Document:

EX-10.1

 Exhibit 10.1 
  

 
  

CREDIT AGREEMENT 
 Dated
as of March 23, 2015 
 by and among 

SHEA HOMES LIMITED PARTNERSHIP, 

as Borrower, 
 The
Several Lenders from Time to Time Parties Hereto, 
 and 

U.S. BANK NATIONAL ASSOCIATION, 

as Administrative Agent, 

with 
 U.S. BANK
NATIONAL ASSOCIATION, 
 as Lead Arranger and Bookrunner 
  

 
  

 TABLE OF CONTENTS 

 

							
	 	 	 	  	Page	 
	 ARTICLE I
	 	 DEFINITIONS
	  	 	1	  
			
	 ARTICLE II
	 	 THE CREDITS
	  	 	28	  
	 2.1
	 	Commitment	  	 	28	  
	 2.2
	 	Required Payments	  	 	28	  
	 2.3
	 	Ratable Loans; Types of Advances	  	 	28	  
	 2.4
	 	This Agreement Supersedes the Prior Credit Agreement	  	 	29	  
	 2.5
	 	Undrawn Fee	  	 	29	  
	 2.6
	 	Minimum Amount of Each Advance	  	 	29	  
	 2.7
	 	Reductions in Aggregate Commitment; Optional Principal Payments	  	 	29	  
	 2.8
	 	Method of Selecting Types and Interest Periods for New Advances	  	 	30	  
	 2.9
	 	Conversion and Continuation of Outstanding Advances; Maximum Number of Interest Periods	  	 	30	  
	 2.10
	 	Interest Rates	  	 	31	  
	 2.11
	 	Rates Applicable After Event of Default	  	 	31	  
	 2.12
	 	Method of Payment	  	 	31	  
	 2.13
	 	Noteless Agreement; Evidence of Indebtedness	  	 	32	  
	 2.14
	 	Telephonic Notices	  	 	32	  
	 2.15
	 	Interest Payment Dates; Interest and Fee Basis	  	 	33	  
	 2.16
	 	Notification of Advances, Interest Rates, Prepayments and Commitment Reductions	  	 	33	  
	 2.17
	 	Lending Installations	  	 	33	  
	 2.18
	 	Non-Receipt of Funds by the Administrative Agent	  	 	33	  
	 2.19
	 	Facility LCs	  	 	34	  
	 2.20
	 	Replacement of Lender	  	 	38	  
	 2.21
	 	Limitation of Interest	  	 	39	  
	 2.22
	 	Defaulting Lenders	  	 	40	  
	 2.23
	 	Increase Option	  	 	43	  
	 2.24
	 	[Reserved]	  	 	44	  
	 2.25
	 	Term Out Provision.	  	 	44	  
	 2.26
	 	Swingline Commitment.	  	 	45	  
	 2.27
	 	Procedure for Swingline Borrowing; Refunding of Swingline Loans.	  	 	46	  
			
	 ARTICLE III
	 	 YIELD PROTECTION; TAXES
	  	 	47	  
	 3.1
	 	Yield Protection	  	 	47	  
	 3.2
	 	Changes in Capital Adequacy Regulations	  	 	48	  
	 3.3
	 	Availability of Types of Advances; Adequacy of Interest Rate	  	 	48	  
	 3.4
	 	Funding Indemnification	  	 	49	  
	 3.5
	 	Taxes	  	 	49	  
	 3.6
	 	Selection of Lending Installation; Mitigation Obligations; Lender Statements; Survival of Indemnity	  	 	53	  

  
 -i- 

							
	 ARTICLE IV
		 CONDITIONS PRECEDENT
		 	53	  
	 4.1
		Initial Credit Extension		 	53	  
	 4.2
		Each Credit Extension		 	55	  
			
	 ARTICLE V
		 REPRESENTATIONS AND WARRANTIES
		 	56	  
	 5.1
		Existence and Standing		 	56	  
	 5.2
		Authorization and Validity		 	56	  
	 5.3
		No Conflict; Government Consent		 	56	  
	 5.4
		Financial Statements and Information		 	57	  
	 5.5
		Material Adverse Change		 	57	  
	 5.6
		Taxes		 	57	  
	 5.7
		Litigation and Contingent Obligations		 	57	  
	 5.8
		Entities Owned		 	57	  
	 5.9
		ERISA		 	58	  
	 5.10
		Accuracy of Information		 	58	  
	 5.11
		Regulation U		 	58	  
	 5.12
		Material Agreements		 	58	  
	 5.13
		Compliance With Laws		 	58	  
	 5.14
		Title to Properties		 	59	  
	 5.15
		Plan Assets; Prohibited Transactions		 	59	  
	 5.16
		Environmental Matters		 	59	  
	 5.17
		Investment Company Act		 	59	  
	 5.18
		Insurance		 	59	  
	 5.19
		Subordinated Debt		 	59	  
	 5.20
		Solvency		 	59	  
	 5.21
		No Default		 	60	  
	 5.22
		Foreign Asset Control Regulations		 	60	  
			
	 ARTICLE VI
		 COVENANTS
		 	60	  
	 6.1
		Financial Reporting		 	61	  
	 6.2
		Notice of Material Events		 	62	  
	 6.3
		Preservation of Existence and Similar Matters		 	63	  
	 6.4
		Compliance with Applicable Law		 	63	  
	 6.5
		Maintenance of Property; Completion of Construction		 	63	  
	 6.6
		Insurance		 	63	  
	 6.7
		Payment of Taxes and Claims		 	63	  
	 6.8
		Books and Records; Inspections		 	64	  
	 6.9
		Use of Proceeds		 	64	  
	 6.10
		Environmental Matters		 	64	  
	 6.11
		Further Assurances		 	64	  
	 6.12
		[Reserved]		 	64	  
	 6.13
		ERISA Compliance		 	64	  
	 6.14
		Business Operations; Unrelated Business		 	65	  
	 6.15
		[Reserved].		 	65	  
	 6.16
		[Reserved].		 	65	  
	 6.17
		Liens		 	65	  
	 6.18
		Prepayment of Indebtedness		 	68	  

  
 -ii- 

							
	 6.19
		Limitation on Fundamental Changes		 	68	  
	 6.20
		Transactions with Affiliates		 	69	  
	 6.21
		Investments		 	70	  
	 6.22
		Dividends and Subordinated Debt		 	72	  
	 6.23
		Financial Covenants		 	73	  
	 6.24
		Guarantors		 	74	  
	 6.25
		[Reserved.]		 	74	  
	 6.26
		Foreign Assets Control Regulations		 	74	  
			
	 ARTICLE VII
		 DEFAULTS
		 	74	  
			
	 ARTICLE VIII
		 ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
		 	77	  
	 8.1
		Acceleration; Remedies		 	77	  
	 8.2
		Application of Funds		 	78	  
	 8.3
		Amendments		 	79	  
	 8.4
		Preservation of Rights		 	80	  
			
	 ARTICLE IX
		GENERAL PROVISIONS		 	80	  
	 9.1
		Survival of Representations		 	80	  
	 9.2
		Governmental Regulation		 	80	  
	 9.3
		Headings		 	80	  
	 9.4
		Entire Agreement		 	80	  
	 9.5
		Several Obligations; Benefits of this Agreement		 	81	  
	 9.6
		Expenses; Indemnification.		 	81	  
	 9.7
		[Reserved].		 	82	  
	 9.8
		Accounting		 	82	  
	 9.9
		Severability of Provisions		 	83	  
	 9.10
		Nonliability of Lenders		 	83	  
	 9.11
		Confidentiality		 	83	  
	 9.12
		Nonreliance		 	84	  
	 9.13
		Disclosure		 	84	  
	 9.14
		USA PATRIOT ACT NOTIFICATION		 	84	  
	 9.15
		Document Interpretation.		 	84	  
			
	 ARTICLE X
		 THE ADMINISTRATIVE AGENT
		 	85	  
	 10.1
		Appointment; Nature of Relationship		 	85	  
	 10.2
		Powers		 	85	  
	 10.3
		General Immunity		 	85	  
	 10.4
		No Responsibility for Loans, Recitals, etc.		 	86	  
	 10.5
		Action on Instructions of Lenders		 	86	  
	 10.6
		Employment of Administrative Agents and Counsel		 	86	  
	 10.7
		Reliance on Documents; Counsel		 	86	  
	 10.8
		Administrative Agent’s Reimbursement and Indemnification		 	87	  
	 10.9
		Notice of Event of Default		 	87	  
	 10.10
		Rights as a Lender		 	87	  
	 10.11
		Lender Credit Decision, Legal Representation		 	88	  
	 10.12
		Successor Administrative Agent		 	88	  

  
 -iii- 

							
	 10.13
		Administrative Agent and Arranger Fees		 	89	  
	 10.14
		Delegation to Affiliates		 	89	  
	 10.15
		No Advisory or Fiduciary Responsibility		 	89	  
			
	 ARTICLE XI
		 SETOFF; RATABLE PAYMENTS
		 	90	  
	 11.1
		Setoff		 	90	  
	 11.2
		Ratable Payments		 	90	  
			
	 ARTICLE XII
		 BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
		 	90	  
	 12.1
		Successors and Assigns		 	90	  
	 12.2
		Participations		 	91	  
	 12.3
		Assignments		 	92	  
			
	 ARTICLE XIII
		 NOTICES
		 	94	  
	 13.1
		Notices; Effectiveness; Electronic Communication		 	94	  
			
	 ARTICLE XIV
		 COUNTERPARTS; INTEGRATION; EFFECTIVENESS;

ELECTRONIC EXECUTION
		 	96	  
	 14.1
		Counterparts; Effectiveness		 	96	  
	 14.2
		Electronic Execution of Assignments		 	96	  
			
	 ARTICLE XV
		 CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF

JURY TRIAL
		 	96	  
	 15.1
		CHOICE OF LAW		 	96	  
	 15.2
		CONSENT TO JURISDICTION; OTHER MATTERS; WAIVERS		 	96	  
			
	 ARTICLE XVI
		 NON-RECOURSE
		 	98	  
	 16.1
		Notwithstanding any other term of provision of this Agreement, any other Loan Document or applicable law:		 	98	  

  
 -iv- 

 SCHEDULES 
  

			
	Schedule 1		Authorized Officer(s)
	Schedule 1(a)		Commitments
	Schedule 1(b)		Guarantors
	Schedule 5.8		Subsidiaries; Existing Investments
	Schedule 6.17		Existing Liens
	Schedule 6.20		Transactions with Affiliates

 EXHIBITS 
  

			
	Exhibit A		Borrowing Base Certificate
	Exhibit B		Guaranty
	Exhibit C		Form of Borrowing Notice
	Exhibit D		Note
	Exhibit E		Form of Increasing Lender Supplement
	Exhibit F		Form of Augmenting Lender Supplement
	Exhibit G		[Reserved]
	Exhibit H		List of Closing Documents
	Exhibit I		Compliance Certificate
	Exhibit J		Assignment and Assumption Agreement

  
 -v- 

 CREDIT AGREEMENT 

CREDIT AGREEMENT (this “Agreement”), dated as of March 23, 2015, among SHEA HOMES LIMITED PARTNERSHIP, a
California limited partnership (the “Borrower”), the several banks and other financial institutions or entities from time to time parties to this Agreement (the “Lenders”), and U.S. BANK NATIONAL
ASSOCIATION, as administrative agent. This Agreement and the Loan Documents described herein replace and supersede in their entirety the Prior Credit Agreement (as defined below) and all “Loan Documents” described therein, as is more fully
set forth in this Agreement. 
 ARTICLE I 

DEFINITIONS 
 As
used in this Agreement: 
 “Adjusted Leverage Ratio” means the ratio, as of any date, of
(a) Consolidated Debt minus Unrestricted Cash in excess of $5,000,000 divided by (b) Consolidated Tangible Net Worth on such date. 

“Administrative Agent” means U.S. Bank in its capacity as contractual representative of the Lenders pursuant to
Article X, and not in its individual capacity as a Lender, and any successor Administrative Agent appointed pursuant to Article X. 

“Advance” means a borrowing hereunder, (i) made (or required to be made) by all of the Lenders on the same
Borrowing Date (or a Swingline Loan), or (ii) converted or continued by the Lenders on the same date of conversion or continuation, consisting, in either case, of the aggregate amount of the several Loans of the same Type and, in the case of
Eurocurrency Loans, for the same Interest Period. 
 “Affected Lender” is defined in Section 2.20.

 “Affiliate” of any Person means any other Person directly or indirectly controlling, controlled by or
under common control with such Person, including, without limitation, such Person’s Subsidiaries. 

“Affiliate Obligations” means obligations of Shea Properties, LLC, Shea Properties II, LLC or any of their
respective Subsidiaries (or joint ventures in which they own an interest) or other Shea-family-owned entities (or joint ventures in which they own an interest, excluding, however, any of the foregoing that is a Guarantor), including development
loans; provided, however, that capital calls required to be made by the Borrower or its Subsidiaries to or for the benefit of a joint venture pro rata on the basis of the Borrower’s or a Subsidiary’s ownership in such joint venture, which
capital calls are not being made to enable such joint venture to pay amounts owed under any Indebtedness, shall not be Affiliate Obligations but will be treated as Restricted Payments. 

  
 -1- 

 “Aggregate Commitment” means the aggregate of the Commitments of
all the Lenders, as reduced or increased from time to time pursuant to the terms hereof. As of the date of this Agreement, the Aggregate Commitment is $175,000,000. 

“Aggregate Outstanding Credit Exposure” means, at any time, the aggregate of the Outstanding Credit Exposure of
all the Lenders. 
 “Agreement” means this Credit Agreement, as it may be amended, restated,
supplemented or otherwise modified and in effect from time to time. 
 “Anti-Corruption Laws” means
all laws, rules and regulations of any jurisdiction applicable to the Borrower or any of its Subsidiaries from time to time concerning or relating to bribery or corruption. 

“Applicable L/C Fee Rate” means the Applicable Margin for Eurocurrency Loans. 

“Applicable Law” means all applicable provisions of constitutions, statutes, rules, regulations, orders and
decrees of all Governmental Authorities. 
 “Applicable Margin” means, with respect to Eurocurrency
Loans and Daily Eurocurrency Loans, the percentage rate per annum which is applicable at such time with respect to each such Type of Advance, as set forth in the Pricing Schedule. 

“Applicable Undrawn Fee Rate” means, at any time, the percentage rate per annum at which Undrawn Fees are
accruing on the Available Aggregate Commitment at such time as set forth in the Pricing Schedule. 
 “Approved
Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender. 

“Arrangers” means, collectively, U.S. Bank and any respective successors, in their capacities as Lead Arrangers
and Joint Book Runners. 
 “Article” means an article of this Agreement unless another document is
specifically referenced. 
 “Augmenting Lender” is defined in Section 2.23. 

“Authorized Officer” means, collectively, each of the authorized officers listed on Schedule 1 or such
additional authorized officers or agents as Borrower shall designate in writing to Administrative Agent from time to time. 

“Available Aggregate Commitment” means, at any time, the Aggregate Commitment then in effect minus the
Aggregate Outstanding Credit Exposure at such time. 
 “Book Value” means, with respect to any
Property at any time, the book value of such Property as determined in accordance with GAAP at such time. 

  
 -2- 

 “Borrower” means Shea Homes Limited Partnership, a California
limited partnership, and its successors and assigns.  
 “Borrowing Base” means, as of any
date, an amount calculated as follows: 
 (a) 100% of Unrestricted Cash to the extent it exceeds $5,000,000; plus 

(b) 100% of the amount of Escrow Proceeds Receivable, plus 

(c) subject to the limitations set forth below, 90% of the Book Value of Units Under Contract; plus 

(d) subject to the limitations set forth below, 85% of the Book Value of Units Under Construction; plus 

(e) subject to the limitations set forth below, 80% of the Book Value of Speculative Units (other than Model Units); plus 

(f) subject to the limitations set forth below, 85% of the Book Value of Model Units; plus 

(g) subject to the limitations set forth below, 65% of the Book Value of Finished Lots; plus 

(h) subject to the limitations set forth below, 65% of the Book Value of Land Under Development; plus 

(i) subject to the limitation set forth below, 50% of the Book Value of Entitled Land that is not included in the Borrowing Base under
clauses (a)-(f) above. 
 Notwithstanding the foregoing: 

(i) the Borrowing Base shall not include any amounts under clauses (g), (h) and (i) to the extent the aggregate of such amounts
exceed 55% of the Borrowing Base. 
 (ii) the Borrowing Base shall not include any amounts under clause (i) to the extent that such
amount exceeds 20% of the Borrowing Base. 
 (iii) the advance rate for Speculative Units shall decrease to zero percent (0%) for any Unit
that has been a Speculative Unit for more than eighteen (18) months. 
 (iv) the advance rate for Model Units shall decrease to zero
percent (0%) for any Unit that has been a Model Unit for more than eighteen (18) months following the sale of the last production Unit in the applicable project relating to such Model Unit. 

Notwithstanding anything in the definition of Borrowing Base which may be construed to the contrary, in no event may any Unit or Lot or other Property
described above be counted more than once (notwithstanding that it may satisfy the criteria of more than one category) in the calculation of the Borrowing Base hereunder. Any land or other Property that does not fit within

  
 -3- 

 
one of the categories specified above in this definition, shall have a zero percent (0%) advance rate. In no event may any Lot, Unit, Project or other Property be included in the Borrowing Base
unless it is (x) one hundred percent (100%) owned by Borrower or a Wholly-Owned Subsidiary of Borrower (except only as specified immediately below) that is a Guarantor, and (y) is not subject to any deeds of trust, mortgages, judgment
liens or other Liens (other than Permitted Liens). Other than with respect to Properties owned by the Initial Non-Wholly-Owned Guarantors, no Property that is owned by a Non-Wholly-Owned Subsidiary may be included in the Borrowing Base,
unless Agent and Lenders so approve in their sole and absolute discretion and such Non-Wholly-Owned Subsidiary is managed and controlled by Borrower. The amount of the Borrowing Base with respect to any Property owned by a Non-Wholly-Owned
Subsidiary shall be adjusted by multiplying (a) the Loan Party Ownership Percentage of such Non-Wholly-Owned Subsidiary, by (b) the amount of the Borrowing Base for such Property calculated as set forth above in the definition of Borrowing
Base. 
 “Borrowing Base Availability” means, as of any date, (a) the Borrowing Base calculated in the
most recently delivered Borrowing Base Certificate minus (b) the Borrowing Base Debt on such date. 

“Borrowing Base Certificate” means a certificate signed by an Authorized Officer of Borrower, substantially in
the form of Exhibit A. 
 “Borrowing Base Debt” means, as of any date, Consolidated Debt
minus (a) Subordinated Debt (to the extent included in Consolidated Debt, and that is not then in default) due later than one year following such date, minus (b) Non-Recourse Indebtedness of the
Loan Parties and their respective Subsidiaries (other than Excluded Subsidiaries). 
 “Borrowing Date”
means a date on which an Advance is made or a Facility LC is issued hereunder. 
 “Borrowing Notice”
is defined in Section 2.8. 
 “Business Day” means (i) with respect to any borrowing, payment or
rate selection of Eurocurrency Advances, a day (other than a Saturday or Sunday) on which banks generally are open in New York City, New York for the conduct of substantially all of their commercial lending activities, interbank wire transfers can
be made on the Fedwire system and dealings in Dollars are carried on in the London interbank market and (ii) for all other purposes, a day (other than a Saturday or Sunday) on which banks generally are open in New York City, New York for the
conduct of substantially all of their commercial lending activities and interbank wire transfers can be made on the Fedwire system. 

“Capital Stock” means any and all shares, interests, rights to purchase, warrants, options, participations or
other equivalents of or interests in (however designated) equity of a Person, including any preferred stock, but excluding any debt securities convertible into such equity. 

“Capitalized Lease” of a Person means any lease of Property by such Person as lessee which would be capitalized
on a balance sheet of such Person prepared in accordance with GAAP. 

  
 -4- 

 “Capitalized Lease Obligations” of a Person means the amount of
the obligations of such Person under Capitalized Leases which would be shown as a liability on a balance sheet of such Person prepared in accordance with GAAP (as GAAP is in effect on the date hereof). 

“Cash Collateralize” means to deposit in the Facility LC Collateral Account or to pledge and deposit with or
deliver to the Administrative Agent, for the benefit of one or more of the LC Issuer or Lenders, as collateral for LC Obligations or obligations of Lenders to fund participations in respect of LC Obligations, cash or deposit account balances or, if
the Administrative Agent and the LC Issuer shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the LC Issuer, in an amount
equal to 103% of the outstanding LC Obligations. “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support. 

“Cash Equivalent Investments” means (i) obligations of, or fully guaranteed or insured by, the United
States of America or any agency or instrumentality thereof having maturities of one year or less from the date of acquisition, (ii) commercial paper rated A-1 or better by S&P or P-1 or better by Moody’s, (iii) demand deposit
accounts maintained in the ordinary course of business, and (iv) certificates of deposit issued by and time deposits with bankers’ acceptances with maturities not exceeding one year and overnight bank deposits with, commercial banks
(whether domestic or foreign) having capital and surplus in excess of 500,000,000, (v) repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (i) and (iv) of this
definition entered into with any financial institution meeting the qualifications specified in clause (iv) of this definition, and (vi) shares of money market mutual funds substantially all of the assets of which consist of securities
described in the foregoing clauses (i) through (v) of this definition. 
 “Cash Management
Services” means any banking services that are provided to any Loan Party or any Subsidiary of a Loan Party by the Administrative Agent or any of its Affiliates (other than pursuant to this Agreement), the LC Issuer or any other Lender,
including without limitation: (a) credit cards, (b) credit card processing services, (c) debit cards, (d) purchase cards, (e) stored value cards, (f) automated clearing house or wire transfer services, or
(g) treasury management, including controlled disbursement, consolidated account, lockbox, overdraft, return items, sweep and interstate depository network services. 

“CCM Proceeding” shall have the meaning assigned to such term in the Tax Distribution Agreement. 

“Change in Law” is defined in Section 3.1. 

“Change of Control” means (i) the acquisition by any Person, or two or more Persons acting in concert
(other than the Permitted Holders), of beneficial ownership (within the meaning of Rule 13d-3 of the U.S. Securities and Exchange Commission under the Securities Exchange Act of 1934) of 50% or more of the outstanding shares of voting stock of the
Borrower; (ii) the merger or consolidation of the Borrower with or into another Person or the merger of another Person with or into Borrower, or the sale of all or substantially all the assets of Borrower to another Person, other than any such
sale to one or more Loan Parties, and in the case of any such  

  
 -5- 

 
merger or consolidation, the equity securities of Borrower that are outstanding immediately prior to such transaction and which represent 100% of the aggregate voting power of the voting stock of
Borrower are changed into or exchanged for cash, securities or property, unless pursuant to such transaction such securities are changed into or exchanged for, in addition to any other consideration, securities of the surviving corporation, or a
parent corporation that owns all of the capital stock of such surviving corporation, that represent immediately after such transaction, at least a majority of the aggregate voting power of the voting stock of the surviving corporation or such parent
corporation, as the case may be, or (iii) a “change of control” as defined under any of Borrower’s public note indebtedness or other notes issued by Borrower under an indenture or comparable documents which debt is permitted
under this Agreement. 
 “Code” means the Internal Revenue Code of 1986, as amended, reformed or otherwise
modified from time to time. 
 “Commitment” means, for each Lender, the obligation of such Lender to
make Loans (and participate in Swingline Loans) to, and participate in Facility LCs issued upon the application of, the Borrower in an aggregate amount not exceeding the amount set forth in Schedule 1(a), as it may be modified as a result of any
assignment that has become effective pursuant to Section 12.3(b) or as otherwise modified from time to time pursuant to the terms hereof. 

“Commitment Period” has the meaning set forth in Section 2.1. 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to
time, and any successor statute. 
 “Completed Unit” means a Unit as to which all necessary
Governmental Approvals have been obtained, including a certificate of occupancy. 
 “Consolidated
Debt” at any date, without duplication (a) all funded debt of the Loan Parties and their respective Subsidiaries determined on a consolidated basis; plus (b) all funded debt with recourse to any limited or general partnership
in which any Loan Party or any of their respective Subsidiaries is a general partner; plus (c) the sum of (i) all reimbursement obligations with respect to amounts drawn and not reimbursed under Financial Letters of Credit and amounts
drawn and not reimbursed under Performance Letters of Credit (excluding any portion of the actual or potential obligations that are secured by cash collateral) and (ii) the maximum amount available to be drawn under all undrawn Financial
Letters of Credit, in each case issued for the account of, or guaranteed by, any Loan Party or any of their respective Subsidiaries (excluding any portion of the actual or potential obligations that are secured by cash collateral); plus (d) all
Contingent Obligations of any Loan Party or any of their respective Subsidiaries with respect to funded debt of third parties; provided, however, except as provided above in this definition with respect to Financial Letters of Credit, that in the
case of any Contingent Obligation, only amounts due and payable at the time of determination will be included in the calculation of Consolidated Debt; plus (e) Contingent Obligations that are due and payable at the time of determination;
provided, however, “Consolidated Debt” excludes (i) obligations of Excluded Subsidiaries unless such obligations are guaranteed by any Loan Party pursuant to a Contingent 

  
 -6- 

 
Obligation that has been called, and (ii) obligations of one Loan Party owing to another Loan Party. 

“Consolidated EBITDA” means, for any period, (a) Consolidated Net Income (excluding net income from Excluded
Subsidiaries), plus (b) cash distributions of income received from Joint Ventures, plus (c) to the extent deducted from revenues in determining Consolidated Net Income (excluding net income from Excluded Subsidiaries), without duplication,
(i) Consolidated Interest Expense, (ii) expense for income taxes paid or accrued, (iii) depreciation, (iv) amortization, (v) non-cash (including impairment) charges, (vi) extraordinary losses, (vii) loss (gain) on
early extinguishment of indebtedness, (viii) transaction costs and restructuring charges required to be expensed under FASB ASC 805, (ix) the amount of any net losses from discontinued operations, including net losses from the sale or
disposition of discontinued operations, (x) any fees, expenses or charges related to any issuance of Capital Stock, Investment, acquisition, disposition, recapitalization or the incurrence or repayment of Indebtedness permitted to be incurred
hereunder including a refinancing thereof (whether or not successful) and any amendment or modification to the terms of any such transactions, including such fees, expenses or charges related to the Transaction, in each case, deducted in computing
Consolidated Net Income and (xi) unusual or non-recurring costs and expenses in an amount not to exceed 10% of Consolidated EBITDA in any four fiscal quarter period, and plus (d) (to the extent not duplicative of any of the foregoing) cash
distributions received from Excluded Subsidiaries minus (e) to the extent added to revenues in determining Consolidated Net Income, non-cash gains and extraordinary gains, and minus (f) income (loss) from consolidated Joint Ventures and
income (loss) from consolidated Financial Services Subsidiaries (except to the extent of cash distributions received from such Joint Ventures or Financial Services Subsidiaries). 

“Consolidated Interest Expense” means, for any period, the consolidated interest expense and previously
capitalized interest and other interest related charges amortized to cost of sales or other accounts of the Loan Parties and their Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP. 

