value of the assets by more than   $40,000,000 in the aggregate for all Plans.  The term “benefit liabilities” has the meaning   specified in section 4001 of ERISA and the terms “current value” and “present value” have the   meaning specified in section 3 of ERISA.         (c)  The Company and its ERISA Affiliates have not incurred withdrawal liabilities (and   are not subject to contingent withdrawal liabilities) under section 4201 or 4204 of ERISA in   respect of Multiemployer Plans that individually or in the aggregate are Material.                                          -8-   \\DC - 047743/000003 - 10986815 v12    

 

        (d)  The expected postretirement benefit obligation (determined as of the last day of the  Company’s most recently ended fiscal year in accordance with Financial Accounting Standards  Board Accounting Standards Codification Topic 715-60, without regard to liabilities attributable  to continuation coverage mandated by section 4980B of the Code) of the Company and its  Subsidiaries is not Material.        (e)  The execution and delivery of this Agreement and the issuance and sale of the Notes  hereunder will not involve any transaction that is subject to the prohibitions of section 406 of  ERISA or in connection with which a tax could be imposed pursuant to section 4975(c)(1)(A)-(D)  of the Code.  The representation by the Company to each Purchaser in the first sentence of this  Section 5.12(e) is made in reliance upon and subject to the accuracy of such Purchaser’s  representation in Section 6.2 as to the sources of the funds to be used to pay the purchase price of  the Notes to be purchased by such Purchaser.        (f)  The Company and its Subsidiaries do not have any Non-U.S. Plans.      Section 5.13.  Private Offering by the Company.  Neither the Company nor anyone acting  on its behalf has offered the Notes or any similar Securities for sale to, or solicited any offer to buy  the Notes or any similar Securities from, or otherwise approached or negotiated in respect thereof  with, any Person other than the Purchasers and not more than 5 other Institutional Investors, each  of which has been offered the Notes at a private sale for investment.  Neither the Company nor  anyone acting on its behalf has taken, or will take, any action that would subject the issuance or  sale of the Notes to the registration requirements of section 5 of the Securities Act or to the  registration requirements of any Securities or blue sky laws of any applicable jurisdiction.      Section 5.14.  Use of Proceeds; Margin Regulations.  The Company will apply the  proceeds of the sale of the Notes to refinance existing Indebtedness and for general purposes of  the Company.  No part of the proceeds from the sale of the Notes hereunder will be used, directly  or indirectly, for the purpose of buying or carrying any margin stock within the meaning of  Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), to extend  credit to others for the purpose of buying or carrying margin stock, or for the purpose of buying or  carrying or trading in any Securities under such circumstances as to involve the Company in a  violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a  violation of Regulation T of said Board (12 CFR 220).  Margin stock does not constitute more than  10% of the value of the consolidated assets of the Company and its Subsidiaries and the Company  does not have any present intention that margin stock will constitute more than 10% of the value  of such assets.  As used in this Section, the terms “margin stock” and “purpose of buying or  carrying” shall have the meanings assigned to them in said Regulation U.      Section 5.15.  Existing Indebtedness; Future Liens.    a) Except as described therein,  Schedule 5.15 sets forth a complete and correct list of all outstanding Indebtedness of the Company  and its Subsidiaries as of December 30, 2017 having an outstanding principal amount in excess of  $10,000,000 (other than intercompany Indebtedness) (including descriptions of the obligors and  the original lender (or, if applicable, administrative agent) therefor, principal amounts outstanding,  a general description of the primary collateral therefor and a general description of any Guaranties  thereof), since which date there has been no Material change in the amounts (other than changes                                        -9-  \\DC - 047743/000003 - 10986815 v12    

 

   in line of credit balances arising in the ordinary course of business of the Company), interest rates  (other than with respect to variable interest rates and changes in the underlying index rates), sinking  funds, installment payments or maturities of the Indebtedness of the Company or its Subsidiaries.   Neither the Company nor any Subsidiary is in default and no waiver of default is currently in  effect, in the payment of any principal or interest on any Indebtedness of the Company or such  Subsidiary and no event or condition exists with respect to any Indebtedness of the Company or  any Subsidiary the outstanding principal amount of which exceeds $10,000,000 that would permit  (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such  Indebtedness to become due and payable before its stated maturity or before its regularly scheduled  dates of payment.        (b)  Except as disclosed in Schedule 5.15, neither the Company nor any Subsidiary has  agreed or consented to cause or permit any of its property, whether now owned or hereafter  acquired, to be subject to a Lien that secures Indebtedness the outstanding principal amount of  which exceeds $10,000,000 or to cause or permit in the future (upon the happening of a  contingency or otherwise) any of its property, whether now owned or hereafter acquired, to be  subject to a Lien that secures Indebtedness the outstanding principal amount of which exceeds  $10,000,000.        (c)  Neither the Company nor any Subsidiary is a party to, or otherwise subject to any  provision contained in, any instrument evidencing Indebtedness of the Company or such  Subsidiary, any agreement relating thereto or any other agreement (including its charter or any  other organizational document) which limits the amount of, or otherwise imposes restrictions on  the incurring of, Indebtedness of the Company, except as provided in the agreements and  documents related to the Indebtedness described in Schedule 5.15.      Section 5.16.  Foreign Assets Control Regulations, Etc.  (a) Neither the Company nor any  Controlled Entity (i) is a Blocked Person, (ii) has been notified that its name appears or may in the  future appear on a State Sanctions List or (iii) is a target of sanctions that have been imposed by  the United Nations or the European Union.        (b)  Neither the Company nor any Controlled Entity (i) within the past five (5) years has  violated, been found in violation of, or been charged or convicted under, any applicable U.S.  Economic Sanctions Laws, Anti-Money Laundering Laws or Anti-Corruption Laws or (ii) to the  Company’s knowledge, is under investigation by any Governmental Authority for possible  violation of any U.S. Economic Sanctions Laws, Anti-Money Laundering Laws or  Anti-Corruption Laws.        (c)  No part of the proceeds from the sale of the Notes hereunder:                (i)  constitutes or will constitute funds obtained on behalf of any Blocked        Person or will otherwise be used by the Company or any Controlled Entity, directly or        indirectly, (A) in connection with any investment in, or any transactions or dealings with,        any Blocked Person in violation of U.S. Economic Sanctions Laws or any applicable        similar state laws, (B) for any purpose that would cause any Purchaser to be in violation of                                        -10-  \\DC - 047743/000003 - 10986815 v12    

 

           any U.S. Economic Sanctions Laws or (C) otherwise in violation of any U.S. Economic         Sanctions Laws;                (ii)  will be used, directly or indirectly, in violation of, or cause any Purchaser         to be in violation of, any applicable Anti-Money Laundering Laws; or               (iii)  will be used, directly or indirectly, for the purpose of making any improper         payments, including bribes, to any Governmental Official or commercial counterparty in         order to obtain, retain or direct business or obtain any improper advantage, in each case         which would be in violation of, or cause any Purchaser to be in violation of, any applicable         Anti-Corruption Laws.         (d)  The Company has established procedures and controls which it reasonably believes  are adequate (and otherwise comply with applicable law) to ensure that the Company and each  Controlled Entity is and will continue to be in compliance with all applicable U.S. Economic  Sanctions Laws, Anti-Money Laundering Laws and Anti-Corruption Laws.       Section 5.17.  Status under Certain Statutes.  Neither the Company nor any Subsidiary is   subject to regulation under the Investment Company Act of 1940, the Public Utility Holding   Company Act of 2005, the ICC Termination Act of 1995, or the Federal Power Act.       Section 5.18.  Environmental Matters.  (a) Neither the Company nor any Subsidiary has  knowledge of any claim or has received any notice of any claim and no proceeding has been  instituted asserting any claim against the Company or any of its Subsidiaries or any of their  respective real properties or other assets now or formerly owned, leased or operated by any of  them, alleging any damage to the environment or violation of any Environmental Laws, except, in  each case, such as could not reasonably be expected to result in a Material Adverse Effect.          (b)  Neither the Company nor any Subsidiary has knowledge of any facts which would  give rise to any claim, public or private, of violation of Environmental Laws or damage to the  environment emanating from, occurring on or in any way related to real properties now or formerly  owned, leased or operated by any of them or to other assets or their use, except, in each case, such  as could not, individually or in the aggregate, reasonably be expected to result in a Material  Adverse Effect.         (c)  Neither the Company nor any Subsidiary has stored any Hazardous Materials on real  properties now or formerly owned, leased or operated by any of them in a manner which is contrary  to any Environmental Law that could, individually or in the aggregate, reasonably be expected to  result in a Material Adverse Effect.         (d)  Neither the Company nor any Subsidiary has disposed of any Hazardous Materials in  a manner which is contrary to any Environmental Law that could, individually or in the aggregate,  reasonably be expected to result in a Material Adverse Effect.         (e)  All buildings on all real properties now owned, leased or operated by the Company  or any Subsidiary are in compliance with applicable Environmental Laws, except where failure to                                         -11-   \\DC - 047743/000003 - 10986815 v12    

 

     comply could not, individually or in the aggregate, reasonably be expected to result in a Material   Adverse Effect.    SECTION 6.    REPRESENTATIONS OF THE PURCHASERS.        Section 6.1.  Purchase for Investment.  (a) Each Purchaser severally represents that it is   purchasing the Notes for its own account or for one or more separate accounts maintained by such   Purchaser or for the account of one or more pension or trust funds and not with a view to the   distribution thereof, provided that the disposition of such Purchaser’s or their property shall at all   times be within such Purchaser’s or their control.  Each Purchaser acknowledges that the Notes   have not been registered under the Securities Act or the securities laws of any state or other   jurisdiction and may be resold only if registered pursuant to the provisions of the Securities Act or   if an exemption from registration is available, except under circumstances where neither such   registration nor such an exemption is required by law, and that the Company is not required to   register the Notes.           (b)  Each Purchaser acknowledges that the Company and, for purposes of the opinions to   be delivered to the Purchasers pursuant hereto, counsel to the Company and the Subsidiary   Guarantors will rely upon the accuracy and truth of the foregoing representations and in this   Section 6 and hereby consents to such reliance.        Section 6.2.  Source of Funds.  Each Purchaser severally represents that at least one of the   following statements is an accurate representation as to each source of funds (a “Source”) to be   used by such Purchaser to pay the purchase price of the Notes to be purchased by such Purchaser  hereunder:                (a)   the Source is an “insurance company general account” (as the term is         defined in the United States Department of Labor’s Prohibited Transaction Exemption         (“PTE”) 95-60) in respect of which the reserves and liabilities (as defined by the annual        statement for life insurance companies approved by the NAIC (the “NAIC Annual         Statement”)) for the general account contract(s) held by or on behalf of any employee         benefit plan together with the amount of the reserves and liabilities for the general account         contract(s) held by or on behalf of any other employee benefit plans maintained by the         same employer (or affiliate thereof as defined in PTE 95-60) or by the same employee         organization in the general account do not exceed 10% of the total reserves and liabilities         of the general account (exclusive of separate account liabilities) plus surplus as set forth in         the NAIC Annual Statement filed with such Purchaser’s state of domicile; or                (b)   the Source is a separate account that is maintained solely in connection with         such Purchaser’s fixed contractual obligations under which the amounts payable, or         credited, to any employee benefit plan (or its related trust) that has any interest in such         separate account (or to any participant or beneficiary of such plan (including any         annuitant)) are not affected in any manner by the investment performance of the separate         account; or                                          -12-   \\DC - 047743/000003 - 10986815 v12    

 

               (c)   the Source is either (i) an insurance company pooled separate account,        within the meaning of PTE 90-1 or (ii) a bank collective investment fund, within the       meaning of the PTE 91-38 and, except as disclosed by such Purchaser to the Company in       writing pursuant to this clause (c), no employee benefit plan or group of plans maintained       by the same employer or employee organization beneficially owns more than 10% of all       assets allocated to such pooled separate account or collective investment fund; or               (d)   the Source constitutes assets of an “investment fund” (within the meaning        of Part VI of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified professional        asset manager” or “QPAM” (within the meaning of Part VI of the QPAM Exemption), no        employee benefit plan’s assets that are managed by the QPAM in such investment fund,        when combined with the assets of all other employee benefit plans established or        maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of        the QPAM Exemption) of such employer or by the same employee organization and        managed by such QPAM, represent more than 20% of the total client assets managed by        such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are satisfied,       neither the QPAM nor a person controlling or controlled by the QPAM maintains an       ownership interest in the Company that would cause the QPAM and the Company to be       “related” within the meaning of Part VI(h) of the QPAM Exemption and (i) the identity of       such QPAM and (ii) the names of any employee benefit plans whose assets in the       investment fund, when combined with the assets of all other employee benefit plans       established or maintained by the same employer or by an affiliate (within the meaning of       Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee       organization, represent 10% or more of the assets of such investment fund, have been       disclosed to the Company in writing pursuant to this clause (d);or               (e)  the Source constitutes assets of a “plan(s)” (within the meaning of Part       IV(h) of PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset       manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption), the       conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied, neither the       INHAM nor a person controlling or controlled by the INHAM (applying the definition of       “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10% or more interest in the       Company and (i) the identity of such INHAM and (ii) the name(s) of the employee benefit       plan(s) whose assets constitute the Source have been disclosed to the Company in writing       pursuant to this clause (e); or                (f)  the Source is a governmental plan; or               (g)   the Source is one or more employee benefit plans, or a separate account or       trust fund comprised of one or more employee benefit plans, each of which has been       identified to the Company in writing pursuant to this clause (g); or               (h)   the Source does not include assets of any employee benefit plan, other than       a plan exempt from the coverage of ERISA.                                         -13-  \\DC - 047743/000003 - 10986815 v12    

 

   As used in this Section 6.2, the terms “employee benefit plan,” “governmental plan,” and  “separate account” shall have the respective meanings assigned to such terms in section 3 of  ERISA.       Section 6.3.  Fiduciary  Status.  Each Purchaser has independently evaluated the  investment risks associated with the acquisition of the Notes and recognizes that the Company has  not provided any advice or recommendation relating to the acquisition of the Notes.    Section 6.4. Investor Status.  (a) Each Purchaser certifies and represents to the Company  that it is an institutional “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7)  promulgated under the Securities Act acting for its own account (and not for the account of others)  or as a fiduciary or agent for others (which others are also “institutional accredited investors”) and  was not organized for the purpose of acquiring the Notes.  Each Purchaser further represents that  its financial condition is such that it is able to bear the risk of holding the Notes for an indefinite  period of time and the risk of loss of its entire investment, and that it has sufficient knowledge and  experience in investing in companies similar to the Company so as to be able to evaluate the risk  and merits of its investment in the Company.          (b)  Each Purchaser further represents and warrants that it has received a copy of the  Memorandum and such other materials or information as it has deemed necessary in connection  with its purchase of Notes hereunder and that it is not purchasing the Notes as a result of any  general solicitation or general advertising within the meaning of Regulation D under the Securities  Act.     SECTION 7.    INFORMATION AS TO COMPANY       Section 7.1.  Financial and Business Information.  The Company shall deliver to each  holder of a Note that is an Institutional Investor:          (a) Quarterly Statements — within 60 days (or such shorter period as is the        earlier of (x) 15 days greater than the period applicable to the filing of the Company’s        Quarterly Report on Form 10-Q (the “Form 10-Q”) with the SEC regardless of whether        the Company is subject to the filing requirements thereof and (y) the date by which such       financial statements are required to be delivered under any Material Credit Facility or the       date on which such corresponding financial statements are delivered under any Material       Credit Facility if such delivery occurs earlier than such required delivery date) after the       end of each quarterly fiscal period in each fiscal year of the Company (other than the last       quarterly fiscal period of each such fiscal year), duplicate copies of,                      (i)  an unaudited consolidated balance sheet of the Company and its             Subsidiaries as at the end of such quarter, and               (ii) unaudited consolidated statements of income, changes in             shareholders’ equity and cash flows of the Company and its Subsidiaries, for such             quarter and (in the case of the second and third quarters) for the portion of the fiscal             year ending with such quarter,                                        -14-  \\DC - 047743/000003 - 10986815 v12    

 

         setting forth in each case in comparative form the figures for the corresponding periods in        the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP        applicable to quarterly financial statements generally, and certified by a Senior Financial        Officer as fairly presenting, in all material respects, the financial position of the companies        being reported on and their results of operations and cash flows, subject to changes        resulting from year-end adjustments and the absence of footnotes;          (b) Annual Statements— within 105 days (or such shorter period as is the earlier        of (x) 15 days greater than the period applicable to the filing of the Company’s Annual        Report on Form 10-K (the “Form 10-K”) with the SEC regardless of whether the       Company is subject to the filing requirements thereof and (y) the date by which such       financial statements are required to be delivered under any Material Credit Facility or the       date on which such corresponding financial statements are delivered under any Material       Credit Facility if such delivery occurs earlier than such required delivery date) after the       end of each fiscal year of the Company, duplicate copies of                      (i)  a consolidated balance sheet of the Company and its Subsidiaries as             at the end of such year, and                     (ii)  consolidated statements of income, changes in shareholders’ equity             and cash flows of the Company and its Subsidiaries for such year,        setting forth in each case in comparative form the figures for the previous fiscal year, all in       reasonable detail, prepared in accordance with GAAP, and accompanied by an opinion       thereon (without a “going concern” or similar qualification or exception and without any       qualification or exception as to the scope of the audit on which such opinion is based) of       independent public accountants of recognized national standing, which opinion shall       include a statement to the effect that such financial statements present fairly, in all material       respects, the financial position of the companies being reported upon and their results of       operations and cash flows and have been prepared in conformity with GAAP, and that the       examination of such accountants in connection with such financial statements has been       made in accordance with generally accepted auditing standards, and that such audit       provides a reasonable basis for such opinion in the circumstances;         (c) SEC and Other Reports — promptly upon their becoming available, one       copy of (i) each financial statement, report, notice or proxy statement (collectively,       “Reports”) sent by the Company or any Subsidiary to the administrative agent under any       Material Credit Facility pursuant to any reporting requirements thereunder (excluding (1)       Reports sent to such administrative agent in the ordinary course of administration of a       credit facility, such as information relating to pricing, interest period elections, prepayment       notices, and borrowing requests or availability calculations, (2) Reports provided in       response to specific inquiries from any lender or agent under any Material Credit Facility       and (3) Reports that correspond to Reports that are separately required to be provided       pursuant to the requirements of this Agreement), and (ii) each regular or periodic report,       each registration statement (without exhibits except as expressly requested by such holder),       and each prospectus and all amendments thereto filed by the Company or any Subsidiary                                        -15-  \\DC - 047743/000003 - 10986815 v12    

 

         with the SEC and of all press releases and other statements made available to its public       Securities holders generally by the Company or any Subsidiary to the public concerning       developments that are Material;          (d) Notice of Default or Event of Default — promptly, and in any event within        5 Business Days after a Responsible Officer becoming aware of the existence of any       Default or Event of Default or that any Person has given any notice or taken any action        with respect to a claimed default hereunder or that any Person has given any written notice        or taken any action with respect to a claimed default of the type referred to in Section 11(f),        a written notice specifying the nature and period of existence thereof and what action the        Company is taking or proposes to take with respect thereto;          (e) Employee Benefits Matters — promptly, and in any event within 5 Business        Days after a Responsible Officer becoming aware of any of the following, a written notice        setting forth the nature thereof and the action, if any, that the Company or an ERISA        Affiliate proposes to take with respect thereto:                      (i)  with respect to any Plan, any reportable event, as defined in              section 4043(c) of ERISA and the regulations thereunder, for which notice thereof              has not been waived pursuant to such regulations as in effect on the date hereof;                     (ii)  the taking by the PBGC of steps to institute, or the threatening by              the PBGC of the institution of, proceedings under section 4042 of ERISA for the              termination of, or the appointment of a trustee to administer, any Plan, or the receipt              by the Company or any ERISA Affiliate of a notice from a Multiemployer Plan that              such action has been taken by the PBGC with respect to such Multiemployer Plan;                      (iii)  any event, transaction or condition that could result in the incurrence              of any liability by the Company or any ERISA Affiliate pursuant to Title I or IV of              ERISA or the penalty or excise tax provisions of the Code relating to employee              benefit plans, or in the imposition of any Lien on any of the rights, properties or              assets of the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA              or such penalty or excise tax provisions, if such liability or Lien, taken together              with any other such liabilities or Liens then existing, could reasonably be expected              to have a Material Adverse Effect; or                     (iv)  receipt of notice of the imposition of a Material financial penalty              (which for this purpose shall mean any tax, penalty or other liability, whether by              way of indemnity or otherwise) with respect to one or more Non-U.S. Plans;          (f) Notices from Governmental Authority — promptly, and in any event within        30 days of receipt thereof, copies of any notice to the Company or any Subsidiary from any        Governmental Authority relating to any order, ruling, statute or other law or regulation that        could reasonably be expected to have a Material Adverse Effect;                                          -16-  \\DC - 047743/000003 - 10986815 v12    

 