“Consolidated Interest Incurred” means, for any period, the aggregate amount (without duplication and
determined in each case in accordance with GAAP) of interest (excluding interest owing by a Loan Party to another Loan Party) whether such interest was expensed or capitalized, paid, accrued, or scheduled to be paid or accrued by any of the Loan
Parties and their respective Subsidiaries, excluding interest obligations of Excluded Subsidiaries unless such obligation is guaranteed pursuant to a Contingent Obligation that has been called and is due during such period, including (a) the
interest portion of all deferred payment obligations, and (b) all commissions, discounts, and other fees and charges (excluding premiums) owed with respect to bankers’ acceptances and letter of credit financings (including, without
limitation, letter of credit fees) and interest swap and Rate Management Obligations, in each case to the extent attributable to such period. 

“Consolidated Net Income” means, with reference to any period, the net income (or loss) of the Borrower and its
Subsidiaries calculated on a consolidated basis for such period in accordance with GAAP. 

  
 -7- 

 “Consolidated Tangible Net Worth” means, for purposes of calculating the
covenants in Section 6.23, at any time the consolidated stockholders’ equity of the Borrower and its Subsidiaries calculated on a consolidated basis as of such time, all as defined according to GAAP less intangible assets, plus up to
$70,000,000 of the funds paid as required by the CCM Proceeding determined in accordance with GAAP at such time, and adjusted up to account for decreases in stockholders’ equity that have not been included in the calculation of the aggregate
net income (or loss) solely to the extent such changes are due to unusual transfers of assets between Borrower and its Affiliates permitted under this Agreement, excluding contributions or distributions of equity. 

“Contingent Obligation” of a Person means any agreement, undertaking, indemnity or arrangement by which such
Person assumes, guarantees (including completion guaranties), endorses, contingently agrees to purchase or provide funds for the payment of, or otherwise becomes or is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth, loan-to-value or working capital or other financial condition of any other Person, or otherwise assures any creditor of such other Person against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or the obligations of any such Person as general partner of a partnership with respect to the liabilities of the partnership. 

“Conversion/Continuation Notice” is defined in Section 2.9. 

“Credit Extension” means the making of an Advance or the issuance of a Facility LC hereunder. 

“Daily Eurocurrency Advance” means an Advance which, except as otherwise provided in Section 2.11, bears
interest at the Daily Eurocurrency Rate. 
 “Daily Eurocurrency Base Rate” means the greater of
(a) zero percent (0%) or (b) the applicable ICE Benchmark Administration (or successor thereto) rate for Dollar LIBOR for one month appearing on the applicable Reuters Screen LIBOR01 as of 11:00 a.m. (London time) on a Business Day,
provided that, if the applicable Reuters Screen LIBOR01 for Dollar LIBOR is not available to the Administrative Agent for any reason, the applicable Daily Eurocurrency Base Rate for one month shall instead be the applicable ICE
Benchmark Administration (or successor thereto) rate for deposits in Dollar LIBOR for one month as reported by any other generally recognized financial information service selected by the Administrative Agent as of 11:00 a.m. (London time) on a
Business Day, provided further that, if no such ICE Benchmark Administration (or successor thereto) rate is available to the Administrative Agent, the applicable Daily Eurocurrency Base Rate for one month shall instead be the
rate determined by the Administrative Agent to be the rate at which U.S. Bank or one of its Affiliate banks offers to place deposits in Dollars with first-class banks in the interbank market at approximately 11:00 a.m. (London time) on a Business
Day in the approximate amount of the relevant Loan and having a maturity equal to one month. For purposes of determining any interest rate hereunder or under any other Loan Document which is based on the Daily Eurocurrency Base Rate, such interest
rate shall change as and when the Daily Eurocurrency Base Rate shall change. 

  
 -8- 

 “Daily Eurocurrency Loan” means a Loan which, except as otherwise
provided in Section 2.11, bears interest at the Daily Eurocurrency Rate. 
 “Daily Eurocurrency
Rate” means, with respect to a Loan, the sum of (a) the quotient of (i) the Daily Eurocurrency Base Rate, reset daily, divided by (ii) one minus the Reserve Requirement (expressed as a decimal) applicable to a one-month
Interest Period, plus (b) the Applicable Margin. 
 “Debtor Relief Laws” means the Bankruptcy
Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United
States or other applicable jurisdictions from time to time in effect. 
 “Default” means an event
which but for the lapse of time or the giving of notice, or both, would constitute an Event of Default. 

“Defaulting Lender” means, subject to Section 2.22(b), any Lender that (a) has failed to
(i) fund all or any portion of its Loans within two (2) Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the
result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied or
waived, or (ii) pay to the Administrative Agent, any LC Issuer, any Swingline Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Facility LCs or Swingline Loans) within
two (2) Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent, any LC Issuer or any Swingline Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a
public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to
funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by
the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender
pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any
Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including
the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of
any equity interest in that Lender or any direct or indirect parent company thereof by a governmental authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the
United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such governmental authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such 

  
 -9- 

 
Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent
manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.22(b)) upon delivery of written notice of such determination to the Borrower, the LC Issuer, each Swingline Lender and each Lender. 

“Dollar” and “$” means the lawful currency of the United States of America. 

“Effective Date” means the date on which all of the conditions precedent set forth in Section 4.1 shall
have been fulfilled or waived in writing by the Administrative Agent. 
 “Eligible Assignee” means any
Person except a natural Person, the Borrower, any of the Borrower’s Affiliates or Subsidiaries or any Defaulting Lender or any of its Subsidiaries; provided that such Person is in the business of making or purchasing commercial loans similar to
the Loans and has total assets in excess of $3,000,000,000, calculated in accordance with the accounting principles prescribed by the regulatory authority applicable to such Person in its jurisdiction of organization. 

“Entitled Land” means Qualified Real Property Inventory (a) that is zoned and otherwise suitable for the
development of Units or certain limited commercial development incidental to the development and sale of Lots or Units, (b) which the Borrower (or any Loan Party) intends to develop for the sale of Lots or Units or certain limited commercial
development incidental to the development and sale of Lots or Units, and (c) with respect to which approval and entitlement from required Governmental Authorities of a tentative map, a preliminary development plan and all other plan and related
Governmental Approvals required by Applicable Law in accordance with the provisions of all Applicable Law have been obtained (other than approvals which are simply ministerial and non-discretionary in nature or otherwise not material, such as a
final map) such that in each instance Borrower or another Loan Party has the vested right to develop the Qualified Real Property Inventory as a residential housing project and construct Units thereon. 

“Environmental Laws” means any and all federal, state, local and foreign statutes, laws, judicial decisions,
regulations, ordinances, rules, judgments, orders, decrees, plans, injunctions, permits, concessions, grants, franchises, licenses, agreements and other governmental restrictions relating to (i) the protection of the environment,
(ii) personal injury or property damage relating to the release or discharge of Hazardous Materials, (iii) emissions, discharges or releases of pollutants, contaminants, hazardous substances or wastes into surface water, ground water or
land, or (iv) the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of pollutants, contaminants, hazardous substances or wastes or the clean-up or other remediation thereof. 

“Equity Issuance” means any issuance or sale of Capital Stock by Borrower or any of its Subsidiaries.

 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and
any rule or regulation issued thereunder. 

  
 -10- 

 “ERISA Affiliate” means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code. 
 “ERISA Event” means (a) any “reportable
event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived); (b) the failure with respect to any Plan to satisfy the
“minimum funding standard” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 303(c) of ERISA of an
application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal of the Borrower or any of its ERISA Affiliates from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA
Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition upon the Borrower or any of its ERISA Affiliates of withdrawal liability under Section 4201 of
ERISA or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA. 

“Escrow Proceeds Receivable” shall mean funds due to the Borrower or any Guarantor held in escrow following the
sale and conveyance of title of a Unit to a buyer. 
 “Eurocurrency Advance” means an Advance which,
except as otherwise provided in Section 2.11, bears interest at the applicable Eurocurrency Rate. 

“Eurocurrency Base Rate” means, with respect to a Eurocurrency Advance for the relevant Interest Period, a per
annum rate of interest (rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the greater of (a) zero percent (0%), and (b) the rate which appears on the Reuters Screen LIBOR01 (or as successor or substitute thereto selected
by Administrative Agent in its sole discretion) as of 11:00 a.m., London time, two (2) Business Days prior to the first day of the applicable Interest Period selected by Borrower, for Dollar deposits having a term coinciding with the
Interest Period selected by Borrower, the applicable ICE Benchmark Administration rate for deposits in Dollars (Dollar LIBOR), provided that, (i) if the applicable Reuters Screen is not available to the Administrative Agent
for any reason, the applicable Eurocurrency Base Rate for the relevant Interest Period shall instead be the applicable ICE Benchmark Administration rate for deposits in Dollars as reported by any other generally recognized financial information
service selected by the Administrative Agent as of 11:00 a.m. (London time) two (2) Business Days prior to the first day of such Interest Period, and having a maturity equal to such Interest Period, provided that, if no
such ICE Benchmark Administration rate is available to the Administrative Agent, the applicable Eurocurrency Base Rate for the relevant Interest Period shall instead be the rate determined by the Administrative Agent to be the rate at which U.S.
Bank or one of its Affiliate banks offers to place deposits in Dollars with first-class banks in the interbank market at approximately 11:00 a.m. (London time) two (2) 

  
 -11- 

 
Business Days prior to the first day of such Interest Period, in the approximate amount of U.S. Bank’s relevant Eurocurrency Loan and having a maturity equal to such Interest Period. 

“Eurocurrency Loan” means a Loan which, except as otherwise provided in Section 2.11, bears interest at
the applicable Eurocurrency Rate. 
 “Eurocurrency Rate” means, with respect to a Eurocurrency Advance
for the relevant Interest Period, the sum of (i) the quotient of (a) the Eurocurrency Base Rate applicable to such Interest Period, divided by (b) one minus the Reserve Requirement (expressed as a decimal) applicable to such Interest
Period, plus (ii) the Applicable Margin. 
 “Event of Default” is defined in Article VII.

 “Excluded Subsidiaries” means, collectively, (a) each Financial Service Subsidiary and any other
Subsidiary which is not in the homebuilding business, (b) Joint Ventures, (c) Partners Insurance Company, Inc., a Hawaii corporation, and its successors and assigns and (d) any Wholly-Owned Subsidiary that is prohibited from becoming
a Guarantor as a result of any requirement of law, rule or regulation binding on such Subsidiary. 
 “Excluded Swap
Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap
Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of
such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guarantee of such Guarantor or the grant of such security
interest becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps
for which such Guarantee or security interest is or becomes illegal. 
 “Excluded Taxes” means, in the case
of each Lender or applicable Lending Installation, the LC Issuer, and the Administrative Agent, (i) Taxes imposed on its overall net income, franchise Taxes, and branch profits Taxes imposed on it, by the respective jurisdiction under the laws
of which such Lender, the LC Issuer or the Administrative Agent is incorporated or is organized or in which its principal executive office is located or, in the case of a Lender, in which such Lender’s applicable Lending Installation is
located, (ii) in the case of a Non-U.S. Lender, any withholding tax that is imposed on amounts payable to such Non-U.S. Lender pursuant to the laws in effect at the time such Non-U.S. Lender becomes a party to this Agreement or designates a new
Lending Installation, except in each case to the extent that, pursuant to Section 3.5(a), amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such
Lender immediately before it changed its Lending Installation, or is attributable to the Non-U.S. Lender’s failure to comply with Section 3.5(f), and (iii) any U.S. federal withholding taxes imposed by FATCA. 

  
 -12- 

 “Exhibit” refers to an exhibit to this Agreement, unless another
document is specifically referenced. 
 “Facility LC” is defined in Section 2.19(a) 

“Facility LC Application” is defined in Section 2.19(c). 

“Facility LC Collateral Account” is defined in Section 2.19(k). 

“Facility Termination Date” means March 23, 2018. 

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

“Federal Funds Effective Rate” means, for any day, an interest rate per annum equal to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published for such day (or, if such day is not a Business Day, for the immediately preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations at approximately 10:00 a.m. (New York City time) on such day on such transactions received by the
Administrative Agent from three (3) Federal funds brokers of recognized standing selected by the Administrative Agent in its sole discretion. 

“Fee Letter” means that certain letter agreement regarding the mandate for this Agreement dated March 23,
2015 between the Borrower and the Arrangers and the Administrative Agent. 
 “Financial Letter of
Credit” means a standby Letter of Credit that is not a Performance Letter of Credit, and serves as credit support for the repayment of financial obligations (and does not include trade Letters of Credit). 

“Financial Services Subsidiary” means a Subsidiary engaged exclusively in mortgage banking (including mortgage
origination, loan servicing, mortgage broker and title and escrow businesses), master servicing and related activities, including, without limitation, a Subsidiary which facilitates the financing of mortgage loans and mortgage-backed securities and
the securitization of mortgage-backed bonds and other activities ancillary thereto. 
 “Finished Lots”
means Entitled Land that has been subdivided into Lots and as to which (a) a final subdivision plat or map has been approved by all applicable Governmental Authorities and recorded in all appropriate records, (b) Borrower (or any Loan
Party) has legal and physical access to all Lots sufficient to commence vertical construction of the applicable Units thereon, (c) utilities have been stubbed and utility services are available (subject only to completion of the Units) to each
Lot in accordance with the applicable requirements of Governmental Authorities, (d) the building permits for the construction of Units may be promptly pulled and construction commenced by Borrower (or any Loan Party) without satisfaction of any
further material conditions, and (e) all offsite construction and all major infrastructure required to be completed  

  
 -13- 

 
by an Applicable Law as a condition of commencing vertical construction on the applicable Lot or Lots have been substantially completed in compliance with Applicable Law. As used in this
definition of “Finished Lots,” “substantially completed” shall not include the completion of any punch list work with respect to the foregoing items of work, warranty work required by any Governmental Authority
having jurisdiction or the final lift of the street on which such Lots are located. 
 “Fronting
Exposure” means, at any time there is a Defaulting Lender, (a) with respect to the LC Issuer, such Defaulting Lender’s ratable share of the LC Obligations with respect to Facility LCs issued by the LC Issuer other than LC
Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to any Swingline Lender, such Defaulting
Lender’s ratable share of outstanding Swingline Loans made by such Swingline Lender other than Swingline Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders. 

“Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing,
holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business. 

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States,
applied in a manner consistent with that used in preparing the financial statements referred to in Section 5.4, subject at all times to Section 9.8. 

“Governmental Approvals” means all authorizations, consents, approvals, licenses and exemptions of,
registrations and filings with, and reports to, all Governmental Authorities. 
 “Governmental
Authority” means any national, state or local government (whether domestic or foreign), any political subdivision thereof or any other governmental, quasi-governmental, judicial, public or statutory instrumentality, authority, body,
agency, bureau or entity (including, without limitation, the Federal Deposit Insurance Corporation, the Comptroller of the Currency or the Federal Reserve Board, any central lender or any comparable authority) or any arbitrator with authority to
bind a party at law. 
 “Guarantors” means the collective reference to all Wholly-Owned Subsidiaries of
Borrower the assets of which are included in the Borrowing Base, the Initial Non-Wholly Owned Guarantors and all other Subsidiaries of Borrower who are party to the Guaranty. The original Guarantors are indicated on Schedule 1(b) to this Agreement.

 “Guaranty” means that certain Guaranty Agreement, substantially in the form of Exhibit B
attached hereto to be executed by the Guarantors in favor of the Lenders, as it may be amended or modified and in effect from time to time. 

“Hazardous Materials” means all or any of the following: (a) substances that are defined or listed in, or
otherwise classified pursuant to, any applicable Environmental Laws as “hazardous substances”, “hazardous materials”, “hazardous wastes”, “toxic substances” or any other formulation intended to define, list or
classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, 

  
 -14- 

 
“TCLP” toxicity, or “EP toxicity”; (b) oil, petroleum or petroleum derived substances, natural gas, natural gas liquids or synthetic gas and drilling fluids, produced
waters and other wastes associated with the exploration, development or production of crude oil, natural gas or geothermal resources; (c) any flammable substances or explosives or any radioactive materials; (d) asbestos in any form; and
(e) electrical equipment which contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of fifty parts per million. 

“Highest Lawful Rate” means, on any day, the maximum non-usurious rate of interest permitted for that day by
applicable federal or state law stated as a rate per annum. 
 “Increasing Lender” is defined in
Section 2.23. 
 “Indebtedness” of a Person means, without duplication, such Person’s
(i) obligations for borrowed money (including the Obligations hereunder), (ii) obligations representing the deferred purchase price of property (other than (x) accounts payable and other accrued liabilities arising in the ordinary
course of such Person’s business and (y) any obligation to pay a contingent purchase price, as long as such obligation remains contingent or exists on the balance sheet of such Person on a non-interest accruing basis and is paid within 45
days of the date such obligation becomes non-contingent or a liability on the balance sheet), (iii) obligations, whether or not assumed, secured by Liens or payable out of the proceeds or production from Property now or hereafter owned or
acquired by such Person, (iv) obligations which are evidenced by notes, acceptances, or other instruments, (v) obligations of such Person to purchase securities or other Property arising out of or in connection with the sale of the same or
substantially similar securities or Property, (vi) Capitalized Lease Obligations, (vii) obligations of such Person for the reimbursement of any obligor on any standby and commercial Letters of Credit (other than obligations with respect to
Letters of Credit securing obligations (other than obligations described in clauses (i), (ii) or (vi) above) entered into in the ordinary course of business of such Person to the extent such letters of credit are not drawn upon or, if and
to the extent drawn upon, such drawing is reimbursed no later than the 10th Business Day following payment on the Letter of Credit), (viii) Contingent Obligations of such Person in respect of obligations otherwise described in clauses
(i)-(vii), (ix) Net Mark-to-Market Exposure under Rate Management Transactions, and (x) any other obligation for borrowed money or other indebtedness which in accordance with GAAP would be shown as a liability on the consolidated balance
sheet of such Person. Notwithstanding the foregoing, guarantees constituting Specified Obligations shall not constitute Indebtedness. 

“Indemnified Taxes” means Taxes imposed on or with respect to any payment made by or on account of any
obligation of any Loan Party under any Loan Document, other than Excluded Taxes and Other Taxes. 

“Indenture” means the Indenture dated as of May 10, 2011 among Shea Homes Limited Partnership and Shea
Homes Funding Corp., as Issuers, Wells Fargo Bank, a National Association, as Trustee, and the Guarantors named therein, as it may be amended, restated, supplemented or otherwise modified from time to time. 

“Indenture Notes Obligations” means the “Notes Obligations,” as defined in the Indenture. 

  
 -15- 

 “Initial Non-Wholly-Owned Guarantors” means Shea Homes Arizona
Limited Partnership and Shea Riverpark Developers, LLC. 
 “Interest Coverage Ratio” means, as of any
date, for the applicable period, the ratio of (a) Consolidated EBITDA to (b) Consolidated Interest Incurred. 

“Interest Period” means, with respect to a Eurocurrency Advance, a period of one (1), two (2), three (3) or six
(6) months commencing on a Business Day selected by the Borrower pursuant to this Agreement. Such Interest Period shall end on the day which corresponds numerically to such date one (1), two (2), three (3) or six (6) months
thereafter, provided, however, that if there is no such numerically corresponding day in such next, second, third or sixth succeeding month, such Interest Period shall end on the last Business Day of such next, third or sixth
succeeding month. If an Interest Period would otherwise end on a day which is not a Business Day, such Interest Period shall end on the next succeeding Business Day, provided, however, that if said next succeeding Business Day falls in
a new calendar month, such Interest Period shall end on the immediately preceding Business Day. No Interest Period may end after the Facility Termination Date. 

“Investment” means (a) the purchase or other acquisition of capital stock or other securities of another
Person, (b) a loan, advance, extension or credit (by way of guaranty or otherwise) or capital contribution to another Person or (c) the purchase or other acquisition of assets of another Person that constitute a business unit. For purposes
hereof, the Book Value of any Investment shall be calculated in accordance with GAAP. 
 “Joint Venture”
means a corporation, partnership, limited liability company, joint venture or similar legal entity (a) formed by the Borrower or any other Loan Party to engage in the business of homebuilding or a related business, and (b) in which a
Person other than the Borrower or another Loan Party has an ownership interest, whether or not Borrower is required to consolidate such entity in its financial statements in accordance with GAAP. 

“Land Assets” means the value, as determined on a consolidated basis in accordance with GAAP, of all real
estate assets owned by Borrower and/or any of its Subsidiaries which constitute raw land or are in the nature of Entitled Land, Land Under Development and/or Finished Lots on which no vertical improvements are located and no construction of any such
vertical improvements has commenced. 
 “Land Under Development” means Entitled Land where (a) a
tentative subdivision plat or map has been approved by all applicable Governmental Authorities to the extent necessary to permit the development of such Entitled Land, (b) all governmental permits, consents and other Governmental Approvals have
been obtained to permit the commencement and grading of such Entitled Land as necessary to improve such Entitled Land to a Finished Lot, (c) all fees required in connection with such licenses, permits, Governmental Approvals and grading have
been paid, (d) no material impediments exist to the issuance of all further permits, licenses or Governmental Approvals necessary or appropriate in connection with the development of utilities, infrastructure and other physical site
improvements on such Lots, and (e) physical site improvement has commenced. 

  
 -16- 

 “LC Fee” is defined in Section 2.19(d). 

“LC Issuer” means U.S. Bank (or any subsidiary or affiliate of U.S. Bank designated by U.S. Bank) in its
capacity as issuer of Facility LCs hereunder, and any other Lender approved by Administrative Agent (such consent not to be unreasonably withheld) and Borrower that has agreed in its sole discretion to act as an LC Issuer hereunder, or any of their
respective subsidiaries or affiliates, in each case in its capacity as an issuer of Facility LC’s hereunder. Each reference herein to the “LC Issuer” shall be deemed to be a reference to the relevant LC Issuer. 

“LC Obligations” means, at any time, the sum, without duplication, of (i) the aggregate undrawn stated
amount under all Facility LCs outstanding at such time plus (ii) the aggregate unpaid amount at such time of all Reimbursement Obligations. 

“LC Payment Date” is defined in Section 2.19(e). 

“Lenders” means the lending institutions listed on the signature pages of this Agreement and any Augmenting
Lender and their respective successors and assigns (and includes, as the context requires, the Swingline Lender). 

“Lending Installation” means, with respect to a Lender or the Administrative Agent, the office, branch,
subsidiary or affiliate of such Lender or the Administrative Agent listed on the signature pages hereof (in the case of the Administrative Agent) or on its Administrative Questionnaire (in the case of a Lender) or otherwise selected by such Lender
or the Administrative Agent pursuant to Section 2.17. 
 “Letter of Credit” means a letter of credit
or similar instrument which is issued upon the application of Borrower or for which the Borrower or any other Loan Party is an account party or for which such Person is in any way liable. Letters of Credit shall be issued only for the account of a
Loan Party in compliance with Section 2.19. 
 “Lien” means any lien (statutory or other),
mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, the interest of a vendor
or lessor under any conditional sale, Capitalized Lease or other title retention agreement). 
 “Loan”
means, with respect to a Lender, such Lender’s loan made pursuant to its commitment to lend set forth in Section 2.1 (or any conversion or continuation thereof), or, with respect to Swingline Lender, any Swingline Loan made by Swingline
Lender. 
 “Loan Documents” means this Agreement, the Fee Letter, the Facility LC Applications, the
Guaranty, any Note or Notes executed by the Borrower in connection with this Agreement and payable to a Lender, and any other document or agreement, now or in the future, executed by the Borrower for the benefit of the Administrative Agent or any
Lender in connection with this Agreement. 

  
 -17- 

 “Loan Party” or “Loan Parties” means,
individually or collectively, the Borrower and the Guarantors. 
 “Loan Party Ownership Percentage”
means the percentage of ownership of Borrower and any Wholly-Owned Subsidiary of Borrower in a Non-Wholly-Owned Subsidiary. 

“Lot” or “Lots” means an individual residential lot designated on the final subdivision
plat, map or filing (or in the case of Land Under Development, an individual lot designated on an approved tentative tract map, preliminary plat map, preliminary subdivision plat or similar plat or map). 

“Marketable Securities” means (a) equity securities that are listed on the New York Stock Exchange, the
American Stock Exchange or The Nasdaq Stock Market and (b) debt securities that are rated by a nationally recognized rating agency, listed on the New York Stock Exchange or covered by at least two reputable market makers. 

“Material Adverse Effect” means a material adverse effect on (i) the business, Property, liabilities (actual and
contingent), operations, financial condition or results of operations of the Loan Parties taken as a whole, (ii) the ability of the Loan Parties to perform their payment obligations under the Loan Documents, or (iii) the validity or
enforceability of any of the Loan Documents or the rights or remedies of the Administrative Agent, the LC Issuer or the Lenders under the Loan Documents. 

“Material Contract” means any contract or other arrangement (other than Loan Documents), whether written or
oral, to which Borrower or any other Loan Party is a party as to which the breach, nonperformance, cancellation or failure to renew by any party thereto could have a Material Adverse Effect. This definition of “Material Contract” is not
intended to include trade contracts. 
 “Material Indebtedness” means Indebtedness of the Borrower or
any Subsidiary in an outstanding principal amount of $25,000,000 or more in the aggregate (or the equivalent thereof in any currency other than Dollars). 

“Material Indebtedness Agreement” means any agreement under which any Material Indebtedness was created or is
governed or which provides for the incurrence of Indebtedness in an amount which would constitute Material Indebtedness (whether or not an amount of Indebtedness constituting Material Indebtedness is outstanding thereunder). 

“Minimum Collateral Amount” means, with respect to a Defaulting Lender, at any time, (i) with respect to Cash
Collateral consisting of cash or deposit account balances, an amount equal to 100% of the Fronting Exposure of the LC Issuer with respect to such Defaulting Lender for all Facility LCs issued and outstanding at such time and (ii) otherwise, an
amount determined by the Administrative Agent and the LC Issuer, but not to exceed 103% of such Fronting Exposure. 

“Model Unit” means a Completed Unit to be used as a model home in connection with the sale of Units in a
residential housing project. 

  
 -18- 

 “Modify” and “Modification” are defined in Section
2.19(a). 
 “Moody’s” means Moody’s Investors Service, Inc. 

“Multiemployer Plan” means a Plan maintained pursuant to a collective bargaining agreement or any other
arrangement to which the Borrower or any ERISA Affiliate is a party to which more than one employer is obligated to make contributions. 

“Net Cash Proceeds” means, in connection with any Equity Issuance, the cash proceeds received from such
issuance, net of attorneys’ fees, investment banking fees, accountants’ fees, underwriting discounts and commissions and other customary fees and expenses actually incurred in connection therewith. 

“Net Mark-to-Market Exposure” of a Person means, as of any date of determination, the excess (if any) of all
unrealized losses over all unrealized profits of such Person arising from Rate Management Transactions. “Unrealized losses” means the fair market value of the cost to such Person of replacing such Rate Management Transaction
as of the date of determination (assuming the Rate Management Transaction were to be terminated as of that date), and “unrealized profits” means the fair market value of the gain to such Person of replacing such Rate
Management Transaction as of the date of determination (assuming such Rate Management Transaction were to be terminated as of that date). 

“New Indenture” means, collectively, (i) the Indenture dated as of March 23, 2015 among Shea Homes
Limited Partnership and Shea Homes Funding Corp., as Issuers, Wells Fargo Bank, National Association, as Trustee, and the Guarantors named therein, with respect to the 5.875% Senior Notes due 2023, and (ii) the Indenture dated as of
March 23, 2015 among Shea Homes Limited Partnership and Shea Homes Funding Corp., as Issuers, Wells Fargo Bank, National Association, as Trustee, and the Guarantors named therein, with respect to the 6.125% Senior Notes due 2025, in each case,
as it may be amended, restated, supplemented or otherwise modified from time to time. 
 “New Indenture Notes
Obligations” means the “Notes Obligations” as defined in the New Indenture. 

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

 “Non-Recourse Indebtedness” means indebtedness or other obligations secured by a Lien on Property to
the extent that the liability for such indebtedness or other obligations is limited to the security of such Property (or to Persons other than a Loan Party) without liability on the part of any Loan Party (other than, in the case of indebtedness or
obligations of a Subsidiary, with respect to the Subsidiary that holds title to such property (if such property constitutes all or substantially all the property of such Subsidiary) and a pledge of the equity interests of such Subsidiary or its
Subsidiaries) for any deficiency; provided that recourse obligations or liabilities of the Loan Parties solely for indemnities, covenants (including, without limitation, performance, completion or similar guarantees or covenants), or breach of any
warranty, representation, covenant or other Contingent Obligation in respect of any indebtedness, including indemnities for and liabilities arising from fraud, misrepresentation, misapplication or 

  
 -19- 

 
non-payment of rents, profits, insurance and condemnation proceeds and other sums actually received by any Loan Party from secured assets to be paid to the Lenders, waste and mechanics’
liens, will in each case not prevent indebtedness from being classified as “Non-Recourse Indebtedness”. 

“Non-U.S. Lender” means a Lender that is not a United States person as defined in Section 7701(a)(30) of
the Code. 
 “Non-Wholly-Owned Subsidiary” means a Subsidiary that is not a Wholly-Owned
Subsidiary. 
 “Note” is defined in Section 2.13. 

“Obligations” means all unpaid principal of and accrued and unpaid interest on the Loans, all LC Obligations,
all obligations in connection with Cash Management Services, all Rate Management Obligations, all accrued and unpaid fees and all expenses, reimbursements, indemnities and other obligations of the Borrower to the Lenders or to any Lender, the
Administrative Agent, the LC Issuer or any indemnified party arising under the Loan Documents; provided that for purposes of determining any guaranteed Obligations of any Guarantor pursuant to the Guaranty Agreement, the definition of
“Obligations” shall not create any guarantee by any Guarantor of (or grant of security interest by any Guarantor to support, if applicable) any Excluded Swap Obligations. 

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar
Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document. 

“Outstanding Credit Exposure” means, as to any Lender at any time, the sum of (i) the aggregate principal
amount of its Loans (other than Swingline Loans) outstanding at such time, plus (ii) an amount equal to its Pro Rata Share of the LC Obligations at such time, plus (iii) an amount equal to its aggregate Swingline Exposure. 

“Participant” is defined in Section 12.2(a). 

“Participant Register” is defined in Section 12.2(c). 

“Payment Date” means the first day of each month occurring after the Effective Date. 

“PBGC” means the Pension Benefit Guaranty Corporation, or any successor thereto. 

“Performance Letter of Credit” means any standby Letter of Credit issued: (a) on behalf of a Person in
favor of a Governmental Authority, including, without limitation, any utility, water, or sewer authority, or other similar entity, for the purpose of assuring such Governmental Authority that such Person or other Loan Party will properly and timely
complete work it has agreed to perform for the benefit of such Governmental Authority; (b) in lieu of cash deposits to obtain a license, in place of a utility deposit, or for land option contracts; or (c) in lieu of other contract
performance, to secure performance warranties payable upon breach, and to 

  
 -20- 

 
secure the performance of labor and materials, including, without limitation, construction, bid, and performance bonds (and does not include trade Letters of Credit). 

“Permitted Holders” means, collectively, John F. Shea, Peter O. Shea, Peter O. Shea, Jr., Mary Shea, John
Morrissey and their respective family trusts, spouses, sons and daughters and lineal descendants, siblings and other familial relatives of any of them, including any corporation, limited liability companies or other entities more than 50% of the
issued and outstanding equity interests of which are held, directly or indirectly, by any of the foregoing persons. 

“Permitted Liens” means, as to the Borrower or any Guarantor, any of the following: 

(i) Liens for taxes, assessments or governmental charges or levies on the Borrower’s or such Guarantor’s Property if the same
(A) shall not at the time be delinquent or thereafter can be paid without penalty, or (B) are not being foreclosed (or any such proceedings have been stayed), are being contested in good faith and by appropriate proceedings, the encumbered
Property is not (in Administrative Agent’s reasonable determination) in danger of being lost or forfeited by reason thereof, and for which adequate reserves shall have been established on the Borrower’s or such Guarantor’s books in
accordance with GAAP. 
 (ii) Liens imposed by law, such as carriers’, warehousemen’s, mechanics’ and materialmen’s
Liens and other similar Liens arising in the ordinary course of business with respect to amounts that either (A) are not yet delinquent, or (B) are delinquent but are not being foreclosed (or any such proceedings have been stayed), are
being contested in a timely manner in good faith by appropriate proceedings and the encumbered Property is not (in Administrative Agent’s reasonable determination) in danger of being lost or forfeited by reason thereof, and for which adequate
reserves shall have been established on the Borrower’s or Guarantor’s books in accordance with GAAP. 
 (iii) Utility easements,
rights of way, zoning restrictions, licenses, covenants, conditions, restrictions, reservations, and such other burdens, encumbrances (but not for borrowed money) or charges against real property, or other minor irregularities of title which are not
unusual with respect to properties of a similar character and which do not in any material way interfere with the use or value thereof or the sale thereof in the ordinary course of business of the Borrower or such Guarantor. 

(iv) Easements, dedications, assessment district or similar Liens in connection with municipal or special district financing, agreements with
adjoining landowners or state or local government authorities and other similar encumbrances or charges, in each case reasonably necessary or appropriate for the development of real property of the Borrower or such Guarantor, and which are granted
in the ordinary course of the business of the Borrower or such Guarantor, and which in the aggregate do not materially burden or impair the fair market value, sale or use of such real property (or the project to which it is related) for the purposes
for which it is or may reasonably be expected to be held. 

  
 -21- 

 (v) Any option or right of first refusal to purchase real property granted to the master
developer or the seller of real property that arises as a result of the non-use or non-development of such real property by the Borrower or such Guarantor. 

(vi) Any arrangement (commonly referred to in the real estate industry (and defined herein) as “PAPAs”) in conjunction with any
agreement or contract for the purchase of real property, which provides for future payments due to the sellers of such real property after a specified period of time following such acquisition or at the time of the sale of Finished Lots or Units,
and which payments may be contingent on the sale price of such Finished Lots or Units, which arrangement may include (1) adjustments to the land purchase price, (2) community marketing fees and community enhancement fees,
(3) reimburseable costs paid by the developer, (4) participations in the appreciation or profit, and (5) fixed minimum amounts in respect of such arrangements and true-up payments, in each case under (1) through (5) paid
from amounts in excess of Book Value or to pay lot premiums in excess of Book Value, in each case derived from the sale of Finished Lots or Units, and granted in the ordinary course of business. 

(vii) Easements, exceptions, reservations, or other agreements for the purpose of facilitating the joint or common use of property affecting
real property which in the aggregate do not materially burden or impair the fair market value or use of such property for the purposes for which it is or may reasonably be expected to be held. 

(viii) Rights reserved to or vested in any Governmental Authority to control or regulate the use of any real property. 

(ix) Liens for homeowner and property owner association developments and assessments if (A) the obligations secured by such Liens are not
delinquent or thereafter can be paid without penalty, or (B) such Liens are not being foreclosed (or any such proceedings have been stayed), are being contested in good faith and by appropriate proceedings, the Property encumbered thereby is
not (in Administrative Agent’s reasonable determination) in danger of being lost or forfeited by reason thereof, and adequate reserves therefor shall have been established on the Borrower’s or such Guarantor’s books in accordance with
GAAP. 
 “Person” means any natural person, corporation, firm, joint venture, partnership, limited liability
company, association, enterprise, trust or other entity or organization, or any government or political subdivision or any agency, department or instrumentality thereof. 

“Plan” means an employee pension benefit plan which is covered by Title IV of ERISA or subject to the minimum
funding standards under Section 412 of the Code as to which the Borrower or any ERISA Affiliate may have any liability. 

“Pricing Schedule” means the Schedule attached hereto identified as such. 

“Prior Credit Agreement” means that certain Credit Agreement dated as of February 20, 2014, by and among
Shea Homes Limited Partnership, as Borrower, and U.S. Bank National Association, as Administrative Agent, and the other Lenders party thereto. 

“Pro Rata Share” means, with respect to a Lender, a portion equal to a fraction the numerator of which is such
Lender’s Commitment and the denominator of which is the  

  
 -22- 

 
Aggregate Commitment, provided, however, if all of the Commitments are terminated pursuant to the terms of this Agreement, then “Pro Rata
Share” means the percentage obtained by dividing (a) such Lender’s Outstanding Credit Exposure at such time by (b) the Aggregate Outstanding Credit Exposure at such time; and provided,
further, that when a Defaulting Lender shall exist, “Pro Rata Share” shall mean the percentage of the Aggregate Commitment (disregarding any Defaulting Lender’s Commitment) represented by such
Lender’s Commitment. 
 “Project” means a parcel or parcels of real property owned by Borrower or
any other Loan Party which is comprised of (or will be comprised of) a discrete single family residential development on which will be developed Lots for the construction of Units to be sold to individual buyers or sales of Lots in bulk to other
developers. 
 “Property” of a Person means any and all property, whether real, personal, tangible,
intangible, or mixed, of such Person, or other assets owned, leased or operated by such Person. 
 “Public
Indebtedness” means Indebtedness evidenced by notes, debentures, or other similar instruments issued after the date of this Agreement pursuant to either (i) a registered public offering or (ii) a private placement of such
instruments in accordance with an exemption from registration under the Securities Act of 1933 and/or the Securities Exchange Act of 1934 or similar law. 

“Purchasers” is defined in Section 12.3(a). 

“Qualified Real Property Inventory” means, as of any date, Real Property Inventory that is not subject to or
encumbered by any deed of trust, mortgage, judgment Lien, or any other Lien (other than Permitted Liens and other Liens which have been bonded around so as to remove such Liens as encumbrances against such Real Property Inventory in a matter
satisfactory to Administrative Agent and its legal counsel). 
 “Rate Management Obligations” of a
Person means any and all obligations of such Person, whether absolute or contingent and howsoever and whomsoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under
(i) any and all Rate Management Transactions, and (ii) any and all cancellations, buy backs, reversals, terminations or assignments of any Rate Management Transactions. 

“Rate Management Transaction” means any transaction (including an agreement with respect thereto) now existing
or hereafter entered by any Loan Party or any Subsidiary of a Loan Party which is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest
rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, forward transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any
option with respect to any of these transactions) or any combination thereof, whether linked to one or more interest rates, foreign currencies, commodity prices, equity prices or other financial measures. 

“Real Property Inventory” means, as of any date, land that is owned by any Loan Party, which land is being
developed or held for future development or sale of residential housing  

  
 -23- 

 
Projects, together with the right, title and interest of the Loan Party in and to the streets, the land lying in the bed of any streets, roads or avenues, open or proposed, in or of, the air
space and development rights pertaining thereto and the right to use such air space and development rights, all rights of way, privileges, liberties, tenements, hereditaments and appurtenances belonging in or in any way appertaining thereto, all
fixtures, all easements now or hereafter benefiting such land and all royalties and rights appertaining to the use and enjoyment of such land necessary for the residential development of such land, together with all of the buildings and other
improvements now or hereafter erected on such land, and any fixtures appurtenant thereto and all related personal property. 

“Refinancing Indebtedness” means Indebtedness that refunds, refinances or extends any Indebtedness (or that
refunds, refinances or extends any refund, refinancing or extension of such Indebtedness) (such Indebtedness, the “Refinanced Indebtedness”), but only to the extent that: 

 

	 	(i)	the Refinancing Indebtedness is subordinated to or pari passu with the Obligations (or a Guarantor’s obligations under its Guaranty, as applicable) to the same extent as the Indebtedness being refunded, refinanced
or extended, 

  

	 	(ii)	the Refinancing Indebtedness is scheduled to mature no earlier than the then current maturity date of such Indebtedness, 

  

	 	(iii)	such Refinancing Indebtedness is in an aggregate principal amount (or, if incurred with original issue discount, an aggregate issue price) that is equal to or less than the sum of the aggregate amount then outstanding
plus all amounts committed but undisbursed under the Indebtedness being refunded, refinanced or extended, plus all fees (including, any premiums, if any), costs and expenses incurred in connection with the incurrence of such Refinancing
Indebtedness, 

  

	 	(iv)	One or more Loan Parties (or successor(s) thereto) were liable for the Indebtedness being refunded, refinanced or extended when such Indebtedness was initially incurred, and 

 

	 	(v)	to the extent that the Refinanced Indebtedness is repaid in connection with the Refinancing Indebtedness, such Refinancing Indebtedness is incurred within 120 days after such repayment. 

“Refunded Swingline Loans”: as defined in Section 2.27(b). 

“Register” is defined in Section 12.3(d). 

“Regulation D” means Regulation D of the Board of Governors of the Federal Reserve System as from time to time
in effect and any successor thereto or other regulation or official interpretation of said Board of Governors relating to reserve requirements applicable to member banks of the Federal Reserve System. 

“Regulation U” means Regulation U of the Board of Governors of the Federal Reserve System as from time to time
in effect and any successor or other regulation or official interpretation of said Board of Governors relating to the extension of credit by banks for the  

  
 -24- 

 
purpose of purchasing or carrying margin stocks applicable to member banks of the Federal Reserve System. 

“Reimbursement Obligations” means, at any time, the aggregate of all obligations of the Borrower then
outstanding under Section 2.19 to reimburse the LC Issuer for amounts paid by the LC Issuer in respect of any one or more drawings under Facility LCs. 

“Reports” is defined in Section 9.6. 

“Required Lenders” means Lenders in the aggregate having greater than 50% of the Aggregate Commitment or, if
the Aggregate Commitment has been terminated, Lenders in the aggregate holding greater than 50% of the Aggregate Outstanding Credit Exposure. The Commitments and Outstanding Credit Exposure of any Defaulting Lender shall be disregarded in
determining Required Lenders at any time. If there are then more than two (2) Lenders hereunder, “Required Lenders” shall be a minimum of two (2) Lenders. 

“Reserve Requirement” means, with respect to an Interest Period, the maximum aggregate reserve requirement
(including all basic, supplemental, marginal and other reserves) which is imposed under Regulation D on Eurocurrency liabilities. 

“Risk-Based Capital Guidelines” means (i) the risk-based capital guidelines in effect in the United States
on the date of this Agreement, including transition rules, and (ii) the corresponding capital regulations promulgated by regulatory authorities outside the United States, including transition rules, and, in each case, any amendments to such
regulations. 
 “S&P” means Standard & Poor’s Ratings Services, a
Standard & Poor’s Financial Services LLC business. 
 “Schedule” refers to a specific
schedule to this Agreement, unless another document is specifically referenced. 
 “SEC” means the
Securities and Exchange Commission, any successor thereto and any analogous Governmental Authority. 

“Section” means a numbered section of this Agreement, unless another document is specifically referenced.

 “Specified Obligations” means (1) interest-coverage, re-margin and completion guarantees with respect to
any joint venture in which Borrower or any Subsidiary has a direct or an indirect equity interest, (2) customary “bad-boy” guarantees, (3) guarantees of Affiliate Obligations existing on the Effective Date (and any extension,
modification or replacement of such Affiliate Obligation provided that such extension, modification or replacement does not increase the obligations of the Borrower or any Subsidiary with respect to such Affiliate Obligations) and (4) tax
payments (including interest and penalties) or tax distributions, as applicable, attributable to any U.S. Federal income tax proceeding (whether or not still contested or subject to appeal) regarding the completed contract method (as defined in U.S.
Treasury Regulation Section 1.460-4(d)) of accounting for periods prior to 2011 (other than any increase in taxes payable for periods after 2010 as a result of such proceeding). 

  
 -25- 

 “Speculative Unit” means any Completed Unit that is not a Unit
Under Contract. Speculative Units shall not include Model Units. 
 “Stated Rate” is defined in
Section 2.21. 
 “Subordinated Debt” means any Indebtedness of any Loan Party which is contractually
subordinated in right of payment to the Obligations at all times (including in respect of any amendment or modification thereto) pursuant to terms reasonably satisfactory to the Administrative Agent. 

“Subsidiary” of a Person means (i) any corporation more than 50% of the outstanding securities having
ordinary voting power of which shall at the time be owned or controlled, directly or indirectly, by such Person or by one or more of its Subsidiaries or by such Person and one or more of its Subsidiaries, or (ii) any partnership, limited
liability company, association, joint venture or similar business organization more than 50% of the ownership interests having ordinary voting power of which shall at the time be so owned or controlled. Unless otherwise expressly provided, all
references herein to a “Subsidiary” shall mean a Subsidiary of the Borrower. 
 “Substantial
Portion” means, with respect to any Loan Party, Property which represents more than 10% of the consolidated assets of the Borrower and its Subsidiaries taken as a whole or Property which is responsible for more than 10% of the
Consolidated Net Income of the Borrower and its Subsidiaries taken as a whole, in each case, as would be shown in the consolidated financial statements of the Borrower and its Subsidiaries as at the beginning of the twelve-month period ending with
the month in which such determination is made (or if financial statements have not been delivered hereunder for that month which begins the twelve-month period, then the financial statements delivered hereunder for the quarter ending immediately
prior to that month). 
 “Swap Obligation” means, with respect to any Guarantor, any obligation to pay
or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.  

“Swingline Commitment” means the obligation of the Swingline Lender to make Swingline Loans pursuant to
Section 2.26 in an aggregate principal amount at any one time outstanding not to exceed $25,000,000. 

“Swingline Exposure” means at any time, the aggregate principal amount of all Swingline Loans outstanding at
such time. The Swingline Exposure of any Lender in respect of any Swingline Loan shall be its Pro Rata Share of the principal amount of such Swingline Loan. 

“Swingline Lender” U.S. Bank, in its capacity as the lender of Swingline Loans. 

“Swingline Loans” has the meaning defined in Section 2.26. 

“Swingline Participation Amount” has the meaning defined in Section 2.27(c).  

  
 -26- 

 “Tax Distribution Agreement” means the Tax Distribution Agreement
dated as of May 10, 2011 among the Borrower, the direct and indirect holders of ownership interests in the Borrower, and each of the Persons party to the Sixth Amended and Restated Agreement of Limited Partnership of Shea Homes Limited
Partnership, dated as of April 1, 2005 (as amended, restated, supplemented or otherwise modified from time to time). 

“Tax Distributions” means, so long as the Borrower is treated as a passthrough or disregarded entity for United
States Federal income tax purposes, the distributions in respect of income taxes permitted under Section 2 of the Tax Distribution Agreement as in effect on May 10, 2011. 

“Taxes” means any and all present or future taxes, duties, levies, imposts, deductions, fees, assessments,
charges or withholdings, and any and all liabilities with respect to the foregoing, including interest, additions to tax and penalties applicable thereto. 

“Term Out Period” shall have the meaning set forth in Section 2.25. 

“Transferee” has the meaning set forth in Section 12.3(e). 

“Type” means, with respect to any Advance, its nature as a Daily Eurocurrency Advance or a Eurocurrency Advance
and with respect to any Loan, its nature as a Daily Eurocurrency Loan or a Eurocurrency Loan. 
 “Undrawn
Fee” is defined in Section 2.5. 
 “Unit” means Qualified Real Property Inventory on
Entitled Land that is, or is planned to be, comprised of a single family residential housing unit offered for sale. 

“Units Under Construction” means Units for which building permits have been issued where on-site construction
has commenced on a Finished Lot as evidenced by the trenching of foundations for such Units. 
 “Unit Under
Contract” means a Completed Unit or a Unit Under Construction for which building permits have been issued as to which a Loan Party owning such Unit has entered into a bona fide contract of sale (a) in a form customarily employed by
Borrower or such Loan Party, (b) for delivery not more than twenty-four (24) months after the date of such contract, (c) with a Person who is not a Subsidiary or Affiliate, (d) under which no Defaults then exist, (e) in the
case of (i) any Unit the purchase of which is to be financed in whole or in part by a loan insured by the Federal Housing Administration or guaranteed by the Veterans Administration, to Borrower’s or applicable Guarantor’s knowledge,
the applicable buyer shall have made, or will be required to make, the minimum down payment required (if any) under the rules of the relevant agency, and (ii) in all other cases, providing for a minimum down payment of $1,000, (f) not
subject to contingencies other than timely completion of the Unit, obtaining financing for the purchase and contingency related to the sale of the buyer’s existing residence, (g) and providing for a sale in compliance with all Applicable
Law and applicable restriction or requirements. 

  
 -27- 

 “Unrestricted Cash” means Cash Equivalent Investments of the Loan Parties
that are free and clear of all Liens (other than Liens securing (1) the Obligations, or (2) customary bankers liens) and not subject to any restrictions on the use thereof to pay Indebtedness and other obligations of the applicable Loan
Party. 
 “U.S. Bank” means U.S. Bank National Association, a national banking association, in its individual
capacity, and its successors. 
 “Wholly-Owned Subsidiary” of a Person means (i) any Subsidiary
of which 100% of the beneficial ownership interests shall at the time be owned or controlled, directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries of such Person, or by such Person and one or more Wholly-Owned Subsidiaries
of such Person, or (ii) any partnership, limited liability company, association, joint venture or similar business organization of which 100% of the beneficial ownership interests shall at the time be so owned or controlled. 

The foregoing definitions shall be equally applicable to both the singular and plural forms of the defined terms. 

ARTICLE II 
 THE
CREDITS 
 2.1 Commitment. From and including the date of this Agreement and prior to the Facility Termination Date, each
Lender severally agrees, on the terms and conditions set forth in this Agreement, to make Loans to the Borrower in Dollars and participate in Swingline Loans and Facility LCs issued upon the request of the Borrower, provided that, after
giving effect to the making of each such Loan and Swingline Loan, and the issuance of each such Facility LC, the amount of such Lender’s Outstanding Credit Exposure shall not exceed the lesser of (a) its Commitment or (b) its Pro Rata
Share of the Borrowing Base Availability at such time. Subject to the terms of this Agreement, the Borrower may borrow, repay and reborrow at any time prior to the earlier of the Facility Termination Date or the commencement of the Term Out Period
(the period commencing on the Effective Date and ending on such date, the “Commitment Period”). The Commitments to extend credit hereunder shall expire at the end of the Commitment Period. The LC Issuer will issue Facility LCs
hereunder on the terms and conditions set forth in Section 2.19. 
 2.2 Required Payments. If at any time the amount of the Aggregate
Outstanding Credit Exposure exceeds the lesser of (i) the Aggregate Commitment or (ii) the Borrowing Base Availability, the Borrower shall within 5 Business Days of such occurrence make a payment on the Obligations sufficient to eliminate
such excess. The Aggregate Outstanding Credit Exposure and all other unpaid Obligations shall be paid in full by the Borrower on the Facility Termination Date. 

2.3 Ratable Loans; Types of Advances. Each Advance hereunder shall consist of Loans made from the several Lenders ratably according to
their Pro Rata Shares. Each Advance shall be a Eurocurrency Advance except as provided in Sections 2.6, 2.8 and 2.9. 

  
 -28- 

 2.4 This Agreement Supersedes the Prior Credit Agreement. This Agreement and the Loan
Documents pertaining hereto and described herein replace and supersede in their entirety the Prior Credit Agreement and all “Loan Documents” described in the Prior Credit Agreement, effective as of the Effective Date specified herein. From
and after the Effective Date hereunder, all indebtedness and obligations owing under and evidenced by the Prior Credit Agreement and the “Loan Documents” described therein shall be deemed to be owing under, evidenced by and governed by
this Agreement and the Loan Documents described herein (provided, however, that the foregoing shall not be deemed to relieve or absolve the Borrower or any Guarantors under the Prior Credit Agreement from and for any continuing indemnity obligations
or similar obligations which by their terms survive the termination of the Prior Credit Agreement or the repayment of the monetary obligations owing thereunder). 

2.5 Undrawn Fee. The Borrower agrees to pay to the Administrative Agent for the account of each Lender according to its Pro Rata Share
a fee (the “Undrawn Fee”) at a per annum rate equal to the Applicable Undrawn Fee Rate per annum on the average daily Available Aggregate Commitment (subject to the following sentence) from the date hereof to and including the
Facility Termination Date, payable in arrears on the first day of each calendar quarter hereafter and on the Facility Termination Date. The Swingline Exposure shall not be taken into account in calculating the available Aggregate Commitment for the
purpose of determining the Undrawn Fee. 
 2.6 Minimum Amount of Each Advance. Each Eurocurrency Advance and Daily Eurocurrency
Advance shall be in the minimum amount of $500,000 and incremental amounts in integral multiples of $500,000, provided, however, that any Daily Eurocurrency Advance may be in the amount of the Available Aggregate Commitment or, if
less, the unused portion of the Borrowing Base Availability at such time. 
 2.7 Reductions in Aggregate Commitment; Optional Principal
Payments. The Borrower may permanently reduce the Aggregate Commitment in whole, or in part ratably among the Lenders in integral multiples of $1,000,000, upon at least five (5) Business Days’ written notice to the Administrative
Agent, which notice (1) may be conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by written notice to the Administrative Agent on or prior to the specified effective date
previously provided in the applicable notice) if such condition is not satisfied, and (2) shall specify the amount of any such reduction, provided, however, that the amount of the Aggregate Commitment may not be reduced below the
Aggregate Outstanding Credit Exposure. All accrued Undrawn Fees shall be payable on the effective date of any termination of the obligations of the Lenders to make Credit Extensions hereunder. The Borrower may from time to time pay, without
indemnity, penalty or premium, all outstanding Daily Eurocurrency Advances or, in a minimum aggregate amount of $1,000,000, any portion of the outstanding Daily Eurocurrency Advances upon same day notice to the Administrative Agent. The Borrower may
from time to time pay, subject to the payment of any funding indemnification amounts required by Section 3.4 but without penalty or premium, all outstanding Eurocurrency Advances, or, in a minimum aggregate amount of $1,000,000, any portion of
the outstanding Eurocurrency Advances upon three (3) Business Days’ prior written notice to the Administrative Agent. 