          (g) Resignation or Replacement of Auditors — within 10 days following the        date on which the Company’s independent auditors resign or the Company elects to change        independent auditors, as the case may be, notification thereof, together with such further        information as the Required Holders may reasonably request; and          (h) Requested Information — with reasonable promptness, such other data and        information relating to the business, operations, affairs, financial condition, assets or        properties of the Company or any of its Subsidiaries (including actual copies of the        Company’s Form 10-Q and Form 10-K) or relating to the ability of the Company to        perform its obligations hereunder and under the Notes as from time to time may be        reasonably requested by any such holder of a Note.       Section 7.2.  Officer’s Certificate.  Each set of financial statements delivered to a holder  of a Note pursuant to Section 7.1(a) or Section 7.1(b) shall be accompanied by a certificate of a  Senior Financial Officer substantially in the form attached hereto as Schedule 7.2:          (a) Covenant Compliance — setting forth the information from such financial        statements that is required in order to establish whether the Company was in compliance        with the requirements of Section 10.3 and Section 10.7 during the quarterly or annual        period covered by the financial statements then being furnished (including with respect to        each such provision that involves mathematical calculations, the information from such        financial statements that is required to perform such calculations) and a statement of the        maximum or minimum amount, ratio or percentage, as the case may be, permissible under        the terms of such Section, and the calculation of the amount, ratio or percentage then in        existence.  In the event that the Company or any Subsidiary has made an election to        measure any financial liability using fair value (which election is being disregarded for        purposes of determining compliance with this Agreement pursuant to Section 22.2) as to        the period covered by any such financial statement, such Senior Financial Officer’s        certificate as to such period shall include a reconciliation from GAAP with respect to such        election;          (b) Event of Default — certifying that such Senior Financial Officer has        reviewed the relevant terms hereof and has made, or caused to be made, under his or her        supervision, a review of the transactions and conditions of the Company and its        Subsidiaries from the beginning of the quarterly or annual period covered by the statements        then being furnished to the date of the certificate and that such review shall not have        disclosed the existence during such period of any condition or event that constitutes a        Default or an Event of Default or, if any such condition or event existed or exists (including        any such event or condition resulting from the failure of the Company or any Subsidiary to        comply with any Environmental Law), specifying the nature and period of existence        thereof and what action the Company shall have taken or proposes to take with respect        thereto; and          (c) Subsidiary      Guarantors – setting forth a list of all Subsidiaries that are        Subsidiary Guarantors and certifying that each Subsidiary that is required to be a                                        -17-  \\DC - 047743/000003 - 10986815 v12    

 

         Subsidiary Guarantor pursuant to Section 9.7 is a Subsidiary Guarantor, in each case, as of        the date of such certificate of Senior Financial Officer.       Section 7.3.  Visitation.  The Company shall permit the representatives of each holder of  a Note that is an Institutional Investor:          (a) No Default — if no Default or Event of Default then exists, at the expense        of such holder and upon reasonable prior notice to the Company, to visit the principal        executive office of the Company, to discuss the affairs, finances and accounts of the        Company and its Subsidiaries with the Company’s officers, and (with the written consent        of the Company, which consent will not be unreasonably withheld) its independent public        accountants (so long as a representative of the Company is provided a reasonable        opportunity to participate in any such discussion with accountants), and (with the written        consent of the Company, which consent will not be unreasonably withheld) to visit the        other offices and properties of the Company and each Subsidiary, all at such reasonable        times during regular business hours and as often as may be reasonably requested in writing;        and          (b) Default — if a Default or Event of Default then exists, at the expense of the        Company to visit and inspect any of the offices or properties of the Company or any        Subsidiary, to examine all their respective books of account, records, reports and other        papers, to make copies and extracts therefrom, and to discuss their respective affairs,        finances and accounts with their respective officers and independent public accountants (so        long as a representative of the Company is provided a reasonable opportunity to participate        in any such discussion with accountants) (and by this provision the Company authorizes        said accountants to discuss the affairs, finances and accounts of the Company and its        Subsidiaries), all at such times during regular business hours and as often as may be        requested.       Section 7.4.  Electronic Delivery.  Financial statements, opinions of independent certified  public accountants, other information and Officer’s Certificates that are required to be delivered  by the Company pursuant to Sections 7.1(a), (b), (c) or (h) and Section 7.2, 9.7 or 10.2 shall be  deemed to have been delivered if the Company satisfies any of the following requirements with  respect thereto:               (a)   such financial statements satisfying the requirements of Section 7.1(a) or        (b) and related Officer’s Certificate satisfying the requirements of Section 7.2 and any        other information required under Section 7.1(c) or (h), 9.7 or 10.2 are delivered to each        holder of a Note by e-mail at the e-mail address set forth in such holder’s Purchaser        Schedule or as communicated from time to time in a separate writing delivered to the        Company;              (b)  the Company shall have timely filed such Form 10–Q or Form 10–K,        satisfying the requirements of Section 7.1(a) or Section 7.1(b), as the case may be, with the        SEC on EDGAR and shall have made such form available on its home page on the internet,        which is located at http://www.hnicorp.com as of the date of this Agreement;                                         -18-  \\DC - 047743/000003 - 10986815 v12    

 

                (c)  such financial statements satisfying the requirements of Section 7.1(a) or         Section 7.1(b) and related Officer’s Certificate(s) satisfying the requirements of         Section 7.2 and any other information required under Section 7.1(c) and (h) are timely         posted by or on behalf of the Company on IntraLinks or on any other similar website to         which each holder of Notes has free access; or                (d)  the Company shall have timely filed any of the items referred to in         Section 7.1(c) with the SEC on EDGAR and shall have made such items available on its         home page on the internet or on IntraLinks or on any other similar website to which each         holder of Notes has free access;    provided however, that in no case shall access to such financial statements, other information and   Officer’s Certificates be conditioned upon any waiver or other agreement or consent (other than   confidentiality provisions consistent with Section 20 of this Agreement); provided further, that in   the case of any of clauses (b), (c) or (d) (other than information required under Section 7.1(c)(ii),   the Company shall have given each holder of a Note prompt written notice, which may be by   e-mail or in accordance with Section 18, of such posting or filing in connection with each delivery,   provided further, that upon request of any holder to receive paper copies of such forms, financial   statements, other information and Officer’s Certificates or to receive them by e-mail, the Company   will promptly e-mail them or deliver such paper copies, as the case may be, to such holder.          Section 7.5.    Limitation on Disclosure Obligation.    Notwithstanding the obligations   under Section 7.1(h) or 7.3, the Company shall not be required to disclose information (x) to the   extent that such disclosure to the holder of Notes violates any bona fide contractual confidentiality   obligations by which it is bound, so long as (i) such obligations were not entered into in   contemplation of this Agreement or any of the other transactions contemplated hereby and (ii) such   obligations are owed by it to a third party or (y) as to which it has been advised by counsel that the   provision of such information to any holder of Notes would give rise to a waiver of the attorney-  client privilege in which case the Company shall provide notice to such holder describing why  such information cannot be provided.    SECTION 8.        PAYMENT AND PREPAYMENT OF THE NOTES.        Section 8.1.  Maturity.  As provided therein, the entire unpaid principal balance of each   Note shall be due and payable on the Maturity Date thereof.        Section 8.2.  Optional Prepayments with Make-Whole Amount.  The Company may,   at its option, upon notice as provided below, prepay at any time all, or from time to time any part   of, the Notes, in an amount not less than 5% of the aggregate principal amount of the Notes then   outstanding in the case of a partial prepayment, at 100% of the principal amount so prepaid, and   the Make-Whole Amount determined for the prepayment date with respect to such principal   amount.  The Company will give each holder of Notes being so prepaid written notice of each   optional prepayment under this Section 8.2 not less than 10 days and not more than 60 days prior   to the date fixed for such prepayment unless the Company and the Required Holders agree to   another time period pursuant to Section 17.  Each such notice shall specify such date (which shall  be a Business Day), the aggregate principal amount of the Notes to be prepaid on such date, the                                         -19-   \\DC - 047743/000003 - 10986815 v12    

 

     principal amount of each Note held by such holder to be prepaid (determined in accordance with   Section 8.3), and the interest to be paid on the prepayment date with respect to such principal   amount being prepaid, and shall be accompanied by a certificate of a Senior Financial Officer as   to the estimated Make-Whole Amount due in connection with such prepayment (calculated as if  the date of such notice were the date of the prepayment), setting forth the details of such   computation.  Two Business Days prior to such prepayment, the Company shall deliver to each   holder of Notes a certificate of a Senior Financial Officer specifying the calculation of such   Make-Whole Amount as of the specified prepayment date.        Section 8.3.  Allocation of Partial Prepayments.  In the case of each partial prepayment   of the Notes pursuant to Section 8.2, the principal amount of the Notes to be prepaid shall be   allocated among all of the Notes at the time outstanding in proportion, as nearly as practicable, to   the respective unpaid principal amounts thereof not theretofore called for prepayment.        Section 8.4.  Maturity; Surrender, Etc.    In the case of each prepayment of Notes   pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and become   due and payable on the date fixed for such prepayment, together with interest on such principal   amount accrued to such date and the applicable Make-Whole Amount, if any.  From and after such   date, unless the Company shall fail to pay such principal amount when so due and payable, together   with the interest and Make-Whole Amount, if any, as aforesaid, interest on such principal amount   shall cease to accrue.  Any Note paid or prepaid in full shall be surrendered to the Company and   cancelled and shall not be reissued, and no Note shall be issued in lieu of any prepaid principal   amount of any Note.        Section 8.5.  Purchase of Notes.  The Company will not and will not permit any Affiliate   that it Controls to purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the   outstanding Notes except (a) upon the payment or prepayment of the Notes in accordance with this   Agreement and the Notes, or (b) pursuant to an offer to purchase made by the Company or an   Affiliate pro rata to the holders of all Notes at the time outstanding upon the same terms and   conditions.  Any such offer shall provide each holder with sufficient information to enable it to   make an informed decision with respect to such offer, and shall remain open for at least 15 days.    If the holders of more than 35% of the principal amount of the Notes then outstanding accept such   offer, the Company shall promptly notify the remaining holders of such fact and the expiration   date for the acceptance by holders of Notes of such offer shall be extended by the number of days   necessary to give each such remaining holder at least 5 Business Days from its receipt of such   notice to accept such offer.  A failure by a holder of Notes to respond to an offer to purchase made   pursuant to subpart (b) of this Section 8.5 shall be deemed to constitute a rejection of such offer   by such holder.  The Company will promptly cancel all Notes acquired by it or any Affiliate   pursuant to any payment, prepayment or purchase of Notes pursuant to this Agreement and no   Notes may be issued in substitution or exchange for any such Notes.          Section 8.6.  Make-Whole Amount.  The term “Make-Whole Amount” means, with   respect to any Note, an amount equal to the excess, if any, of the Discounted Value of the   Remaining Scheduled Payments with respect to the Called Principal of such Note over the amount   of such Called Principal, provided that the Make-Whole Amount may in no event be less than zero.   For the purposes of determining the Make-Whole Amount, the following terms have the following                                         -20-   \\DC - 047743/000003 - 10986815 v12    

 

     meanings: “Called Principal” means, with respect to any Note, the principal of such Note that is  to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and  payable pursuant to Section 12.1, as the context requires.         “Discounted Value” means, with respect to the Called Principal of any Note, the amount  obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal  from their respective scheduled due dates to the Settlement Date with respect to such Called  Principal, in accordance with accepted financial practice and at a discount factor (applied on the  same periodic basis as that on which interest on the Notes is payable) equal to the Reinvestment  Yield with respect to such Called Principal.         “Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum  of (a) 0.50% plus (b) the yield to maturity implied by the “Ask Yield(s)” reported as of 10:00 a.m.  (New York City time) on the second Business Day preceding the Settlement Date with respect to  such Called Principal, on the display designated as “Page PX1” (or such other display as may  replace Page PX1) on Bloomberg Financial Markets for the most recently issued actively traded   on-the-run U.S. Treasury securities (“Reported”) having a maturity equal to the Remaining   Average Life of such Called Principal as of such Settlement Date.  If there are no such U.S.   Treasury securities Reported having a maturity equal to such Remaining Average Life, then such   implied yield to maturity will be determined by (i) converting U.S. Treasury bill quotations to   bond equivalent yields in accordance with accepted financial practice and (ii) interpolating linearly  between the “Ask Yields” Reported for the applicable most recently issued actively traded  on-the-run U.S. Treasury securities with the maturities (1) closest to and greater than such  Remaining Average Life and (2) closest to and less than such Remaining Average Life.  The  Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest  rate of the applicable Note.           If such yields are not Reported or the yields Reported as of such time are not ascertainable  (including by way of interpolation), then “Reinvestment Yield” means, with respect to the Called  Principal of any Note, the sum of (x) 0.50% plus (y) the yield to maturity implied by the U.S.  Treasury constant maturity yields reported, for the latest day for which such yields have been so  reported as of the second Business Day preceding the Settlement Date with respect to such Called  Principal, in Federal Reserve Statistical Release H.15 (or any comparable successor publication)  for the U.S. Treasury constant maturity having a term equal to the Remaining Average Life of such  Called Principal as of such Settlement Date.  If there is no such U.S. Treasury constant maturity  having a term equal to such Remaining Average Life, such implied yield to maturity will be  determined by interpolating linearly between (1) the U.S. Treasury constant maturity so reported  with the term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury  constant maturity so reported with the term closest to and less than such Remaining Average Life.   The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest  rate of the applicable Note.         “Remaining Average Life” means, with respect to any Called Principal, the number of  years obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by  multiplying (a) the principal component of each Remaining Scheduled Payment with respect to  such Called Principal by (b) the number of years, computed on the basis of a 360-day year                                         -21-   \\DC - 047743/000003 - 10986815 v12    

 

     comprised of twelve 30-day months and calculated to two decimal places, that will elapse between   the Settlement Date with respect to such Called Principal and the scheduled due date of such   Remaining Scheduled Payment.          “Remaining Scheduled Payments” means, with respect to the Called Principal of any   Note, all payments of such Called Principal and interest thereon that would be due after the   Settlement Date with respect to such Called Principal if no payment of such Called Principal were  made prior to its scheduled due date, provided that if such Settlement Date is not a date on which  interest payments are due to be made under the Notes, then the amount of the next succeeding  scheduled interest payment will be reduced by the amount of interest accrued to such Settlement   Date and required to be paid on such Settlement Date pursuant to Section 8.2 or Section 12.1.          “Settlement Date” means, with respect to the Called Principal of any Note, the date on   which such Called Principal is to be prepaid pursuant to Section 8.2 or has become or is declared   to be immediately due and payable pursuant to Section 12.1, as the context requires.        Section 8.7.  Payments and Reporting Due on Non-Business Days.  Anything in this  Agreement or the Notes to the contrary notwithstanding, (x) except as set forth in clause (y), any  payment of interest on any Note that is due on a date that is not a Business Day shall be made on  the next succeeding Business Day without including the additional days elapsed in the computation  of the interest payable on such next succeeding Business Day; (y) any payment of principal of or  Make-Whole Amount on any Note (including principal due on the Maturity Date of such Note)  that is due on a date that is not a Business Day shall be made on the next succeeding Business Day  and shall include the additional days elapsed in the computation of interest payable on such next  succeeding Business Day; and (z) any reporting or notices under this Agreement that are due on a  date that is not a Business Day shall be due on the next succeeding Business Day.        Section 8.8.  Change of Control. (a) Notice of Change in Control. The Company will,   within 15 Business Days after any Responsible Officer has knowledge of the occurrence of any   Change of Control, or, at the Company’s option, prior to the occurrence of any Change of Control,  give written notice of such Change of Control to each holder of Notes (as determined as of the date  of such notice).  Such notice shall contain and constitute an offer to prepay Notes as described in  subparagraph (b) of this Section 8.8 and shall be accompanied by the certificate described in  subparagraph (e) of this Section 8.8.    (b) Offer to Prepay Notes.  The offer to prepay Notes contemplated by subparagraph (a)  of this Section 8.8 shall be an offer to prepay, in accordance with and subject to this Section 8.8,  all, but not less than all, the Notes held by each holder on a date (which shall be a Business Day)  specified in such offer (the “Proposed Prepayment Date”).  The Proposed Prepayment Date shall  be not less than 20 days and not more than 60 days after the date of such offer (if the Proposed  Prepayment Date shall not be specified in such offer, the Proposed Prepayment Date shall be on  the first Business Day on or after the 45th day after the date of the written notice of such offer).  The offer to prepay will, if made prior to the date of consummation of the Change of Control, state  that the offer is conditioned on the Change of Control occurring on or prior to the applicable  Proposed Repayment Date.                                         -22-   \\DC - 047743/000003 - 10986815 v12    

 

      (c) Acceptance; Rejection.  A holder of Notes may accept or reject the offer to prepay   made pursuant to this Section 8.8 by causing a written notice of such acceptance or rejection to be   delivered to the Company at least 10 Business Days prior to the Proposed Prepayment Date.  A   failure by a holder of Notes to respond to an offer to prepay made pursuant to this Section 8.8, or   to accept an offer as to all of the Notes held by such holder, in each case on or before the 10th   Business Day preceding the Proposed Prepayment Date, shall be deemed to constitute a rejection   of such offer by such holder (in this case only, “holder” in respect of any Note registered in the  name of a nominee for a disclosed beneficial owner shall mean such beneficial owner).    (d) Prepayment.  Prepayment of the Notes to be prepaid pursuant to this Section 8.8 shall  be at 100% of the principal amount of such Notes, together with interest on such Notes accrued to  (but not including) the date of prepayment and without any Make-Whole Amount.  The  prepayment shall be made on the Proposed Prepayment Date.      (e) Officer’s Certificate.  Each offer to prepay the Notes pursuant to this Section 8.8 shall  be accompanied by a certificate, executed by a Senior Financial Officer of the Company and dated  the date of such offer, specifying: (i) the Proposed Prepayment Date; (ii) that such offer is made  pursuant to this Section 8.8; (iii) the principal amount of each Note offered to be prepaid; (iv) the  interest that would be due on each Note offered to be prepaid, accrued to (but not including) the  Proposed Prepayment Date; and (v) in reasonable detail, the nature and date of the transaction that  constitutes or may constitute a Change of Control.   SECTION 9.     AFFIRMATIVE COVENANTS.         The Company covenants that so long as any of the Notes are outstanding:        Section 9.1.  Compliance with Laws.  Without limiting Section 10.4, the Company will,  and will cause each of its Subsidiaries to, comply with all laws, ordinances or governmental rules  or regulations to which each of them is subject (including ERISA, Environmental Laws, the USA  PATRIOT Act and the other laws and regulations that are referred to in Section 5.16) and will  obtain and maintain in effect all licenses, certificates, permits, franchises and other governmental  authorizations necessary to the ownership of their respective properties or to the conduct of their  respective businesses, in each case to the extent necessary to ensure that non-compliance with such  laws, ordinances or governmental rules or regulations or failures to obtain or maintain in effect  such licenses, certificates, permits, franchises and other governmental authorizations could not,  individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.        Section 9.2.  Insurance.  The Company will, and will cause each of its Subsidiaries to,  maintain, with financially sound and reputable insurers, insurance with respect to their respective  properties and businesses against such casualties and contingencies, of such types, on such terms  and in such amounts (including deductibles, co-insurance and self-insurance, if adequate reserves  are maintained with respect thereto) as is customary in the case of entities of established  reputations engaged in the same or a similar business and similarly situated, except for any non- maintenance that would not be expected to have a Material Adverse Effect.                                            -23-   \\DC - 047743/000003 - 10986815 v12    

 

         Section 9.3.  Maintenance of Properties.  The Company will, and will cause each of its   Subsidiaries to, maintain and keep, or cause to be maintained and kept, their respective properties  in good repair, working order and condition (other than ordinary wear and tear), so that the business  carried on in connection therewith may be properly conducted at all times, provided that this  Section 9.3 shall not prevent the Company or any Subsidiary from discontinuing the operation  and/or the maintenance of any of its properties if such discontinuance is desirable in the conduct  of its business and the Company has concluded that such discontinuance could not, individually  or in the aggregate, reasonably be expected to have a Material Adverse Effect.        Section 9.4.  Payment of Taxes and Claims.  The Company will, and will cause each of  its Subsidiaries to, file all income and other material tax returns required to be filed in any  jurisdiction and to pay and discharge all taxes shown to be due and payable on such returns and  all other taxes, assessments, governmental charges, or levies imposed on them or any of their  properties, assets, income or franchises, to the extent the same have become due and payable and  before they have become delinquent and all claims for which sums have become due and payable  that have or might become a Lien on properties or assets of the Company or any Subsidiary not   permitted by Section 10.6, provided that neither the Company nor any Subsidiary need pay any  such tax, assessment, charge, levy or claim if (i) the amount, applicability or validity thereof is  contested by the Company or such Subsidiary on a timely basis in good faith and in appropriate   proceedings, and the Company or a Subsidiary has established adequate reserves therefor in   accordance with GAAP on the books of the Company or such Subsidiary or (ii) the nonpayment   of all such taxes, assessments, charges, levies and claims could not, individually or in the   aggregate, reasonably be expected to have a Material Adverse Effect.         Section 9.5.  Corporate Existence, Etc.  Subject to Section 10.2, the Company will at all   times preserve and keep its corporate existence in full force and effect.  Subject to Sections 10.2   and 10.3, the Company will at all times preserve and keep in full force and effect the corporate (or   other applicable organizational) existence of each of its Subsidiaries (unless merged into the   Company or another Subsidiary or otherwise merged into a Person in a transaction otherwise  permitted by this Agreement, including Sections 10.2 and 10.3) and all rights and franchises of the  Company and its Subsidiaries unless, in the good faith judgment of the Company, the termination  of or failure to preserve and keep in full force and effect such corporate (or other applicable  organizational) existence, right or franchise, could not, individually or in the aggregate, reasonably  be expected to have a Material Adverse Effect.          Section 9.6.  Books and Records.  The Company will, and will cause each of its  Subsidiaries to, maintain proper books of record and account in a manner that permits preparation  of financial statements in conformity with GAAP and in compliance in all material respects with  all applicable requirements of any Governmental Authority having legal or regulatory jurisdiction  over the Company or such Subsidiary, as the case may be.  The Company will, and will cause each  of its Subsidiaries to, keep books, records and accounts which, in reasonable detail, accurately  reflect all transactions and dispositions of assets in all material respects.  The Company and its   Subsidiaries have devised a system of internal accounting controls sufficient to provide reasonable   assurances that their respective books, records, and accounts accurately reflect in all material   respects all transactions and dispositions of assets and the Company will, and will cause each of   its Subsidiaries to, continue to maintain such system.                                         -24-   \\DC - 047743/000003 - 10986815 v12    

 