  
 -29- 

 2.8 Method of Selecting Types and Interest Periods for New Advances. The Borrower shall
give the Administrative Agent irrevocable notice in the form of Exhibit C (a “Borrowing Notice”) not later than 10:00 a.m. (Pacific time) three (3) Business Days before the Borrowing Date for each Advance, specifying:

 (i) the Borrowing Date, which shall be a Business Day, of such Advance, 

(ii) the aggregate amount of such Advance, 

(iii) the Type of Advance, and 

(iv) in the case of each Eurocurrency Advance, the Interest Period applicable thereto and, if no Interest Period is selected, such Advance
shall be a Daily Eurocurrency Advance. 
 Not later than 12:00 noon (Pacific time) on each Borrowing Date, each Lender shall make available its Loan or
Loans in funds immediately available to the Administrative Agent at its address specified pursuant to Article XIII. The Administrative Agent will make the funds so received from the Lenders available to the Borrower at the Administrative
Agent’s aforesaid address. 
 2.9 Conversion and Continuation of Outstanding Advances; Maximum Number of Interest Periods. Daily
Eurocurrency Advances shall continue as Daily Eurocurrency Advances unless and until such Daily Eurocurrency Advances are converted into Eurocurrency Advances pursuant to this Section 2.9 or are repaid in accordance with Section 2.7. Each
Eurocurrency Advance shall continue as a Eurocurrency Advance until the end of the then applicable Interest Period therefor, at which time (as of the last day of such Interest Period) such Eurocurrency Advance shall be automatically
converted into a Daily Eurocurrency Advance unless (x) such Eurocurrency Advance is or was repaid in accordance with Section 2.7 or (y) the Borrower shall have given the Administrative Agent a Conversion/Continuation Notice (as
defined below) requesting that, at the end of such Interest Period, such Eurocurrency Advance continue as a Eurocurrency Advance for the same or another Interest Period. Subject to the terms of Section 2.6, the Borrower may elect from time to
time to convert all or any part of a Daily Eurocurrency Advance into a Eurocurrency Advance. The Borrower shall give the Administrative Agent irrevocable notice (a “Conversion/Continuation Notice”) of each conversion of a
Daily Eurocurrency Advance into a Eurocurrency Advance, or continuation of a Eurocurrency Advance not later than 10:00 a.m. (Pacific time) at least three (3) Business Days prior to the date of the requested conversion or continuation,
specifying: 
 (i) the requested date, which shall be a Business Day, of such conversion or continuation, 

(ii) the Type of the Advance which is to be converted or continued, and 

(iii) the amount of such Advance which is to be converted into or continued as a Eurocurrency Advance and the duration of the Interest Period
applicable thereto. 

  
 -30- 

 After giving effect to all Advances, all conversions of Advances from one Type to another and all continuations
of Advances of the same Type, there shall be no more than five (5) Interest Periods in effect hereunder. 
 2.10 Interest Rates.
Each Eurocurrency Advance shall bear interest on the outstanding principal amount thereof from and including the first day of the Interest Period applicable thereto to but not including the last day of such Interest Period at the interest rate
determined by the Administrative Agent as applicable to such Eurocurrency Advance based upon the Borrower’s selections under Sections 2.8 and 2.9. Each Daily Eurocurrency Advance shall bear interest on the outstanding principal amount thereof
for each day from and including the date such Advance is made or converted in accordance with Section 2.9, but excluding the date it becomes or is converted to a Eurocurrency Advance, at a rate per annum equal to the Daily Eurocurrency Rate for
such day. Changes in the rate of interest on that portion of any Advance maintained as a Daily Eurocurrency Advance will take effect simultaneously with each change in the Daily Eurocurrency Base Rate, as applicable. 

2.11 Rates Applicable After Event of Default. 

(a) Notwithstanding anything to the contrary contained in Section 2.8, 2.9 or 2.10, during the continuance of a Default or Event of
Default the Required Lenders may, at their option, by notice to the Borrower (which notice may be revoked at the option of the Required Lenders notwithstanding any provision of Section 8.3 requiring unanimous consent of the Lenders to changes
in interest rates), declare that no Advance may be made as, converted into or continued as a Eurocurrency Advance (provided, however, that the foregoing shall not be deemed to modify the requirement of unanimous approval by all Lenders to waive any
payment defaults as specified in Section 8.3(a) hereof). Provided further, however, during the continuance of an Event of Default the Required Lenders may, at their option, by notice to the Borrower (which notice may be revoked at the option of
the Required Lenders notwithstanding any provision of Section 8.3 requiring unanimous consent of the Lenders to changes in interest rates), declare that (i) each Eurocurrency Advance shall bear interest for the remainder of the applicable
Interest Period at the rate otherwise applicable to such Interest Period plus 2.00% per annum, (ii) each Daily Eurocurrency Advance shall bear interest at a rate per annum equal to the Daily Eurocurrency Rate, in effect from time to time
plus 2.00% per annum, and (iii) the LC Fee shall be increased by 2.00% per annum, provided that, during the continuance of an Event of Default under Section 7.6 or 7.7, the interest rates set forth in clauses (i) and
(ii) above and the increase in the LC Fee set forth in clause (iii) above shall be applicable to all Credit Extensions without any election or action on the part of the Administrative Agent or any Lender. After an Event of Default has been
cured or waived, the interest rate applicable to advances and the LC Fee shall revert to the rates applicable prior to the occurrence of an Event of Default. 

2.12 Method of Payment. Each Advance shall be repaid and each payment of interest thereon shall be paid in Dollars. All payments of the
Obligations hereunder shall be made, without setoff, deduction, or counterclaim, in immediately available funds to the Administrative Agent at the Administrative Agent’s address specified pursuant to Article XIII, or at any other Lending
Installation of the Administrative Agent specified in writing by the Administrative Agent to the Borrower, by 12:00 noon (Pacific time) on the date when due and shall (except (i) in the case of Reimbursement Obligations for which the LC Issuer
has not been fully 

  
 -31- 

 
indemnified by the Lenders, or (ii) as otherwise specifically required hereunder) be applied ratably by the Administrative Agent among the Lenders. Each payment delivered to the
Administrative Agent for the account of any Lender shall be delivered promptly by the Administrative Agent to such Lender in the same type of funds that the Administrative Agent received at its address specified pursuant to Article XIII or at any
Lending Installation specified in a notice received by the Administrative Agent from such Lender. The Administrative Agent is hereby authorized to charge the account of the Borrower maintained with U.S. Bank for each payment of principal, interest,
Reimbursement Obligations and fees as it becomes due hereunder. Each reference to the Administrative Agent in this Section 2.12 shall also be deemed to refer, and shall apply equally, to the LC Issuer, in the case of payments required to be
made by the Borrower to the LC Issuer pursuant to Section 2.19(f). 
 2.13 Noteless Agreement; Evidence of Indebtedness. 

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

(b) The Administrative Agent shall also maintain accounts in which it will record (i) the amount of each Loan made hereunder, the Type
thereof and the Interest Period with respect thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder, (iii) the original stated amount of each Facility
LC and the amount of LC Obligations outstanding at any time, and (iv) the amount of any sum received by the Administrative Agent hereunder from the Borrower and each Lender’s share thereof. 

(c) The entries maintained in the accounts maintained pursuant to paragraphs (i) and (ii) above shall be prima facie evidence
of the existence and amounts of the Obligations therein recorded; provided, however, that the failure of the Administrative Agent or any Lender to maintain such accounts or any error therein shall not in any manner affect the
obligation of the Borrower to repay the Obligations in accordance with their terms. 
 (d) Any Lender may request that its Loans be
evidenced by a promissory note, representing its Loans substantially in the form of Exhibit D (each a “Note”). In such event, the Borrower shall prepare, execute and deliver to such Lender such Note payable to the order of
such Lender in a form supplied by the Administrative Agent. 
 2.14 Telephonic Notices. The Borrower hereby authorizes the Lenders
and the Administrative Agent to extend, convert or continue Advances, effect selections of Types of Advances and to transfer funds based on telephonic notices made by any person or persons the Administrative Agent or any Lender in good faith
believes to be acting on behalf of the Borrower, it being understood that the foregoing authorization is specifically intended to allow Borrowing Notices and Conversion/Continuation Notices to be given telephonically. The Borrower agrees to deliver
promptly to the Administrative Agent a written confirmation (which may include e-mail) of each telephonic notice authenticated by an Authorized Officer. If the written confirmation differs in any material respect from the action taken by the
Administrative 

  
 -32- 

 
Agent and the Lenders, the records of the Administrative Agent and the Lenders shall govern absent manifest error. The parties agree to prepare appropriate documentation to correct any such error
within ten (10) days after discovery by any party to this Agreement. 
 2.15 Interest Payment Dates; Interest and Fee Basis.
Interest accrued on each Advance shall be payable on each Payment Date, commencing with the first such Payment Date to occur after the date hereof and on any date on which such Advance is prepaid, whether by acceleration or otherwise, and at
maturity. Interest on all Advances and fees shall be calculated for actual days elapsed on the basis of a 360-day year. Interest shall be payable for the day an Advance is made but not for the day of any payment on the amount paid if payment is
received prior to 12:00 noon (Pacific time) at the place of payment. If any payment of principal of or interest on an Advance shall become due on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day. 

2.16 Notification of Advances, Interest Rates, Prepayments and Commitment Reductions. Promptly after receipt thereof, the
Administrative Agent will notify each Lender of the contents of each Aggregate Commitment reduction notice, Borrowing Notice, Conversion/ Continuation Notice, and repayment notice received by it hereunder. Promptly after notice from the LC Issuer,
the Administrative Agent will notify each Lender of the contents of each request for issuance of a Facility LC hereunder. The Administrative Agent will notify each Lender of the interest rate applicable to each Eurocurrency Advance promptly upon
determination of such interest rate and will give each Lender prompt notice of each change in the Daily Eurocurrency Rate. 
 2.17
Lending Installations. Each Lender may book its Advances and its participation in any LC Obligations and the LC Issuer may book the Facility LCs at any Lending Installation selected by such Lender or the LC Issuer, as the case may be, and may
change its Lending Installation from time to time. All terms of this Agreement shall apply to any such Lending Installation and the Loans, Facility LCs, participations in LC Obligations and any Notes issued hereunder shall be deemed held by each
Lender or the LC Issuer, as the case may be, for the benefit of any such Lending Installation. Each Lender and the LC Issuer may, by written notice to the Administrative Agent and the Borrower in accordance with Article XIII, designate replacement
or additional Lending Installations through which Loans will be made by it or Facility LCs will be issued by it and for whose account Loan payments or payments with respect to Facility LCs are to be made. 

2.18 Non-Receipt of Funds by the Administrative Agent. Unless the Borrower or a Lender, as the case may be, notifies the Administrative
Agent prior to the date on which it is scheduled to make payment to the Administrative Agent of (i) in the case of a Lender, the proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal, interest or fees to the
Administrative Agent for the account of the Lenders, that it does not intend to make such payment, the Administrative Agent may assume that such payment has been made. The Administrative Agent may, but shall not be obligated to, make the amount of
such payment available to the intended recipient in reliance upon such assumption. If such Lender or the Borrower, as the case may be, has not in fact made such payment to the Administrative Agent, the recipient of such payment shall, on demand by
the Administrative Agent, repay to the Administrative Agent the amount so made available together with interest thereon in respect of 

  
 -33- 

 
each day during the period commencing on the date such amount was so made available by the Administrative Agent until the date the Administrative Agent recovers such amount at a rate per annum
equal to (x) in the case of payment by a Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation or (y) in the case of
payment by the Borrower, the interest rate applicable to the relevant Loan. 
 2.19 Facility LCs. 

(a) Issuance. The LC Issuer hereby agrees, on the terms and conditions set forth in this Agreement, to issue Performance Letters of
Credit and Financial Letters of Credit denominated in Dollars (each, a “Facility LC”) and to renew, extend, increase, decrease or otherwise modify each Facility LC (“Modify,” and each such action a
“Modification”), from time to time from and including the date of this Agreement and prior to the Facility Termination Date upon the request of the Borrower; provided that immediately after each such Facility LC is
issued or Modified, (i) the aggregate amount of the outstanding LC Obligations shall not exceed 50% of the Aggregate Commitment at such time and (ii) the Aggregate Outstanding Credit Exposure shall not exceed the lesser of the Aggregate
Commitment and the Borrowing Base Availability at such time. No Facility LC shall have an expiry date later than the earlier to occur of (x) the fifth Business Day prior to the Facility Termination Date and (y) one (1) year after its
issuance; provided, however, that the expiry date of a Facility LC may be up to one (1) year later than the fifth Business Day prior to the Facility Termination Date if the Borrower has posted on or before the thirtieth (30th) day prior to the Facility Termination Date cash collateral in the Facility LC Collateral Account on terms satisfactory to the Administrative Agent in an amount equal to 100% of the LC
Obligations with respect to such Facility LC. Additionally, if the Term Out Period commences as set forth in Section 2.25 below, Borrower shall promptly post cash collateral in the Facility LC Collateral Account on terms satisfactory to the
Administrative Agent in an amount equal to 100% of the LC Obligations with respect to any Facility LC or LC Obligations that remain outstanding as of the date that the Term Out Period commences. Borrower may request of each LC Issuer that the LC
Issuer issue “Evergreen” letters of credit as the Facility LCs which automatically renew unless the LC Issuer provides notice to the Borrower that such LC Issuer is not renewing such Facility LC; and it shall be at the sole discretion of
each LC Issuer as to whether or not it will issue “Evergreen” letters of credit. 
 (b) Participations. Upon the issuance
or Modification by the LC Issuer of a Facility LC in accordance with this Section 2.19, the LC Issuer shall be deemed, without further action by any party hereto, to have unconditionally and irrevocably sold to each Lender, and each Lender
shall be deemed, without further action by any party hereto, to have unconditionally and irrevocably purchased from the LC Issuer, a participation in such Facility LC (and each Modification thereof) and the related LC Obligations in proportion to
its Pro Rata Share. 
 (c) Notice. Subject to Section 2.19(a), the Borrower shall give the Administrative Agent notice prior to
10:00 a.m. Pacific time at least five (5) Business Days prior to the proposed date of issuance or Modification of each Facility LC, specifying the beneficiary, the LC Issuer, the proposed date of issuance (or Modification) and the expiry date
of such Facility LC, and describing the proposed terms of such Facility LC and the nature of the transactions proposed to be supported thereby. Upon receipt of such notice, the Administrative 

  
 -34- 

 
Agent shall promptly notify the LC Issuer and each Lender, of the contents thereof and of the amount of such Lender’s participation in such proposed Facility LC. The issuance or Modification
by the LC Issuer of any Facility LC shall, in addition to the conditions precedent set forth in Article IV, be subject to the conditions precedent that such Facility LC shall be satisfactory to the LC Issuer and that the Borrower shall have executed
and delivered such application agreement and/or such other instruments and agreements relating to such Facility LC as the LC Issuer shall have reasonably requested (each, a “Facility LC Application”). The LC Issuer shall have no
independent duty to ascertain whether the conditions set forth in Article IV have been satisfied; provided, however, that the LC Issuer shall not issue a Facility LC if, on or before the proposed date of issuance, the LC Issuer shall
have received notice from the Administrative Agent or the Required Lenders that any such condition has not been satisfied or waived. In the event of any conflict between the terms of this Agreement and the terms of any Facility LC Application, the
terms of this Agreement shall control. 
 (d) LC Fees. The Borrower shall pay to the Administrative Agent, for the account of the
Lenders ratably in accordance with their respective Pro Rata Shares, with respect to each Facility LC, a letter of credit fee at a per annum rate equal to the Applicable Margin for Eurocurrency Loans in effect from time to time on the average daily
undrawn stated amount under such Facility LC, such fee to be payable in arrears on the third day of each calendar quarter (but, for the avoidance of doubt, each such payment shall be calculated as of the first day of each calendar quarter) (the
“LC Fee”). The Borrower shall also pay to the LC Issuer for its own account (x) a fronting fee in an amount equal to 0.125% per annum of the average daily undrawn stated amount under such Facility LC, such fee to be
payable in arrears on the third day of each calendar quarter (but, for the avoidance of doubt, each such payment shall be calculated as of the first day of each calendar quarter), and (y) on demand, all amendment, drawing and other fees
regularly charged by the LC Issuer to its letter of credit customers and all out-of-pocket expenses incurred by the LC Issuer in connection with the issuance, Modification, administration or payment of any Facility LC. 

(e) Administration; Reimbursement by Lenders. Upon receipt from the beneficiary of any Facility LC of any demand for payment under such
Facility LC, the LC Issuer shall notify the Administrative Agent and the Administrative Agent shall promptly notify the Borrower and each other Lender as to the amount to be paid by the LC Issuer as a result of such demand and the proposed payment
date (the “LC Payment Date”). The responsibility of the LC Issuer to the Borrower and each Lender shall be only to determine that the documents (including each demand for payment) delivered under each Facility LC in
connection with such presentment shall be in conformity in all material respects with such Facility LC. The LC Issuer shall endeavor to exercise the same care in the issuance and administration of the Facility LCs as it does with respect to letters
of credit in which no participations are granted, it being understood that in the absence of any gross negligence or willful misconduct by the LC Issuer, each Lender shall be unconditionally and irrevocably liable without regard to the occurrence of
any Event of Default or any condition precedent whatsoever, to reimburse the LC Issuer on demand for (i) such Lender’s Pro Rata Share of the amount of each payment made by the LC Issuer under each Facility LC to the extent such amount is
not reimbursed by the Borrower pursuant to Section 2.19(f) below and there are not funds available in the Facility LC Collateral Account to cover the same, plus (ii) interest on the foregoing amount to be reimbursed by such Lender,
for each day from the date of the LC Issuer’s demand for such reimbursement (or, if such demand is 

  
 -35- 

 
made after 11:00 a.m. (Pacific time) on such date, from the next succeeding Business Day) to the date on which such Lender pays the amount to be reimbursed by it, at a rate of interest per annum
equal to the Federal Funds Effective Rate for the first three (3) days and, thereafter, at a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation. 

(f) Reimbursement by Borrower. The Borrower shall be irrevocably and unconditionally obligated to reimburse the LC Issuer on or before
the applicable LC Payment Date (provided that the Borrower has received notice from the Administrative Agent of such LC Payment Date not later than 11:00 am Pacific time on the LC Payment Date, otherwise such amount shall be due on the Business Day
immediately following the date on which the Borrower receives such notice) for any amounts to be paid by the LC Issuer upon any drawing under any Facility LC, without presentment, demand, protest or other formalities of any kind; provided
that neither the Borrower nor any Lender shall hereby be precluded from asserting any claim for direct (but not consequential) damages suffered by the Borrower or such Lender to the extent, but only to the extent, caused by (i) the willful
misconduct or gross negligence of the LC Issuer in determining whether a request presented under any Facility LC issued by it complied with the terms of such Facility LC or (ii) the LC Issuer’s failure to pay under any Facility LC issued
by it after the presentation to it of a request strictly complying with the terms and conditions of such Facility LC. All such amounts paid by the LC Issuer and remaining unpaid by the Borrower shall bear interest, payable on demand, for each day
until paid at a rate per annum equal to the rate applicable to Daily Eurocurrency Advances for such day if such day falls on or before the applicable LC Payment Date. The LC Issuer will pay to each Lender ratably in accordance with its Pro Rata
Share all amounts received by it from the Borrower for application in payment, in whole or in part, of the Reimbursement Obligation in respect of any Facility LC issued by the LC Issuer, but only to the extent such Lender has made payment to the LC
Issuer in respect of such Facility LC pursuant to Section 2.19(e). Subject to the terms and conditions of this Agreement (including without limitation the submission of a Borrowing Notice in compliance with Section 2.8 and the satisfaction
of the applicable conditions precedent set forth in Article IV), the Borrower may request an Advance hereunder for the purpose of satisfying any Reimbursement Obligation. 

(g) Obligations Absolute. The Borrower’s obligations under this Section 2.19 shall be absolute and unconditional under any
and all circumstances and irrespective of any setoff, counterclaim or defense to payment which the Borrower may have or have had against the LC Issuer, any Lender or any beneficiary of a Facility LC. The Borrower further agrees with the LC Issuer
and the Lenders that the LC Issuer and the Lenders shall not be responsible for, and the Borrower’s Reimbursement Obligation in respect of any Facility LC shall not be affected by, among other things, the validity or genuineness of documents or
of any endorsements thereon, even if such documents should in fact prove to be in any or all respects invalid, fraudulent or forged, or any dispute between or among the Borrower, any of its Affiliates, the beneficiary of any Facility LC or any
financing institution or other party to whom any Facility LC may be transferred or any claims or defenses whatsoever of the Borrower or of any of its Affiliates against the beneficiary of any Facility LC or any such transferee. The LC Issuer shall
not be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Facility LC. The Borrower agrees that any action taken or omitted by the LC
Issuer or any Lender under or in connection 

  
 -36- 

 
with each Facility LC and the related drafts and documents, if done without gross negligence or willful misconduct, shall be binding upon the Borrower and shall not put the LC Issuer or any
Lender under any liability to the Borrower. Nothing in this Section 2.19(g) is intended to limit the right of the Borrower to make a claim against the LC Issuer for damages as contemplated by the proviso to the first sentence of
Section 2.19(f). 
 (h) Actions of LC Issuer. The LC Issuer shall be entitled to rely, and shall be fully protected in relying,
upon any Facility LC, draft, writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, facsimile, telex, teletype or electronic mail message, statement, order or other document believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel, independent accountants and other experts selected by the LC Issuer. The LC Issuer shall be fully justified in failing or
refusing to take any action under this Agreement unless it shall first have received such advice or concurrence of the Required Lenders as it reasonably deems appropriate or it shall first be indemnified to its reasonable satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. Notwithstanding any other provision of this Section 2.19, the LC Issuer shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement in accordance with a request of the Required Lenders, and such request and any action taken or failure to act pursuant thereto shall be binding upon the Lenders and any future holders of a
participation in any Facility LC. 
 (i) Indemnification. The Borrower hereby agrees to indemnify and hold harmless each Lender, the
LC Issuer and the Administrative Agent, and their respective directors, officers, agents and employees from and against any and all claims and damages, losses, liabilities, costs or expenses (including reasonable counsel fees and disbursements)
which such Lender, the LC Issuer or the Administrative Agent may incur (or which may be claimed against such Lender, the LC Issuer or the Administrative Agent by any Person whatsoever) by reason of or in connection with the issuance, execution and
delivery or transfer of or payment or failure to pay under any Facility LC or any actual or proposed use of any Facility LC, including, without limitation, any claims, damages, losses, liabilities, costs or expenses (including reasonable counsel
fees and disbursements) which the LC Issuer may incur by reason of or in connection with (i) the failure of any other Lender to fulfill or comply with its obligations to the LC Issuer hereunder (but nothing herein contained shall affect any
rights the Borrower may have against any Defaulting Lender) or (ii) by reason of or on account of the LC Issuer issuing any Facility LC which specifies that the term “Beneficiary” included therein includes any successor
by operation of law of the named Beneficiary, but which Facility LC does not require that any drawing by any such successor Beneficiary be accompanied by a copy of a legal document, satisfactory to the LC Issuer, evidencing the appointment of such
successor Beneficiary; provided that the Borrower shall not be required to indemnify any Lender, the LC Issuer or the Administrative Agent for any claims, damages, losses, liabilities, costs or expenses to the extent, but only to the extent, caused
by (x) the willful misconduct or gross negligence of the LC Issuer in determining whether a request presented under any Facility LC complied with the terms of such Facility LC or (y) the LC Issuer’s failure to pay under any Facility
LC after the presentation to it of a request strictly complying with the terms and conditions of such Facility LC. Nothing in this Section 2.19(i) is intended to limit the obligations of the Borrower under any other provision of this
Agreement. 

  
 -37- 

 (j) Lenders’ Indemnification. Each Lender shall, ratably in accordance with its Pro
Rata Share, indemnify the LC Issuer, its affiliates and their respective directors, officers, agents and employees (to the extent not reimbursed by the Borrower) against any cost, expense (including reasonable counsel fees and disbursements), claim,
demand, action, loss or liability (except such as result from such indemnitees’ gross negligence or willful misconduct or the LC Issuer’s failure to pay under any Facility LC after the presentation to it of a request strictly complying
with the terms and conditions of the Facility LC) that such indemnitees may suffer or incur in connection with this Section 2.19 or any action taken or omitted by such indemnitees hereunder. 

(k) Facility LC Collateral Account. If Administrative Agent determines that any event that would require Borrower to Cash Collateralize
the LC Obligations is reasonably likely to occur, including without limitation, the existence of a Defaulting Lender or the continuation of any LC Obligation beyond the Facility Termination Date, Borrower shall, promptly upon the request of the
Administrative Agent or the Required Lenders and until the final expiration date of any Facility LC and thereafter as long as any amount is payable to the LC Issuer or the Lenders in respect of any Facility LC, maintain a special collateral account
pursuant to arrangements satisfactory to the Administrative Agent (the “Facility LC Collateral Account”), in the name of the Borrower but under the sole dominion and control of the Administrative Agent, for the benefit of the
Lenders and in which the Borrower shall have no interest other than as set forth in Section 8.1. The Borrower hereby pledges, assigns and grants to the Administrative Agent, on behalf of and for the ratable benefit of the Lenders and the LC
Issuer, a security interest in all of the Borrower’s right, title and interest in and to all funds which may from time to time be on deposit in the Facility LC Collateral Account to secure the prompt and complete payment and performance of the
Obligations. The Administrative Agent will invest any funds on deposit from time to time in the Facility LC Collateral Account in certificates of deposit of U.S. Bank having a maturity not exceeding thirty (30) days. Nothing in this
Section 2.19(k) shall either obligate the Administrative Agent to require the Borrower to deposit any funds in the Facility LC Collateral Account or limit the right of the Administrative Agent to release any funds held in the Facility LC
Collateral Account in each case other than as required by Section 8.1. 
 (l) Rights as a Lender. In its capacity as a Lender,
the LC Issuer shall have the same rights and obligations as any other Lender. 
 2.20 Replacement of Lender. If the Borrower is
required pursuant to Section 3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any Lender’s obligation to make or continue Eurocurrency Advances shall be suspended pursuant to Section 3.3 or if any Lender defaults in
its obligation to make a Loan, reimburse the LC Issuer pursuant to Section 2.19(e) or declines to approve an amendment or waiver that is approved by the Required Lenders or otherwise becomes a Defaulting Lender (any Lender so affected an
“Affected Lender”), the Borrower may elect, if such amounts continue to be charged or such suspension is still effective or such default continues to exist, to replace such Affected Lender as a Lender party to this Agreement,
provided that no Default or Event of Default shall have occurred and be continuing at the time of such replacement, and provided further that, concurrently with such replacement, (i) another bank or other entity which is reasonably
satisfactory to the Borrower and the Administrative Agent shall agree, as of such date, to purchase for cash the Loans and other 

  
 -38- 

 
Obligations due to the Affected Lender pursuant to an assignment substantially in the form of Exhibit J and to become a Lender for all purposes under this Agreement and to assume all obligations
of the Affected Lender to be terminated as of such date and to comply with the requirements of Section 12.3 applicable to assignments, and (ii) the Borrower shall pay to such Affected Lender in same day funds on the day of such replacement
(a) all interest, fees and other amounts then accrued but unpaid to such Affected Lender by the Borrower hereunder to and including the date of termination, including without limitation payments due to such Affected Lender under Sections 3.1,
3.2 and 3.5, plus any assignment fees specified in Section 12.3(c), and (b) an amount, if any, equal to the payment which would have been due to such Lender on the day of such replacement under Section 3.4 had the Loans of such
Affected Lender been prepaid on such date rather than sold to the replacement Lender. If the Borrower is entitled to elect the replacement of an Affected Lender with another Lender as a party to this Agreement because the Affected Lender has failed
or refused to consent to an amendment or waiver that is required to be approved by the Required Lenders or all Lenders, the replacement Lender must have so consented to the amendment or waiver that the Affected Lender failed or refused to approve.