       Section 9.7.  Subsidiary  Guarantors.  (a) The Company will cause each of its  Subsidiaries that guarantees or otherwise becomes liable at any time, whether as a borrower or an  additional or co-borrower or otherwise, for or in respect of any Indebtedness under any Material  Credit Facility to concurrently therewith:                (i)  enter into an agreement in the form attached hereto as Schedule 9.7        providing for the guaranty by such Subsidiary, on a joint and several basis with all other        such Subsidiaries, of (x) the prompt payment in full when due of all amounts payable by        the Company pursuant to the Notes (whether for principal, interest, Make-Whole Amount        or otherwise) and this Agreement, including all indemnities, fees and expenses payable by        the Company thereunder and (y) the prompt, full and faithful performance, observance and        discharge by the Company of each and every covenant, agreement, undertaking and        provision required pursuant to the Notes or this Agreement to be performed, observed or        discharged by it (a “Subsidiary Guaranty”); and                (ii)  deliver the following to each holder of a Note:                     (A)  an executed counterpart of such Subsidiary Guaranty;                     (B)  a certificate signed by an authorized responsible officer of such              Subsidiary containing representations and warranties on behalf of such Subsidiary              to the same effect, mutatis mutandis, as those contained in Sections 5.1, 5.2, 5.6,              and 5.7 of this Agreement (but with respect to such Subsidiary and such Subsidiary              Guaranty rather than the Company);                     (C)   a Secretary’s Certificate of such Subsidiary consistent with the              requirements of Section 4.3(d) with respect to the execution and delivery of the              Subsidiary Guaranty and the performance by such Subsidiary of its obligations              thereunder and, where applicable, good standing of such Subsidiary in its             jurisdiction of organization dated not more than 30 days prior to the date of the              documents delivered pursuant to clause (a)(i) above; and                     (D)  an opinion of counsel (which may be from in-house counsel;              provided that, any opinion covering the enforceability of the applicable agreements              or instruments effecting such Subsidiary Guaranty shall be from in-house counsel             admitted in the State of New York) that includes the types of opinions delivered at              Closing to the extent applicable.           Anything in this Section 9.7 to the contrary notwithstanding, a Foreign Subsidiary that  guarantees or is otherwise liable as a borrower or an additional or co-borrower under a Material  Credit Facility shall be deemed not to be a guarantor, borrower or an additional or co-borrower of  Indebtedness existing under such Material Credit Facility for purposes of this Section 9.7 if such  Subsidiary shall have no obligations under such Material Credit Facility (or any other agreement  or instrument relating thereto) for the repayment of any Indebtedness of the Company or any other  Subsidiary outstanding thereunder (whether upon default by any party to such Material Credit                                        -25-  \\DC - 047743/000003 - 10986815 v12    

 

     Facility (or otherwise)) other than Indebtedness of another Foreign Subsidiary which Subsidiary   also satisfies the conditions of this sentence.                       (b)  At the election of the Company and by written notice to each holder               of Notes, any Subsidiary Guarantor that has provided a Subsidiary Guaranty under               subparagraph (a) of this Section 9.7 may be discharged from all of its obligations              and liabilities under its Subsidiary Guaranty and shall be automatically released              from its obligations thereunder effective upon the satisfaction of the following              conditions (and without the need for the execution or delivery of any other              document by the holders): (i) if such Subsidiary Guarantor is a guarantor or is              otherwise liable for or in respect of any Material Credit Facility, then such              Subsidiary Guarantor has been released and discharged (or will be released and              discharged concurrently with the release of such Subsidiary Guarantor under its              Subsidiary Guaranty) under such Material Credit Facility, (ii) at the time of, and              after giving effect to, such release and discharge, no Default or Event of Default              shall be existing, (iii) no amount is then due and payable under such Subsidiary              Guaranty, (iv) if in connection with such Subsidiary Guarantor being released and              discharged under any Material Credit Facility, any fee is given to any holder of              Indebtedness under such Material Credit Facility for such release, the holders of the              Notes shall receive equivalent consideration on a pro rata basis (or other form of              consideration reasonably acceptable to the Required Holders) substantially              concurrently with the release hereunder and (v) each holder shall have received a              certificate of a Responsible Officer certifying as to the matters set forth in              clauses (i) through (iv) above.  In connection with such release, if requested by the              Company, each holder of Notes shall execute and deliver, at the sole cost and              expense of the Company, such documents as the Company may reasonably request              to evidence such release.  In the event of any such release, for purposes of              Section 10.7(c) and to the extent such Subsidiary remains a Subsidiary after giving              effect to such release, all Indebtedness of such Subsidiary constituting Priority Debt              as a result of it no longer being a Subsidiary Guarantor shall be deemed to have              been incurred concurrently with such release.          Section 9.8.  Priority of Obligations.  The Company will ensure that its payment   obligations under this Agreement and the Notes, and the payment obligations of any Subsidiary   Guarantor under its Subsidiary Guaranty, will at all times rank at least pari passu, without   preference or priority, with all other unsecured and unsubordinated Indebtedness of the Company   and such Subsidiary Guarantor, as applicable, in each case except for obligations mandatorily  preferred by law applying to companies generally.   SECTION 10.    NEGATIVE COVENANTS.          The Company covenants that so long as any of the Notes are outstanding:       Section 10.1.  Transactions with Affiliates.  The Company will not, and will not permit   any Subsidiary to, enter into directly or indirectly any Material transaction or Material group of  related transactions (including without limitation the purchase, lease, sale or exchange of                                         -26-   \\DC - 047743/000003 - 10986815 v12    

 

     properties of any kind or the rendering of any service) with any Affiliate (other than the Company   or another Subsidiary or an employee stock ownership plan for the benefit of employees of the   Company or any Subsidiary), except (a) in the ordinary course of business and pursuant to the  reasonable requirements of the Company’s or such Subsidiary’s business and upon fair and  reasonable terms no less favorable to the Company or such Subsidiary than would be obtainable  in a comparable arm’s-length transaction with a Person not an Affiliate or, if such transaction is   not one which by its nature could be obtained from any such Person, is on fair and reasonable  terms and (b) cash dividends and market share price repurchases approved by the board of directors  of the Company and permitted under each Material Credit Facility.         Section 10.2.  Merger, Consolidation, Etc.  The Company will not, and will not permit  any Subsidiary Guarantor to, consolidate with or merge with any other Person or convey, transfer  or lease all or substantially all of its assets in a single transaction or series of related transactions  to any Person unless:                (a)   in the case of any such transaction involving the Company, the successor        formed by such consolidation or the survivor of such merger or the Person that acquires by        conveyance, transfer or lease all or substantially all of the assets of the Company, as the        case may be, is a solvent corporation or limited liability company organized and existing        under the laws of the United States or any state thereof (including the District of Columbia),        and, if the Company is not such corporation or limited liability company, such corporation        or limited liability company shall have (i) executed and delivered to each holder of any        Notes its assumption of the due and punctual performance and observance of each covenant        and condition of this Agreement and the Notes and (ii) caused to be delivered to each holder        of any Notes an opinion of Hogan Lovells US LLP, another nationally recognized        independent counsel or in-house counsel admitted in the State of New York, or other        independent counsel reasonably satisfactory to the Required Holders, to the effect that all        agreements or instruments effecting such assumption are enforceable in accordance with        their terms and comply with the terms hereof;                 (b)   in the case of any such transaction involving a Subsidiary Guarantor, the        successor formed by such consolidation or the survivor of such merger or the Person that        acquires by conveyance, transfer or lease all or substantially all of the assets of such        Subsidiary Guarantor as an entirety, as the case may be, shall be (1) the Company, such        Subsidiary Guarantor or another Subsidiary Guarantor; (2) a solvent corporation or limited        liability company (other than the Company or another Subsidiary Guarantor) that is        organized and existing under the laws of the United States or any state thereof (including        the District of Columbia) and, if such Subsidiary Guarantor is not such corporation or        limited liability company, (A) such corporation or limited liability company shall have        executed and delivered to each holder of Notes its assumption of the due and punctual        performance and observance of each covenant and condition of the Subsidiary Guaranty of        such Subsidiary Guarantor and (B) the Company shall have caused to be delivered to each        holder of Notes an opinion of nationally recognized independent counsel or in-house        counsel admitted in the State of New York, or other independent counsel reasonably        satisfactory to the Required Holders, to the effect that all agreements or instruments         effecting such assumption are enforceable in accordance with their terms and comply with                                         -27-   \\DC - 047743/000003 - 10986815 v12    

 

           the terms hereof; or (3) any other Person so long as the transaction is treated as a disposition         of all of the assets of such Subsidiary Guarantor for purposes of Section 10.3 and, based         on such characterization, would be permitted pursuant Section 10.3;                (c)   each Subsidiary Guarantor under any Subsidiary Guaranty that is         outstanding at the time such transaction or each transaction in such a series of transactions         occurs reaffirms its obligations under such Subsidiary Guaranty in writing at such time         pursuant to a reaffirmation in the form attached hereto as Schedule 10.2(c)(unless and to         the extent any such Subsidiary Guaranty has been discharged or released as permitted by         Section 9.7(b) or otherwise); and                (d)   immediately before and immediately after giving effect to such transaction         or each transaction in any such series of related transactions, no Default or Event of Default         shall have occurred and be continuing.    No such conveyance, transfer or lease of substantially all of the assets of the Company or any   Subsidiary Guarantor shall have the effect of releasing the Company or such Subsidiary Guarantor,   as the case may be, or any successor corporation or limited liability company that shall theretofore   have become such in the manner prescribed in this Section 10.2, from its liability under (x) this   Agreement or the Notes (in the case of the Company) or (y) the Subsidiary Guaranty (in the case   of any Subsidiary Guarantor), unless, in the case of the conveyance, transfer or lease of all or   substantially all of the assets of a Subsidiary Guarantor, such Subsidiary Guarantor is released   from its Subsidiary Guaranty in accordance with Section 9.7(b) in connection with or immediately   following such conveyance, transfer or lease.       Section 10.3.  Sale of Assets.  Except as permitted by Section 10.2, the Company will not   and will not permit any Subsidiary to, sell, lease or otherwise dispose of any Substantial Part (as   defined below) of the assets of the Company and its Subsidiaries; provided, however, that the   Company or any Subsidiary may sell, lease or otherwise dispose of assets constituting a Substantial  Part of the assets of the Company and its Subsidiaries if such assets are sold, leased or otherwise   disposed of, in an arm’s length transaction and, at such time and after giving effect thereto, no   Default or Event of Default shall have occurred and be continuing and an amount equal to the Net   Cash Proceeds received from such sale, lease or other disposition of that portion of such assets that   exceeds the definition of Substantial Part (but not less than that portion of such assets that exceeds  the definition of Substantial Part) shall be used within 365 days of such sale, lease or disposition,  in any combination:                (1)   to acquire productive assets used or useful in carrying on the business of the        Company and its Subsidiaries; and/or                (2)   to prepay or retire Senior Debt of the Company and its Subsidiaries,        provided that (i) the Company shall offer to prepay each outstanding Note in a principal        amount which equals the Ratable Portion for such Note, and (ii) any such prepayment of        the Notes shall be made at 100% of the principal amount of such Note offered to be prepaid,        together with accrued interest thereon to (but not including) the date of such prepayment,        but without the payment of the Make-Whole Amount or other premium.  Any offer of                                         -28-   \\DC - 047743/000003 - 10986815 v12    

 

         prepayment of the Notes pursuant to this Section 10.3 shall be given to each holder of the        Notes by written notice that shall be delivered not less than 20 days and not more than 60        days prior to the proposed prepayment date.  Each such notice shall state that it is given        pursuant to this Section 10.3 and that the offer set forth in such notice must be accepted by        such holder in writing and shall also set forth (i) the prepayment date (which shall be a        Business Day), (ii) a description of the circumstances which give rise to the proposed        prepayment, (iii) that such offer is being made pursuant to this Section 10.3, and (iv) a        calculation of the Ratable Portion for such holder’s Notes.  Each holder of the Notes which        desires to have its Notes prepaid shall notify the Company in writing delivered not less        than seven Business Days prior to the proposed prepayment date of its acceptance of such        offer of prepayment.  A failure by a holder of Notes to respond to an offer to prepay made        pursuant to this Section 10.3, or to accept an offer as to all of the Notes held by such holder        subject to such offer, in each case on or before the 5th Business Day preceding the proposed        prepayment date, shall be deemed to constitute a rejection of such offer by such holder.        Prepayment of Notes pursuant to this Section 10.3 shall be made in accordance with        Section 8.2 (but without payment of the Make-Whole Amount) and otherwise to the extent        not inconsistent with this Section 10.3.   provided that, in the case of clause (1) above, a commitment pursuant to a definitive binding  agreement that is executed within such 365-day period shall be treated as a permitted application  of such Net Cash Proceeds so long as such acquisition or expenditure is consummated within 180  days of the end of such 365-day period.     As used in this Section 10.3, a sale, lease or other disposition of assets shall be deemed to be a  “Substantial Part” of the assets of the Company and its Subsidiaries if the book value of such  assets, when added to the book value of all other assets sold, leased or otherwise disposed of by  the Company and its Subsidiaries during the same fiscal year, exceeds 10% of the book value of  Consolidated Assets, determined as of the end of the fiscal year immediately preceding such sale,  lease or other disposition; provided that there shall be excluded from any determination of a  “Substantial Part” (i) any sale, lease, transfer or disposition of assets in the ordinary course of  business of the Company and its Subsidiaries, (ii) the sale, lease or transfer of property or assets  between and among the Company and its Subsidiaries; and (iii) any sale, transfer or disposition of  property acquired by the Company or any Subsidiary after the date of this Agreement to any Person  within 365 days following the acquisition or construction of such property by the Company or any  Subsidiary if the Company or a Subsidiary shall concurrently with such sale or transfer, lease such  property, as lessee.  For purposes of clarification, cash dividends and market share repurchases  approved by the board of directors of the Company shall not be deemed to be sales, leases or other  dispositions of assets for purposes of this Section 10.3.      Section 10.4.  Line of Business.  The Company will not and will not permit any Subsidiary  to engage in any Material line of business if, as a result, the general nature of the business in which  the Company and its Subsidiaries, taken as a whole, would then be engaged would be substantially  changed from the general nature of the business in which the Company and its Subsidiaries, taken  as a whole, are engaged on the date of this Agreement as described in the Memorandum.                                         -29-  \\DC - 047743/000003 - 10986815 v12    

 

        Section 10.5.  Economic Sanctions, Etc.  The Company will not, and will not permit any   Controlled Entity to (a) take any action that would result in either the Company or any Controlled   Entity becoming, owning or controlling a Blocked Person or (b) directly or indirectly have any  investment in or engage in any dealing or transaction (including any investment, dealing or  transaction involving the proceeds of the Notes) with any Person if such investment, dealing or  transaction (i) would cause any holder of the Notes or any affiliate of such holder to be in violation   of any sanctions under, any law or regulation applicable to such holder, or (ii) is prohibited under  any U.S. Economic Sanctions Laws.       Section 10.6.  Liens.  The Company will not and will not permit any of its Subsidiaries to  directly or indirectly create, incur, assume or permit to exist (upon the happening of a contingency  or otherwise) any Lien on or with respect to any property or asset (including any document or  instrument in respect of goods or accounts receivable) of the Company or any such Subsidiary,  whether now owned or held or hereafter acquired, or any income or profits therefrom, or assign or  otherwise convey any right to receive income or profits, except:                (a)   purchase money Liens securing purchase money Indebtedness and Liens        arising in connection with Capital Leases, to the extent each is permitted under        Section 10.7 hereof;                (b)   Liens for taxes, assessments, charges or other governmental levies not yet        due or as to which the period of grace, if any, related thereto has not expired or which are        being contested in good faith by appropriate proceedings diligently pursued, provided that        adequate reserves with respect thereto are maintained on the books of the Company or its        Subsidiaries, as the case may be, in conformity with GAAP (or, in the case of Subsidiaries        with significant operations outside of the United States of America, generally accepted        accounting principles in effect from time to time in their respective jurisdictions of        incorporation);                (c)   carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or        other like Liens arising in the ordinary course of business which are not overdue for a        period of more than sixty (60) days or which are being contested in good faith by        appropriate proceedings diligently pursued, provided that (i) any proceedings commenced        for the enforcement of such Liens and encumbrances shall have been duly suspended and        (ii) adequate reserves with respect thereto are maintained on the books of the Company or        its Subsidiaries, as the case may be, in conformity with GAAP (or, in the case of        Subsidiaries with significant operations outside of the United States of America, generally        accepted accounting principles in effect from time to time in their respective jurisdictions        of incorporation);                (d)  pledges or deposits in connection with workers’ compensation,        unemployment insurance and other social security legislation and deposits securing        liability to insurance carriers under insurance or self-insurance arrangements;                                          -30-   \\DC - 047743/000003 - 10986815 v12    

 

               (e)   Liens to secure the performance of bids, trade contracts (other than for       borrowed money), leases, statutory obligations, surety and appeal bonds, performance       bonds and other obligations of a like nature incurred in the ordinary course of business;                (f)   Liens existing on the date of Closing; provided that no such Lien shall at       any time be extended to cover property or assets other than the property or assets subject       thereto on the date of Closing (other than improvements thereto or, if required by the terms       of the document or instrument creating or governing such Lien as in effect on the date of       Closing, additions thereto and replacements and substitutions therefor);               (g)   Liens in favor of Pearl City on assets of the Company and its Subsidiaries       (other than accounts receivable and inventory) securing extensions of credit from Pearl       City to the Company and its Subsidiaries in an aggregate principal amount not to exceed       $120,000,000 at any time outstanding;               (h)   Liens arising in the ordinary course of the Company’s or any Subsidiary’s       business that (i) do not secure Indebtedness and (ii) do not in the aggregate materially       detract from the value of its assets or materially impair the use thereof in the operation of       its business;                (i)  Liens securing judgments for the payment of money not constituting an       Event of Default under Section 11(j) or securing appeal or other surety bonds relating to       such judgments;                (j)  minor survey exceptions or minor encumbrances, easements or       reservations, or rights of others for rights-of-way, utilities and other similar purposes, or       zoning or other restrictions as to the use of real properties, which customarily exist on       properties of corporations engaged in similar activities and similarly situated and which do       not in any event materially impair their use in the operation of the business of Company       and the Subsidiaries;               (k)   (i) Liens in favor of the Company or Subsidiary Guarantors securing       Indebtedness of the Company, Subsidiary Guarantors or a Non-Guarantor Subsidiary, and       (ii) Liens in favor of the Company or a Subsidiary securing Indebtedness of a Subsidiary;                (l)  customary rights of setoff, revocation, refund or chargeback under deposit       agreements or under applicable law, of banks or other financial institutions where the       Company or its Subsidiaries maintain deposits in the ordinary course of business;               (m)   any extension, renewal or replacement (or successive extensions, renewals       or replacements), in whole or in part, of any Lien referred to in the foregoing clauses;       provided that such extension, renewal or replacement Lien shall be limited to all or a part       of the property which secured the Lien so extended, renewed or replaced (plus       improvements on such property);                                         -31-  \\DC - 047743/000003 - 10986815 v12    

 

                 (o)   Liens in favor of the Issuing Lenders and/or Swingline Lender to cash         collateralize or otherwise secure the obligations of a Defaulting Lender to fund risk        participations under the Bank Credit Facility;                 (p)   leases, subleases, licenses or sublicences granted to others, in each case        incidental to the ownership of property or assets or the ordinary conduct of the business of        the Company or any of its Subsidiaries and not securing Indebtedness;                (q)   any Lien existing on any property or asset prior to the acquisition thereof        by the Company or any Subsidiary or existing on any property or asset of any Person that        becomes a Subsidiary (or of any Person not previously a Subsidiary that is merged or        consolidated with or into a Subsidiary in a transaction permitted hereunder) prior to the        time such Person becomes a Subsidiary (or is so merged or consolidated) and securing        Indebtedness permitted under Section 10.7, provided that (i) such Lien is not created in        contemplation of or in connection with such acquisition or such Person becoming a        Subsidiary (or such merger or consolidation), as the case may be, (ii) such Lien shall not        apply to any other property or assets of the Company or any Subsidiary, and (iii) such Lien        shall secure only those obligations which it secures on the date of such acquisition or the        date such Person becomes a Subsidiary (or is so merged or consolidated), as the case may        be, and extensions, renewals and replacements thereof that do not increase the outstanding        principal amount thereof other than as permitted by Section 10.7); and                (r)   other Liens securing Indebtedness and other obligations of the Company or        any Subsidiary not otherwise permitted by clauses (a) through (q), provided that such        Indebtedness and other obligations shall not at any time exceed the limitations set forth in        Section 10.7, provided, further, that notwithstanding the foregoing, the Company shall not,        and shall not permit any of its Subsidiaries to, secure pursuant to this Section 10.6(r) any        Indebtedness outstanding under or pursuant to any Material Credit Facility unless and until        the Notes (and any guaranty delivered in connection therewith) shall concurrently be        secured equally and ratably with such Indebtedness pursuant to documentation reasonably        acceptable to the Required Holders in substance and in form, including an intercreditor        agreement and opinions of counsel to the Company and/or any such Subsidiary, as the case        may be, from counsel that is reasonably acceptable to the Required Holders.      Section 10.7    Financial Covenants.         (a)     Leverage Ratio.  The Company will not permit, on a Consolidated basis, the  Leverage Ratio to exceed 3.50 to 1.0 as of the end of any fiscal quarter of the Company.         (b)     Interest Coverage Ratio.  The Company will not permit, on a Consolidated basis,  the Interest Coverage Ratio to fall below 3.00 to 1.0 as of the end of any fiscal quarter of the  Company.         (c)     Priority Debt.  The Company will not at any time permit the aggregate amount of  all Priority Debt to exceed 20% of Consolidated Assets (Consolidated Assets to be determined as  of the end of the immediately preceding fiscal quarter of the Company).                                           -32-   \\DC - 047743/000003 - 10986815 v12    