 2.21 Limitation of Interest. The Borrower, the Administrative Agent and the Lenders intend to strictly comply with all Applicable
Laws, including applicable usury laws. Accordingly, the provisions of this Section 2.21 shall govern and control over every other provision of this Agreement or any other Loan Document which conflicts or is inconsistent with this
Section 2.21, even if such provision declares that it controls. As used in this Section 2.21, the term “interest” includes the aggregate of all charges, fees, benefits or other compensation which constitute interest under
Applicable Law, provided that, to the maximum extent permitted by Applicable Law, (a) any non-principal payment shall be characterized as an expense or as compensation for something other than the use, forbearance or detention of money
and not as interest, and (b) all interest at any time contracted for, reserved, charged or received shall be amortized, prorated, allocated and spread, in equal parts during the full term of the Obligations. In no event shall the Borrower or
any other Person be obligated to pay, or any Lender have any right or privilege to reserve, receive or retain, (a) any interest in excess of the maximum amount of no usurious interest permitted under the applicable laws (if any) of the United
States or of any applicable state, or (b) total interest in excess of the amount which such Lender could lawfully have contracted for, reserved, received, retained or charged had the interest been calculated for the full term of the Obligations
at the Highest Lawful Rate. On each day, if any, that the interest rate (the “Stated Rate”) called for under this Agreement or any other Loan Document exceeds the Highest Lawful Rate, the rate at which interest shall accrue
shall automatically be fixed by operation of this sentence at the Highest Lawful Rate for that day, and, to the extent lawful, shall remain fixed at the Highest Lawful Rate for each day thereafter until the total amount of interest accrued equals
the total amount of interest which would have accrued if there were no such ceiling rate as is imposed by this sentence. Thereafter, interest shall accrue at the Stated Rate unless and until the Stated Rate again exceeds the Highest Lawful Rate when
the provisions of the immediately preceding sentence shall again automatically operate to limit the interest accrual rate. The daily interest rates to be used in calculating interest at the Highest Lawful Rate shall be determined by dividing the
applicable Highest Lawful Rate per annum by the number of days in the calendar year for which such calculation is being made. None of the terms and provisions contained in this Agreement or in any other Loan Document which directly or indirectly
relate to interest shall ever be construed without reference to this Section 2.21, or be construed to create a 

  
 -39- 

 
contract to pay for the use, forbearance or detention of money at an interest rate in excess of the Highest Lawful Rate. If the term of any Obligation is shortened by reason of acceleration of
maturity as a result of any Event of Default or by any other cause, or by reason of any required or permitted prepayment, and if for that (or any other) reason any Lender at any time, including but not limited to, the stated maturity, is owed or
receives (and/or has received) interest in excess of interest calculated at the Highest Lawful Rate, then and in any such event all of any such excess interest shall be canceled automatically as of the date of such acceleration, prepayment or other
event which produces the excess, and, if such excess interest has been paid to such Lender, it shall be credited pro tanto against the then-outstanding principal balance of the Borrower’s obligations to such Lender, effective as of the
date or dates when the event occurs which causes it to be excess interest, until such excess is exhausted or all of such principal has been fully paid and satisfied, whichever occurs first, and any remaining balance of such excess shall be promptly
refunded to its payor. 
 2.22 Defaulting Lenders. 

(a) Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a
Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law: 
 (i)
Waivers and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders. 

(ii) Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Administrative Agent for
the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 11.1 shall be applied at such time or
times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts
owing by such Defaulting Lender to the LC Issuer or Swingline Lender hereunder; third, to Cash Collateralize the LC Issuer’s Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.22(d); fourth,
as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the
Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account (including the Facility LC Collateral Account) and released pro rata in order to (x) satisfy such Defaulting
Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize the LC Issuer’s future Fronting Exposure with respect to such Defaulting Lender with respect to future Facility LCs
issued under this Agreement, in accordance with Section 2.22(d); sixth, to the payment of any amounts owing to the Lenders, the LC Issuer or Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by
any Lender, the LC Issuer or Swingline Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the
payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the 

  
 -40- 

 
Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; eighth, if so determined by the Administrative
Agent, distributed to the Lenders other than the Defaulting Lender until the ratio of the Outstanding Credit Exposure of such Lenders to the Aggregate Outstanding Credit Exposure equals such ratio immediately prior to the Defaulting Lender’s
failure to fund any portion of any Loans or participations in Facility LCs; and ninth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the
principal amount of any Loans or Facility LC issuances in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Facility LCs were issued at a time when the conditions set
forth in Section 4.2 were satisfied or waived, such payment shall be applied solely to pay the Credit Extensions of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Credit Extensions of such Defaulting
Lender until such time as all Loans and funded and unfunded participations in LC Obligations and Swingline Loans are held by the Lenders pro rata in accordance with the Commitments without giving effect to Section 2.22(a)(iv). Any payments,
prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.22(a)(ii) shall be deemed paid to and
redirected by such Defaulting Lender, and each Lender irrevocably consents hereto. 
 (iii) Certain Fees. 

(A) No Defaulting Lender shall be entitled to receive any Undrawn Fee for any period during which that Lender is a Defaulting
Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender). 

(B) Each Defaulting Lender shall be entitled to receive LC Fees for any period during which that Lender is a Defaulting Lender
only to the extent allocable to its ratable share of the stated amount of Facility LCs for which it has provided Cash Collateral pursuant to Section 2.22(d). 

(C) With respect to any Undrawn Fee or LC Fee not required to be paid to any Defaulting Lender pursuant to clause (a) or
(b) above, the Borrower shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in LC Obligations or Swingline Loans
that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to the LC Issuer and Swingline Lender the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to the LC
Issuer’s or Swingline Lender’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee. 

(iv) Reallocation of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in LC
Obligations and Swingline Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Pro Rata 

  
 -41- 

 
Shares (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in Section 4.2 are satisfied at the time of such
reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such
reallocation does not cause the aggregate Outstanding Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party
hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation. 

(v) Cash Collateral, Repayment of Swingline Loans. If the reallocation described in clause (iv) above cannot, or can only
partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under law, (x) first, prepay Swingline Loans in an amount equal to the Swingline Lenders Fronting Exposure, and (y) second,
Cash Collateralize the LC Issuer’s Fronting Exposure in accordance with the procedures set forth in Section 2.22(d). 
 (b)
Defaulting Lender Cure. If the Borrower, the Administrative Agent, each LC Issuer and Swingline Lender agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as
of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of
outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Facility LCs and Swingline Loans to be held pro rata by the
Lenders in accordance with the Commitments (without giving effect to Section 2.22(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued
or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender
to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. 

(c) New Swingline Loans and Facility LCs. So long as any Lender is a Defaulting Lender, (i) Swingline Lender shall not be required
to fund any Swingline Loans unless it is satisfied that it will have no Fronting Exposure after giving effect to such Swingline Loan, and (ii) LC Issuer shall not be required to issue, extend, renew or increase any Facility LC unless it is
satisfied that it will have no Fronting Exposure after giving effect thereto. 
 (d) Cash Collateral. At any time that there shall
exist a Defaulting Lender, within one (1) Business Day following the written request of the Administrative Agent or the LC Issuer (with a copy to the Administrative Agent) the Borrower shall Cash Collateralize the LC Issuer’s Fronting
Exposure with respect to such Defaulting Lender (determined after giving effect to Section 2.22(a)(iv) and any Cash Collateral provided by such Defaulting Lender) in an amount not less than the Minimum Collateral Amount. 

  
 -42- 

 (i) Grant of Security Interest. The Borrower, and to the extent provided by any
Defaulting Lender, such Defaulting Lender, hereby grants to the Administrative Agent, for the benefit of the LC Issuer, and agrees to maintain, a first priority security interest in all such Cash Collateral as security for the Defaulting
Lender’s obligation to fund participations in respect of LC Obligations, to be applied pursuant to clause (ii) below. If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person
other than the Administrative Agent and the LC Issuer as herein provided or that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, the Borrower will, promptly upon demand by the Administrative Agent, pay or provide
to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender). 

(ii) Application. Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this
Section 2.22 in respect of Facility LCs shall be applied to the satisfaction of the Defaulting Lender’s obligation to fund participations in respect of LC Obligations (including, as to Cash Collateral provided by a Defaulting Lender, any
interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein. 

(iii) Termination of Requirement. Cash Collateral (or the appropriate portion thereof) provided to reduce the LC Issuer’s
Fronting Exposure shall no longer be required to be held as Cash Collateral pursuant to this Section 2.22(d) following (i) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status
of the applicable Lender), or (ii) the determination by the Administrative Agent and the LC Issuer that there exists excess Cash Collateral; provided that, subject to this Section 2.22 the Person providing Cash Collateral and the LC
Issuer may agree that Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations. 
 2.23
Increase Option. The Borrower may from time to time, with the prior written approval of the Administrative Agent which approval shall not be unreasonably withheld, elect to increase the Aggregate Commitment, in each case in minimum increments
of $10,000,000 or such lower amount as the Borrower and the Administrative Agent agree upon, so long as, after giving effect thereto, the aggregate amount of such increases does not exceed $125,000,000, and the Aggregate Commitment does not exceed
$300,000,000. The Borrower may arrange for any such increase to be provided by one or more Lenders (each Lender so agreeing to an increase in its Commitment, an “Increasing Lender”), or by one or more new banks, financial
institutions or other entities (each such new bank, financial institution or other entity, an “Augmenting Lender”), to increase their existing Commitments, or extend Commitments, as the case may be; provided that
(i) no Lender shall be required to commit to any such increase, (ii) each Augmenting Lender and each Increasing Lender shall be subject to the reasonable approval of the Borrower, the Administrative Agent and the LC Issuer and
(iii) (x) in the case of an Increasing Lender, the Borrower and such Increasing Lender execute an agreement substantially in the form of Exhibit E hereto, and (y) in the case of an Augmenting Lender, the Borrower and such Augmenting Lender
execute an agreement substantially in the form of Exhibit F hereto. No consent of any Lender (other than the Lenders participating in the increase) shall be required for any increase in Commitments pursuant to this Section 2.23. Increases and
new Commitments created pursuant to this Section 2.23 shall become effective on the date agreed by the Borrower, 

  
 -43- 

 
the Administrative Agent and the relevant Increasing Lenders or Augmenting Lenders, and the Administrative Agent shall notify each Lender thereof. Notwithstanding the foregoing, no increase in
the Commitments (or in the Commitment of any Lender) shall become effective under this paragraph unless, (i) on the proposed date of the effectiveness of such increase, (a) the conditions set forth in paragraphs (a) and (b) of
Section 4.2 shall be satisfied or waived by the Required Lenders (or, if required under Section 8.3, all Lenders) and the Administrative Agent shall have received a certificate to that effect dated such date and executed by an Authorized
Officer of the Borrower and (b) the Borrower shall be in compliance (on a pro forma basis reasonably acceptable to the Administrative Agent) with the covenants contained in Section 6.23 and (ii) the Administrative Agent shall have
received documents consistent with those delivered on the date hereof as to the corporate power and authority of the Borrower to borrow hereunder after giving effect to such increase. On the effective date of any increase in the Commitments,
(i) each relevant Increasing Lender and Augmenting Lender shall make available to the Administrative Agent such amounts in immediately available funds as the Administrative Agent shall determine, for the benefit of the other Lenders, as being
required in order to cause, after giving effect to such increase and the use of such amounts to make payments to such other Lenders, each Lender’s portion of the outstanding Loans of all the Lenders to equal its Pro Rata Share of such
outstanding Loans, and (ii) the Borrower shall be deemed to have repaid and reborrowed all outstanding Loans as of the date of any increase in the Commitments (with such reborrowing to consist of the Types of Loans, with related Interest
Periods if applicable, specified in a notice delivered by the Borrower, in accordance with the requirements of Section 2.3). The deemed payments made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by
payment of all accrued interest on the amount prepaid and, in respect of each Eurocurrency Loan, shall be subject to indemnification by the Borrower pursuant to the provisions of Section 3.4 if the deemed payment occurs other than on the last
day of the related Interest Periods. 
 2.24 [Reserved] 

2.25 Term Out Provision. In the event that Borrower fails to meet or satisfy, or there is otherwise a default under, any of the
financial covenants set forth in Sections 6.23(a), (b), (d), or (e), and such breach is not cured to the reasonable satisfaction of Administrative Agent by Borrower within 30 days after the earlier of (a) Borrower becoming aware of such breach,
or (b) Administrative Agent notifying Borrower of such breach (the “Cure Period”), the credit facility available to Borrower under this Agreement will convert at the end of such Cure Period to an 18 month term loan (the period between
the end of the 30 day Cure Period specified above and 18 months following the end of such Cure Period being referred to herein as the “Term Out Period”). Upon the commencement of the Term Out Period, Borrower shall no longer
have any right to request or receive Loans hereunder or the issuance of Letters of Credit hereunder, and shall otherwise have no rights to any credit accommodations or other rights to obtain any further loans, money, letters of credit, or other
credit accommodations of any nature whatsoever, under this Agreement. Commencing with the first day of the first month following the commencement of the Term Out Period, and continuing on the first day of each month thereafter, Borrower shall pay to
Bank an amount equal to 1/18th of the Aggregate Outstanding Credit Exposure as of the commencement of the Term Out Period. All such payments shall be applied first to the outstanding principal amount of all Loans owing hereunder and then to all due
and owing LC Obligations. To the extent that any of the LC Obligations consist of undrawn amounts under any 

  
 -44- 

 
Facility LCs then outstanding, any payments to be made under this Section 2.25 remaining after the outstanding principal amount of all Loans and then due and payable LC Obligations have been
paid in full, shall be remitted to the Facility LC Collateral Account with Administrative Agent, to serve as security for the payment of all future amounts drawn under all Facility LC’s and other LC Obligations as the same become due and
payable, and shall also serve as security for all other Obligations owing hereunder (and Borrower hereby grants to Administrative Agent and Lenders, a security interest in all of the Borrower’s right, title and interest in and to the Facility
LC Collateral Account and all funds and sums which may from time to time be on deposit therein). For purposes of clarification, if it occurs prior to the Facility Termination Date, at the end of the Term Out Period, this facility shall be
terminated. For purposes of further clarification, notwithstanding that the Facility Termination Date has occurred, if the Term Out Period has commenced prior to the Facility Termination Date, then (notwithstanding the occurrence of the Facility
Termination Date) Borrower shall have the option to continue to make the principal amortization payments, and interest payments and other sums owing under the Loan Documents, in accordance with the foregoing provisions of this Section 2.25
during the remainder of the Term Out Period (so that, so long as no other Event of Default has occurred other than the failure to satisfy the financial covenants described above in this Section 2.25, and so long as interest and other amounts
owing under the Loan Documents continue to be paid, Borrower need not pay the full principal amount of the Loan outstanding on the Facility Termination Date, but rather may continue to pay the principal amortization payment equal to 1/18th of the Aggregate Outstanding Credit Exposure as of the commencement of the Term Out Period each month for the remainder of the period of the Term Out Period). Notwithstanding the foregoing or
anything else contained herein which may be construed to the contrary, in no event shall the Term Out Period exceed the maturity date of the New Indenture Notes Obligations or any Refinancing Indebtedness with respect thereto, at which time all
Obligations owing hereunder and under the other Loan Documents, not otherwise paid when due, shall be immediately due and payable in full. 

2.26 Swingline Commitment. 
 (a)
Subject to the terms and conditions hereof, the Swingline Lender agrees to make a portion of the credit otherwise available to the Borrower under the Commitments from time to time prior to the Facility Termination Date by making swing line loans
(“Swingline Loans”) to the Borrower; provided that (i) the aggregate principal amount of Swingline Loans outstanding at any time shall not exceed the Swingline Commitment then in effect (notwithstanding that the
Swingline Loans outstanding at any time, when aggregated with the Swingline Lender’s other outstanding Loans, may exceed the Swingline Commitment then in effect), (ii) the Borrower shall not request and the Swingline Lender shall not make,
any Swingline Loan if, after giving effect to the making of such Swingline Loan, the amount of the Available Aggregate Commitment would be less than zero, and (iii) Borrower shall not request, and the Swingline Lender shall not make, any
Swingline Loan if, after giving effect to the making of such Swingline Loan, the Borrowing Base Availability would be less than zero. During the Commitment Period, the Borrower may use the Swingline Commitment by borrowing, repaying and reborrowing,
all in accordance with the terms and conditions hereof. Swingline Loans shall be Daily Eurocurrency Loans only. 

  
 -45- 

 (b) The Borrower shall repay to the Swingline Lender the then unpaid principal amount of each
Swingline Loan on the earliest of the end of the Commitment Period, the tenth (10th) Business Day after such Swingline Loan is made, or the date that the next Loan is borrowed. 

2.27 Procedure for Swingline Borrowing; Refunding of Swingline Loans. 

(a) Whenever the Borrower desires that the Swingline Lender make Swingline Loans it shall give the Swingline Lender irrevocable telephonic
notice confirmed promptly in writing (which telephonic notice must be received by the Swingline Lender not later than 2:00 P.M., New York City time, on the proposed Borrowing Date), specifying (i) the amount to be borrowed and (ii) the
requested Borrowing Date (which shall be a Business Day during the Commitment Period). Each borrowing under the Swingline Commitment shall be in an amount equal to $500,000 or a whole multiple of $100,000 in excess thereof. Not later than 3:00 P.M.,
New York City time, on the Borrowing Date specified in a notice in respect of Swingline Loans, the Swingline Lender shall make available to the Administrative Agent at the Funding Office an amount in immediately available funds equal to the amount
of the Swingline Loan to be made by the Swingline Lender. The Administrative Agent shall make the proceeds of such Swingline Loan available to the Borrower on such Borrowing Date by depositing such proceeds in the account of the Borrower with the
Administrative Agent or as otherwise directed by the Borrower on such Borrowing Date in immediately available funds. 
 (b) The Swingline
Lender, at any time and from time to time in its sole and absolute discretion may, on behalf of the Borrower (which hereby irrevocably directs the Swingline Lender to act on its behalf), on one (1) Business Day’s notice given by the
Swingline Lender no later than 12:00 Noon, New York City time, request each Lender to make, and each Lender hereby agrees to make, a Loan, in an amount equal to such Lender’s Pro Rata Share of the aggregate amount of the Swingline Loans (the
“Refunded Swingline Loans”) outstanding on the date of such notice, to repay the Swingline Lender. Each Lender shall make the amount of such Loan available to the Administrative Agent in immediately available funds, not later than
10:00 A.M., New York City time, one (1) Business Day after the date of such notice. The proceeds of such Loans shall be immediately made available by the Administrative Agent to the Swingline Lender for application by the Swingline Lender
to the repayment of the Refunded Swingline Loans. If the amounts received from the Lenders are not sufficient to repay in full such Refunded Swingline Loans, then the Borrower shall pay such difference to the Administrative Agent within two
(2) Business Days of notice from the Administrative Agent, which payments shall be made available by the Administrative Agent to the Swingline Lender to repay the Refunded Swingline Loans. 

(c) If prior to the time a Loan would have otherwise been made pursuant to Section 2.27(b), one of the events described in
Section 7.6 shall have occurred and be continuing with respect to the Borrower or if for any other reason, as determined by the Swingline Lender in its sole discretion, Loans may not be made as contemplated by
Section 2.27(b), each Lender shall, on the date such Loan was to have been made pursuant to the notice referred to in Section 2.27(b), purchase for cash an undivided participating interest in the then outstanding Swingline
Loans by paying to the Swingline Lender an amount (the “Swingline Participation  

  
 -46- 

 
Amount”) equal to (i) such Lender’s Pro Rata Share times (ii) the sum of the aggregate principal amount of Swingline Loans then outstanding that were to have been
repaid with such Loans. 
 (d) Whenever, at any time after the Swingline Lender has received from any Lender such Lender’s Swingline
Participation Amount, the Swingline Lender receives any payment on account of the Swingline Loans, the Swingline Lender will distribute to such Lender its Swingline Participation Amount (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender’s participating interest was outstanding and funded and, in the case of principal and interest payments, to reflect such Lender’s pro rata portion of such payment if such payment
is not sufficient to pay the principal of and interest on all Swingline Loans then due); provided, however, that in the event that such payment received by the Swingline Lender is required to be returned, such Lender will return to the
Swingline Lender any portion thereof previously distributed to it by the Swingline Lender. 
 (e) Each Lender’s obligation to make the
Loans referred to in Section 2.27(b) and to purchase participating interests pursuant to Section 2.27(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (i) any setoff,
counterclaim, recoupment, defense or other right that such Lender or the Borrower may have against the Swingline Lender, the Borrower or any other Person for any reason whatsoever, (ii) the occurrence or continuance of a Default or an Event of
Default or the failure to satisfy any of the other conditions specified in Section 4.2, (iii) any adverse change in the condition (financial or otherwise) of the Borrower, (iv) any breach of this Agreement or any other Loan
Document by the Borrower, any other Loan Party or any other Lender or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. 

ARTICLE III 
 YIELD
PROTECTION; TAXES 
 3.1 Yield Protection. If, after the date of this Agreement, there occurs any adoption of or change in
any law, governmental or quasi-governmental rule, regulation, policy, guideline, interpretation, or directive (whether or not having the force of law) or in the interpretation, promulgation, implementation or administration thereof by any
governmental or quasi-governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, including, notwithstanding the foregoing, all requests, rules, guidelines or directives (x) in connection
with the Dodd-Frank Wall Street Reform and Consumer Protection Act or (y) promulgated by the Bank for International Settlements, the Basel Committee on Banking Regulations and Supervisory Practices (or any successor or similar authority) or the
United States financial regulatory authorities, in each case of clauses (x) and (y), regardless of the date enacted, adopted, issued, promulgated or implemented, or compliance by any Lender or applicable Lending Installation or the LC Issuer
with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency (any of the foregoing, a “Change in Law”) which: 

(a) subjects any Lender or any applicable Lending Installation, the LC Issuer, or the Administrative Agent to any Taxes (other than with
respect to Indemnified Taxes, 

  
 -47- 

 
Excluded Taxes, and Other Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto,
or 
 (b) imposes or increases or deems applicable any reserve, assessment, insurance charge, special deposit or similar requirement against
assets of, deposits with or for the account of, or credit extended by, any Lender or any applicable Lending Installation or the LC Issuer (other than reserves and assessments taken into account in determining the interest rate applicable to
Eurocurrency Advances and Daily Eurocurrency Advances), or 
 (c) imposes any other condition (other than Taxes) the result of which is to
increase the cost to any Lender or any applicable Lending Installation or the LC Issuer of making, funding or maintaining its Eurocurrency Loans or Daily Eurocurrency Loans, or of issuing or participating in Facility LCs, or reduces any amount
receivable by any Lender or any applicable Lending Installation or the LC Issuer in connection with its Eurocurrency Loans, Daily Eurocurrency Loans, Facility LCs or participations therein, or requires any Lender or any applicable Lending
Installation or the LC Issuer to make any payment calculated by reference to the amount of Eurocurrency Loans, Daily Eurocurrency Loans, Facility LCs or participations therein held or interest or LC Fees received by it, by an amount deemed material
by such Lender or the LC Issuer as the case may be, 
 and the result of any of the foregoing is to increase the cost to such Person of making or
maintaining its Loans or Commitment or of issuing or participating in Facility LCs or to reduce the return received by such Person in connection with such Loans or Commitment, Facility LCs or participations therein, then, within fifteen
(15) days after demand by such Person, the Borrower shall pay such Person, as the case may be, such additional amount or amounts as will compensate such Person for such increased cost or reduction in amount received. 

3.2 Changes in Capital Adequacy Regulations. If a Lender or the LC Issuer determines the amount of capital or liquidity required or
expected to be maintained by such Lender or the LC Issuer, any Lending Installation of such Lender or the LC Issuer, or any corporation or holding company controlling such Lender or the LC Issuer is increased as a result of (i) a Change in Law
or (ii) any change after the date of this Agreement in the Risk-Based Capital Guidelines, then, within fifteen (15) days of demand by such Lender or the LC Issuer, the Borrower shall pay such Lender or the LC Issuer the amount necessary to
compensate for any shortfall in the rate of return on the portion of such increased capital which such Lender or the LC Issuer determines is attributable to this Agreement, its Outstanding Credit Exposure or its Commitment to make Loans and issue or
participate in Facility LCs, as the case may be, hereunder (after taking into account such Lender’s or the LC Issuer’s policies as to capital adequacy or liquidity), in each case that is attributable to such Change in Law or change in the
Risk-Based Capital Guidelines, as applicable. 
 3.3 Availability of Types of Advances; Adequacy of Interest Rate. If (a) the
Administrative Agent or the Required Lenders determine that deposits of a type and maturity appropriate to match fund Eurocurrency Advances or Daily Eurocurrency Loans are not available to such Lenders in the relevant market or (b) the
Administrative Agent, in consultation with the Lenders, determines that the interest rate applicable to Eurocurrency Advances or Daily Eurocurrency Advances is not ascertainable or does not adequately and fairly reflect the cost of 

  
 -48- 

 
making or maintaining Eurocurrency Advances or Daily Eurocurrency Advances or (c) it becomes unlawful for the Lenders to maintain any Loan based on the Eurocurrency Rate and/or Daily
Eurocurrency Rate, then the Administrative Agent shall suspend the availability of Eurocurrency Advances and Daily Eurocurrency Advances and require any affected Eurocurrency Advances or Daily Eurocurrency Advances to be repaid or converted to
Advances accruing interest at a rate per annum determined based upon an alternate index selected by Administrative Agent, in its reasonable discretion after consultation with (but not approval of) Borrower, reasonably comparable to that of a
one-month Interest Period, intended to generate a return substantially the same as that generated by the Eurocurrency Rate at such time with a one-month Interest Period, and all references in the Loan Documents to the Daily Eurocurrency or
Eurocurrency Rate shall be deemed to be references to such alternate index while such rate is in effect, such repayment or conversion subject to the payment of any funding indemnification amounts required by Section 3.4. 

3.4 Funding Indemnification. If (a) any payment of a Eurocurrency Advance occurs on a date which is not the last day of the
applicable Interest Period, whether because of acceleration, prepayment or otherwise, (b) a Eurocurrency Advance is not made on the date specified by the Borrower for any reason other than default by the Lenders, (c) a Eurocurrency Loan is
converted other than on the last day of the Interest Period applicable thereto, (d) the Borrower fails to borrow, convert, continue or prepay any Eurocurrency Loan on the date specified in any notice delivered pursuant hereto, or (e) any
Eurocurrency Loan is assigned other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.20, the Borrower will indemnify each Lender for such Lender’s costs, expenses
and Interest Differential (as determined by such Lender) incurred as a result of such prepayment. The term “Interest Differential” shall mean that sum equal to the greater of zero or the financial loss incurred by the Lender
resulting from prepayment, calculated as the difference between the amount of interest such Lender would have earned (from the investments in money markets as of the Borrowing Date of such Loan) had prepayment not occurred and the interest such
Lender will actually earn (from like investments in money markets as of the date of prepayment) as a result of the redeployment of funds from the prepayment. Because of the short-term nature of this facility, Borrower agrees that Interest
Differential shall not be discounted to its present value. 
 3.5 Taxes. 

(a) Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or
withholding for any Taxes, except as required by applicable law. If any applicable law requires the deduction or withholding of any Tax from any such payment, then the applicable Loan Party shall be entitled to make such deduction or withholding and
shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax or Other Tax, then the sum payable by the applicable Loan Party shall be increased
as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.5) the applicable Lender, the LC Issuer or the Administrative Agent
receives an amount equal to the sum it would have received had no such deduction or withholding been made. 