 

   SECTION 11.   EVENTS OF DEFAULT.         An “Event of Default” shall exist if any of the following conditions or events shall occur  and be continuing:               (a)   the Company defaults in the payment of any principal or Make-Whole        Amount, if any, on any Note when the same becomes due and payable, whether at maturity        or at a date fixed for prepayment or by declaration or otherwise; or               (b)   the Company defaults in the payment of any interest on any Note for more        than five (5) Business Days after the same becomes due and payable; or               (c)  the Company defaults in the performance of or compliance with any term        contained in Section 7.1(d) or Sections 10.2, 10.3, 10.5 or 10.6, 10.7; or               (d)   the Company or any Subsidiary Guarantor defaults in the performance of or        compliance with any term contained herein (other than those referred to in Sections 11(a),        (b) and (c)) or in any Subsidiary Guaranty and such default is not remedied within 30 days        after the earlier of (i) a Responsible Officer obtaining actual knowledge of such default and        (ii) the Company receiving written notice of such default from any holder of a Note (any        such written notice to be identified as a “notice of default” and to refer specifically to this        Section 11(d)); or               (e)   (i) any representation or warranty made in writing by or on behalf of the        Company or by any officer of the Company in this Agreement or any writing furnished in        connection with the transactions contemplated hereby proves to have been false or        incorrect in any material respect on the date as of which made, or (ii) any representation or        warranty made in writing by or on behalf of any Subsidiary Guarantor or by any officer of        such Subsidiary Guarantor in any Subsidiary Guaranty or any writing furnished in        connection with such Subsidiary Guaranty proves to have been false or incorrect in any        material respect on the date as of which made; or                (f)  (i) the Company or any Subsidiary is in default (as principal or as guarantor        or other surety) in the payment of any principal of or premium or make-whole amount or        interest on any Material Indebtedness, in each case beyond any period of grace provided        with respect thereto, or (ii) the Company or any Subsidiary is in default in the performance        of or compliance with any term of any evidence of any Material Indebtedness or of any        mortgage, indenture or other agreement relating thereto or any other condition exists, and        as a consequence of such default or condition such Material Indebtedness has become, or        has been declared (or one or more Persons are entitled to declare such Material        Indebtedness to be), due and payable before its stated maturity or before its regularly        scheduled dates of payment (in each case, other than as a result of the occurrence of        customary non-default mandatory prepayment events, such as prepayment requirements        associated with asset sales), or (iii) as a consequence of the occurrence or continuation of        any event or condition (other than the passage of time or the right of the holder of        Indebtedness to convert such Indebtedness into Equity Interests or as a result of customary                                        -33-  \\DC - 047743/000003 - 10986815 v12    

 

         non-default mandatory prepayment events, such as prepayment requirements associated       with asset sales), (x) the Company or any Subsidiary has become obligated to purchase or       repay any Material Indebtedness before its regular maturity or before its regularly       scheduled dates of payment or (y) one or more Persons have the right to require the       Company or any Subsidiary so to purchase or repay such Indebtedness); or               (g)   the Company or any Material Subsidiary or any Subsidiary Guarantor (i) is       generally not paying, or admits in writing its inability to pay, its debts as they become due,       (ii) files, or consents by answer or otherwise to the filing against it of, a petition for relief       or reorganization or arrangement or any other petition in bankruptcy, for liquidation or to       take advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar       law of any jurisdiction, (iii) makes an assignment for the benefit of its creditors,       (iv) consents to the appointment of a custodian, receiver, trustee or other officer with       similar powers with respect to it or with respect to any substantial part of its property, (v) is       adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for the purpose       of any of the foregoing; or               (h)   a court or other Governmental Authority of competent jurisdiction enters an       order appointing, without consent by the Company or any of its Material Subsidiaries or       any Subsidiary Guarantor, a custodian, receiver, trustee or other officer with similar powers       with respect to it or with respect to any substantial part of its property, or constituting an       order for relief or approving a petition for relief or reorganization or any other petition in        bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law of        any jurisdiction, or ordering the dissolution, winding-up or liquidation of the Company or        any of its Material Subsidiaries or any Subsidiary Guarantor and such order shall not have        been reversed or vacated or such petition shall not be dismissed within 60 days;                (i)  any event occurs with respect to the Company or any Material Subsidiary       or any Subsidiary Guarantor which under the laws of any jurisdiction is analogous to any       of the events described in Section 11(g) or Section 11(h), provided that the applicable grace        period, if any, which shall apply shall be the one applicable to the relevant proceeding        which most closely corresponds to the proceeding described in Section 11(g) or        Section 11(h); or                (j)  one or more final judgments or orders for the payment of money        aggregating in excess of the greater of $30,000,000 (or its equivalent in the relevant        currency of payment) and two and one-half percent (2.5%) of Consolidated Assets (other        than to the extent not covered by third party insurance or self-insurance as to which the        insurer does not dispute coverage), including any such final order enforcing a binding        arbitration decision, are rendered against one or more of the Company and its Subsidiaries        and which judgments are not, within 60 days after entry thereof, bonded, discharged or        stayed pending appeal, or are not discharged within 60 days after the expiration of such        stay; or               (k)  if (i) any Plan shall fail to satisfy the minimum funding standards of ERISA        or the Code for any plan year or part thereof or a waiver of such standards or extension of                                        -34-  \\DC - 047743/000003 - 10986815 v12    

 

           any amortization period is sought or granted under section 412 of the Code, (ii) a notice of         intent to terminate any Plan shall have been or is reasonably expected to be filed with the        PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to        terminate or appoint a trustee to administer any Plan or the PBGC shall have notified the        Company or any ERISA Affiliate that a Plan may become a subject of any such        proceedings, (iii) there is any “amount of unfunded benefit liabilities” (within the meaning        of section 4001(a)(18) of ERISA) under one or more Plans, determined in accordance with        Title IV of ERISA, (iv)  the Company or any ERISA Affiliate shall have incurred or is        reasonably expected to incur any liability pursuant to Title I or IV of ERISA or the penalty        or excise tax provisions of the Code relating to employee benefit plans, (v) the Company        or any ERISA Affiliate withdraws from any Multiemployer Plan, (vi) the Company or any        Subsidiary establishes or amends any employee welfare benefit plan that provides        post-employment welfare benefits in a manner that would increase the liability of the        Company or any Subsidiary thereunder, and any such event or events described in        clauses (i) through (vi) above, either individually or together with any other such event or        events, could reasonably be expected to have a Material Adverse Effect.  As used in this        Section 11(k), the terms “employee benefit plan” and “employee welfare benefit plan”        shall have the respective meanings assigned to such terms in section 3 of ERISA; or                 (l)  any Subsidiary Guaranty shall cease to be in full force and effect, any        Subsidiary Guarantor or any Person acting on behalf of any Subsidiary Guarantor shall        contest in any manner the validity, binding nature or enforceability of any Subsidiary        Guaranty, or the obligations of any Subsidiary Guarantor under any Subsidiary Guaranty        are not or cease to be legal, valid, binding and enforceable in accordance with the terms of        such Subsidiary Guaranty.     SECTION 12.    REMEDIES ON DEFAULT, ETC.       Section 12.1.  Acceleration.  (a) If an Event of Default with respect to the Company   described in Section 11(g), (h) or (i) (other than an Event of Default described in clause (i) of   Section 11(g) or described in clause (vi) of Section 11(g) by virtue of the fact that such clause   encompasses clause (i) of Section 11(g)) has occurred, all the Notes then outstanding shall   automatically become immediately due and payable.         (b)  If any other Event of Default has occurred and is continuing, the Required Holders   may at any time at its or their option, by notice or notices to the Company, declare all the Notes   then outstanding to be immediately due and payable.         (c)  If any Event of Default described in Section 11(a) or (b) has occurred and is   continuing, any holder or holders of Notes at the time outstanding affected by such Event of   Default may at any time, at its or their option, by notice or notices to the Company, declare all the   Notes held by it or them to be immediately due and payable.          Upon any Notes becoming due and payable under this Section 12.1, whether automatically   or by declaration, such Notes will forthwith mature and the entire unpaid principal amount of such   Notes, plus (x) all accrued and unpaid interest thereon (including interest accrued thereon at the                                         -35-   \\DC - 047743/000003 - 10986815 v12    

 

     Default Rate) and (y) the Make-Whole Amount determined in respect of such principal amount,   shall all be immediately due and payable, in each and every case without presentment, demand,   protest or further notice, all of which are hereby waived.  The Company acknowledges, and the   parties hereto agree, that each holder of a Note has the right to maintain its investment in the Notes   free from repayment by the Company (except as herein specifically provided for) and that the   provision for payment of a Make-Whole Amount by the Company in the event that the Notes are   prepaid or are accelerated as a result of an Event of Default, is intended to provide compensation   for the deprivation of such right under such circumstances.       Section 12.2.  Other Remedies.  If any Default or Event of Default has occurred and is   continuing, and irrespective of whether any Notes have become or have been declared immediately   due and payable under Section 12.1, the holder of any Note at the time outstanding may proceed   to protect and enforce the rights of such holder by an action at law, suit in equity or other   appropriate proceeding, whether for the specific performance of any agreement contained herein   or in any Note or Subsidiary Guaranty, or for an injunction against a violation of any of the terms   hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law or   otherwise.       Section 12.3.  Rescission.  At any time after any Notes have been declared due and payable  pursuant to Section 12.1(b) or (c), the Required Holders, by written notice to the Company, may  rescind and annul any such declaration and its consequences if (a) the Company has paid all  overdue interest on the Notes, all principal of and Make-Whole Amount, if any, on any Notes that  are due and payable and are unpaid other than by reason of such declaration, and all interest on   such overdue principal and Make-Whole Amount, if any, and (to the extent permitted by applicable   law) any overdue interest in respect of the Notes, at the Default Rate, (b) neither the Company nor   any other Person shall have paid any amounts which have become due solely by reason of such   declaration, (c) all Events of Default and Defaults, other than non-payment of amounts that have   become due solely by reason of such declaration, have been cured or have been waived pursuant   to Section 17, and (d) no judgment or decree has been entered for the payment of any monies due   pursuant hereto or to the Notes.  No rescission and annulment under this Section 12.3 will extend   to or affect any subsequent Event of Default or Default or impair any right consequent thereon.       Section 12.4.  No Waivers or Election of Remedies, Expenses, Etc.  No course of dealing   and no delay on the part of any holder of any Note in exercising any right, power or remedy shall   operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or remedies.  No   right, power or remedy conferred by this Agreement, any Subsidiary Guaranty or any Note upon   any holder thereof shall be exclusive of any other right, power or remedy referred to herein or   therein or now or hereafter available at law, in equity, by statute or otherwise.  Without limiting   the obligations of the Company under Section 15, the Company will pay to the holder of each Note   on demand such further amount as shall be sufficient to cover all costs and expenses of such holder   incurred in any enforcement or collection under this Section 12, including reasonable attorneys’   fees, expenses and disbursements.                                          -36-   \\DC - 047743/000003 - 10986815 v12    

 

     SECTION 13.   REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.       Section 13.1.  Registration of Notes.  The Company shall keep at its principal executive   office a register for the registration and registration of transfers of Notes.  The name and address  of each holder of one or more Notes, each transfer thereof and the name and address of each   transferee of one or more Notes shall be registered in such register.  If any holder of one or more   Notes is a nominee, then (a) the name and address of the beneficial owner of such Note or Notes   shall also be registered in such register as an owner and holder thereof and (b) at any such   beneficial owner’s option, either such beneficial owner or its nominee may execute any   amendment, waiver or consent pursuant to this Agreement.  Prior to due presentment for   registration of transfer, the Person in whose name any Note shall be registered shall be deemed   and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be   affected by any notice or knowledge to the contrary.  The Company shall give to any holder of a   Note that is an Institutional Investor promptly upon request therefor, a complete and correct copy   of the names and addresses of all registered holders of Notes.       Section 13.2.  Transfer and Exchange of Notes; No Transfer to Competitors .  (a) Upon   surrender of any Note to the Company at the address and to the attention of the designated officer   (all as specified in Section 18(iii)), for registration of transfer or exchange (and in the case of a   surrender for registration of transfer accompanied by a written instrument of transfer duly executed   by the registered holder of such Note or such holder’s attorney duly authorized in writing and   accompanied by the relevant name, address and other information for notices of each transferee of   such Note or part thereof), within 10 Business Days thereafter, the Company shall execute and   deliver, at the Company’s expense (except as provided below), one or more new Notes (as   requested by the holder thereof) in exchange therefor, in an aggregate principal amount equal to   the unpaid principal amount of the surrendered Note.  Each such new Note shall be payable to such   Person as such holder may request and shall be substantially in the form of Schedule 1.  Each such   new Note shall be dated and bear interest from the date to which interest shall have been paid on   the surrendered Note or dated the date of the surrendered Note if no interest shall have been paid   thereon.  The Company may require payment of a sum sufficient to cover any stamp tax or   governmental charge imposed in respect of any such transfer of Notes.  Notes shall not be   transferred in denominations of less than $500,000, provided that if necessary to enable the   registration of transfer by a holder of its entire holding of Notes, one Note may be in a   denomination of less than $500,000.  Any transferee, by its acceptance of a Note registered in its   name (or the name of its nominee), shall be deemed to have made the representations set forth in   Section 6.          The Notes have not been registered under the Securities Act or under the securities laws of   any state and may not be transferred or resold unless registered under the Securities Act and all  applicable state securities laws or unless an exemption from the requirement for such registration  is available.                 (b)  Without limiting the foregoing, each Purchaser and each subsequent holder  of any Note severally agrees that it will not, directly or indirectly, resell any Notes purchased by  it to a Person which is a Competitor.  The Company shall not be required to recognize any sale or                                         -37-   \\DC - 047743/000003 - 10986815 v12    

 

     other transfer of a Note to a Competitor and no such transfer shall confer any rights hereunder  upon such transferee.       Section 13.3.  Replacement of Notes.  Upon receipt by the Company at the address and to  the attention of the designated officer (all as specified in Section 18(iii)) of evidence reasonably  satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any Note  (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional  Investor of such ownership and such loss, theft, destruction or mutilation), and                (a)  in the case of loss, theft or destruction, of indemnity reasonably satisfactory        to it (provided that if the holder of such Note is, or is a nominee for, an original Purchaser        or another holder of a Note with a minimum net worth of at least $50,000,000 or a Qualified         Institutional Buyer, such Person’s own unsecured agreement of indemnity shall be deemed         to be satisfactory), or                (b)   in the case of mutilation, upon surrender and cancellation thereof,    within 10 Business Days thereafter, the Company at its own expense shall execute and deliver, in   lieu thereof, a new Note, dated and bearing interest from the date to which interest shall have been   paid on such lost, stolen, destroyed or mutilated Note or dated the date of such lost, stolen,   destroyed or mutilated Note if no interest shall have been paid thereon.    SECTION 14.   PAYMENTS ON NOTES.       Section 14.1.  Place of Payment.  Subject to Section 14.2, payments of principal,   Make-Whole Amount, if any, and interest becoming due and payable on the Notes shall be made   in New York, New York at the principal office of Bank of America, N.A. in such jurisdiction.  The   Company may at any time, by notice to each holder of a Note, change the place of payment of the   Notes so long as such place of payment shall be either the principal office of the Company in such   jurisdiction or the principal office of a bank or trust company in such jurisdiction.       Section 14.2.  Payment by Wire Transfer.  So long as any Purchaser or its nominee shall   be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note   to the contrary, the Company will pay all sums becoming due on such Note for principal,   Make-Whole Amount, if any, interest and all other amounts becoming due hereunder by the   method and at the address specified for such purpose below such Purchaser’s name in the   Purchaser Schedule, or by such other method or at such other address as such Purchaser shall have   from time to time specified to the Company in writing for such purpose, without the presentation   or surrender of such Note or the making of any notation thereon, except that upon written request   of the Company made concurrently with or reasonably promptly after payment or prepayment in   full of any Note, such Purchaser shall surrender such Note for cancellation, reasonably promptly   after any such request, to the Company at its principal executive office or at the place of payment   most recently designated by the Company pursuant to Section 14.1.  Prior to any sale or other   disposition of any Note held by a Purchaser or its nominee, such Purchaser will, at its election,   either endorse thereon the amount of principal paid thereon and the last date to which interest has   been paid thereon or surrender such Note to the Company in exchange for a new Note or Notes                                         -38-   \\DC - 047743/000003 - 10986815 v12    

 

     pursuant to Section 13.2.  The Company will afford the benefits of this Section 14.2 to any   Institutional Investor that is the direct or indirect transferee of any Note purchased by a Purchaser   under this Agreement and that has made the same agreement relating to such Note as the   Purchasers have made in this Section 14.2.     Section 14.3. FATCA Information.  By acceptance of any Note, the holder of such Note   agrees that such holder will with reasonable promptness duly complete and deliver to the   Company, or to such other Person as may be reasonably requested by the Company, from time to   time (a) in the case of any such holder that is a United States Person, such holder’s United States   tax identification number or other Forms reasonably requested by the Company necessary to   establish such holder’s status as a United States Person under FATCA and as may otherwise be   necessary for the Company to comply with its obligations under FATCA and (b) in the case of any   such holder that is not a United States Person, such documentation prescribed by applicable law   (including as prescribed by section 1471(b)(3)(C)(i) of the Code) and such additional   documentation as may be necessary for the Company to comply with its obligations under FATCA   and to determine that such holder has complied with such holder’s obligations under FATCA or   to determine the amount (if any) to deduct and withhold from any such payment made to such   holder.  Nothing in this Section 14.3 shall require any holder to provide information that is   confidential or proprietary to such holder unless the Company is required to obtain such   information under FATCA and, in such event, the Company shall treat any such information it   receives as confidential.    SECTION 15.   EXPENSES, ETC.       Section 15.1.  Transaction  Expenses.  Whether or not the transactions contemplated  hereby are consummated, the Company will pay all reasonable and documented out-of-pocket  costs and expenses (but limited, in the case of legal fees and expenses, to the reasonable and  documented out-of-pocket charges of one outside counsel representing the holders taken as a   whole and, if reasonably required by the Required Holders, one counsel in any relevant jurisdiction   representing the holders taken as a whole) incurred by the Purchasers and each other holder of a   Note in connection with such transactions and in connection with any amendments, waivers or   consents under or in respect of this Agreement, any Subsidiary Guaranty or the Notes (whether or   not such amendment, waiver or consent becomes effective), including: (a) the reasonable and   documented out-of-pocket costs and expenses incurred in enforcing or defending (or determining   whether or how to enforce or defend) any rights under this Agreement, any Subsidiary Guaranty   or the Notes or in responding to any subpoena or other legal process or informal investigative   demand issued in connection with this Agreement, any Subsidiary Guaranty or the Notes, or by   reason of being a holder of any Note, (b) the reasonable and documented out-of-pocket costs and   expenses, including financial advisors’ fees, incurred in connection with the insolvency or   bankruptcy of the Company or any Subsidiary or in connection with any work-out or restructuring   of the transactions contemplated hereby and by the Notes and any Subsidiary Guaranty and (c) the   reasonable and documented out-of-pocket costs and expenses incurred in connection with the   initial filing of this Agreement and all related documents and financial information with the SVO   provided, that such costs and expenses under this clause (c) shall not exceed $5,000.  If required   by the NAIC, the Company shall obtain and maintain at its own cost and expense a Legal Entity   Identifier (LEI).                                           -39-   \\DC - 047743/000003 - 10986815 v12    

 

     The Company will pay, and will save each Purchaser and each other holder of a Note harmless   from, (i) all claims in respect of any fees, costs or expenses, if any, of brokers and finders (other   than those, if any, retained by a Purchaser or other holder in connection with its purchase of the   Notes), (ii) any and all wire transfer fees that any bank or other financial institution deducts from   any payment under such Note to such holder or otherwise charges to a holder of a Note with respect   to a payment under such Note and (iii) any judgment, liability, claim, order, decree, fine, penalty,   cost, fee, expense (but limited, in the case of legal fees and expenses, to the reasonable and   documented out-of-pocket charges of one outside counsel representing the holders taken as a   whole and, if reasonably required by the Required Holders, one counsel in any relevant jurisdiction   representing the holders taken as a whole) or obligation resulting from the consummation of the   transactions contemplated hereby, including the use of the proceeds of the Notes by the Company;   provided that no such indemnity shall be owing by the Company if the applicable claim, judgment,   liability, order, decree, fine, penalty, cost, fee, or expense is found by a court of competent   jurisdiction by final and nonappealable judgment to have resulted from the gross negligence, bad   faith or willful misconduct of such Purchaser or of any affiliate of such Purchaser.     Section 15.2. Certain Taxes.  The Company agrees to pay all stamp, documentary or   similar taxes or fees which may be payable in respect of the execution and delivery or the   enforcement of this Agreement or any Subsidiary Guaranty or the execution and delivery (but not   the transfer) or the enforcement of any of the Notes in the United States or any other jurisdiction   where the Company or any Subsidiary Guarantor has assets or of any amendment of, or waiver or   consent under or with respect to, this Agreement or any Subsidiary Guaranty or of any of the Notes,   and to pay any value added tax due and payable in respect of reimbursement of costs and expenses   by the Company pursuant to this Section 15, and will save each holder of a Note to the extent   permitted by applicable law harmless against any loss or liability resulting from nonpayment or   delay in payment of any such tax or fee required to be paid by the Company hereunder.       Section 15.3.  Survival.  The obligations of the Company under this Section 15 will survive   the payment or transfer of any Note, the enforcement, amendment or waiver of any provision of   this Agreement, any Subsidiary Guaranty or the Notes, and the termination of this Agreement.    SECTION 16.   SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.         All representations and warranties contained herein shall survive the execution and  delivery of this Agreement and the Notes, the purchase or transfer by any Purchaser of any Note  or portion thereof or interest therein and the payment of any Note, and may be relied upon by any  subsequent holder of a Note, regardless of any investigation made at any time by or on behalf of  such Purchaser or any other holder of a Note.  All statements contained in any certificate or other  instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed  representations and warranties of the Company under this Agreement.  Subject to the preceding  sentence, this Agreement, the Notes and any Subsidiary Guaranties embody the entire agreement  and understanding between each Purchaser and the Company and supersede all prior agreements  and understandings relating to the subject matter hereof.                                          -40-   \\DC - 047743/000003 - 10986815 v12    

 

     SECTION 17.   AMENDMENT AND WAIVER.         Section 17.1.  Requirements.  This Agreement and the Notes may be amended, and the   observance of any term hereof or of the Notes may be waived (either retroactively or   prospectively), only with the written consent of the Company and the Required Holders, except   that:                (a)  no amendment or waiver of any of Sections 1, 2, 3, 4, 5, 6 or 21 hereof, or        any defined term (as it is used therein), will be effective as to any Purchaser unless        consented to by such Purchaser in writing; and                (b)   no amendment or waiver may, without the written consent of each        Purchaser and the holder of each Note at the time outstanding, (i) subject to Section 12        relating to acceleration or rescission, change the amount or time of any prepayment or        payment of principal of, or reduce the rate or change the time of payment or method of        computation of (x) interest on the Notes or (y) the Make-Whole Amount, (ii) change the        percentage of the principal amount of the Notes the holders of which are required to consent        to any amendment or waiver, or (iii) amend any of Sections 8 (except as set forth in the        second sentence of Section 8.2), 11(a), 11(b), 12, 17 or 20.       Section 17.2.  Solicitation of Holders of Notes.    (a) Solicitation.    The Company will provide each holder of a Note with sufficient  information, sufficiently far in advance of the date a decision is required, to enable such holder to  make an informed and considered decision with respect to any proposed amendment, waiver or  consent in respect of any of the provisions hereof or of the Notes or any Subsidiary Guaranty.  The  Company will deliver executed or true and correct copies of each amendment, waiver or consent  effected pursuant to this Section 17 or any Subsidiary Guaranty to each holder of a Note promptly  following the date on which it is executed and delivered by, or receives the consent or approval of,  the requisite holders of Notes.    (b) Payment.  The Company will not directly or indirectly pay or cause to be paid any  remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant  any security or provide other credit support, to any holder of a Note as consideration for or as an  inducement to the entering into by such holder of any waiver or amendment of any of the terms  and provisions hereof or of any Subsidiary Guaranty or any Note unless such remuneration is  concurrently paid, or security is concurrently granted or other credit support concurrently  provided, on the same terms, ratably to each holder of a Note even if such holder did not consent  to such waiver or amendment.    (c) Consent in Contemplation of Transfer.  Any consent given pursuant to this Section 17  or any Subsidiary Guaranty by a holder of a Note that has transferred or has agreed to transfer its   Note to (i) the Company, (ii) any Subsidiary or any other Affiliate or (iii) any other Person in   connection with, or in anticipation of, such other Person acquiring, making a tender offer for or   merging with the Company and/or any of its Affiliates in connection with such consent, shall be   void and of no force or effect except solely as to such holder, and any amendments effected or                                         -41-   \\DC - 047743/000003 - 10986815 v12    

 

   waivers granted or to be effected or granted that would not have been or would not be so effected  or granted but for such consent (and the consents of all other holders of Notes that were acquired  under the same or similar conditions) shall be void and of no force or effect except solely as to  such holder.      Section 17.3.  Binding Effect, Etc.  Any amendment or waiver consented to as provided in  this Section 17 or any Subsidiary Guaranty applies equally to all holders of Notes and is binding  upon them and upon each future holder of any Note and upon the Company without regard to  whether such Note has been marked to indicate such amendment or waiver.  No such amendment  or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default  not expressly amended or waived or impair any right consequent thereon.  No course of dealing  between the Company and any holder of a Note and no delay in exercising any rights hereunder  or under any Note or Subsidiary Guaranty shall operate as a waiver of any rights of any holder of  such Note.      Section 17.4.  Notes Held by Company, Etc.  Solely for the purpose of determining  whether the holders of the requisite percentage of the aggregate principal amount of Notes then  outstanding approved or consented to any amendment, waiver or consent to be given under this  Agreement, any Subsidiary Guaranty or the Notes, or have directed the taking of any action  provided herein or in any Subsidiary Guaranty or the Notes to be taken upon the direction of the  holders of a specified percentage of the aggregate principal amount of Notes then outstanding,  Notes directly or indirectly owned by the Company or any of its Affiliates shall be deemed not to  be outstanding.   SECTION 18.   NOTICES.        Except to the extent otherwise provided in Section 7.4, all notices and communications  provided for hereunder shall be in writing and sent (a) by telecopy if the sender on the same day  sends a confirming copy of such notice by an internationally recognized overnight delivery service  (charges prepaid), or (b) by registered or certified mail with return receipt requested (postage  prepaid), or (c) by an internationally recognized overnight delivery service (charges prepaid).  Any  such notice must be sent:                (i)  if to any Purchaser or its nominee, to such Purchaser or nominee at the        address specified for such communications in the Purchaser Schedule, or at such other        address as such Purchaser or nominee shall have specified to the Company in writing,               (ii)  if to any other holder of any Note, to such holder at such address as such        other holder shall have specified to the Company in writing, or              (iii)  if to the Company, to the Company at its address set forth at the beginning        hereof to the attention of the Vice President and Chief Financial Officer, with a copy to the        General Counsel, or at such other address as the Company shall have specified to the holder        of each Note in writing.   Notices under this Section 18 will be deemed given only when actually received.                                       -42-  \\DC - 047743/000003 - 10986815 v12    

 

     SECTION 19.   REPRODUCTION OF DOCUMENTS.          This Agreement and all documents relating thereto, including (a) consents, waivers and   modifications that may hereafter be executed, (b) documents received by any Purchaser at the   Closing (except the Notes themselves), and (c) financial statements, certificates and other   information previously or hereafter furnished to any Purchaser, may be reproduced by such   Purchaser by any photographic, photostatic, electronic, digital, or other similar process and such   Purchaser may destroy any original document so reproduced.  The Company agrees and stipulates   that, to the extent permitted by applicable law, any such reproduction shall be admissible in   evidence as the original itself in any judicial or administrative proceeding (whether or not the   original is in existence and whether or not such reproduction was made by such Purchaser in the   regular course of business) and any enlargement, facsimile or further reproduction of such   reproduction shall likewise be admissible in evidence.  This Section 19 shall not prohibit the   Company or any other holder of Notes from contesting any such reproduction to the same extent  that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of   any such reproduction.    SECTION 20.   CONFIDENTIAL INFORMATION.          For the purposes of this Section 20, “Confidential Information” means information   delivered to any Purchaser by or on behalf of the Company or any Subsidiary in connection with   the transactions contemplated by or otherwise pursuant to this Agreement, provided that such term   does not include information that (a) was publicly known or otherwise known to such Purchaser   prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or   omission by such Purchaser or any Person acting on such Purchaser’s behalf, (c) otherwise  becomes known to such Purchaser other than through disclosure by the Company or any  Subsidiary or (d) constitutes financial statements delivered to such Purchaser under Section 7.1  that are otherwise publicly available.  Each Purchaser will maintain the confidentiality of such  Confidential Information in accordance with procedures adopted by such Purchaser in good faith  to protect confidential information of third parties delivered to such Purchaser, provided that such  Purchaser may deliver or disclose Confidential Information to (i) its directors, officers, employees,   agents, attorneys, trustees and affiliates (to the extent such disclosure reasonably relates to the   administration of the investment represented by its Notes), (ii) its auditors, financial advisors and   other professional advisors who agree to hold confidential the Confidential Information   substantially in accordance with this Section 20, (iii) any other holder of any Note, (iv) any   Institutional Investor to which it sells or offers to sell such Note or any part thereof or any   participation therein (if such Person has agreed in writing prior to its receipt of such Confidential   Information to be bound by this Section 20), (v) any Person from which it offers to purchase any   Security of the Company (if such Person has agreed in writing prior to its receipt of such   Confidential Information to be bound by this Section 20), (vi) any federal or state regulatory   authority having jurisdiction over such Purchaser, (vii) the NAIC or the SVO or, in each case, any   similar organization, or any nationally recognized rating agency that requires access to information   about such Purchaser’s investment portfolio, or (viii) any other Person to which such delivery or   disclosure may be necessary or appropriate (w) to effect compliance with any law, rule, regulation   or order applicable to such Purchaser, (x) in response to any subpoena or other legal process, (y) in   connection with any litigation to which such Purchaser is a party or (z) if an Event of Default has                                         -43-   \\DC - 047743/000003 - 10986815 v12    

 

     occurred and is continuing, to the extent such Purchaser may reasonably determine such delivery  and disclosure to be necessary or appropriate in the enforcement or for the protection of the rights   and remedies under such Purchaser’s Notes, this Agreement or any Subsidiary Guaranty.  Each   holder of a Note, by its acceptance of a Note, will be deemed to have agreed to be bound by and   to be entitled to the benefits of this Section 20 as though it were a party to this Agreement.  On   reasonable request by the Company in connection with the delivery to any holder of a Note of   information required to be delivered to such holder under this Agreement or requested by such   holder (other than a holder that is a party to this Agreement or its nominee), such holder will enter   into an agreement with the Company embodying this Section 20.         In the event that as a condition to receiving access to information relating to the Company   or its Subsidiaries in connection with the transactions contemplated by or otherwise pursuant to   this Agreement, any Purchaser or holder of a Note is required to agree to a confidentiality   undertaking (whether through IntraLinks, another secure website, a secure virtual workspace or   otherwise) which is different from this Section 20, this Section 20 shall not be amended thereby   and, as between such Purchaser or such holder and the Company, this Section 20 shall supersede   any such other confidentiality undertaking.    SECTION 21.   SUBSTITUTION OF PURCHASER.          Each Purchaser shall have the right to substitute any one of its Affiliates or another   Purchaser or any one of such other Purchaser’s Affiliates (a “Substitute Purchaser”) as the   purchaser of the Notes that it has agreed to purchase hereunder, by written notice to the Company,   which notice shall be signed by both such Purchaser and such Substitute Purchaser, shall contain   such Substitute Purchaser’s agreement to be bound by this Agreement and shall contain a   confirmation by such Substitute Purchaser of the accuracy with respect to it of the representations   set forth in Section 6.  Upon receipt of such notice, any reference to such Purchaser in this   Agreement (other than in this Section 21), shall be deemed to refer to such Substitute Purchaser in   lieu of such original Purchaser.  In the event that such Substitute Purchaser is so substituted as a   Purchaser hereunder and such Substitute Purchaser thereafter transfers to such original Purchaser   all of the Notes then held by such Substitute Purchaser, upon receipt by the Company of notice of   such transfer, any reference to such Substitute Purchaser as a “Purchaser” in this Agreement (other   than in this Section 21), shall no longer be deemed to refer to such Substitute Purchaser, but shall   refer to such original Purchaser, and such original Purchaser shall again have all the rights of an   original holder of the Notes under this Agreement.    SECTION 22.   MISCELLANEOUS.       Section 22.1.  Successors and Assigns.  All covenants and other agreements contained in  this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their  respective successors and assigns (including any subsequent holder of a Note) whether so  expressed or not, except that, subject to Section 10.2, the Company may not assign or otherwise  transfer any of its rights or obligations hereunder or under the Notes without the prior written  consent of each holder.  Nothing in this Agreement, expressed or implied, shall be construed to  confer upon any Person (other than the parties hereto and their respective successors and assigns                                         -44-   \\DC - 047743/000003 - 10986815 v12    

 

   permitted hereby) any legal or equitable right, remedy or claim under or by reason of this  Agreement.      Section 22.2.  Accounting  Terms.  All accounting terms used herein which are not  expressly defined in this Agreement have the meanings respectively given to them in accordance  with GAAP.  Except as otherwise specifically provided herein, (i) all computations made pursuant  to this Agreement shall be made in accordance with GAAP, and (ii) all financial statements shall  be prepared in accordance with GAAP.  For purposes of determining compliance with this  Agreement (including Section 9, Section 10 and the definition of “Indebtedness”), any election by  the Company to measure any financial liability using fair value (as permitted by Financial  Accounting Standards Board Accounting Standards Codification Topic No. 825-10-25 – Fair  Value Option, International Accounting Standard 39 – Financial Instruments: Recognition and  Measurement or any similar accounting standard) shall be disregarded and such determination  shall be made as if such election had not been made.         (b)     Changes  in  GAAP.  If at any time any change in GAAP would affect the  computation of any financial ratio or requirement set forth in this Agreement, and either the  Company or the Required Holders shall so request, the Company and the holders of the Notes 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 the approval of the Required Holders); provided that,  until so amended, (i) such ratio or requirement shall continue to be computed in accordance with  GAAP prior to such change therein and (ii) the Company shall provide to the holders of the Notes  financial statements and other documents required under this Agreement or as reasonably  requested hereunder setting forth a reconciliation between calculations of such ratio or requirement  made before and after giving effect to such change in GAAP.  Furthermore, notwithstanding any  such change in GAAP or the application thereof after the Closing Date that would require lease  obligations that would be treated as operating leases as of the date they are entered into to be  classified and accounted for as capital leases or otherwise reflected on the consolidated balance  sheet of the Company and its Subsidiaries, for the purposes of determining compliance with any  covenant or other obligation contained herein, such obligations shall be treated as operating leases  during the term of this Agreement.      Section 22.3.  Severability.  Any provision of this Agreement that 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, and any such  prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not  invalidate or render unenforceable such provision in any other jurisdiction.      Section 22.4.  Construction,  Etc.  Each covenant contained herein shall be construed  (absent express provision to the contrary) as being independent of each other covenant contained  herein, so that compliance with any one covenant shall not (absent such an express contrary  provision) be deemed to excuse compliance with any other covenant.  Where any provision herein  refers to action to be taken by any Person, or which such Person is prohibited from taking, such  provision shall be applicable whether such action is taken directly or indirectly by such Person.                                         -45-  \\DC - 047743/000003 - 10986815 v12    

 

           Defined 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 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 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 herein) and, for purposes of the Notes, shall also include   any such notes issued in substitution therefor pursuant to Section 13, (b) subject to Section 22.1,   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 Sections and Schedules shall be construed to refer to Sections of, and   Schedules to, this Agreement, and (e) any reference to any law or regulation herein shall, unless   otherwise specified, refer to such law or regulation as amended, modified or supplemented from   time to time.       Section 22.5.  Counterparts.  This Agreement may be executed in any number of   counterparts, each of which shall be an original but all of which together shall constitute one   instrument.  Each counterpart may consist of a number of copies hereof, each signed by less than   all, but together signed by all, of the parties hereto.       Section 22.6.  Governing  Law.  This Agreement shall be construed and enforced in   accordance with, and the rights of the parties shall be governed by, the law of the State of New   York excluding choice-of-law principles of the law of such State that would permit the application   of the laws of a jurisdiction other than such State.       Section 22.7.  Jurisdiction and Process; Waiver of Jury Trial.  (a) The  Company   irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting   in the Borough of Manhattan, The City of New York, over any suit, action or proceeding arising   out of or relating to this Agreement or the Notes.  To the fullest extent permitted by applicable   law, the Company irrevocably waives and agrees not to assert, by way of motion, as a defense or   otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that   it may now or hereafter have to the laying of the venue of any such suit, action or proceeding   brought in any such court and any claim that any such suit, action or proceeding brought in any   such court has been brought in an inconvenient forum.         (b)  The Company agrees, to the fullest extent permitted by applicable law, that a final   judgment in any suit, action or proceeding of the nature referred to in Section 22.7(a) brought in   any such court shall be conclusive and binding upon it subject to rights of appeal, as the case may   be, and may be enforced in the courts of the United States of America or the State of New York  (or any other courts to the jurisdiction of which it or any of its assets is or may be subject) by a  suit upon such judgment.                                          -46-   \\DC - 047743/000003 - 10986815 v12    

 

          (c)  The Company consents to process being served by or on behalf of any holder of Notes   in any suit, action or proceeding of the nature referred to in Section 22.7(a) by mailing a copy   thereof by registered, certified, priority or express mail (or any substantially similar form of mail),   postage prepaid, return receipt or delivery confirmation requested, to it at its address specified in   Section 18 or at such other address of which such holder shall then have been notified pursuant to   said Section.  The Company agrees that such service upon receipt (i) shall be deemed in every   respect effective service of process upon it in any such suit, action or proceeding and (ii) shall, to   the fullest extent permitted by applicable law, be taken and held to be valid personal service upon   and personal delivery to it.  Notices hereunder shall be conclusively presumed received as   evidenced by a delivery receipt furnished by the United States Postal Service or any reputable   commercial delivery service.         (d)  Nothing in this Section 22.7 shall affect the right of any holder of a Note to serve   process in any manner permitted by law, or limit any right that the holders of any of the Notes may   have to bring proceedings against the Company in the courts of any appropriate jurisdiction or to   enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.     (e) THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR  WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN   CONNECTION HEREWITH OR THEREWITH.                                             *    *    *    *    *                                          -47-   \\DC - 047743/000003 - 10986815 v12    

 

 HNI CORPORATION                                          Note Purchase Agreement             If you are in agreement with the foregoing, please sign the form of agreement on a   counterpart of this Agreement and return it to the Company, whereupon this Agreement shall  become a binding agreement between you and the Company.                                            Very truly yours,                                          HNI CORPORATION                                           By: /s/ Marshall H. Bridges ________________                                             Name: Marshall H. Bridges                                            Title:  Senior Vice President and Chief                                                   Financial officer                                                  \\DC - 047743/000003 - 10986815 v12    

 

HNI CORPORATION                                          Note Purchase Agreement    This Agreement is hereby  accepted and agreed to as   of the date hereof.                                        METROPOLITAN LIFE INSURANCE COMPANY                                        by MetLife Investment Advisors, LLC, Its                                           Investment Manager                                                                                METLIFE INSURANCE K.K.                                           by MetLife Investment Advisors, LLC, Its                                           Investment Manager                                                                                                                        By /s/ John A. Wills _______________________                                           Name: John A. Wills                                           Title: Senior Vice President and Managing                                                Director                                                                                                                          BRIGHTHOUSE LIFE INSURANCE COMPANy                                        by MetLife Investment Advisors, LLC, Its                                           Investment Manager                                                                                BRIGHTHOUSE LIFE INSURANCE COMPANY OF NY                                           by MetLife Investment Advisors, LLC, Its                                           Investment Manager                                                                                                                        By /s/ Judith A. Gulotta ____________________                                           Name: Judith A. Gulotta                                           Title: Managing Director                                                                                                                                   \\DC - 047743/000003 - 10986815 v12    

 

HNI CORPORATION                                          Note Purchase Agreement    This Agreement is hereby  accepted and agreed to as   of the date hereof.                                                                                  THE NORTHWESTERN MUTUAL LIFE INSURANCE                                          COMPANY                                                                                  By: Northwestern Mutual Investment                                            Management Company, LLC, its investment                                            adviser                                                                                                                           By /s/ Brian P. McDonald __________________                                            Name: Brian P. McDonald                                            Title: Managing Director                                                                                   THE NORTHWESTERN MUTUAL LIFE INSURANCE                                          COMPANY FOR ITS GROUP ANNUITY SEPARATE                                          ACCOUNT                                                                                                                                                                    By /s/ Brian P. McDonald __________________                                            Name: Brian P. McDonald                                            Its:  Authorized Representative                                                                                                                              -2-  \\DC - 047743/000003 - 10986815 v12    

 

HNI CORPORATION                                          Note Purchase Agreement    This Agreement is hereby  accepted and agreed to as   of the date hereof.                                                                                  PRINCIPAL LIFE INSURANCE COMPANY                                                                                  By: Principal Global Investors, LLC                                            a Delaware limited liability company,                                            its authorized signatory                                                                                                                           By /s/ Colin Pennycooke  __________________                                            Name:  Colin Pennycooke                                            Title:  Counsel                                                                                                                           By /s/ Joellen J. Watts _____________________                                            Name:  Joellen J. Watts                                            Title:  Counsel                                                                                     -3-  \\DC - 047743/000003 - 10986815 v12    

 

HNI CORPORATION                                          Note Purchase Agreement    This Agreement is hereby  accepted and agreed to as   of the date hereof.                                                                                  THRIVENT FINANCIAL FOR LUTHERANS                                                                                                                                                                    By /s/ Allen Stoltman _____________________                                            Name:  Allen Stoltman                                            Title:  Managing Director                                                                                     -4-  \\DC - 047743/000003 - 10986815 v12    

 

HNI CORPORATION                                          Note Purchase Agreement    This Agreement is hereby  accepted and agreed to as   of the date hereof.                                                                                  UNITED OF OMAHA LIFE INSURANCE COMPANY                                                                                                                                                                By /s/ Lee Martin ________________________                                            Name:  Lee Martin                                           Title:  Vice President                                                                                      -5-  \\DC - 047743/000003 - 10986815 v12    

 