  
 -49- 

 (b) The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with
applicable law or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes. 
 (c) The Loan Parties
shall indemnify any Lender, the LC Issuer or the Administrative Agent, within fifteen (15) days after demand therefor, for the full amount of any Indemnified Taxes and Other Taxes (including Indemnified Taxes and Other Taxes imposed or asserted
on or attributable to amounts payable under this Section 3.5) payable or paid by such Lender, the LC Issuer or the Administrative Agent or required to be withheld or deducted from a payment to such Lender, the LC Issuer or the Administrative
Agent and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes and Other Taxes were correctly or legally imposed or asserted by the relevant governmental authority. A certificate as to the amount
of such payment or liability delivered to the Borrower by a Lender or LC Issuer (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender or LC Issuer, shall be conclusive absent manifest
error. 
 (d) Each Lender shall severally indemnify the Administrative Agent, within fifteen (15) days after demand therefor, for
(i) any Indemnified Taxes and Other Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes and Other Taxes and without limiting the
obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 12.2(c) relating to the maintenance of a Participant Register, and (iii) any Excluded
Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were
correctly or legally imposed or asserted by the relevant governmental authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender
hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this paragraph (d). 
 (e) As soon as practicable after any payment of Taxes by any Loan Party to a
Governmental Authority pursuant to this Section 3.5, such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such governmental authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent. 
 (f) (i) Any Lender that is
entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the
Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition,
any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the 

  
 -50- 

 
Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements.
Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.5(f)(ii)(A), (ii)(B) and (ii)(D) below)
shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such
Lender. 
 (ii) Without limiting the generality of the foregoing, 

(A) any Lender that is a United States Person for U.S. federal income Tax purposes shall deliver to the Borrower and the
Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9
certifying that such Lender is exempt from U.S. federal backup withholding Tax; 
 (B) any Non-U.S. Lender shall, to the
extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Non-U.S. Lender becomes a Lender under this
Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable: 

(i) in the case of a Non-U.S. Lender claiming the benefits of an income Tax treaty to which the United States is a party
(x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such Tax
treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other
income” article of such Tax treaty; 
 (ii) executed originals of IRS Form W-8ECI; 

(iii) in the case of a Non-U.S. Lender claiming the benefits of the exemption for portfolio interest under
Section 881(c) of the Code, (x) a certificate to the effect that such Non-U.S. Lender is not a “bank” within the meaning of Section 881(c)(3)(a) of the Code, a “10 percent shareholder” of the Borrower
within the meaning of Section 881(c)(3)(b) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(c) of the Code and (y) executed originals of IRS Form W-8BEN; or 

  
 -51- 

 (iv) to the extent a Non-U.S. Lender is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, IRS Form W-8IMY or IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable. 

(C) any Non-U.S. Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative
Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Non-U.S. Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the
Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be
prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and 

(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if
such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the
Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by
Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations
under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA”
shall include any amendments made to FATCA after the date of this Agreement. 
 (iii) Each Lender agrees that if any form or certification
it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so. 

(g) If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has
been indemnified pursuant to this Section 3.5 (including by the payment of additional amounts pursuant to this Section 3.5), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity
payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other 

  
 -52- 

 
than any interest paid by the relevant governmental authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified
party the amount paid over pursuant to this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant governmental authority) in the event that such indemnified party is required to repay such refund to such
governmental authority. Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment of which would
place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the indemnification payments or additional amounts giving rise to such refund had never been paid. This paragraph shall not be
construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person. 

(h) Each party’s obligations under this Section 3.5 shall survive the resignation or replacement of the Administrative Agent or any
assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document. 

(i) For purposes of Section 3.5(d) and (f), the term “Lender” includes the LC Issuer. 

3.6 Selection of Lending Installation; Mitigation Obligations; Lender Statements; Survival of Indemnity. To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation with respect to its Eurocurrency Loans or Daily Eurocurrency Loans to reduce any liability of the Borrower to such Lender under Sections 3.1, 3.2 and 3.5 or to avoid the
unavailability of Eurocurrency Loans or Daily Eurocurrency Loans under Section 3.3, so long as such designation is not, in the judgment of such Lender, disadvantageous to such Lender. Each Lender shall deliver a written statement of such Lender
to the Borrower (with a copy to the Administrative Agent) as to the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such written statement shall set forth in reasonable detail the calculations upon which such Lender determined such
amount and shall be final, conclusive and binding on the Borrower in the absence of manifest error. Determination of amounts payable under such Sections in connection with a Eurocurrency Loan or Daily Eurocurrency Loan shall be calculated as though
each Lender funded its Eurocurrency Loan or its Daily Eurocurrency Loans through the purchase of a deposit of the type and maturity corresponding to the deposit used as a reference in determining the Eurocurrency Rate or Daily Eurocurrency Rate
applicable to such Loan, whether in fact that is the case or not. Unless otherwise provided herein, the amount specified in the written statement of any Lender shall be payable on demand after receipt by the Borrower of such written statement. The
obligations of the Borrower under Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of the Obligations and termination of this Agreement. 

ARTICLE IV 

CONDITIONS PRECEDENT 

4.1 Initial Credit Extension. The Lenders shall not be required to make the initial Credit Extension hereunder unless each of the
following conditions is satisfied: 

  
 -53- 

 (a) The Administrative Agent shall have received executed counterparts of each of this Agreement
and the Guaranty. 
 (b) The Administrative Agent shall have received a certificate, signed by the chief financial officer of the Borrower,
stating that on the date of the initial Credit Extension (1) no Default or Event of Default has occurred and is continuing and (2) the representations and warranties contained in Article V are (x) with respect to any representations
or warranties that contain a materiality qualifier, true and correct in all respects and (y) with respect to any representations or warranties that do not contain a materiality qualifier, true and correct in all material respects as of such
date, except to the extent any such representation or warranty is stated to relate solely to an earlier date, in which case such representation or warranty shall have been true and correct on and as of such earlier date. 

(c) The Administrative Agent shall have received a written opinion of the Borrower’s counsel in form and substance reasonably acceptable
to the Administrative Agent. 
 (d) The Administrative Agent shall have received any Notes requested by a Lender pursuant to
Section 2.13 payable to the order of each such requesting Lender. 
 (e) The Administrative Agent shall have received such documents
and certificates relating to the organization, existence and good standing of the Borrower and each initial Guarantor, the authorization of the transactions contemplated hereby and any other legal matters relating to the Borrower and such
Guarantors, the Loan Documents or the transactions contemplated hereby, all in form and substance satisfactory to the Administrative Agent and its counsel and as further described in the list of closing documents attached as Exhibit H. 

(f) If the initial Credit Extension will be the issuance of a Facility LC, the Administrative Agent shall have received a properly completed
Facility LC Application. 
 (g) The Administrative Agent shall have received evidence satisfactory to it that any credit facility currently
in effect for the Borrower or any Guarantor (other than the New Indenture Notes Obligations) shall have been terminated and cancelled or arrangement made for the substantially concurrent discharge thereof and all indebtedness thereunder shall have
been fully repaid or arrangement made for the substantially concurrent discharge thereof (except to the extent being so repaid with the initial Loans) and any and all liens thereunder shall have been terminated and released. 

(h) The Administrative Agent and Arrangers shall have received all fees and other amounts due and payable on or prior to the date hereof,
including fees payable under the Fee Letter and, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower hereunder. 

(i) There shall not have occurred a Material Adverse Effect since December 31, 2014. 

(j) The Administrative Agent shall have received all governmental, equity holder and third party consents and approvals necessary in
connection with the contemplated financing and all applicable waiting periods shall have expired without any action being taken by 

  
 -54- 

 
any authority that would be reasonably likely to restrain, prevent or impose any material adverse conditions on the Loan Parties, taken as a whole, and no law or regulation shall be applicable
which in the reasonable judgment of the Administrative Agent could have such effect. 
 (k) No action, suit, investigation or proceeding is
pending or, to the knowledge of the Borrower, threatened in any court or before any arbitrator or governmental authority that would reasonably be expected to result in a Material Adverse Effect. 

(l) The Administrative Agent shall have received: (i) pro forma financial statements giving effect to the initial Credit Extensions
contemplated hereby, which demonstrate, in the Administrative Agent’s reasonable judgment, together with all other information then available to the Administrative Agent, that the Borrower can repay its debts and satisfy its other obligations
as and when they become due, and can comply with the financial covenants set forth in Section 6.23 throughout the term of this Agreement and (ii) such information as the Administrative Agent may reasonably request to confirm the tax,
legal, and business assumptions made in such pro forma financial statements. 
 (m) The Administrative Agent shall have received evidence
satisfactory to Administrative Agent that all of the existing Indenture Note Obligations and any and all other Specified Pari Passu Lien Obligations (as defined in the Prior Credit Agreement or the “Intercreditor Agreement” described
therein) shall have been repaid or that arrangements have been made for such obligations to be discharged pursuant to the terms thereof (other than contingent indemnification obligations for which no claim has been made), and all liens and security
interests in any Collateral (as defined in the Prior Credit Agreement or the “Intercreditor Agreement” described therein) or any other property or assets pertaining thereto shall have been cancelled and released. 

(n) The net proceeds of the New Indenture and the New Indenture Notes Obligations shall be used in whole or in part to repay and satisfy the
existing Indenture Notes Obligations. 
 (o) The Administrative Agent shall have successfully syndicated $100,000,000 of the total Aggregate
Commitment hereunder to Lenders other than U.S. Bank, so that the total Aggregate Commitment of U.S. Bank under this Credit Agreement does not exceed $75,000,000; and such other Lenders shall be a party to this Agreement, and shall have executed
such documents and agreements to evidence and confirm the foregoing as the Administrative Agent in its reasonable discretion shall require. 

(p) Borrower, Guarantors and any other parties reasonably deemed necessary or appropriate by Administrative Agent shall have executed any and
all other documents and agreements, in form and substance satisfactory to Administrative Agent, which Administrative Agent deems necessary or appropriate to carry out the intent and agreement of the parties hereto. 

4.2 Each Credit Extension. The Lenders shall not be required to make any Credit Extension unless on the applicable Borrowing Date: 

(a) There exists no Default or Event of Default, nor would a Default or Event of Default result from such Credit Extension. 

  
 -55- 

 (b) The representations and warranties contained in Article V are (x) with respect to any
representations or warranties that contain a materiality qualifier, true and correct in all respects and (y) with respect to any representations or warranties that do not contain a materiality qualifier, true and correct in all material
respects as of such Borrowing Date except to the extent any such representation or warranty is stated to relate solely to an earlier date, in which case such representation or warranty shall have been true and correct on and as of such earlier date.

 (c) After giving effect to the requested Credit Extension, the Aggregate Outstanding Credit Exposure does not exceed the lesser of
(i) the Borrowing Base Availability at such time, or (ii) the Aggregate Commitment at such time. 
 Each Borrowing Notice or
request for issuance of a Facility LC with respect to each such Credit Extension shall constitute a representation and warranty by the Borrower that the conditions contained in Sections 4.2(a) and (b) have been satisfied. 

ARTICLE V 

REPRESENTATIONS AND WARRANTIES 

The Borrower represents and warrants to the Lenders that: 

5.1 Existence and Standing. Each of the Loan Parties is a corporation, partnership or limited liability company duly and properly
incorporated or formed, as the case may be, validly existing and (to the extent such concept applies to such entity) in good standing under the laws of its jurisdiction of incorporation or organization and has all requisite authority to conduct its
business in each jurisdiction in which its business is conducted. 
 5.2 Authorization and Validity. Each Loan Party has the power
and authority and legal right to execute and deliver the Loan Documents to which it is a party and to perform its obligations thereunder. The execution and delivery by each Loan Party of the Loan Documents to which it is a party and the performance
of its obligations thereunder have been duly authorized by proper corporate, limited partnership and limited liability company proceedings, as the case may be, and the Loan Documents to which each Loan Party is a party constitute legal, valid and
binding obligations of such Loan Party enforceable against such Loan Party in accordance with their terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights
generally. 
 5.3 No Conflict; Government Consent. Neither the execution and delivery by any Loan Party of the Loan Documents to
which it is a party, nor the consummation of the transactions therein contemplated, nor compliance with the provisions thereof will violate (i) any law, rule, regulation, order, writ, judgment, injunction, decree or award binding on any Loan
Party except where such violation could not reasonably be expected to have a Material Adverse Effect, (ii) any Loan Party’s articles or certificate of incorporation, partnership agreement, certificate of partnership, articles or
certificate of organization, by-laws, or operating or other management agreement, as the case may be, or (iii) the provisions of any indenture, instrument or agreement to which any Loan Party is a party or is subject, or by which it, or its
Property, is 

  
 -56- 

 
bound, or conflict with or constitute a default thereunder, or result in, or require, the creation or imposition of any Lien in, of or on the Property of any Loan Party pursuant to the terms of
any such indenture, instrument or agreement, except where such violation or conflict could not reasonably be expected to have a Material Adverse Effect. No order, consent, adjudication, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, or other action in respect of any governmental or public body or authority, or any subdivision thereof, which has not been obtained by any Loan Party is required to be obtained by such Loan Party in
connection with the execution and delivery of the Loan Documents, the borrowings under this Agreement, the payment and performance by the Borrower of the Obligations or the legality, validity, binding effect or enforceability of any of the Loan
Documents. 
 5.4 Financial Statements and Information. The financial statements of Borrower and its Subsidiaries for the fiscal year
ended December 31, 2014 heretofore delivered to the Lenders, fairly present in all material respects the consolidated financial condition and operations of Borrower and its Subsidiaries at such date and the consolidated results of their
operations for the periods described therein. The information contained in such financial statements regarding the Borrower and its Subsidiaries and their respective operations and assets is true and accurate in all material respects. 

5.5 Material Adverse Change. Since the date of the most recent audited financial statements delivered to the Administrative Agent there
has been no change in the business, Property, prospects, financial condition or results of operations of the Loan Parties which could reasonably be expected to have a Material Adverse Effect. 

5.6 Taxes. The Borrower and each of its Subsidiaries have filed all United States federal and state income Tax returns and all other
material Tax returns which are required to be filed by them and have paid prior to delinquency thereof all United States federal and state income Taxes and all other material Taxes due from the Borrower and each of its Subsidiaries, including,
without limitation, pursuant to any assessment received by the Borrower and each of its Subsidiaries, except such Taxes, if any, (i) as are being contested in good faith and as to which adequate reserves have been provided in accordance with
GAAP and as to which no Lien exists, or (ii) the CCM Proceeding, or (iii) which would not have a Material Adverse Effect. No Tax liens have been filed and no claims are being asserted with respect to any such Taxes. The charges, accruals
and reserves on the books of the Borrower and each of its Subsidiaries in respect of any Taxes or other governmental charges are adequate. 

5.7 Litigation and Contingent Obligations. There is no litigation, arbitration, governmental investigation, proceeding or inquiry
pending or, to the knowledge of any of their executive officers, threatened against or affecting the Borrower or any of its Subsidiaries which could reasonably be expected to have a Material Adverse Effect (other than the CCM Proceeding) or which
seeks to prevent, enjoin or delay the making of any Credit Extensions. 
 5.8 Entities Owned. Schedule 5.8 sets forth, as of the
Effective Date, the names and jurisdictions of incorporation or formation of all Subsidiaries and Joint Ventures in which Borrower has a direct ownership interest (but excluding publicly-traded Persons in which Borrower holds less than a five
percent (5%) ownership interest). Except as described in 

  
 -57- 

 
Schedule 5.8, as of the Effective Date, excluding publicly-traded Persons in which Borrower holds less than a five percent (5%) ownership interest, Borrower does not own any Capital Stock or
ownership interest in any Person other than its Subsidiaries and Joint Ventures. All outstanding shares of Capital Stock or ownership interests, as the case may be, of each Subsidiary (other than an Excluded Subsidiary) and Joint Venture that are
owned by Borrower or any other Loan Party are (i) owned of record and beneficially by Borrower and/or by one (1) or more Loan Parties, free and clear of all Liens, claims, encumbrances, and rights of others (other than Permitted Liens),
and (ii) (to the knowledge of the Borrower in the case of any such Person that is not a Subsidiary of the Borrower) duly authorized, validly issued, fully paid, nonassessable (except for capital calls or contribution requirements in connection
with ownership interests in limited liability companies, limited partnerships and Joint Ventures), and issued in compliance with all applicable state and federal securities and other laws, except where the failure to comply could not reasonably be
expected to have a Material Adverse Effect. 
 5.9 ERISA. With respect to each Plan, the Borrower and all ERISA Affiliates have paid
all required minimum contributions and installments on or before the due dates provided under Section 430(j) of the Code and could not reasonably be subject to a lien under Section 430(k) of the Code or Title IV of ERISA. Neither the
Borrower nor any ERISA Affiliate has filed, pursuant to Section 412(c) of the Code or Section 302(c) of ERISA, an application for a waiver of the minimum funding standard. No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. 

5.10 Accuracy of Information. No information, exhibit, financial statements or report furnished by any Loan Party or any of their
respective Subsidiaries to the Administrative Agent or to any Lender in connection with the negotiation of, or compliance with, the Loan Documents (as modified or supplemented by other information so furnished), taken as a whole, as of the date so
furnished or delivered, contained any material misstatement of fact or omitted to state a material fact or any fact necessary to make the statements contained therein not misleading.; provided that (1) with respect to projected financial
information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time and (2) with respect to the financial statements, the Borrower makes only the
representations set forth in Section 5.4. 
 5.11 Regulation U. Margin stock (as defined in Regulation U) constitutes less than 25%
of the value of those assets of the Borrower and its Subsidiaries which are subject to any limitation on sale, pledge, or other restriction hereunder. 

5.12 Material Agreements. No Loan Party nor any Subsidiary of the Borrower is in default in the performance, observance or fulfillment
of any of the obligations, covenants or conditions contained in (i) any agreement to which it is a party, which default could reasonably be expected to have a Material Adverse Effect or (ii) any agreement or instrument evidencing or
governing Material Indebtedness. 
 5.13 Compliance With Laws. Each Loan Party is in compliance with all applicable statutes, rules,
regulations, orders and restrictions of any domestic or foreign government or any 

  
 -58- 

 
instrumentality or agency thereof having jurisdiction over the conduct of their respective businesses or the ownership of their respective Property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. 
 5.14 Title to
Properties. Each of the Loan Parties has good and marketable fee title to the Real Property Inventory owned by it, and except as could not reasonably be expected to result in a Material Adverse Effect, to all the other assets owned by it and
reflected on the balance sheet and related notes and schedules most recently delivered by the Borrower to the Lenders (the “Recent Balance Sheet”), except for those properties and assets which have been disposed of since the
date of the Recent Balance Sheet or which no longer are used or useful in the conduct of its business or which are classified as real estate not owned under GAAP. All such Real Property Inventory and other assets owned by the Loan Parties are free
and clear of all Liens except Permitted Liens. 
 5.15 Plan Assets; Prohibited Transactions. The Borrower is not an entity deemed to
hold “plan assets” within the meaning of 29 C.F.R. § 2510.3-101 of an employee benefit plan (as defined in Section 3(3) of ERISA) which is subject to Title I of ERISA or any plan (within the meaning of Section 4975 of the
Code), and neither the execution of this Agreement nor the making of Credit Extensions hereunder gives rise to a prohibited transaction within the meaning of Section 406 of ERISA or Section 4975 of the Code. 

5.16 Environmental Matters. Based on its commercially reasonable due diligence, the Borrower has concluded its Property and operations
and those of its Subsidiaries are in material compliance with applicable Environmental Laws and that none of Borrower or any of its Subsidiaries is subject to any liability under Environmental Laws that individually or in the aggregate could
reasonably be expected to have a Material Adverse Effect. None of the Loan Parties has received any notice to the effect that its Property and/or operations are not in material compliance with any of the requirements of applicable Environmental Laws
or are the subject of any federal or state investigation evaluating whether any remedial action is needed to respond to a release of any Hazardous Material, which non-compliance or remedial action could reasonably be expected to have a Material
Adverse Effect. 
 5.17 Investment Company Act. Neither the Borrower nor any Subsidiary is an “investment company” or a
company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended. 

5.18 Insurance. The Borrower maintains, and has caused each Subsidiary to maintain, with financially sound and reputable insurance
companies insurance on all their Property, liability insurance and environmental insurance in such amounts, subject to such deductibles and self-insurance retentions and covering such properties and risks as is consistent with sound business
practice. 
 5.19 Subordinated Debt. The Obligations constitute senior indebtedness which is entitled to the benefits of the
subordination provisions of all outstanding Subordinated Debt. 
 5.20 Solvency. 

  
 -59- 

 (i) Immediately after the consummation of the transactions to occur on the date hereof
(inclusive of the New Indenture Notes Obligations) and immediately following the making of each Credit Extension, if any, made on the date hereof and after giving effect to the application of the proceeds of such Credit Extensions, (a) the fair
value of the assets of the Borrower and its Subsidiaries on a consolidated basis, at a fair valuation, will exceed the debts and liabilities, subordinated, contingent or otherwise, of the Borrower and its Subsidiaries on a consolidated basis;
(b) the present fair saleable value of the Property of the Borrower and its Subsidiaries on a consolidated basis will be greater than the amount that will be required to pay the probable liability of the Borrower and its Subsidiaries on a
consolidated basis on their debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured; (c) the Borrower and its Subsidiaries on a consolidated basis will be able to pay
their debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (d) the Borrower and its Subsidiaries on a consolidated basis will not have unreasonably small capital with which
to conduct the businesses in which they are engaged as such businesses are now conducted and are proposed to be conducted after the date hereof. 

(ii) The Borrower does not intend to, or to permit any of its Subsidiaries to, and does not believe that it or any of its Subsidiaries will,
incur debts beyond its ability to pay such debts as they mature, taking into account the timing of and amounts of cash to be received by it or any such Subsidiary and the timing of the amounts of cash to be payable on or in respect of its
Indebtedness or the Indebtedness of any such Subsidiary. 
 5.21 No Default. No Default or Event of Default has occurred and is
continuing. 
 5.22 Foreign Asset Control Regulations. Neither the execution and delivery of the Loan Documents by Borrower or any
Loan Party nor the use of the proceeds of any Loan or any extension of credit, will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR,
Subtitle B, Chapter V, as amended) or the Anti-Terrorism Order or any enabling legislation or executive order relating to any of the same. Without limiting the generality of the foregoing, none of the Borrower, any Loan Party nor any of
their respective subsidiaries (a) are or will become a blocked person described in Section 2 of the Anti-Terrorism Order or (b) engage or will engage in any dealings or transactions or be otherwise associated with any such blocked
person. 
 5.23 Anti-Corruption Laws. The Borrower, its subsidiaries and their respective officers and employees and, to the
knowledge of Borrower, its directors and agents, are in compliance with Anti-Corruption Laws in all material respects. No Advance or Letter of Credit, use of proceeds or other transaction contemplated by this Agreement will violate any
Anti-Corruption Law. 
 ARTICLE VI 

COVENANTS 
 During
the term of this Agreement, unless the Required Lenders shall otherwise consent in writing: 

  
 -60- 

 6.1 Financial Reporting. The Borrower will maintain, for itself and each Subsidiary, a
system of accounting established and administered in accordance with GAAP, and furnish to the Administrative Agent: 
 (a) Within 90 days
after the close of each of its fiscal years, an unqualified (except for qualifications relating (1) to changes in accounting principles or practices reflecting changes in GAAP, (2) for any period within twelve months of the Facility
Termination Date, the impending maturity of the Obligations) audit report, with no going concern modifier, certified by (1) nationally recognized independent certified accountants or (2) independent certified public accountants acceptable
to the Lenders, prepared in accordance with GAAP on a consolidated basis for the Loan Parties and their respective Subsidiaries, including balance sheets as of the end of such period, related profit and loss and reconciliation of surplus statements,
and a statement of cash flows, accompanied by, if prepared and delivered, any management letter prepared by said accountants. 
 (b) Within
forty-five (45) days after the close of the first three (3) quarterly periods of each of its fiscal years, for the Loan Parties and their respective Subsidiaries, consolidated unaudited balance sheets as at the close of each such period
and consolidated profit and loss statements (including sufficient detail for independent calculation of the financial covenants set forth in Section 6.23) and a statement of cash flows for the period from the beginning of such fiscal year to
the end of such quarter, all certified by its chief financial officer as being prepared in accordance with GAAP, subject to normal year-end adjustments and the absence of footnotes. 

(c) Within forty-five (45) days after the end of each calendar quarter, Borrower shall provide Administrative Agent with a Borrowing Base
Certificate (and Administrative Agent will promptly forward to each Lender) showing Borrower’s calculations of the components of the Borrowing Base and such data supporting such calculations as the Administrative Agent may reasonably require,
which Borrowing Base Certificate shall be subject to the Administrative Agent’s reasonable approval and adjustment. 
 (d) As soon as
available, but in any event within 30 days after the beginning of each fiscal year of the Borrower, a copy of the plan and forecast (including a projected consolidated balance sheet, income statement and cash flow statement) of the Borrower for such
fiscal year. 
 (e) Together with the financial statements required under Sections 6.1(a) and (b), a compliance certificate in
substantially the form of Exhibit I signed by its chief financial officer showing the calculations necessary to determine compliance with Section 6.23 of this Agreement and stating that no Default or Event of Default exists, or if any Default
or Event of Default exists, stating the nature and status thereof. 
 (f) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports which the Borrower or any of its Subsidiaries files with the SEC. 

  
 -61- 

 (g) within 20 days after each month-end, a monthly sales report for all Properties and Projects
owned by Borrower. 
 (h) Such other information (including non-financial information and environmental reports, if available) as the
Administrative Agent may from time to time reasonably request. 
 If any information which is required to be furnished to the Lenders under
this Section 6.1 is required by law or regulation to be filed by the Borrower with a government body on an earlier date, then the information required hereunder shall be furnished to the Lenders at such earlier date. 

Any financial statement or report required to be furnished pursuant to Section 6.1(a), Section 6.1(b) or Section 6.1(f) shall
be deemed to have been furnished on the date on which the Lenders receive notice that the Borrower has posted such financial statement on a website that is freely and readily available to the Administrative Agent and the Lenders without charge.
Notwithstanding the foregoing, the Borrower shall deliver paper copies of any such financial statement to the Administrative Agent if the Administrative Agent requests the Borrower to furnish such paper copies until written notice to cease
delivering such paper copies is given by the Administrative Agent. 
 6.2 Notice of Material Events. The Borrower will give notice in
writing to the Administrative Agent, promptly and in any event within 10 days after an officer of the Borrower obtains knowledge thereof, of the occurrence of any of the following: 

(a) any Default or Event of Default; 

(b) the filing or commencement of any action, suit or proceeding by or before any arbitrator or governmental authority (including pursuant to
any applicable Environmental Laws) against or affecting any Loan Party or any Affiliate thereof that would reasonably be expected to result in a Material Adverse Effect; 

(c) with respect to a Plan, (i) any failure to pay all required minimum contributions and installments on or before the due dates
provided under Section 430(j) of the Code or (ii) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA, of an application for a waiver of the minimum funding standard; 

(d) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be expected to
result in a Material Adverse Effect; 
 (e) as soon as possible and in any event within 10 days after receipt thereof by any of the Loan
Parties or any of their Subsidiaries, a copy of (i) any notice or claim to the effect that any of the Loan Parties or of their Subsidiaries is or may be liable to any Person as a result of the release by any of the Loan Parties, any of their
Subsidiaries, or any other Person of any Hazardous Material into the environment, and (ii) any notice alleging any violation of any Environmental Law or any federal, state or local health or safety law or regulation by any of the

  
 -62- 

 
Loan Parties or any of their Subsidiaries, which, in either case, could reasonably be expected to have a Material Adverse Effect; and 

(f) any other development, financial or otherwise, which would reasonably be expected to have a Material Adverse Effect. 