                                      DEFINED TERMS          As used herein, the following terms have the respective meanings set forth below or set   forth in the Section hereof following such term:          “Acquired Indebtedness” means Indebtedness of any Person that becomes a Subsidiary   after the date hereof which was incurred prior to the time such Person becomes a Subsidiary, and  any renewals, extensions or refinancings thereof, but not any increases in the principal amounts  thereof outstanding at the time, provided that (i) such Indebtedness of such Person is not created   in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary,   as the case may be and (ii) such Indebtedness shall not be assumed or guaranteed by the Company  or a Subsidiary that was a Subsidiary prior to such acquisition or such Person becoming a  Subsidiary.         “Affiliate” means, at any time, and with respect to any Person, any other Person that at  such time directly or indirectly through one or more intermediaries Controls, or is Controlled by,  or is under common Control with, such first Person, and, with respect to the Company, shall  include any Person beneficially owning or holding, directly or indirectly, 10% or more of any class  of voting or Equity Interests of the Company or any Subsidiary or any Person of which the  Company and its Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,  10% or more of any class of voting or Equity Interests.  Unless the context otherwise clearly  requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.         “Agreement” means this Note Purchase Agreement, including all Schedules attached to  this Agreement.         “Anti-Corruption Laws” means any law or regulation in a U.S. or any non-U.S.  jurisdiction regarding bribery or any other corrupt activity, including the U.S. Foreign Corrupt  Practices Act and the U.K. Bribery Act 2010.         “Anti-Money Laundering Laws” means any law or regulation in a U.S. or any non-U.S.  jurisdiction regarding money laundering, drug trafficking, terrorist-related activities or other  money laundering predicate crimes, including the Currency and Foreign Transactions Reporting  Act of 1970 (otherwise known as the Bank Secrecy Act) and the USA PATRIOT Act.         “Bank Credit Facility” is defined in the definition of “Material Credit Facility”.         “Blocked Person” means (a) a Person whose name appears on the list of Specially  Designated Nationals and Blocked Persons published by OFAC, (b) a Person, entity, organization,  country or regime that is blocked or a target of sanctions that have been imposed under U.S.  Economic Sanctions Laws or (c) a Person that is an agent, department or instrumentality of, or is  otherwise 50% or more in the aggregate owned by, controlled by or acting on behalf of, directly  or indirectly, any Person, entity, organization, country or regime described in clause (a) or (b)  individually or in the aggregate.                                     SCHEDULE A                             (to Note Purchase Agreement)   \\DC - 047743/000003 - 10986815 v12    

 

         “Business Day” means (a) for the purposes of Section 8.6 only, any day other than a  Saturday, a Sunday or a day on which commercial banks in New York City are required or  authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any day  other than a Saturday, a Sunday or a day on which commercial banks in New York, New York are  required or authorized to be closed.         “Cash Equivalents” means (a) marketable securities issued or directly and fully  guaranteed or insured by the United States of America or any agency thereof (provided that the  full faith and credit of the United States of America is pledged in support thereof) having maturities  of not more than twelve (12) months from the date of acquisition (“Government Obligations”), (b)  U.S. dollar denominated (or foreign currency fully hedged) time deposits, certificates of deposit,  Eurodollar time deposits and Eurodollar certificates of deposit of (i) any United States commercial  bank of recognized standing having capital and surplus in excess of $200,000,000, (ii) any Lender  or (iii) any bank whose short-term commercial paper rating from S&P is at least A-1 or the  equivalent thereof or from Moody’s is at least P-1 or the equivalent thereof (any such bank and  any Lender being an “Approved Bank”), in each case with maturities of not more than 120 days  from the date of acquisition, (c) commercial paper and variable or fixed rate notes issued by any  Approved Bank (or by the parent company thereof) or any, or guaranteed by any, domestic  corporation rated A-2 (or the equivalent thereof) or better by S&P or P-2 (or the equivalent thereof)  or better by Moody’s and maturing within 120 days of the date of acquisition, (d) securities of the  type described in clauses (a) through (c), inclusive, above purchased under agreements to resell  such securities to any broker/dealer or any commercial bank, if such broker/dealer or bank has an  uninsured, unsecured and unguaranteed rating at the time of the acquisition of P-2 (or the  equivalent thereof) or better by Moody’s, or A-2 (or the equivalent thereof) or better by S&P, (e)  obligations of any state of the United States or any political subdivision thereof for the payment  of the principal and redemption price of and interest on which there shall have been irrevocably  deposited Government Obligations maturing as to principal and interest at times and in amounts  sufficient to provide such payment and (f) Investments in mutual funds registered under the  Investment Company Act of 1940, as amended, or collective trust funds maintained by Approved  Banks, in each case whose only assets are of the type described in clauses (a) through (d), inclusive,  of this definition.         “Capital Lease” means, as applied to any Person, any lease of any Property (whether real,  personal or mixed) by that Person as lessee which, in accordance with GAAP, is or should be  accounted for as a capital lease on the balance sheet of that Person.         “Change of Control” means (a) any Person or two or more Persons acting in concert shall  have acquired “beneficial ownership” (within the meaning provided in Rule 13d-3 promulgated  by the Securities and Exchange Commission under the Securities Exchange Act of 1934), directly  or indirectly, of, or shall have acquired by contract or otherwise, control over, Voting Stock of the  Company representing more than 50% of the combined voting power of all Voting Stock of the  Company, (b) Continuing Directors shall cease for any reason to constitute a majority of the  members of the board of directors of the Company then in office, (c) the sale, lease, transfer,  conveyance or other disposition (other than by way of merger or consolidation), in one or a series  of related transactions, of all or substantially all of the assets of the Company and its Subsidiaries  taken as a whole to any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities                                        A-2  \\DC - 047743/000003 - 10986815 v12    

 

     Exchange Act of 1934) or (d) a “Change of Control” under and as defined in the Bank Credit  Facility (or any equivalent term under and as defined in any Material Credit Facility) occurs.         “Closing” is defined in Section 3.         “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the  rules and regulations promulgated thereunder from time to time if effect.         “Company” is defined in the first paragraph of this Agreement.         “Competitor” means a company, partnership, investment vehicle or trust which has a  controlling interest in any company, partnership, trust or other entity which, as one of its primary  lines of business, manufactures office furniture and hearth products, provided that:          (a)  the provision of investment advisory services by a Person to a Plan which is owned  or controlled by a Person which would otherwise be a Competitor shall not of itself cause the  Person providing such services to be deemed to be a Competitor if such Person has established  procedures which will prevent confidential information supplied to such Person by the Company  or its Subsidiaries from being transmitted or otherwise made available to such Plan or Person  owning or controlling such Plan; and         (b)    in no event shall an Institutional Investor which (i) maintains passive investments  in any Person which is a Competitor be deemed a Competitor it being agreed that the normal  administration of the investment and enforcement thereof shall be deemed not to cause such  Institutional Investor to be a “Competitor” or (ii) is an insurance company, bank, trust company,  savings and loan association or any pension plan be deemed a “Competitor”.         “Confidential Information” is defined in Section 20.         “Consolidated” means, when used with reference to financial statements or financial items  of the Company and its Subsidiaries or any other Person, such statements or items on a  consolidated basis in accordance with the consolidation principles of GAAP.         “Consolidated Assets” means, at any time, the amount representing the total amount of  all assets of the Company and the Subsidiaries that would appear on a Consolidated balance sheet  of the Company and its Subsidiaries at such time prepared in accordance with GAAP.         “Consolidated EBITDA” means as of any date of determination for the four (4)  consecutive fiscal quarter period ending prior to such date, (a) Consolidated Net Income for such  period plus (b) the sum of the following to the extent deducted in calculating Consolidated Net   Income: (i) Consolidated Interest Expense for such period, (ii) the provision for Federal, state,   local and foreign income taxes payable by the Company and its Subsidiaries for such period,   (iii) depreciation and amortization expense for such period, and (iv) all non-cash items decreasing  Consolidated Net Income for such period and minus (c) the following to the extent included in  calculating such Consolidated Net Income: (i) Federal, state, local and foreign income tax credits                                         A-3   \\DC - 047743/000003 - 10986815 v12    

 

     of the Company and its Subsidiaries for such period and (ii) all non-cash items increasing  Consolidated Net Income for such period.           “Consolidated Funded Debt” means as of any date of determination, Funded Debt of the   Company and its Subsidiaries on a Consolidated basis.          “Consolidated Interest Expense” means as of any date of determination for the four (4)  consecutive fiscal quarter period ending prior to such date, all Interest Expense (excluding  amortization of debt discount and premium or debt issuance costs, gains or losses on early  retirement of debt, any commitment, upfront, arrangement, structuring or similar financing fees or  premiums (including redemption and prepayment premiums) or original issue discount, any cash  costs associated with obtaining Swap Agreements or any breakage thereof, and any debt  modification charges, but including the interest component under Capital Leases) for such period  of the Company and its Subsidiaries on a Consolidated basis.         “Consolidated Net Income” means as of any date of determination for the four (4)  consecutive fiscal quarter period ending prior to such date, for the Company and its Subsidiaries  on a Consolidated basis, the net income of the Company and its Subsidiaries for that period.           “Continuing Directors” means, during any period of up to 12 consecutive months  commencing after the Closing Date, individuals who at the beginning of such 12 month period  were directors of the Company (together with any new director whose election by the Company’s  board of directors or whose nomination for election by the Company’s shareholders was approved  by a vote of at least a majority of the directors then still in office who either were directors at the  beginning of such period or whose election or nomination for election was previously so  approved).         “Control” means the possession, directly or indirectly, of the power to direct or cause the  direction of the management and policies of a Person, whether through the ownership of voting  securities, by contract or otherwise; and the terms “Controlled” and “Controlling” shall have  meanings correlative to the foregoing.         “Controlled Entity” means (a) any of the Subsidiaries of the Company and any of their  or the Company’s respective Controlled Affiliates and (b) if the Company has a parent company,  such parent company and its Controlled Affiliates.         “Default” means an event or condition the occurrence or existence of which would, with  the lapse of time or the giving of notice or both, become an Event of Default.         “Defaulting Lender” has the meaning set forth in the Bank Credit Facility.         “Default Rate” means that rate of interest per annum that is the greater of (a) 2.00% above  the rate of interest stated in clause (a) of the first paragraph of the Notes or (b) 2.00% over the rate  of interest publicly announced by Bank of America, N.A. in New York, New York as its “base”  or “prime” rate.                                         A-4   \\DC - 047743/000003 - 10986815 v12    

 

           “Disclosure Documents” is defined in Section 5.3.          “Domestic Subsidiary” means a Subsidiary that is organized under the laws of any state   or commonwealth of the United States of America.          “EDGAR” means the SEC’s Electronic Data Gathering, Analysis and Retrieval System or   any successor SEC electronic filing system for such purposes.          “Environmental Laws” means any and all applicable foreign, federal, state, local or   municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of any   Governmental Authority regulating, relating to or imposing liability or standards of conduct  concerning protection of human health or the environment, as now or may at any time be in effect  during the term of this Agreement.         “Equity Interests” means (a) in the case of a corporation, capital stock, (b) in the case of  an association or business entity, any and all shares, interests, participations, rights or other  equivalents (however designated) of capital stock, (c) in the case of a partnership, partnership  interests (whether general or limited), (d) in the case of a limited liability company, membership  interests and (e) any other interest or participation that confers on a Person the right to receive a  share of the profits and losses of, or distribution of assets of, the issuing Person.         “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from  time to time, and the rules and regulations promulgated thereunder from time to time in effect.         “ERISA Affiliate” means any trade or business (whether or not incorporated) that is  treated as a single employer together with the Company under section 414 of the Code.         “Event of Default” is defined in Section 11.         “FATCA” means (a) 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), together with any current or future regulations or official  interpretations thereof, (b) any treaty, law or regulation of any other jurisdiction, or relating to an  intergovernmental agreement between the United States of America and any other jurisdiction,  which (in either case) facilitates the implementation of the foregoing clause (a),  and  (c) any   agreements entered into pursuant to section 1471(b)(1) of the Code.          “Foreign Subsidiary” means any Subsidiary other than a Domestic Subsidiary.          “Foreign Subsidiary Indebtedness” means Indebtedness of any Foreign Subsidiary or   FSHCO that is not guaranteed by the Company or a Domestic Subsidiary (other than an FSHCO).          “Form 10-K” is defined in Section 7.1(b).          “Form 10-Q” is defined in Section 7.1(a).                                         A-5   \\DC - 047743/000003 - 10986815 v12    

 

           “FSHCO” shall mean any Domestic Subsidiary substantially all of the assets of which   constitute Equity Interests of Foreign Subsidiaries.           “Funded Debt” means, with respect to any Person, without duplication, the sum of (a) all   Indebtedness of such Person (other than the Indebtedness set forth in clauses (e), (g), (i) and (j) of   such definition), plus (b) the maximum amount of all letters of credit issued or bankers’  acceptances facilities created for the account of such Person and, without duplication, all drafts  drawn thereunder (to the extent unreimbursed) other than (i) commercial letters of credit, bankers  acceptances, or the functional equivalent thereof issued to support payment obligations in  connection with trade payables incurred in the ordinary course of business and (ii) standby letters  of credit having an aggregate stated amount of up to $15,000,000, plus (c) all Guaranty Obligations  of such Person with respect to Indebtedness of another Person of the type described in clauses (a)  and (b) hereof.         “GAAP” means generally accepted accounting principles as in effect from time to time in  the United States of America subject to the terms of Section 22.8.         “Governmental Authority” means                (a)   the government of                       (i)  the United States of America or any state or other political              subdivision thereof, or                      (ii)  any other jurisdiction in which the Company or any Subsidiary              conducts all or any part of its business, or which asserts jurisdiction over any              properties of the Company or any Subsidiary, or                (b)   any entity exercising executive, legislative, judicial, regulatory or        administrative functions of, or pertaining to, any such government.         “Governmental Official” means any governmental official or employee, employee of any  government-owned or government-controlled entity, political party, any official of a political  party, candidate for political office, official of any public international organization or anyone else  acting in an official capacity.         “Guaranty Obligations” means, with respect to any Person, without duplication, any  obligations of such Person (other than endorsements in the ordinary course of business of  negotiable instruments for deposit or collection) guaranteeing or intended to guarantee any  Indebtedness of any other Person in any manner, whether direct or indirect, and including without  limitation any obligation, whether or not contingent, (a) to purchase any such Indebtedness or any  property constituting security therefore, (b) to advance or provide funds or other support for the  payment or purchase of any such Indebtedness or to maintain working capital, solvency or other  balance sheet condition of such other Person (including without limitation keep well agreements,  maintenance agreements, comfort letters or similar agreements or arrangements) for the benefit of  any holder of Indebtedness of such other Person, (c) to lease or purchase property, securities or                                         A-6   \\DC - 047743/000003 - 10986815 v12    

 

   services primarily for the purpose of assuring the holder of such Indebtedness of the payment or  performance thereof, or (d) to otherwise assure or hold harmless the holder of such Indebtedness  against loss in respect thereof. The amount of any Guaranty Obligation shall (subject to any  limitations set forth therein) be deemed to be an amount equal to the stated or determinable amount  of the related primary obligation, or portion thereof, in respect of which such Guaranty Obligation  is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect  thereof.         “Hedging Agreements” means, with respect to any Person, any agreement entered into to  protect such Person against fluctuations in interest rates, or currency or raw materials values,  including, without limitation, any interest rate swap, cap or collar agreement or similar  arrangement between such Person and one or more counterparties, any foreign currency exchange  agreement, currency protection agreements, commodity purchase or option agreements or other  interest or exchange rate or commodity price hedging agreements.         “Hazardous Materials” means any and all pollutants, toxic or hazardous wastes or other  substances that might pose a hazard to health and safety, the removal of which may be required or  the generation, manufacture, refining, production, processing, treatment, storage, handling,  transportation, transfer, use, disposal, release, discharge, spillage, seepage or filtration of which is  or shall be restricted, prohibited or penalized by any applicable law, including asbestos, urea  formaldehyde foam insulation, polychlorinated biphenyls, petroleum, petroleum products, lead  based paint, radon gas or similar restricted, prohibited or penalized substances.         “holder” means, with respect to any Note, the Person in whose name such Note is  registered in the register maintained by the Company pursuant to Section 13.1, provided, however,  that if such Person is a nominee, then for the purposes of Sections 7, 12, 17.2 and 18 and any  related definitions in this Schedule A, “holder” shall mean the beneficial owner of such Note  whose name and address appears in such register.        “INHAM Exemption” is defined in Section 6.2(e).         “Indebtedness” with respect to any Person means, at any time, without duplication,               (a)  all obligations of such Person for borrowed money;               (b)   all obligations of such Person evidenced by bonds, debentures, notes or        similar instruments, or upon which interest payments are customarily made;               (c)  all obligations of such Person under conditional sale or other title retention      agreements relating to property purchased by such Person (other than customary       reservations or retentions of title under agreements with suppliers entered into in the       ordinary course of business);               (d)   all obligations of such Person incurred, issued or assumed as the deferred       purchase price of property or services purchased by such Person that would appear as       liabilities on a balance sheet of such Person and that are (i) due more than six months from                                        A-7  \\DC - 047743/000003 - 10986815 v12    

 

         the date of incurrence of such obligations or (ii) evidenced by a note or a similar written        instrument, in each case, other than trade debt and other accrued liabilities incurred in the        ordinary course of business;               (e)  all obligations of such Person under take-or-pay or similar arrangements or        under commodities agreements;               (f)   all Indebtedness of others secured by (or for which the holder of such        Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on,        or payable out of the proceeds of production from, property owned or acquired by such        Person, whether or not the obligations secured thereby have been assumed; provided that        so long as such Indebtedness is nonrecourse to such Person, only the portion of such        obligations which is secured shall constitute Indebtedness hereunder,               (g)  all Guaranty Obligations of such Person with respect to Indebtedness of        another Person,               (h)   the principal portion of all obligations of such Person under Capital Leases,        synthetic leases, tax retention operating leases, off-balance sheet loans or similar off-       balance sheet financing products plus any accrued interest thereon,                (i)  all obligations of such Person under Hedging Agreements to the extent        required to be accounted for as a liability under GAAP, excluding any portion thereof        which would be accounted for as interest expense under GAAP,                (j)  the maximum amount of all letters of credit issued or bankers’ acceptances        facilities created for the account of such Person and, without duplication, all drafts drawn        thereunder (to the extent unreimbursed) other than commercial letters of credit, bankers        acceptances, or the functional equivalent thereof issued to support payment obligations in        connection with trade payables incurred in the ordinary course of business,               (k)   all preferred Equity Interests issued by such Person and which by the terms        thereof could be (at the request of the holders thereof or otherwise) subject to mandatory        sinking fund payments prior to the date six months after the latest Maturity Date,        redemption prior to the date six months after the latest Maturity Date or other acceleration;        provided, that any such Equity Interests shall not constitute “Indebtedness” hereunder if        the provisions thereof provide the holders (or the holders of any security into or for which        such Equity Interests is convertible, exchangeable or exercisable) with the right to require        the issuer thereof to redeem such Equity Interests upon the occurrence of a change in        control or an asset sale occurring prior to the date that is six months after the lasts Maturity        Date if such Equity Interests provide that the issuer thereof will not redeem any such Equity        Interests pursuant to such provisions prior to the repayment in full of the obligations        hereunder, and                                          A-8  \\DC - 047743/000003 - 10986815 v12    

 

                  (l)   the Indebtedness of any partnership or unincorporated joint venture in         which such Person is a general partner or a joint venturer, unless such Indebtedness is         expressly made nonrecourse to such Person.           “Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a Note   holding (together with one or more of its affiliates) more than 3% of the aggregate principal amount   of the Notes then outstanding, (c) any bank, trust company, savings and loan association or other  financial institution, any pension plan, any investment company, any insurance company, any   broker or dealer, or any other similar financial institution or entity, regardless of legal form, and   (d) any Related Fund of any holder of any Note.          “Interest Coverage Ratio” means, as of the end of any fiscal quarter, the ratio of   (i) Consolidated EBITDA for the four (4) consecutive fiscal quarter period ending on such date,   to (ii) Consolidated Interest Expense paid or payable in cash during the four (4) consecutive fiscal   quarter period ending on such date.          “Interest Expense” means, with respect to any Person, as of any date of determination for  the four (4) consecutive fiscal quarter period ending prior to such date, the sum of the amount of  interest paid or accrued in respect of such period.         “Issuing Lender(s)” has the meaning provided in the Bank Credit Facility.         “Leverage Ratio” means, as of the end of any fiscal quarter, the ratio of (a) Consolidated  Funded Debt as of such date to (b) Consolidated EBITDA for the four (4) consecutive fiscal quarter  period ending on such date.         For the purposes of the Leverage Ratio, if during any measurement period of EBITDA  during the period of four (4) consecutive fiscal quarters, the Company or any Subsidiary makes an  acquisition of any entity or segment or line of business (the “Target”), the calculation of the  EBITDA for that measurement period shall include the Target’s EBITDA for that part of the  measurement period before the date of that acquisition.  Furthermore, if during any measurement  period of EBITDA during the period of four (4) consecutive fiscal quarters, the Company or any  Subsidiary disposes of any Subsidiary or any segment or line of business of the Company or a  Subsidiary (the “Disposed Asset”), the calculation of EBITDA for that measurement period shall   exclude EBITDA attributable to such Disposed Asset for that part of the measurement period after   the date of the disposal.           “Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement,  security interest, encumbrance, lien (statutory or otherwise), preference, priority or charge of any  kind (including any conditional sale or other title retention agreement, any financing or similar  statement or notice filed under the Uniform Commercial Code as adopted and in effect in the  relevant jurisdiction or other similar recording or notice statute, and any lease in the nature  thereof).         “Make-Whole Amount” is defined in Section 8.6.                                         A-9   \\DC - 047743/000003 - 10986815 v12    

 

           “Material” means material in relation to the business, operations, affairs, financial  condition, assets, properties, or prospects of the Company and its Subsidiaries taken as a whole.          “Material Adverse Effect” means a material adverse effect on (a) the business,   operations, financial condition, assets or properties of the Company and its Subsidiaries taken as   a whole, (b) the ability of the Company and the Subsidiary Guarantors, taken as a whole, to   perform their obligations under this Agreement, the Notes and the Subsidiary Guaranty, or (c) the   validity or enforceability of this Agreement, the Notes or any Subsidiary Guaranty.          “Material Credit Facility” means, as to the Company and its Subsidiaries,                 (a)   the Third Amended and Restated Credit Agreement dated April 20, 2018,         among the Company, Wells Fargo Bank, National Association, as administrative agent,         and the other lenders party thereto (including any renewals, extensions, amendments,         supplements, restatements, replacements or refinancing thereof, the “Bank Credit         Facility”); and                (b)   any other agreement(s) creating or evidencing indebtedness for borrowed         money entered into on or after the date of Closing by the Company or any Subsidiary, or         in respect of which the Company or any Subsidiary is an obligor or otherwise provides a         guarantee or other credit support (“Credit Facility”), in a principal amount outstanding or         available for borrowing equal to or greater than $75,000,000 (or the equivalent of such         amount in the relevant currency of payment, determined as of the date of the closing of        such facility based on the exchange rate of such other currency); and if the Bank Credit        Facility has been terminated and no Credit Facility or Credit Facilities equal or exceed such         amounts, then the largest Credit Facility shall be deemed to be a Material Credit Facility,         provided, further, that as long as the Company or any Subsidiary Guarantor is not         guaranteeing the obligations evidenced by  the following agreements (other than any         obligations described in clause (v) below), this clause (b) shall in any event exclude (i)         Nonrecourse Indebtedness, (ii) Purchase Money Indebtedness, (iii) Acquired Indebtedness,         (iv) Foreign Subsidiary Indebtedness, (v) completion and repayment guarantees in respect         of construction financings that are secured solely by the assets that are being constructed         and (vi) agreements evidencing Indebtedness that is recourse solely to one or more special         purpose Subsidiaries (including any equity interests therein) created for the purposes of         incurring such Indebtedness (or any earlier financing or subsequent refinancing thereof)         and holding the assets financed by such Indebtedness.          “Material Indebtedness” means any Indebtedness in an aggregate outstanding principal  amount exceeding the greater of (x) $30,000,000 and (y) and two and one-half percent (2.5%) of  Consolidated Assets.          “Material Subsidiary” means, at any time, any Subsidiary of the Company which,  together with all other Subsidiaries of such Subsidiary, accounts for more than (i) 5% of the  Consolidated Assets of the Company and its Subsidiaries as of the end of any fiscal quarter of the  Company prior to such date or (ii) 5% of consolidated revenue of the Company and its Subsidiaries  for any four fiscal period ending prior to such date.                                         A-10   \\DC - 047743/000003 - 10986815 v12    

 

           “Maturity Date” is defined in the first paragraph of each Note.          “Memorandum” is defined in Section 5.3.          “Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is   defined in section 4001(a)(3) of ERISA).          “NAIC” means the National Association of Insurance Commissioners.          “Net Cash Proceeds” means the aggregate cash or Cash Equivalents proceeds received by   the Company or any Subsidiary in respect of any sale, lease or other disposition of assets of the   Company and its Subsidiaries, net of (a) direct costs incurred in connection therewith (including,   without limitation, legal, accounting and investment banking fees, and sales commissions),   (b) taxes paid or payable as a result thereof, (c) the amount necessary to retire any Indebtedness   secured by a lien on the related property, and (d) in the case of any involuntary disposition, direct   costs incurred in connection with the collection of such proceeds, awards or other payments.          “Nonrecourse Indebtedness” means, with respect to a Person or group of Persons,   Indebtedness for borrowed money (or the portion thereof) in respect of which recourse for payment   (except for Nonrecourse Indebtedness Exceptions) is contractually limited to specific assets of   such Persons, including Equity Interests in any such Persons, encumbered by a Lien securing such  Indebtedness.         “Nonrecourse Indebtedness Exceptions” means, with respect to Indebtedness for which   recourse for payment is generally limited to specific assets encumbered by a Lien securing such   Indebtedness, customary exceptions for fraud, misapplication of funds, environmental   indemnities, violation of “special purpose entity” covenants, bankruptcy, insolvency, receivership   or other similar events and other customary exceptions to nonrecourse liability.          “Non-U.S. Plan” means any plan, fund or other similar program that (a) is established or   maintained outside the United States of America by the Company or any Subsidiary primarily for   the benefit of employees of the Company or one or more Subsidiaries residing outside the United   States of America, which plan, fund or other similar program provides, or results in, retirement   income, a deferral of income in contemplation of retirement or payments to be made upon   termination of employment, and (b) is not subject to ERISA or the Code.           “Notes” is defined in Section 1.          “OFAC” means the Office of Foreign Assets Control of the United States Department of   the Treasury.          “OFAC Sanctions Program” means any economic or trade sanction that OFAC is   responsible for administering and enforcing.  A list of OFAC Sanctions Programs may be found   at http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx.                                         A-11   \\DC - 047743/000003 - 10986815 v12    

 

         “Officer’s Certificate” means a certificate of a Senior Financial Officer or of any other  officer of the Company whose responsibilities extend to the subject matter of such certificate.         “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in  ERISA, or any successor thereto.         “Pearl City” means Pearl City Insurance Company, a Vermont corporation.         “Person” means an individual, partnership, corporation, limited liability company,  association, trust, unincorporated organization, business entity or Governmental Authority.         “Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA) subject to  Title I of ERISA that is or, within the preceding five years, has been established or maintained, or  to which contributions are or, within the preceding five years, have been made or required to be  made, by the Company or any ERISA Affiliate or with respect to which the Company or any  ERISA Affiliate may have any liability.         “Preferred Stock” means any class of capital stock of a Person that is preferred over any  other class of capital stock (or similar Equity Interests) of such Person as to the payment of  dividends or the payment of any amount upon liquidation or dissolution of such Person.         “Priority Debt” means (without duplication), as of the date of any determination thereof,  the sum of (i) all unsecured Indebtedness of Subsidiaries (including all Guarantees of Indebtedness  of the Company, but excluding (1) Indebtedness owing to the Company or any other Subsidiary,  (2) all Subsidiary Guarantees and all Indebtedness of any Subsidiary Guarantor, and (3) Acquired  Indebtedness), and (ii) all Indebtedness and other obligations of the Company and its Subsidiaries  secured by Liens other than Indebtedness and other obligations secured by Liens permitted by  subparagraphs (a)  through  (q), inclusive, of Section 10.6.   For the avoidance of doubt, all  Indebtedness of any Foreign Subsidiary party to a Material Credit Facility that does not become a  Subsidiary Guarantor under the terms of this Agreement will constitute Priority Debt for all  purposes of this Agreement.         “property” or “properties” means, unless otherwise specifically limited, real or personal  property of any kind, tangible or intangible, choate or inchoate.         “PTE” is defined in Section 6.2(a).         “Purchase Money Indebtedness” shall mean (i) Indebtedness for the payment of all or  any part of the purchase price of any fixed assets, that is secured by a first lien on only such fixed  assets, (ii) any Indebtedness incurred at the time of or not later than one hundred eighty (180) days  after the acquisition of any fixed assets for the purpose of financing all or any part of the purchase  price thereof, and (iii) any renewals, extensions or refinancings thereof, but not any increases in  the principal amounts thereof outstanding at the time.           “Purchaser” or “Purchasers” means each of the purchasers that has executed and  delivered this Agreement to the Company and such Purchaser’s successors and assigns (so long as                                       A-12  \\DC - 047743/000003 - 10986815 v12    

 

     any such assignment complies with Section 13.2), provided, however, that any Purchaser of a Note   that ceases to be the registered holder or a beneficial owner (through a nominee) of such Note as   the result of a transfer thereof pursuant to Section 13.2 shall cease to be included within the  meaning of “Purchaser” of such Note for the purposes of this Agreement upon such transfer.          “Purchaser Schedule” means the Purchaser Schedule to this Agreement listing the   Purchasers of the Notes and including their notice and payment information.          “Qualified Institutional Buyer” means any Person who is a “qualified institutional  buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.         “QPAM Exemption” is defined in Section 6.2(d).         “Ratable Portion” for any Note shall mean an amount equal to the product of (a) that  portion of the net proceeds from a sale of assets being applied to the payment or prepayment of   Senior Debt pursuant to Section 10.3 multiplied by (b) a fraction, the numerator of which is the  aggregate outstanding principal amount of such Note and the denominator of which is the  aggregate outstanding principal amount of all Senior Debt of the Company or a Subsidiary  receiving any repayment or prepayment (or offer thereof) pursuant to Section 10.3.         “Recovery Event” means the receipt by the Company or any of its Subsidiaries of any   cash insurance proceeds or condemnation award payable by reason of theft, loss, physical   destruction or damage, taking or similar event with respect to any of their respective property or   assets.          “Related Fund” means, with respect to any holder of any Note, any fund or entity that   (a) invests in Securities or bank loans, and (b) is advised or managed by such holder, the same   investment advisor as such holder or by an affiliate of such holder or such investment advisor.          “Required Holders” means at any time on or after the Closing, the holders of at least 50%   in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by the  Company or any of its Affiliates).         “Responsible Officer” means any Senior Financial Officer and any other officer of the  Company with responsibility for the administration of the relevant portion of this Agreement.         “SEC” means the Securities and Exchange Commission of the United States of America.         “Securities” or “Security” shall have the meaning specified in section 2(1) of the  Securities Act.          “Securities Act” means the Securities Act of 1933 and the rules and regulations  promulgated thereunder from time to time in effect.                                         A-13   \\DC - 047743/000003 - 10986815 v12    

 

           “Senior Debt” means all Indebtedness of the Company and its Subsidiaries, other than   unsecured Indebtedness of the Company or its Subsidiaries that is expressly subordinated by its   terms to other unsecured Indebtedness of the Company and its Subsidiaries (including the Notes).         “Senior Financial Officer” means the chief financial officer, principal accounting officer   or treasurer of the Company.          “Source” is defined in Section 6.2.          “State Sanctions List” means a list that is adopted by any state Governmental Authority   within the United States of America pertaining to Persons that engage in investment or other  commercial activities in Iran or any other country that is a target of economic sanctions imposed  under U.S. Economic Sanctions Laws.         “Subsidiary” means, as to any Person, any other Person in which such first Person or one   or more of its Subsidiaries or such first Person and one or more of its Subsidiaries owns sufficient   equity or voting interests to enable it or them (as a group) ordinarily, in the absence of   contingencies, to elect a majority of the directors (or Persons performing similar functions) of such   second Person, and any partnership or joint venture if more than a 50% interest in the profits or   capital thereof is owned by such first Person or one or more of its Subsidiaries or such first Person   and one or more of its Subsidiaries (unless such partnership or joint venture can and does ordinarily   take major business actions without the prior approval of such Person or one or more of its   Subsidiaries).  Unless the context otherwise clearly requires, any reference to a “Subsidiary” is a   reference to a Subsidiary of the Company.         “Subsidiary Guarantor” means each Subsidiary that has executed and delivered a   Subsidiary Guaranty.          “Subsidiary Guaranty” is defined in Section 9.7(a).          “Substitute Purchaser” is defined in Section 21.          “SVO” means the Securities Valuation Office of the NAIC.          “Swap Contract” means (a) any and all interest rate swap transactions, basis 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 foreign exchange transactions, cap  transactions, floor transactions, currency options, spot contracts or any other similar transactions  or any of the foregoing (including any options to enter into any of the foregoing), and (b) any and  all transactions of any kind, and the related confirmations, which are subject to the terms and   conditions of, or governed by, any form of master agreement published by the International Swaps   and Derivatives Association, Inc. or any International Foreign Exchange Master Agreement.          “Swap Termination Value” means, in respect of any one or more Swap Contracts, after   taking into account the effect of any legally enforceable netting agreement relating to such Swap                                        A-14   \\DC - 047743/000003 - 10986815 v12    

 

     Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and  termination value(s) determined in accordance therewith, such termination value(s), and (b) for   any date prior to the date referenced in clause (a), the amounts(s) determined as the mark-to-market   values(s) for such Swap Contracts, as determined based upon one or more mid-market or other   readily available quotations provided by any recognized dealer in such Swap Contracts.         “Swingline Lender” has the meaning provided in the Bank Credit Facility.          “Synthetic Lease” means, at any time, any lease (including leases that may be terminated   by the lessee at any time) of any property (a) that is accounted for as an operating lease under   GAAP and (b) in respect of which the lessee retains or obtains ownership of the property so leased   for U.S. federal income tax purposes, other than any such lease under which such Person is the  lessor.         “United States Person” has the meaning set forth in Section 7701(a)(30) of the Code.          “USA PATRIOT Act” means United States Public Law 107-56, Uniting and   Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct   Terrorism (USA PATRIOT ACT) Act of 2001 and the rules and regulations promulgated  thereunder from time to time in effect.         “U.S. Economic Sanctions Laws” means those laws, executive orders, enabling  legislation or regulations administered and enforced by the United States pursuant to which  economic sanctions have been imposed on any Person, entity, organization, country or regime,   including the Trading with the Enemy Act, the International Emergency Economic Powers Act,   the Iran Sanctions Act, the Sudan Accountability and Divestment Act and any other OFAC   Sanctions Program.          “Voting Stock” means, with respect to any Person, Equity Interests issued by such Person  the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election  of directors (or persons performing similar functions) of such Person, even though the right so to   vote has been suspended by the happening of such a contingency.                                         A-15   \\DC - 047743/000003 - 10986815 v12    

 

                                                                                                              [FORM OF SERIES A NOTE]                                  HNI CORPORATION                      4.22% Senior Notes, Series A, due May 31, 2025    No. [_____]                                                            [Date]   $[_______] PPN[______________]          FOR VALUE  RECEIVED, the undersigned, HNI Corporation (herein called the   “Company”), a corporation organized and existing under the laws of the State of Iowa, hereby   promises to pay to [____________], or registered assigns, the principal sum of   [_____________________] DOLLARS (or so much thereof as shall not have been prepaid) on   May 31, 2025 (the “Maturity Date”), with interest (computed on the basis of a 360-day year of   twelve 30-day months) (a) on the unpaid balance hereof at the rate of 4.22% per annum from the   date hereof, payable semiannually, on May 31st and November 30th in each year, commencing on  November 30, 2018, and on the Maturity Date, until the principal hereof shall have become due   and payable, and (b) to the extent permitted by law, (x) on any overdue payment of interest and   (y) during the continuance of an Event of Default, on such unpaid balance and on any overdue  payment of any Make-Whole Amount, at a rate per annum from time to time equal to the greater  of (i) 6.22% or (ii) 2% over the rate of interest publicly announced by Bank of America, N.A. from  time to time in New York, New York as its “base” or “prime” rate, payable semiannually as  aforesaid (or, at the option of the registered holder hereof, on demand).         Payments of principal of, interest on and any Make-Whole Amount with respect to this  Note are to be made in lawful money of the United States of America at its office in New York,  New York or at such other place as the Company shall have designated by written notice to the   holder of this Note as provided in the Note Purchase Agreement referred to below.          This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to   the Note Purchase Agreement, dated May 31, 2018 (as from time to time amended, the “Note   Purchase Agreement”), between the Company and the respective Purchasers named therein and   is entitled to the benefits thereof.  Each holder of this Note will be deemed, by its acceptance   hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Note   Purchase Agreement and (ii) made the representations set forth in Sections 6.1(a), 6.2, 6.3 and   6.4(a) of the Note Purchase Agreement.  Unless otherwise indicated, capitalized terms used in this   Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.          This Note is a registered Note and, as provided in the Note Purchase Agreement, upon   surrender of this Note for registration of transfer accompanied by a written instrument of transfer   duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing,   a new Note for a like principal amount will be issued to, and registered in the name of, the   transferee.  Prior to due presentment for registration of transfer, the Company may treat the Person                                      SCHEDULE 1                             (to Note Purchase Agreement)   \\DC - 047743/000003 - 10986815 v12    

 

     in whose name this Note is registered as the owner hereof for the purpose of receiving payment  and for all other purposes, and the Company will not be affected by any notice to the contrary.          This Note is subject to prepayment at the option of the Company, in whole or from time to   time in part, at the times and on the terms specified in the Note Purchase Agreement, but not   otherwise.  This Note is not subject to mandatory prepayment; however, the Company may be   required to offer to prepay a portion or all of this Note in accordance with the terms of the Note   Purchase Agreement.          If an Event of Default occurs and is continuing, the principal of this Note may be declared   or otherwise become due and payable in the manner, at the price (including any applicable   Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.          This Note shall be construed and enforced in accordance with, and the rights of the   Company and the holder of this Note shall be governed by, the law of the State of New York   excluding choice-of-law principles of the law of such State that would permit the application of   the laws of a jurisdiction other than such State.                                           HNI CORPORATION                                           By: ____________________________________                                             [Title]                                                -2-   \\DC - 047743/000003 - 10986815 v12    

 

                                                                                                              [FORM OF SERIES B NOTE]                                  HNI CORPORATION                      4.40% Senior Notes, Series B, due May 31, 2028    No. [_____]                                                            [Date]   $[_______] PPN[______________]          FOR VALUE  RECEIVED, the undersigned, HNI Corporation (herein called the   “Company”), a corporation organized and existing under the laws of the State of Iowa, hereby   promises to pay to [____________], or registered assigns, the principal sum of   [_____________________] DOLLARS (or so much thereof as shall not have been prepaid) on   May 31, 2028 (the “Maturity Date”), with interest (computed on the basis of a 360-day year of   twelve 30-day months) (a) on the unpaid balance hereof at the rate of 4.40% per annum from the   date hereof, payable semiannually, on May 31st and November 30th in each year, commencing on  November 30, 2018, and on the Maturity Date, and on the Maturity Date, until the principal hereof  shall have become due and payable, and (b) to the extent permitted by law, (x) on any overdue  payment of interest and (y) during the continuance of an Event of Default, on such unpaid balance  and on any overdue payment of any Make-Whole Amount, at a rate per annum from time to time  equal to the greater of (i) 6.40% or (ii) 2% over the rate of interest publicly announced by Bank of  America, N.A. from time to time in New York, New York as its “base” or “prime” rate, payable  semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).         Payments of principal of, interest on and any Make-Whole Amount with respect to this  Note are to be made in lawful money of the United States of America at its office in New York,  New York or at such other place as the Company shall have designated by written notice to the   holder of this Note as provided in the Note Purchase Agreement referred to below.          This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to   the Note Purchase Agreement, dated May 31, 2018 (as from time to time amended, the “Note   Purchase Agreement”), between the Company and the respective Purchasers named therein and   is entitled to the benefits thereof.  Each holder of this Note will be deemed, by its acceptance   hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Note   Purchase Agreement and (ii) made the representations set forth in Sections 6.1(a), 6.2, 6.3 and   6.4(a) of the Note Purchase Agreement.  Unless otherwise indicated, capitalized terms used in this   Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.          This Note is a registered Note and, as provided in the Note Purchase Agreement, upon   surrender of this Note for registration of transfer accompanied by a written instrument of transfer   duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing,   a new Note for a like principal amount will be issued to, and registered in the name of, the   transferee.  Prior to due presentment for registration of transfer, the Company may treat the Person                                      SCHEDULE 1                             (to Note Purchase Agreement)   \\DC - 047743/000003 - 10986815 v12    

 

     in whose name this Note is registered as the owner hereof for the purpose of receiving payment  and for all other purposes, and the Company will not be affected by any notice to the contrary.          This Note is subject to prepayment at the option of the Company, in whole or from time to   time in part, at the times and on the terms specified in the Note Purchase Agreement, but not   otherwise.  This Note is not subject to mandatory prepayment; however, the Company may be   required to offer to prepay a portion or all of this Note in accordance with the terms of the Note   Purchase Agreement.          If an Event of Default occurs and is continuing, the principal of this Note may be declared   or otherwise become due and payable in the manner, at the price (including any applicable   Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.          This Note shall be construed and enforced in accordance with, and the rights of the   Company and the holder of this Note shall be governed by, the law of the State of New York   excluding choice-of-law principles of the law of such State that would permit the application of   the laws of a jurisdiction other than such State.                                           HNI CORPORATION                                           By: ____________________________________                                             [Title]                                                -2-   \\DC - 047743/000003 - 10986815 v12    

 

                                         SCHEDULE 4.4(A)                                                          MATTERS TO BE COVERED IN OPINION OF SPECIAL COUNSEL                    FOR, AND IN-HOUSE COUNSEL OF, THE COMPANY           1. Each of the Company and the Subsidiary Guarantors being duly incorporated, validly        existing and in good standing and having requisite corporate power and authority to own        its property and assets and to carry on its business as now conducted and to execute and        deliver the Note Purchase Agreement, Notes and Subsidiary Guaranty (the “Documents”).      2. Due authorization and execution of the Documents and such Documents being valid,        binding and enforceable.      3. Entering into such Documents will not conflict with charter documents, laws or other       agreements.     4. No approvals or consents needed under applicable federal or state laws to execute and        deliver the Documents.      5. The offer, sale and delivery of the Notes by the Company and the execution and delivery        of the Guaranty by the Subsidiary Guarantors to the Purchasers are not required to be        registered under the Securities Act and the Note Purchase Agreement is not required to be        qualified under the Trust Indenture Act.      6. Neither Company nor the Subsidiary Guarantors are an “investment company” under the        Investment Company Act of 1940, as amended.       7. The issuance and sale of the Notes and the use of the proceeds of the issuance and sale of        the Notes do not violate Section 7 of the Exchange Act or the Margin Regulations.      8. Such other opinions and qualifications as the parties may negotiate.                 \\DC - 047743/000003 - 11311989 v6    

 

                                                                                                               SCHEDULE 4.4(B)                                                                   FORM OF OPINION OF SPECIAL COUNSEL                               FOR THE PURCHASERS                         [To Be Provided on a Case by Case Basis]                                                                              SCHEDULE 4.4(b)                            (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12    

 

                                                                                                                   SCHEDULE 4.9                           CHANGES IN CORPORATE STRUCTURE     None.                                      SCHEDULE 4.9                             (to Note Purchase Agreement)   \\DC - 047743/000003 - 10986815 v12    

 

                                                                                                                 SCHEDULE 5.3                               DISCLOSURE MATERIALS     None.                                     SCHEDULE 5.3                            (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12    

 