Each notice delivered under this Section shall be accompanied by a statement of an Authorized Officer of Borrower setting forth the details of
the event or development requiring such notice and any action taken or proposed to be taken with respect thereto. 
 6.3 Preservation of
Existence and Similar Matters. Borrower shall, and shall cause each other Loan Party to, preserve and maintain its respective existence, and to keep in full force and effect the rights, franchises, licenses and privileges that are material to
the conduct of the business of the Borrower and its Subsidiaries, taken as a whole; provided, that the Borrower shall not be required to preserve any such right, franchise, license or privilege, if the maintenance or preservation thereof is no
longer desirable in the conduct of the business of the Borrower and its Subsidiaries taken as a whole; and provided further, however, that this Section 6.3 not prohibit any transaction otherwise permitted by Section 6.19.

 6.4 Compliance with Applicable Law. Borrower shall, and shall cause each other Loan Party to, comply with all Applicable Law,
including the obtaining of all Governmental Approvals, the failure with which to comply could be expected to have a Material Adverse Effect. 

6.5 Maintenance of Property; Completion of Construction. In addition to the requirements of any of the other Loan Documents, Borrower
shall, and shall cause each other Loan Party to, (a) protect and preserve all of its Properties (including, but not limited to, all intellectual Property) necessary to the conduct of its respective business, and maintain in good repair, working
order and condition all tangible properties necessary to the conduct of its respective business, ordinary wear and tear excepted, except as would not reasonably be expected to have a Material Adverse Effect, and (b) from time to time make or
cause to be made all needed and appropriate repairs, renewals, replacements and additions to such properties necessary to the conduct of its respective business. 

6.6 Insurance. The Borrower will, and will cause each other Loan Party to, maintain with financially sound and reputable insurance
companies insurance on all their Property, liability insurance and environmental insurance in such amounts, subject to such deductibles and self-insurance retentions and covering such properties and risks as is consistent with sound business
practice, and the Borrower will furnish to the Administrative Agent upon request full information as to the insurance carried. 
 6.7
Payment of Taxes and Claims. Borrower shall, and shall cause each of its Subsidiaries to, pay and discharge prior to delinquency (a) all material taxes, assessments and governmental charges or levies imposed upon it or upon its income or
profits or upon any properties belonging to it, and (b) all material lawful claims of materialmen, mechanics, carriers, warehousemen and landlords for labor, materials, supplies and rentals which, if unpaid, might become a Lien on any
properties of such Person; provided, however, that this Section shall not 

  
 -63- 

 
require the payment or discharge of any such tax, assessment, charge, levy or claim (i) which is being contested in good faith by appropriate proceedings which operate to suspend the
collection thereof, (ii) for which adequate reserves have been established on the books of such Person in accordance with GAAP or federal income tax accounting principles consistently applied or which has been fully bonded in accordance with
Applicable Law, and (iii) failure to pay or discharge the same will not have a Material Adverse Effect. 
 6.8 Books and Records;
Inspections. Borrower will, and will cause each Loan Party to, keep proper books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities. Borrower
will, and will cause each Loan Party to, permit representatives of the Administrative Agent, at the expense of the Administrative Agent, unless an Event of Default has occurred and is continuing (and during the existence of any Event of Default,
each of the Lenders), to visit and inspect any of their respective properties, to examine and make abstracts from any of their respective books and records and to discuss their respective affairs, finances and accounts with their respective
officers, employees and independent public accountants, all at such reasonable times during business hours and as often as may be reasonably requested and, so long as no Event of Default exists, with reasonable prior notice. 

6.9 Use of Proceeds. Borrower will use the proceeds of the Loans and the Facility LCs solely for general corporate purposes not
otherwise prohibited hereunder. The Borrower will not, nor will it permit any Subsidiary to, use any of the proceeds of the Advances in violation of any domestic sanctions. 

6.10 Environmental Matters. Borrower shall comply and shall cause each other Loan Party to comply with all Environmental Laws, except
as would not reasonably be expected to have a Material Adverse Effect. Borrower shall promptly take all actions necessary to prevent the imposition of any Liens on any of the Qualified Real Property Inventory included in the Borrowing Base arising
out of or related to any Environmental Laws. Notwithstanding the foregoing, Borrower may contest the existence of any such Lien in good faith by appropriate proceedings which operate to suspend the collection thereof and for which adequate reserves
have been established on the books of such Person in accordance with GAAP or federal income tax accounting principles consistently applied. 

6.11 Further Assurances. At Borrower’s cost and expense and upon request of the Administrative Agent, Borrower shall, and shall
cause each other Loan Party to, duly execute and deliver or cause to be duly executed and delivered, to the Administrative Agent such further instruments, documents and certificates, and do and cause to be done such further acts that may be
necessary or advisable in the reasonable opinion of the Administrative Agent to carry out more effectively the provisions and purposes of this Agreement and the other Loan Documents. 

6.12 [Reserved]. 
 6.13
ERISA Compliance. Borrower shall, and shall cause each ERISA Affiliate to at all times comply with the provisions of ERISA with respect to any retirement or other employee benefit plan to which it is a party as employer, except as would not
reasonably be expected to have a Material Adverse Effect. If Borrower or any Loan Party or any ERISA Affiliate forms 

  
 -64- 

 
any employee benefit plan subject to ERISA, Borrower shall promptly disclose same to Administrative Agent and shall promptly thereafter execute an amendment to this Agreement to add appropriate
representations, covenants and defaults with respect to such ERISA plan and compliance. 
 6.14 Business Operations; Unrelated
Business. Borrower and its Subsidiaries shall (i) engage solely in the business of homebuilding, housing construction, land acquisition, land (including masterplan) development, land dispositions, and related real estate activities,
including the provision of mortgage financing or title insurance, and businesses that are reasonably related or incidental thereto or are reasonable extensions thereof, and (ii) not change the fundamental nature of such businesses. Borrower and
its Subsidiaries shall further operate their respective businesses in compliance with the terms and conditions of this Agreement and the Loan Documents. 

6.15 [Reserved]. 
 6.16
[Reserved]. 
 6.17 Liens. Neither the Borrower nor any Guarantor will create, incur, or suffer to exist any Lien in, of or on
the Property of the Borrower or any Guarantor, except: 
 (i) Permitted Liens. 

(ii) Liens for taxes, assessments or governmental charges or levies which solely encumber property abandoned or in the process of being
abandoned and with respect to which there is no recourse to the Borrower or any Guarantor or any Subsidiary. 
 (iii) Purchase-money Liens
on any Property hereafter acquired or the assumption of any Lien on Property existing at the time of such acquisition (and not created in contemplation of such acquisition), or a Lien incurred in connection with any conditional sale or other title
retention or a Capitalized Lease; provided that: 
 (A) The Lien on any such Property attaches to such asset
concurrently or within ninety (90) days after the acquisition thereof; 
 (B) Each Lien shall attach only to the
Property so acquired, any accessions or improvements thereto, and any other Property acquired from a common seller. 
 (iv) Liens existing
on the date hereof (and not otherwise permitted under this Section 6.17) and described in Schedule 6.17 hereto and Liens securing Refinancing Indebtedness with respect thereto, but only to the extent such Liens encumber the same
collateral in whole or in part as the previous Liens securing the Indebtedness being refunded, refinanced or extended. 
 (v) Liens
securing obligations for borrowed money in an amount not in excess of $50,000,000 in the aggregate. 

  
 -65- 

 (vi) Judgments and similar Liens arising in connection with court proceedings; provided
the execution or enforcement thereof is stayed and the claim is being contested in good faith, with adequate reserves therefor being maintained by the Borrower or such Guarantor in accordance with GAAP. 

(vii) Liens securing Non-Recourse Indebtedness of the Borrower or any Guarantor. 

(viii) Liens existing with respect to Indebtedness of a Person acquired in an Investment permitted by this Agreement. 

(ix) Liens arising out of pledges or deposits under worker’s compensation laws, unemployment insurance, old age pensions, or other
social security or retirement benefits, or similar legislation. 
 (x) Liens incurred or deposits made to secure the performance of (or in
lieu of) tenders, bids, leases, statutory obligations, surety and appeal bonds, progress payments, government contracts, utility services and other obligations of like nature in each case incurred in the ordinary course of business. 

(xi) Leases or subleases granted to others not materially interfering with the ordinary course of business of the Borrower or any Guarantor.

 (xii) Any interest in or title of a lessor to property subject to any Capitalized Lease Obligations. 

(xiii) Liens on cash pledged to secure deductibles, retentions and other obligations to insurance providers in the ordinary course of
business. 
 (xiv) Any option, contract, right of first refusal or other agreement to sell or purchase an asset or participate in the
income or revenue derived therefrom, together with any Liens granted to secure the obligations incurred in respect of any of the foregoing. 

(xv) Any legal right of, or right granted in good faith to, a lender or lenders to which the Borrower or a Guarantor may be indebted to
offset against, or appropriate and apply to the payment of, such Indebtedness any and all balances, credits, deposits, accounts, or monies of the Borrower or a Guarantor with or held by such lender or lenders. 

(xvi) Any pledge or deposit of cash or property by the Borrower or any Guarantor in conjunction with obtaining surety, performance,
completion or payment bonds and Letters of Credit or other similar instruments or providing earnest money obligations, escrows or similar undertakings or indemnifications required in the ordinary course of business of a homebuilder. 

(xvii) Liens incurred in the ordinary course of business as security for the Borrower’s or any Guarantor’s obligations with respect
to indemnification in favor of title insurance providers. 

  
 -66- 

 (xviii) Letters of Credit, bonds or other assets pledged to secure insurance in the ordinary
course of business. 
 (xix) Liens on assets securing warehouse lines of credit and repurchase agreements and other credit facilities to
finance the operations of the Borrower’s mortgage lending Subsidiaries, insurance subsidiaries and/or financial asset management Subsidiaries and Liens related to issuances of CMOs and mortgage-related securities, so long as such assets are
owned by such mortgage lending Subsidiaries and financial asset Subsidiaries. 
 (xx) Liens incurred in the ordinary course of business to
secure (i) profit and price participation arrangements and (ii) fees, taxes and carry costs on, in respect of or owing to governmental issuers (including enterprises thereof) of community facility district, mello-roos, metro-district or
similar bonding obligations. 
 (xxi) Pledges, deposits and other Liens existing under, or required to be made in connection with,
(i) earnest money obligations, escrows or similar purpose undertakings or indemnifications in connection with any purchase and sale agreement of real property, (ii) development agreements or other contracts entered into with governmental
authorities (or an entity sponsored by a governmental authority), in connection with the entitlement of real property or (iii) agreements for the funding of infrastructure, including in respect of the issuance of community facility district
bonds, metro district bonds, mello-roos bonds and subdivision improvement bonds, and similar bonding requirements arising in the ordinary course of business of a homebuilder. 

(xxii) Licenses of intellectual property granted in the ordinary course of business and not interfering in any material respect with the
ordinary conduct of business of the Borrower and its Subsidiaries. 
 (xxiii) Liens, encumbrances or other restrictions contained in any
joint venture agreement entered into by the Borrower or a Guarantor with respect to the equity interests issued by the relevant joint venture or the assets of such joint venture. 

(xxiv) Customary Liens in favor of a trustee on cash, Cash Equivalent Investments and Marketable Securities supporting the repayment of the
Senior Notes and/or other Public Indebtedness in any case arising in connection with the defeasance, discharge or redemption of such Indebtedness. 

(xxv) Customary Liens in favor of a trustee on all money or personal property held or collected by the trustee pursuant to the indenture
governing the New Indenture Notes Obligations and any indenture governing any other Public Indebtedness, to the extent such Liens secure only customary compensation and reimbursement obligations of such trustee. 

(xxvi) Assignments of insurance or condemnation proceeds provided to landlords (or their mortgagees) pursuant to the terms of any lease and
Liens and rights reserved in any lease for rent or for compliance with the terms of such lease. 

  
 -67- 

 (xxvii) Liens consisting of pledges or deposits of property to secure performance in connection
with operating leases made in the ordinary course of business to which the Borrower or a Guarantor is a party as lessee. 
 (xxviii) Liens
on real property, and additions, accessions, improvements and replacements and customary deposits in connection therewith and proceeds and products therefrom, that (A) is not related to Units and does not constitute Land Under Development,
Finished Lots or Entitled Land, and (B) is owned by the Borrower or a Guarantor, which Liens secure Indebtedness of the Borrower or such Guarantor, provided (x) each such Lien attaches only to such real property and (y) the obligation
secured by such Lien is limited to such Indebtedness. 
 (xxix) Liens arising by operation of law in favor of issuers of letters of credit
in the documents presented under a letter of credit. 
 (xxx) Liens of a lessor, sublessor or licensor arising under any lease, sublease or
license entered into by the Borrower or any Subsidiary in the ordinary course of business and not interfering in any material respect with the ordinary conduct of business of the Borrower or any Subsidiary, and covering only the Property or assets
so leased, subleased or licensed, including rights of tenants under leases or subleases and rental agreements covering real property entered into in the ordinary course of business of the Person owning such real property. 

(xxxi) Liens on property or assets of the Borrower or any Subsidiary securing Indebtedness of the Borrower or any Subsidiary owing to the
Borrower or one or more Subsidiaries not to exceed $20,000,000 in the aggregate. 
 (xxxii) Liens on specific items of personal property
inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or
other goods. 
 6.18 Prepayment of Indebtedness. If a Default or Event of Default has occurred and is continuing, Borrower shall not
voluntarily prepay, or permit any other Loan Party voluntarily to prepay, the principal amount, in whole or in part, of any Indebtedness other than (a) Indebtedness owed to each Lender hereunder or under some other agreement between Borrower
and such Lender, (b) in pro rata amounts with payment of the Loans, Indebtedness which ranks pari passu with the Indebtedness incurred under this Agreement which is or becomes due and owing whether by reason of acceleration or otherwise and
(c) Indebtedness which is exchanged for, or converted into, Capital Stock (or securities to acquire Capital Stock) of any Loan Party. 

6.19 Limitation on Fundamental Changes. 

(a) Borrower shall not, nor shall any Loan Party be permitted to, do any of the following: 

(i) sell, assign, lease or otherwise dispose of (whether in one transaction in a series of transactions) all or substantially all of the
assets (whether now owned or 

  
 -68- 

 
hereafter acquired) of the Loan Parties (taken as a whole on a consolidated basis) except (A) for the sale of inventory in the ordinary course of business, and (B) bulk sales of
Properties held in a geographic region, provided that the fair value of such bulk sales do not exceed in any twelve (12) consecutive months 20% of Consolidated Tangible Net Worth; 

(ii) merge into or consolidate with any other Person or permit any other Person to merge into or consolidate with it; 

(iii) dissolve, liquidate or wind up its business by operation of law or otherwise; or 

(iv) distribute to the stockholders of such Loan Party any Capital Stock of any Subsidiary that is a Loan Party; 

provided, however, that any Loan Party (other than the Borrower) may merge into or consolidate with or may dissolve and liquidate into, or may
sell, assign, lease or otherwise dispose of all or substantially all of the assets to, another Loan Party, and any Person that is not a Loan Party may merge into or consolidate with or may dissolve and liquidate into, or may sell, assign, lease or
otherwise dispose of all or substantially all of the assets to, another Subsidiary that is not a Loan Party, and any Loan Party may distribute to another Loan Party the Capital Stock of any other Loan Parties, if (and only if) (1) in the case
of a merger or consolidation involving a Loan Party other than the Borrower, the surviving Person is, or upon such merger or consolidation becomes, a Loan Party, (2) in the case of merger or consolidation involving the Borrower, the Borrower is
the surviving Person, (3) the character of the business of the Borrower and the Subsidiaries on a consolidated basis will not be materially changed by such occurrence, and (4) such occurrence shall not constitute or give rise to
(a) an Event of Default or (b) Default (beyond all applicable grace and cure periods) in respect of any of the covenants contained in any agreement to which the Borrower or any such Subsidiary is a party or by which its property may be
bound if such Default would have a Material Adverse Effect. 
 (b) Borrower shall not, nor shall it permit any Loan Party to, acquire all or
substantially all of the Capital Stock of another Person unless (i) the primary business of such person is engaging in homebuilding, housing construction, land acquisition, land (including masterplan) development, land dispositions, and related
real estate activities, including the provision of mortgage financing or title insurance, and businesses that are reasonably related or incidental thereto or are reasonable extensions thereof, (ii) the majority of shareholders (or other equity
interest holders), the board of directors or other governing body of such person approves such acquisition and (iii) the Investment complies with the limitations in Section 6.21. 

Nothing contained in this Section 6.19, however, shall restrict (1) any sale of assets among the Loan Parties and their Subsidiaries which is in the
ordinary course of business or is otherwise in compliance with all other provisions of this Agreement or (2) the organization by any Loan Party of one or more Persons in the ordinary conduct of its business. 

6.20 Transactions with Affiliates. Except as described on Schedule 6.20 attached hereto, Borrower shall not, and shall not permit
any other Loan Party to, permit to exist or enter into, any transaction (including the purchase, sale, lease or exchange of any property or the 

  
 -69- 

 
rendering of any service) with any Affiliate of Borrower or any other Loan Party, or with any director, officer or employee of Borrower or any other Loan Party, except transactions in the
ordinary course of and pursuant to the reasonable requirements of the business of Borrower or any other Loan Party and upon fair and reasonable terms that, on an overall basis, are no less favorable to Borrower or such other Loan Party than would be
obtained in a comparable arm’s length transaction with a Person that is not an Affiliate. Notwithstanding the foregoing, the following are permitted: 

(i) any contract, agreement or understanding with, or for the benefit of, or plan for the benefit of, employees of the Borrower or its
Subsidiaries generally (in their capacities as such) that has been approved by the general partner of the Borrower, 
 (ii) Equity
interests issuances to directors, officers and employees of the Borrower or its Subsidiaries pursuant to plans approved by the holders of equity interests of the Company; 

(iii) any Investment permitted under Section 6.21 (other than Investments described in clause (j) thereof) or dividend or
distribution permitted under Section 6.22, 
 (iv) any transaction between or among the Borrower and one or more Loan Parties or
between or among Loan Parties (provided, however, no such transaction shall involve any other Affiliate (other than a Subsidiary to the extent the applicable amount constitutes a payment permitted under Section 6.21 or 6.22)), 

(v) any transaction between one or more Loan Parties and one or more non-Loan Parties where all of the payments to, or other benefits
conferred upon, such non-Loan Parties are substantially contemporaneously dividended, or otherwise distributed or transferred without charge, to the Borrower or a Loan Party, 

(vi) any transactions consummated in accordance with written agreements existing on the Effective Date with Affiliates, or entities in which
an Affiliate owns an interest, including amendments thereto that are no more favorable to the Affiliate in any material respect than the terms existing on the Effective Date, 

(vii) the payment of reasonable and customary fees to, and indemnity provided on behalf of, officers, directors, employees or consultants of
the Borrower or such Loan Party, and 
 (viii) any transaction with an Affiliate that is a Joint Venture in which the Borrower or any Loan
Party has a direct or indirect equity interest so long as the other Joint Venture partners not constituting Affiliates of the Borrower or any Loan Party, as the case may be, approve the subject transaction. 

6.21 Investments. Borrower will not, nor will Borrower permit any other Loan Party to, make or suffer to exist any Investments
(including without limitation, loans and advances to, and other Investments in, Subsidiaries), or commitments therefor, or to create any Subsidiary or to become or remain a partner in any partnership or Joint Venture, except: 

  
 -70- 

 (a) Cash Equivalent Investments. 

(b) Existing Investments in Subsidiaries and Joint Ventures, and other Investments in existence on the date hereof and described in
Schedule 5.8. 
 (c) Any loan or advance to an executive officer, director or employee of the Borrower or any Subsidiary made in the
ordinary course of business or in accordance with past practice; provided, however, that any such loan or advance exceeding $1 million shall have been approved by the board of directors or other governing body of the Borrower or a committee
thereof consisting of disinterested members; and provided further that all such loans and advances may not exceed $10,000,000 in aggregate outstanding at any one time. 

(d) Investments by a Loan Party or Wholly-Owned Subsidiary in another Loan Party or Wholly-Owned Subsidiary. 

(e) Investments constituting Rate Management Transactions. 

(f) receivables owing to any Loan Party if created or acquired in the ordinary course of business; 

(g) prepaid expenses, negotiable instruments held for collection and insurance, lease, utility, workers’ compensation, performance and
other similar deposits in the ordinary course of business; 
 (h) Investments made by any Loan Party for consideration consisting only of
Capital Stock; 
 (i) guarantees of performance obligations in the ordinary course of business; 

(j) Investments permitted by Section 6.19(b) provided that the Person acquired becomes a Guarantor; 

(k) Investments in mortgages, receivables, other securities or ownership interests, loans or advances made in connection with a strategy to
acquire land or other homebuilding assets through foreclosure or other exercise of remedies; 
 (l) Investments received pursuant to any
plan of reorganization or similar arrangement upon the bankruptcy or insolvency of such trade creditors or customers; 
 (m) Investments or
securities received in settlement of debts, including as a result of foreclosure, perfection or enforcement of any Lien or any judgment or settlement in exchange for or satisfaction of such debts, owing to Borrower or any Guarantor in the ordinary
course of business; 
 (n) Investments, other than those permitted by subsections (a) through (m) above, in Persons that are in
the business of homebuilding, land acquisition or land development businesses and businesses that are reasonably related thereto or reasonable extensions thereof not 

  
 -71- 

 
to exceed in the aggregate amount outstanding at any time 35% of Consolidated Tangible Net Worth; 

(o) any receivables, loans or other consideration received in connection with any asset sale otherwise permitted hereunder; 

(p) obligations (but not payments thereon) with respect to homeowners association obligations, community facility district bonds, metro
district bonds, mello-roos bonds and subdivision improvement bonds and similar bonding requirements arising in the ordinary course of business of a homebuilder; 

(q) guarantee, reimbursement or indemnification obligations (other than for the payment of borrowed money) entered into in the ordinary course
of business and incurred for the benefit of any adjoining landowner, seller of real property or municipal government authority (or enterprises thereof) in connection with the acquisition, entitlement and development of real property; 

(r) current Investments acquired in the ordinary course of business for cash management purposes; 

(s) guarantees of any Indebtedness permitted to be incurred hereunder; 

(t) guarantees (but not payments thereon) with respect to Specified Obligations; and 

(u) other Investments in the aggregate amount not to exceed $20,000,000 at any time outstanding. 

6.22 Dividends and Subordinated Debt. No Loan Party shall declare or pay any dividend on, or purchase, redeem, retire, or otherwise
acquire for value any of its Capital Stock now or hereafter outstanding, return any capital to its stockholders or make any distribution of assets to its stockholders, whether in cash, property, or obligations, or pay, repurchase, or redeem all or
any part of any Subordinated Debt, transfer any property in payment of or as security for the payment of all or any part of any Subordinated Debt, or establish any sinking fund, reserve, or like set aside of funds or other property for the
redemption, retirement, or repayment of all or any part of any Subordinated Debt, except: 
 (a) Subject to the subordination terms
applicable to such Subordinated Debt, so long as no Default or Event of Default exists, a Loan Party may make regularly scheduled and mandatory payments in respect of any Subordinated Debt as and when due by the terms thereof; provided, further,
that a Loan Party may prepay or repurchase Subordinated Debt at any time from the proceeds of indebtedness issued by such Loan Party following the Effective Date so long as (i) the maturity date of all such indebtedness is at least six
(6) months beyond the Facility Termination Date, and (ii) no Default exists both before and after giving effect thereto; 
 (b) So
long as no Default or Event of Default exists both immediately before and after giving effect to such dividend, Borrower may declare and pay dividends; 

  
 -72- 

 (c) So long as no Default or Event of Default exists both before and after giving effect to such
repurchase, Borrower may from time to time repurchase shares of its Capital Stock; 
 (d) Any Loan Party may pay dividends or make
distributions to the Borrower or to a Loan Party which is a Subsidiary of the Borrower; and 
 (e) Any Loan Party may, at any time,
(i) declare or pay dividends on Capital Stock in the form of Capital Stock (or warrants or rights to acquire Capital Stock) of such Loan Party or through an accretion to the liquidation preference of such Capital Stock, (ii) purchase,
redeem, retire or otherwise acquire Capital Stock or Subordinated Debt solely in consideration of Capital Stock (or warrants or rights to acquire Capital Stock) of such Loan Party, (iii) exchange Capital Stock or Subordinated Debt solely for
Capital Stock (or warrants or rights to acquire Capital Stock) of such Loan Party or (iv) convert Capital Stock or Subordinated Debt solely into Capital Stock (or warrants or rights to acquire Capital Stock) of such Loan Party, in each case
without transfer to the holders of Capital Stock or Subordinated Debt of any cash or other property of such Loan Party or any of its Subsidiaries in respect thereof. 

(f) Any Loan Party may pay any dividend or redeem any Capital Stock or Subordinated Debt within 60 days after the date of declaration thereof
or call for redemption if, at such date of declaration or call for redemption, such payment or redemption was permitted by the above provisions of this Section 6.22 as of the date of declaration or call for redemption (and the payment itself
will be deemed to have been paid on such date of declaration or call for redemption); and 
 (g) The Borrower may make Tax Distributions.

 6.23 Financial Covenants. 

(a) Interest Coverage Ratio. The Borrower will not permit the ratio, determined as of the end of each of its fiscal quarters for the
then most-recently ended four (4) fiscal quarters, of (i) Consolidated EBITDA to (ii) Consolidated Interest Incurred to be less than 1.5 to 1.0. 

(b) Adjusted Leverage Ratio. The Borrower will not permit the Adjusted Leverage Ratio, determined as of the end of each of its fiscal
quarters, to be greater than (i) 2.0 to 1.0, prior to and including March 31, 2017, and (ii) 1.85 to 1.0 at any time after March 31, 2017. 

(c) [Reserved]. 
 (d)
Minimum Consolidated Tangible Net Worth. As at the end of each fiscal quarter, the Consolidated Tangible Net Worth shall not be less than the sum of (a) $400,000,000 plus (b) 50% of the cumulative Net Cash Proceeds of any Equity
Issuances received by Borrower during each completed fiscal quarter after the Effective Date, plus (c) 50% of an amount equal to (i) the cumulative Consolidated Net Income (without deductions for losses sustained during any fiscal quarter)
for each completed fiscal quarter following the Effective Date, commencing with the quarter ended June 30, 2015, minus (ii) income taxes on such income at a presumed combined Federal and State rate of fifty percent (50%). 

  
 -73- 

 (e) Ratio of Land Assets to Consolidated Tangible Net Worth. As at the end of each fiscal
quarter, Borrower shall not permit the ratio of (a) the Book Value of Land Assets to (b) Consolidated Tangible Net Worth to exceed 1.75 to 1.0. 