                                        SCHEDULE 5.4                             SUBSIDIARIES OF THE COMPANY AND                             OWNERSHIP OF SUBSIDIARY STOCK     (i) Subsidiaries:                                    Jurisdiction                                Subsidiary              Company                 of           Percent of Ownership By    Guarantor                                  Organization                                 (Yes/No)   HNI Holdings Inc.                  IA      100% owned by HNI Corporation      No   HNI International Inc.             IA      100% owned by HNI Corporation      No   HNI International (Mexico) LLC     IA      100% owned by HNI International    No   HNI International (Puerto Rico) LLC  IA    100% owned by HNI International    No   HNI Middle East DMCC               UA      100% owned by HNI International    No   Allsteel Inc.                      IL      100% owned by HNI Corporation      Yes   The Gunlocke Company L.L.C.        IA      100% owned by Allsteel             No   Hickory Business Furniture, LLC    NC      100% owned by Allsteel             No   Contract Resource Group LLC        DE      100% owned by Allsteel             No   AOD San Diego LLC                  DE      100% owned by Allsteel             No   Amovo Workplace Environments Inc. Canada   100% owned by Allsteel             No   IAW LLC                            DE      100% owned by Allsteel             No   Delve Interiors LLC                DE      100% owned by Allsteel             No   Sagus International, Inc.          DE      100% owned by HON                  No   Midwest Folding Products Corp.     DE      100% owned by Sagus                No   The HON Company LLC                IA      100% owned by HNI Holdings Inc.    Yes   OFM, LLC                           DE      100% owned by The HON Co.          No   Maxon Furniture Inc.               IA      100% owned by HNI Corporation      No   Paoli LLC                          IA      100% owned by HNI Holdings Inc.    No   Hearth & Home Technologies LLC     IA      100% owned by HNI Holdings Inc.    Yes   HHT LLC                            WA      100% owned by Hearth & Home                                                                                 No                                              Technologies LLC   Monessen Holding Company, LLC      DE      100% owned by Hearth & Home                                                                                 No                                              Technologies LLC   Monessen Hearth Systems Company,   KY      100% owned by Monessen Holding                                                                                 No   LLC                                        Company, LLC   Monessen Hearth Canada, Inc.     Canada    100% owned by Monessen Hearth                                              Systems Company, LLC               No   HNI Services LLC                   IA      70% owned by HNI Corporation                                              30% owned by HFM Partners          No    HNI Technologies Inc.              IA      100% owned by HNI Corporation      No                                        SCHEDULE 5.4                                (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12    

 

 The Purchasers listed on Exhibit A       - 2 -                            May 31, 2018  attached hereto                                        Jurisdiction                                Subsidiary              Company                 of           Percent of Ownership By    Guarantor                                  Organization                                 (Yes/No)   HFM Partners                       IA      95% owned by HNI Corporation                                              5% owned by Maxon Furniture        No    Pearl City Insurance Company       AZ      100% owned by HNI Corporation      No   HNI Asia LLC                       IA      100% owned by HNI Corporation      No   HON INDUSTRIES (Canada) Inc.     Canada    100% owned by HNI Corporation      No   HON Internacional de Mexico, S. de Mexico  99% owned by HNI International Inc.   R. L. de C. V.                             1% owned by HNI International      No                                              (Mexico) L.L.C.   HON Internacional Servicios de   Mexico    99% owned by HNI International Inc.   Mexico, S. de R.L. de C.V.                 1% owned by HNI International      No                                              (Mexico) L.L.C.   HNI Asia LLC, Taiwan Branch       China    Taiwan - 09-23-04 (Business License) No   HNI Asia Technology Services      China    100% owned by HNI Asia L.L.C.                                                                                 No   (Shenzhen) Limited   HNI Hong Kong Limited           Hong Kong  100% owned by HNI Corporation      No   Global Known Ltd.               Hong Kong  100% owned by HNI Hong Kong Ltd.   No   HNI Singapore Private Limited   Singapore  100% owned by Global Known Ltd.    No   HNI Office India Ltd.             India    99.3% owned by HNI Singapore                                                                                 No                                              Private Limited   Lamex Trading Co. Ltd.          Hong Kong  100% owned by Global Known Ltd.    No   Lamex China Investment Ltd.     Hong Kong  100% owned by Global Known Ltd.    No   HBF Asia Pacific Limited        Hong Kong  100% owned by Global Known Ltd.    No   Dongguan Lamex Furniture Co. Ltd.  China   100% owned by Lamex China                                                                                 No                                              Investment Ltd.    (ii) Affiliates:          None.     (iii)  Company’s Directors and Senior Officers:          Directors                 Stan Askren               Mary Bell               Miguel Calado               Cheryl Francis               John Hartnett               Mary Jones               Jeff Lorenger               Larry Porcellato                                            5.4-2   \\DC - 047743/000003 - 10986815 v12    

 

 The Purchasers listed on Exhibit A       - 3 -                            May 31, 2018  attached hereto                     Abbie Smith               Brian Stern               Ronald Waters, III          Senior Officers                        NAME                     OFFICE                Julie M. Abramowski      Vice President, Corporate Controller                Stan A. Askren           Chairman of the Board                                         Chief Executive Officer                                         Director                                                         Vincent P. Berger        Executive Vice President, HNI Corporation                                         President, Hearth & Home Technologies                Steven M. Bradford       Senior Vice President, General Counsel and Secretary                Marshall H. Bridges      Senior Vice President and Chief Financial Officer                Jeffrey D. Lorenger      President, HNI Corporation                Donna D. Meade           Vice President, Member and Community Relations                Kurt A. Tjaden           President, HNI International                                         Senior Vice President, HNI Corporation         (d) Restrictive Agreements  None.                                            5.4-3   \\DC - 047743/000003 - 10986815 v12    

 

                                    SCHEDULE 5.5                               FINANCIAL STATEMENTS      Audited financial statements included in the Company’s Form10-K for the fiscal years ended on  or about December 31, 2013, 2014, 2015, 2016 and 2017.    2017 – http://investors.hnicorp.com/Doc/Index?did=43658965  2016 – http://investors.hnicorp.com/Doc/Index?did=39703727  2015 – http://investors.hnicorp.com/Doc/Index?did=35564522  2014 – http://investors.hnicorp.com/Doc/Index?did=31413017  2013 – http://investors.hnicorp.com/Doc/Index?did=26994742      Unaudited financial statements included in the Company’s Form 10-Q for the fiscal quarter  ended March 31, 2018    http://investors.hnicorp.com/Doc/Index?did=44432029                                     SCHEDULE 5.5                            (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12    

 

                                    SCHEDULE 5.7                           GOVERNMENTAL AUTHORIZATIONS       Regulation D Filing                                     SCHEDULE 5.7                            (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12    

 

                                                                   SCHEDULE 5.15                                      EXISTING INDEBTEDNESS OF THE COMPANY AND ITS SUBSIDIARIES    (a)              Indebtedness                                                                                       OUTSTANDING        OBLIGOR(S) CREDITOR(S) CUSIP OR ISIN                    DESCRIPTION OF        COLLATERAL              PRINCIPAL AMOUNT                                              (IF APPLICABLE)   INDEBTEDNESS                                                                        HNI Corporation      Wells Fargo Bank,    Published CUSIP  $450 million senior  None    The HON Company LLC  National Association Number:  40425NAJ1 unsecured revolving  Allsteel Inc.        Bank of America, N.A.                 credit facility   Hearth & Home        Bankers Trust Company Revolving Credit  Technologies LLC     Branch Banking and Trust CUSIP Number:                        Company              40425NAK8                       Suntrust Bank                       U.S. Bank National                       Association       (b)     Liens    Mortgage and Assignment of Rents and Leases, dated as of March 31, 2017, and recorded on April 5, 2017, in favor of Pearl City Insurance Company, as  Instrument No. 2017-01655.  The mortgage encumbers the real property situated at 3000 North Highway 61, Muscatine, Iowa.    (c) Restrictive Agreements        Third Amended and Restated Credit Agreement dated April 20, 2018                                                           SCHEDULE 5.15                                                  (to Note Purchase Agreement)    \\DC - 047743/000003 - 10986815 v12    

 

         HNI Corporation 600 East Second Street, Muscatine, Iowa 52761, Tel 563 272 7400, Fax 563 272 7347, www.hnicorp.com                                    SCHEDULE 7.2                          FORM OF COMPLIANCE CERTIFICATE                                                                       TO:         Each holder of a Note under the Agreement that is an Institutional Investor                RE:         Note Purchase Agreement, dated as of May 31, 2018 by and among HNI        Corporation, an Iowa corporation (the “Company”), and each holder of a Note from time        to time party thereto (collectively, the “holders” and individually, a “holder”) (as amended,        modified, extended, restated, replaced, or supplemented from time to time, the        “Agreement”; capitalized terms used herein and not otherwise defined shall have the        meanings set forth in the Agreement)                DATE:       [_________,  20___]                For the fiscal [quarter][year] ended [________, 20__].                The undersigned Senior Financial Officer, in his or her capacity as an officer of the        Company and not individually, hereby certifies on behalf of the Company that with respect        to the Agreement as of the date hereof:                      (a)   Attached hereto as Annex A are the financial statements provided by the        Company to the holders for the fiscal period referenced above.  [Such financial statements        fairly present in all material respects the financial position of the companies being reported        on and their results of operations and cash flows, subject to changes resulting from year-end        adjustments and the absence of footnotes.]1                     (b)    During the fiscal period referred to above, the Company was in compliance       with the financial ratios and requirements of Section 10.3 and Section 10.7 of the       Agreement (except to the extent waived in accordance with the provisions of the       Agreement).  Attached hereto on Annex B is the information from the financial statements        referred to in paragraph (a) above required in order to establish such compliance (including        with respect to each such provision that involves mathematical calculations, the        information from such financial statements that is required to perform such calculations)        and a statement of the maximum or minimum amount, ratio or percentage, as the case may                                                         1 Include only for quarterly certifications.                                    SCHEDULE 7.2                            (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12    

 

            be, permissible under the terms of such Section, and the calculation of the amount, ratio or         percentage then in existence demonstrating such compliance.                       (c)    I have reviewed the relevant terms of the Agreement and have made, or         caused to be made under my supervision, a review of the transactions and conditions of the        Company and its Subsidiaries from the beginning of the [quarterly][annual] period covered         by the statements referred to in paragraph (a) above to the date hereof.  Such review did         not disclose the existence during such period of any condition or event that constitutes a         Default or an Event of Default.2                        (d)   Attached hereto as Annex C is a list of all Subsidiaries that are Subsidiary         Guarantors (if any) on the date hereof.  Each Subsidiary that is required to be a Subsidiary         Guarantor pursuant to Section 9.7 of the Agreement is a Subsidiary Guarantor on the date         hereof.                        [(e)]  [Included as part of the calculations on Annex B is a reconciliation between         the calculations of the financial ratios and requirements referred to in paragraph (b) above         made before and after giving effect to any change in GAAP which affects the computation        of such financial ratios or requirements.]3                       [(f)]  [Included as part of the calculations on Annex B is a reconciliation from         GAAP resulting from the Company or any Subsidiary making an election to measure any         financial liability using fair value (which election is being disregarded for purposes of         determining compliance with the Agreement pursuant to Section 22.2) as to the period         covered by the financial statements referred to in paragraph (a) above.] 4                                   [Remainder of Page Intentionally Left Blank.]                                                                               2 If a Default or Event of Default shall have occurred (including if resulting from the failure of the Company or any        Subsidiary to comply with any Environmental Law), an explanation of such Default or Event of Default shall        be provided on a separate page attached hereto specifying the nature and period of existence thereof and what        action the Company has taken or proposes to take with respect thereto.   3 Include only if, as a result of changes to GAAP, any of the covenants in Sections 10.3 or 10.7 no longer apply as        intended and must therefore be reconciled to account for such change in GAAP (see Section 22.2(b) of the        Agreement).   4 Include only if the Company has elected to measure any financial liability using fair value (as permitted by Financial         Accounting Standards Board Accounting Standards Codification Topic No. 825-10-25 – Fair Value Option,         International Accounting Standard 39 – Financial Instruments: Recognition and Measurement) pursuant to         Section 22.2 of the Agreement.                                        7.2-2   \\DC - 047743/000003 - 10986815 v12    

 

                This Certificate may, upon execution, be delivered by facsimile or electronic mail,        which shall be deemed for all purposes to be an original signature.                                                                                           Name:              Title:                                                                                                  7.2-3  \\DC - 047743/000003 - 10986815 v12    

 

                                          Annex A                                  to Compliance Certificate                                                                               Financial Statements                                                                                   Annex A                                   to Schedule 7.2  \\DC - 047743/000003 - 10986815 v12    

 

                                          Annex B                                 to Compliance Certificate                                                                          Financial Covenant Calculations                                                                                   Annex B                                  to Schedule 7.2  \\DC - 047743/000003 - 10986815 v12    

 

                                         Annex C                                 to Compliance Certificate                                                                            Subsidiary Guarantor List                                                                                                                                                                                                                                                                     Annex C                                  to Schedule 7.2  \\DC - 047743/000003 - 10986815 v12    

 

                                    SCHEDULE 9.7                       FORM OF SUBSIDIARY GUARANTOR JOINDER                              GUARANTOR SUPPLEMENT         THIS GUARANTOR   SUPPLEMENT (the “Guarantor Supplement”), dated as of  [__________, 20__] is made by [__________], a [____________](the “Additional Guarantor”),  in favor of the holders from time to time of the Notes issued pursuant to the Note Agreement  described below:                              PRELIMINARY STATEMENTS:         I.  Pursuant to the Note Purchase Agreement dated as of May 31, 2018 (as amended,  modified, supplemented or restated from time to time, the “Note Agreement”), by and among  HNI Corporation, an Iowa corporation (the “Company”), and the Persons listed on the signature  pages thereto (the “Purchasers”), the Company has issued and sold (a) $50,000,000 aggregate  principal amount of its 4.22% Senior Notes, Series A, due May 31, 2025 (“Series A Notes”) and  (b) $50,000,000 aggregate principal amount of its 4.40% Senior Notes, Series B, due May 31,  2028 (the “Series B Notes” and together with the Series A Notes, each as amended, restated or  otherwise modified from time to time and including any such notes issued in substitution therefor,  the “Notes” and individually a “Note”).          II.  The Company is required pursuant to the Note Agreement to cause the Additional  Guarantor to deliver this Guarantor Supplement in order to cause the Additional Guarantor to  become a Guarantor under the Guaranty Agreement dated as of May 31, 2018 executed by certain  Subsidiaries of the Company (together with each entity that from time to time becomes a party  thereto by executing a Guarantor Supplement pursuant to Section 14.1 thereof, collectively, the  “Guarantors”) in favor of each holder from time to time of any of the Notes (as the same may be  amended, restated, supplemented or otherwise modified from time to time, the “Guaranty  Agreement”).        III.  The Additional Guarantor has received and will receive substantial direct and indirect  benefits from the Company’s compliance with the terms and conditions of the Note Agreement  and the Notes issued thereunder.        IV.  Capitalized terms used and not otherwise defined herein have the definitions set forth  in the Note Agreement.   Now therefore, in consideration of the funds advanced to the Company by the Purchasers under  the Note Agreement and to enable the Company to comply with the terms of the Note Agreement,  the Additional Guarantor hereby covenants, represents and warrants to the holders as follows:               The Additional Guarantor hereby becomes a Guarantor (as defined in the Guaranty        Agreement) for all purposes of the Guaranty Agreement.  Without limiting the foregoing,                                   SCHEDULE 9.7                            (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12    

 

         the Additional Guarantor hereby (a) jointly and severally with the other Guarantors under       the Guaranty Agreement, guarantees to the holders from time to time of the Notes the       prompt payment in full when due (whether at sated maturity, by acceleration or otherwise)        and the full and prompt performance and observance of all Guaranteed Obligations (as       defined in Section 1 of the Guaranty Agreement) in the same manner and to the same extent        as is provided in the Guaranty Agreement, (b) accepts and agrees to perform and observe        all of the covenants set forth therein, (c) waives the rights set forth in Section 3 of the        Guaranty Agreement, (d) makes the representations and warranties set forth in Section 9        of the Guaranty Agreement and (e) waives the rights, submits to jurisdiction, and waives        service of process as described in Section 14.6 of the Guaranty Agreement.               Notice of acceptance of this Guarantor Supplement and of the Guaranty Agreement,        as supplemented hereby, is hereby waived by the Additional Guarantor.               The address for notices and other communications to be delivered to the Additional       Guarantor pursuant to Section 13 of the Guaranty Agreement is set forth below.        IN WITNESS WHEREOF, the Additional Guarantor has caused this Guarantor Supplement to  be duly executed and delivered as of the date and year first above written.                                          [NAME OF GUARANTOR]                                           By:  ___________________________________                                            Name:                                             Title:                                           Notice Address for such Guarantor                                           ______________________________________                                           _______________________________________                                         _______________________________________                                                 9.7-2  \\DC - 047743/000003 - 10986815 v12    

 

                                                                                                                                                                                                                                                                                                                                                                SCHEDULE 10.2(C)                     FORM OF SUBSIDIARY GUARANTOR REAFFIRMATION                            AFFIRMATION OF GUARANTY AGREEMENT          THIS AFFIRMATION OF GUARANTY    AGREEMENT,   dated as of [_______] (this   “Affirmation”), is made by each of the undersigned (each a “Guarantor” and, collectively, the   “Guarantors”) in favor of the holders from time to time of the Notes (as defined below). Unless   otherwise defined herein, capitalized terms used herein shall have the meanings specified in the   hereinafter defined Note Agreement (as defined below).                               PRELIMINARY STATEMENTS:      I. HNI Corporation, an Iowa corporation (the “Company”), previously entered into a   Note Purchase Agreement, dated as of May 31, 2018 (as amended, restated, amended and restated,   supplemented, assumed or otherwise modified from time to time, the “Note Agreement”), pursuant   to which the Company issued (i) $50,000,000 aggregate principal amount of its 4.22% Senior   Notes, Series A, due May 31, 2025 and (ii) $50,000,000 aggregate principal amount of its 4.40%   Senior Notes, Series B, due May 31, 2028 (collectively, the “Notes” (such term also includes any   notes issued in substitution therefor pursuant to the Note Agreement)).         II.  In connection with the Note Agreement, the Guarantors previously executed and   delivered to the holders (as defined in the Note Agreement) a Guaranty Agreement, dated as of   May 31, 2018 (as amended, restated, amended and restated, supplemented, assumed or otherwise   modified from time to time, the “Guaranty Agreement”), pursuant to which each Guarantor has   irrevocably, unconditionally and jointly and severally with the other Guarantors guaranteed the   payment of the Notes outstanding from time to time and the performance by the Company of its   obligations under the Note Agreement to the extent set forth therein.  The undersigned constitute  all of the Guarantors currently party to the Guaranty Agreement.         III.  The Company has entered into a that certain [describe relevant agreement(s)] (the  “[Transfer/Merger/Consolidation]”).           IV.  It is a condition precedent to the Transfer that the Guarantors execute this Affirmation   to ratify and affirm their obligations under the Guaranty Agreement.                                    SCHEDULE 10.2(c)                             (to Note Purchase Agreement)                                                    \\DC - 047743/000003 - 10986815 v12    

 

           NOW, THEREFORE, in consideration of the matters heretofore described, the sufficiency and  accuracy of which are hereby acknowledged, the undersigned agree for the benefit of the   Purchasers (as defined in the Note Agreement) as follows:     1. Affirmation.  Each Guarantor hereby ratifies and affirms all of its payment and   performance obligations under the Guaranty Agreement and confirms and agrees that the Guaranty   Agreement is, and shall continue to be, in full force and effect after giving effect to the Transfer.     2. Successors and Assigns.  All covenants and other agreements contained in this   Affirmation and in the Guaranty Agreement by or on behalf of any of the parties hereto bind and   inure to the benefit of their respective successors and assigns whether so expressed or not.     3. Governing Law.      This Affirmation shall be construed and enforced in accordance  with, and the rights of the parties shall be governed by, the law of the State of New York, excluding   choice-of-law principles of the law of such State that would permit the application of the laws of   a jurisdiction other than such State.     4. Execution in Counterparts.  This Affirmation may be executed in any number of   counterparts, each of which shall be an original but all of which together shall constitute one   instrument.  Each counterpart may consist of a number of copies hereof, each signed by less than   all, but together signed by all, of the parties hereto.     5. Severability.  Any provision of this Affirmation that 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, and any such prohibition or   unenforceability in any jurisdiction shall (to the full extent permitted by law), not invalidate or  render unenforceable such provision in any other jurisdiction.                 6.     Jurisdiction and Process; Waiver of Jury Trial.  Section 14.6 of the Guaranty   Agreement shall apply to this Affirmation.                                                [Signature pages follow]      10.2(c)- 2          \\DC - 047743/000003 - 10986815 v12    

 

                                                                                                                                                                                                                                                                                                                                   IN WITNESS WHEREOF, each Guarantor has caused this Affirmation to be duly executed  and delivered as of the date and year first above written.                                            [INSERT NAME OF GUARANTOR], [a/an]                                           [_____________________]                                                                                                                                                                    10.2(c)- 3  \\DC - 047743/000003 - 10986815 v12    

 

                                                                                                                                                                                                                                                                                                                                                     [NAME AND ADDRESS OF COMPANY]                                                                INFORMATION RELATING TO PURCHASERS                                                          PRINCIPAL AMOUNT OF        NAME AND ADDRESS OF PURCHASER                   NOTES TO BE PURCHASED    [NAME OF PURCHASER] $   (1)   All payments by wire transfer of immediately              available funds to:                                       with sufficient information to identify the             source and application of such funds.            (2)   All notices of payments and written confirmations of              such wire transfers:   (3)   E-mail address for Electronic Delivery:                                               (4)     All other communications:    (5)     U.S. Tax Identification Number:                                                                           PURCHASER SCHEDULE                            (to Note Purchase Agreement)  \\DC - 047743/000003 - 10986815 v12

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