(f) Minimum Liquidity. The Borrower will not permit its Unrestricted Cash, determined as of the end of each of its fiscal quarters, to
be less than $5,000,000. 
 6.24 Guarantors. Shea Homes Funding Corp. and the other direct and indirect Subsidiaries of Borrower
listed on Schedule 1(b) under the heading “Guarantors” shall execute and deliver the Guaranty on the Effective Date. Borrower shall cause each (a) Wholly-Owned Subsidiary of Borrower formed or acquired after the Effective Date, the
assets of which are included in the Borrowing Base, (b) the Initial Non-Wholly-Owned Guarantors, (c) other Subsidiaries that have guaranteed the New Indenture Notes Obligations (other than an Excluded Subsidiary), and
(d) Non-Wholly-Owned Subsidiaries whose assets are to be included in the Borrowing Base, to become a party to the Guaranty and execute and deliver such other documentation required by Administrative Agent, all in form and substance reasonably
acceptable to Administrative Agent within thirty (30) days after the date on which such Subsidiary is formed or acquired; provided that if any Subsidiary that has become a party to the Guaranty (i) is sold or otherwise disposed of in a
transaction permitted by this Agreement to a Person other than Borrower or one of the other Loan Parties, (ii) ceases, at any time, to qualify as a Subsidiary (other than an Excluded Subsidiary) or (iii) is designated an Excluded
Subsidiary in accordance with the terms of this Agreement, then, upon the request of Borrower, Administrative Agent shall, so long as no Default or Event of Default exists or would result therefrom, release such Subsidiary from the Guaranty pursuant
to a release in form and substance reasonably acceptable to Administrative Agent and Borrower. 
 6.25 [Reserved.] 

6.26 Foreign Assets Control Regulations. The Loan Parties shall not use or permit the use of the proceeds of any Loan or any extension
of credit in any manner that will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or the
Anti-Terrorism Order or any enabling legislation or executive order relating to any of the same. Without limiting the foregoing, neither the Borrowers nor any Loan Party will permit itself nor any of its Subsidiaries to (a) become a blocked
person described in Section 1 of the Anti-Terrorism Order or (b) engage in any dealings or transactions or be otherwise associated with any Person who is a blocked person. 

ARTICLE VII 

DEFAULTS 

The occurrence of any one or more of the following events shall constitute an Event of Default (each, an “Event of
Default”): 
 7.1 Any representation or warranty made or deemed made by or on behalf of the Borrower or any of the other Loan
Parties to the Lenders or the Administrative Agent under or in 

  
 -74- 

 
connection with this Agreement, any Credit Extension, or any certificate or information delivered in connection with this Agreement or any other Loan Document shall be materially false on the
date as of which made or confirmed. 
 7.2 Nonpayment of (i) principal of any Loan when due (including, without limitation, under
Section 2.2 hereof), (ii) any Reimbursement Obligation within three (3) Business Days after the same becomes due, or (iii) interest upon any Loan or of any Undrawn Fee, LC Fee or other obligations under any of the Loan Documents
within five (5) days after the same becomes due. 
 7.3 The breach by the Borrower of any of the terms or provisions of
Section 6.2(a), 6.9, 6.17, 6.19, 6.20, 6.21, 6.22, or 6.23(f). By way of clarification, any failure to maintain or observe the financial covenants set forth in Section 6.23(a), (b), (d) or (e) shall put the Term Out Provision
under Section 2.25 hereof into effect, and Borrower must then comply with all the covenants and requirements set forth therein, including without limitation the principal amortization of the Aggregate Outstanding Credit Exposure in eighteen
(18) equal monthly principal payments over the following eighteen (18) month period; provided, however, that a failure to comply with such subsections (a), (b), (c), (d) or (e) of Section 6.23 shall not
result in an Event of Default or otherwise result in an acceleration of the Loans or the LC Obligations, unless or until any other requirements of Section 2.25 hereof have not been met or satisfied by Borrower in response to such defaults
(provided, however, that the foregoing shall not be construed to limit Administrative Agent’s and Lenders’ rights to accelerate the Obligations and exercise all remedies hereunder upon the occurrence of any other Events of Default under
this Article VII). Any default by Borrower or failure to observe or comply with the financial covenants set forth in Section 6.23(f) shall constitute an immediate Event of Default under this Agreement. 

7.4 The breach or failure by the Borrower or any other Loan Party (other than a breach or failure which constitutes an Event of Default under
another Section of this Article VII) of any of the terms or provisions of this Agreement or any other Loan Document which is not remedied within thirty (30) days after the Borrower becomes aware of any such breach; provided that (i) if
such breach or failure cannot, by its nature, be cured within such thirty (30) day period, (ii) Borrower commences efforts to cure such breach or failure within the initial thirty (30) day period and is diligently pursuing such cure,
and (iii) the continuation of such breach or failure does not otherwise have a Material Adverse Effect, Borrower shall have up to an additional sixty (60) days in which to cure such failure. 

7.5 Failure of the Borrower or any other Loan Party to pay when due any Material Indebtedness (other than any purchase money Non-Recourse
Indebtedness); or the default by the Borrower or any other Loan Party in the performance (beyond the applicable grace period with respect thereto, if any) of any term, provision or condition contained in any Material Indebtedness Agreement (other
than any agreement with respect to purchase money Non-Recourse Indebtedness), or any other event shall occur or condition exist, the effect of which default, event or condition is to cause, or to permit the holder(s) of such Material Indebtedness or
the lender(s) under such Material Indebtedness Agreement to cause, such Material Indebtedness to become due prior to its stated maturity or any commitment to lend under such Material Indebtedness Agreement to be terminated prior to its stated
expiration date; or any Material 

  
 -75- 

 
Indebtedness (other than any purchase money Non-Recourse Indebtedness) of the Borrower or any other Loan Party shall be declared to be due and payable or required to be prepaid or repurchased
(other than by a regularly scheduled payment) prior to the stated maturity thereof; or the Borrower or any other Loan Party shall not pay, or admit in writing its inability to pay, its debts generally as they become due. 

7.6 Any Loan Party shall (i) have an order for relief entered with respect to it under any Debtor Relief Laws as now or hereafter in
effect, (ii) make an assignment for the benefit of creditors, (iii) apply for, seek, consent to, or acquiesce in, the appointment of a receiver, custodian, trustee, examiner, liquidator or similar official for it or any Substantial Portion
of its Property, (iv) institute any proceeding seeking an order for relief under any Debtor Relief Laws as now or hereafter in effect or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors or fail to file an answer or other pleading denying the material allegations of any
such proceeding filed against it, (v) take any corporate, partnership or limited liability company action to authorize or effect any of the foregoing actions set forth in this Section 7.6 or (vi) fail to contest in good faith any
appointment or proceeding described in Section 7.7. 
 7.7 Without the application, approval or consent of Borrower or any of the other
Loan Parties, a receiver, trustee, examiner, liquidator or similar official shall be appointed for such Person or any Substantial Portion of its Property, or a proceeding described in Section 7.6(iv) shall be instituted against any such
Person and such appointment continues undischarged or such proceeding continues undismissed or unstayed for a period of sixty (60) consecutive days. 

7.8 [Reserved.] 
 7.9 Any of the
other Loan Parties shall fail within thirty (30) days to pay, bond or otherwise discharge one or more (i) judgments or orders for the payment of money in excess of $25,000,000 (or the equivalent thereof in currencies other than U.S.
Dollars), in the aggregate, exclusive of amounts covered by insurance, or (ii) nonmonetary judgments or orders which, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect, which judgment(s), in any
such case, is/are not stayed on appeal or otherwise being appropriately contested in good faith. 
 7.10 (a) With respect to a Plan,
the Borrower or an ERISA Affiliate is subject to a lien in excess of $10,000,000 pursuant to Section 430(k) of the Code or Section 302(c) of ERISA or Title IV of ERISA, or (b) an ERISA Event shall have occurred that, in the
opinion of the Required Lenders, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect. 

7.11 [Reserved.] 
 7.12 Any
Change of Control shall occur. 
 7.13 The occurrence of any “default” or “Event of Default”, as defined in any Loan
Document (other than this Agreement) or the breach of any of the terms or provisions of any 

  
 -76- 

 
Loan Document (other than this Agreement), which default or breach continues beyond any applicable period of grace therein provided (provided, however, that should there not be any
cure or grace period specified with respect to any “default” or “event of default” under any Loan Document that is not one of the Events of Default otherwise specified in this Article VII, Borrower shall have the cure period
specified in Section 7.4 above with respect to such breach or default). 
 7.14 Any Loan Document shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity or unenforceability of the Guaranty, in whole or in part, or any Guarantor shall fail to comply with any of the terms or provisions of any Guaranty to which it is a
party, or any Guarantor shall deny that it has any further liability, in whole or in part, under any Guaranty to which it is a party, or shall give notice to such effect. 

7.15 Any Borrowing Base Certificate proves to have been incorrect in any material respect when delivered to Administrative Agent; provided
that, it shall not be an Event of Default under this Section 7.15 if (i) such incorrect Borrowing Base Certificate has been corrected by the delivery of a subsequent Borrowing Base Certificate within 10 days after the Borrower obtains
knowledge of such inaccuracy, and (ii) the corrected Borrowing Base Certificate demonstrate that Borrower is in compliance with Section 2.2. 

ARTICLE VIII 

ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES 

8.1 Acceleration; Remedies. 

(a) If any Event of Default described in Section 7.6 or 7.7 occurs with respect to the Borrower, the obligations of the Lenders to make
Loans hereunder and the obligation and power of the LC Issuer to issue Facility LCs shall automatically terminate and the Obligations shall immediately become due and payable without any election or action on the part of the Administrative Agent,
the LC Issuer or any Lender and the Borrower will be and become thereby unconditionally obligated, without any further notice, act or demand, to pay to the Administrative Agent an amount in immediately available funds, which funds shall be held in
the Facility LC Collateral Account, equal to the difference of (x) the amount of LC Obligations at such time, less (y) the amount on deposit in the Facility LC Collateral Account at such time which is free and clear of all rights and
claims of third parties and has not been applied against the Obligations (such difference, the “Collateral Shortfall Amount”). If any other Event of Default occurs, the Required Lenders (or the Administrative Agent with the
consent of the Required Lenders) may (a) terminate or suspend the obligations of the Lenders to make Loans hereunder and the obligation and power of the LC Issuer to issue Facility LCs, or declare the Obligations to be due and payable, or both,
whereupon the Obligations shall become immediately due and payable, without presentment, demand, protest or notice of any kind, all of which the Borrower hereby expressly waives, and (b) upon notice to the Borrower and in addition to the
continuing right to demand payment of all amounts payable under this Agreement, make demand on the Borrower to pay, and the Borrower will, forthwith upon such demand and without any further notice or act, pay to the Administrative Agent the
Collateral Shortfall Amount, which funds shall be deposited in the Facility LC Collateral Account. 

  
 -77- 

 (b) If at any time while any Event of Default is continuing, the Administrative Agent determines
that the Collateral Shortfall Amount at such time is greater than zero, the Administrative Agent may make demand on the Borrower to pay, and the Borrower will, forthwith upon such demand and without any further notice or act, pay to the
Administrative Agent the Collateral Shortfall Amount, which funds shall be deposited in the Facility LC Collateral Account. 
 (c) The
Administrative Agent may at any time or from time to time after funds are deposited in the Facility LC Collateral Account, apply such funds to the payment of the Obligations and any other amounts as shall from time to time have become due and
payable by the Borrower to the Lenders or the LC Issuer under the Loan Documents, as provided in Section 8.2. 
 (d) At any time while
any Event of Default is continuing (or if there is, or if the withdrawal would result in, a Collateral Shortfall Amount), neither the Borrower nor any Person claiming on behalf of or through the Borrower shall have any right to withdraw any of the
funds held in the Facility LC Collateral Account. After all of the Obligations have been indefeasibly paid in full and the Aggregate Commitment has been terminated, and there are no undrawn amounts under any Facility LCs, any funds remaining in the
Facility LC Collateral Account shall be returned by the Administrative Agent to the Borrower or paid to whomever may be legally entitled thereto at such time. 

(e) If, within thirty (30) days after acceleration of the maturity of the Obligations or termination of the obligations of the Lenders to
make Loans and the obligation and power of the LC Issuer to issue Facility LCs hereunder as a result of any Event of Default (other than any Event of Default as described in Section 7.6 or 7.7 with respect to the Borrower) and before any
judgment or decree for the payment of the Obligations due shall have been obtained or entered, the Required Lenders (in their sole discretion) shall so direct, the Administrative Agent shall, by notice to the Borrower, rescind and annul such
acceleration and/or termination. 
 (f) Upon the occurrence and during the continuation of any Event of Default, the Administrative Agent
may and at the direction of the Required Lenders shall, subject to the direction of the Required Lenders, exercise all rights and remedies under the Loan Documents and enforce all other rights and remedies under applicable law. 

8.2 Application of Funds. After the exercise of remedies provided for in Section 8.1 (or after the Obligations have automatically
become immediately due and payable as set forth in the first sentence of Section 8.1(a)), any amounts received by the Administrative Agent on account of the Obligations shall be applied by the Administrative Agent in the following order: 

(a) First, to payment of fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the
Administrative Agent and amounts payable under Article III) payable to the Administrative Agent in its capacity as such; 
 (b) Second, to
payment of fees, indemnities and other amounts (other than principal, interest, LC Fees and Undrawn Fees) payable to the Lenders (including the Swingline 

  
 -78- 

 
Lender) and the LC Issuer (including fees, charges and disbursements of counsel to the respective Lenders and the LC Issuer as required by Section 9.6 and amounts payable under Article III);

 (c) Third, to payment of accrued and unpaid LC Fees, Undrawn Fees and interest on the Loans and Reimbursement Obligations, ratably among
the Lenders and the LC Issuer in proportion to the respective amounts described in this Section 8.2(c) payable to them; 
 (d)
Fourth, to payment of all Swingline Loans; 
 (e) Fifth, to payment of all Obligations ratably among the Lenders; 

(f) Sixth, to the Administrative Agent for deposit to the Facility LC Collateral Account in an amount equal to the Collateral Shortfall Amount
(as defined in Section 8.1(a)), if any; and 
 (g) Last, the balance, if any, to the Borrower or as otherwise required by Applicable
Law. 
 8.3 Amendments. Subject to the provisions of this Section 8.3, the Required Lenders (or the Administrative Agent with
the consent in writing of the Required Lenders) and the Borrower may enter into agreements supplemental hereto for the purpose of adding or modifying any provisions to the Loan Documents or changing in any manner the rights of the Lenders or the
Borrower hereunder or waiving any Default or Event of Default hereunder; provided, however, that no such supplemental agreement shall: 

(a) without the written consent of each Lender directly affected thereby, extend the final maturity of any Loan, or extend the expiry date of
any Facility LC to a date after the Facility Termination Date or postpone any regularly scheduled payment of principal of any Loan or forgive all or any portion of the principal amount thereof or any Reimbursement Obligation related thereto, or
reduce the rate or extend the time of payment of interest or fees thereon or Reimbursement Obligations related thereto or increase the amount of the Commitment of such Lender hereunder. 

(b) without the consent of all of the Lenders, change the percentage specified in the definition of Required Lenders. 

(c) without the consent of all of the Lenders, amend this Section 8.3. 

(d) without the consent of all of the Lenders, modify the Guaranty, release any material Guarantor of the Obligations or add any additional
borrower. 
 (e) reduced the amount of any fees payable to any Lender without that Lender’s prior written consent. 

(f) modify the definition of Pro Rata Share without the unanimous written consent of each Lender. 

  
 -79- 

 No amendment of any provision of this Agreement relating to the Administrative Agent shall be
effective without the written consent of the Administrative Agent, and no amendment of any provision relating to the LC Issuer shall be effective without the written consent of the LC Issuer. The Administrative Agent may waive payment of the fee
required under Section 12.3(b) without obtaining the consent of any other party to this Agreement. Notwithstanding anything to the contrary herein, the Administrative Agent may, with the consent of the Borrower only, amend, modify or supplement
this Agreement or any of the other Loan Documents to cure any ambiguity, omission, mistake, defect or inconsistency of a technical or immaterial nature, as determined in good faith by the Administrative Agent. 

8.4 Preservation of Rights. No delay or omission of the Lenders, the LC Issuer or the Administrative Agent to exercise any right under
the Loan Documents shall impair such right or be construed to be a waiver of any Event of Default or an acquiescence therein, and the making of a Credit Extension notwithstanding the existence of an Event of Default or the inability of the Borrower
to satisfy the conditions precedent to such Credit Extension shall not constitute any waiver or acquiescence. Any single or partial exercise of any such right shall not preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment or other variation of the terms, conditions or provisions of the Loan Documents whatsoever shall be valid unless in writing signed by the Lenders required pursuant to Section 8.2, and then only to the extent in such
writing specifically set forth. All remedies contained in the Loan Documents or by law afforded shall be cumulative and all shall be available to the Administrative Agent, the LC Issuer and the Lenders until the Obligations have been paid in full.

 ARTICLE IX  

GENERAL PROVISIONS 

9.1 Survival of Representations. All representations and warranties of the Borrower contained in this Agreement shall survive the
making of the Credit Extensions herein contemplated. 
 9.2 Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, neither the LC Issuer nor any Lender shall be obligated to extend credit to the Borrower in violation of any limitation or prohibition provided by any applicable statute or regulation. 

9.3 Headings. Section headings in the Loan Documents are for convenience of reference only, and shall not govern the interpretation of
any of the provisions of the Loan Documents. 
 9.4 Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Borrower, the Administrative Agent, the LC Issuer and the Lenders and supersede all prior agreements and understandings among the Borrower, the Administrative Agent, the LC Issuer and the Lenders relating to the subject
matter thereof other than those contained in the Fee Letter which shall survive and remain in full force and effect during the term of this Agreement. If there is any conflict between the terms, conditions and provisions of this Agreement and those
of any other agreement or instrument executed by Borrower, including 

  
 -80- 

 
any of the other Loan Documents, the terms, conditions and provisions of this Agreement shall prevail. By executing this Agreement Borrower expressly represents and warrants that it did not rely
on any representation, assurance or agreement, oral or written, not expressly set forth in this Agreement or any of the other Loan Documents in reaching its decision to enter into this Agreement or any of the other Loan Documents and that no
promises or other representations have been made to Borrower which conflict with the written terms of the Loan Documents. Borrower represents to Lender that (i) it has read and understands the terms and conditions contained in this Agreement
and the other Loan Documents executed in connection with this Agreement, (ii) its legal counsel has carefully reviewed all of the Loan Documents and it has received legal advice from counsel of its choice regarding the meaning and legal
significance of this Agreement and all other Loan Documents, (iii) it is satisfied with its legal counsel and the advice received from it, and (iv) it has relied only on its review of the Loan Documents and its own legal counsel’s
advice and representations (and it has not relied on any advice or representations from Lender, or any of Lender’s officers, employees, agents or attorneys). The Loan Documents may not be modified, amended or terminated as provided in
Section 8.3. 
 9.5 Several Obligations; Benefits of this Agreement. The respective obligations of the Lenders hereunder are
several and not joint and no Lender shall be the partner or agent of any other (except to the extent to which the Administrative Agent is authorized to act as such). The failure of any Lender to perform any of its obligations hereunder shall not
relieve any other Lender from any of its obligations hereunder. This Agreement shall not be construed so as to confer any right or benefit upon any Person other than the parties to this Agreement and their respective successors and assigns,
provided, however, that the parties hereto expressly agree that the Arrangers shall enjoy the benefits of the provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set forth therein and shall have the right to enforce
such provisions on its own behalf and in its own name to the same extent as if it were a party to this Agreement. 
 9.6 Expenses;
Indemnification. 
 (a) The Borrower shall reimburse the Administrative Agent and the Arrangers upon demand for all reasonable and
documented out-of-pocket expenses paid or incurred by the Administrative Agent or any Arranger, including, without limitation, filing and recording costs and fees, costs of any environmental review, and consultants’ fees, travel expenses and
reasonable fees, charges and disbursements of outside counsel to the Administrative Agent and any Arranger incurred from time to time, in connection with the due diligence, preparation, administration, negotiation, execution, delivery, syndication,
distribution (including, without limitation, via DebtX and any other internet service selected by the Administrative Agent), review, amendment, modification, and administration of the Loan Documents. The Borrower also agrees to reimburse the
Administrative Agent, the Arrangers, the LC Issuer and the Lenders for any costs, internal charges and out-of-pocket expenses, including, without limitation, filing and recording costs and fees, costs of any environmental review, and
consultants’ fees, travel expenses and reasonable fees, charges and disbursements of outside counsel to the Administrative Agent, the Arrangers, the LC Issuer and the Lenders incurred by the Administrative Agent, the Arrangers, the LC Issuer or
any Lender in connection with the collection and enforcement of the Loan Documents. Expenses being reimbursed by the Borrower under this Section include, without limitation, costs and expenses incurred in connection with the Reports described in the
following sentence. The Borrower acknowledges 

  
 -81- 

 
that from time to time U.S. Bank may prepare and may distribute to the Lenders (but shall have no obligation or duty to prepare or to distribute to the Lenders) certain audit reports (the
“Reports”) pertaining to the Borrower’s assets for internal use by U.S. Bank from information furnished to it by or on behalf of the Borrower, after U.S. Bank has exercised its rights of inspection pursuant to this
Agreement. 
 (b) The Borrower hereby further agrees to indemnify and hold harmless the Administrative Agent, each Arranger, the LC Issuer,
each Lender, their respective Affiliates, and each of their directors, officers and employees, agents, attorneys and advisors against all losses, claims, damages, penalties, judgments, liabilities and expenses (including, without limitation, all
expenses of litigation or preparation therefor (including reasonable fees, charges and disbursements of outside counsel) whether or not the Administrative Agent, the Arrangers, the LC Issuer, any Lender or any Affiliate is a party thereto) which any
of them may pay or incur arising out of or relating to this Agreement, the other Loan Documents, the transactions contemplated hereby, any actual or alleged presence or release of Hazardous Materials on or from any Property owned or operated by
Borrower or any of the Loan Parties, any environmental liability related in any way to Borrower or any of the Loan Parties, or any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based
on contract, tort or any other theory, whether brought by a third party or by Borrower or any of the Loan Parties, or the direct or indirect application or proposed application of the proceeds of any Credit Extension hereunder except to the extent
that they are determined in a final non-appealable judgment by a court of competent jurisdiction to have resulted from (i) the gross negligence or willful misconduct of the party seeking indemnification or (ii) a material breach by such
party of its express contractual obligations under the Loan Documents, including, without limitation, reasonable attorneys’ fees and settlement costs. The obligations of the Borrower under this Section 9.6 shall survive the termination of
this Agreement. 
 9.7 [Reserved]. 

9.8 Accounting. Except as provided to the contrary herein, all accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP in a manner consistent with that used in preparing the financial statements referred to in Section 5.4; provided, however that, notwithstanding any other provision
contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made without giving effect to (i) any election under Accounting Standards
Codification Section 825-10-25 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Borrower or any of its Subsidiaries at
“fair value”, as defined therein, or (ii) any treatment of Indebtedness in respect of convertible debt instruments under Financial Accounting Standards Codification Subtopic 470-20 (or any other Accounting Standards Codification or
Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof.
If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and the Borrower, the Administrative Agent or the Required Lenders shall so request, the Administrative Agent, the
Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to 

  
 -82- 

 
preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders), provided that, until so amended, such ratio or requirement shall continue
to be computed in accordance with GAAP prior to such change therein and the Borrower shall provide to the Administrative Agent and the Lenders reconciliation statements showing the difference in such calculation, together with the delivery of
quarterly and annual financial statements required hereunder. 
 9.9 Severability of Provisions. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or invalid without affecting the remaining provisions in that jurisdiction or the operation, enforceability,
or validity of that provision in any other jurisdiction, and to this end the provisions of all Loan Documents are declared to be severable. 

9.10 Nonliability of Lenders. The relationship between the Borrower on the one hand and the Lenders, the LC Issuer and the
Administrative Agent on the other hand shall be solely that of borrower and lender. Neither the Administrative Agent, any Arranger, the LC Issuer nor any Lender shall have any fiduciary responsibilities to the Borrower. Neither the Administrative
Agent, any Arranger, the LC Issuer nor any Lender undertakes any responsibility to the Borrower to review or inform the Borrower of any matter in connection with any phase of the Borrower’s business or operations. The Borrower agrees that
neither the Administrative Agent, any Arranger, the LC Issuer nor any Lender shall have liability to the Borrower (whether sounding in tort, contract or otherwise) for losses suffered by the Borrower in connection with, arising out of, or in any way
related to, the transactions contemplated and the relationship established by the Loan Documents, or any act, omission or event occurring in connection therewith, unless it is determined in a final non-appealable judgment by a court of competent
jurisdiction that such losses resulted from the gross negligence or willful misconduct of the party from which recovery is sought. Neither the Administrative Agent, any Arranger, the LC Issuer nor any Lender shall have any liability with respect to,
and the Borrower hereby waives, releases and agrees not to sue for, any special, indirect, consequential or punitive damages suffered by the Borrower and its Subsidiaries in connection with, arising out of, or in any way related to the Loan
Documents or the transactions contemplated thereby. It is agreed that each Arranger shall, in its capacity as such, have no duties or responsibilities under the Agreement or any other Loan Document. Each Lender acknowledges that it has not relied
and will not rely on the Arrangers in deciding to enter into the Agreement or any other Loan Document or in taking or not taking any action. 

9.11 Confidentiality. The Administrative Agent and each Lender agrees to hold any confidential information which it may receive from
the Borrower in connection with this Agreement in confidence, except for disclosure (i) to its Affiliates and to the Administrative Agent and any other Lender and their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to the Administrative Agent or such Lender or to a Transferee or potential Transferee provided such parties agree to be bound by this Section 9.11 or comparable confidentiality provisions, (iii) to regulatory
officials, (iv) to any Person as requested pursuant to or as required by law, regulation, or legal process, (v) to any Person in connection with any legal proceeding to which it is a party, (vi) to its direct or indirect contractual
counterparties in swap agreements or to legal counsel, accountants and other professional advisors to such counterparties provided such parties agree to be bound by this Section 9.11 or comparable 

  
 -83- 

 
confidentiality provisions, and (vii) to rating agencies if requested or required by such agencies in connection with a rating relating to the Advances hereunder. Without limiting
Section 9.4, the Borrower agrees that the terms of this Section 9.11 shall set forth the entire agreement between the Borrower and the Administrative Agent and each Lender with respect to any confidential information previously or
hereafter received by the Administrative Agent or such Lender in connection with this Agreement, and this Section 9.11 shall supersede any and all prior confidentiality agreements entered into by the Administrative Agent or any Lender with
respect to such confidential information. 
 9.12 Nonreliance. Each Lender hereby represents that it is not relying on or looking to
any margin stock (as defined in Regulation U) for the repayment of the Credit Extensions provided for herein. 
 9.13 Disclosure. The
Borrower and each Lender hereby acknowledge and agree that U.S. Bank and/or its Affiliates from time to time may hold investments in, make other loans to or have other relationships with the Borrower and its Affiliates. 

9.14 USA PATRIOT ACT NOTIFICATION. The following notification is provided to Borrower pursuant to Section 326 of the USA Patriot
Act of 2001, 31 U.S.C. Section 5318: 
 Each Lender that is subject to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”) hereby notifies the Borrower and each other Loan Party that pursuant to the requirements of the Act, it is required to obtain, verify and record information that identifies
such Loan Party, which information includes the name and address of such Loan Party and other information that will allow such Lender to identify such Loan Party in accordance with the Act. 

9.15 Document Interpretation. 

(a) Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the other Loan
Documents or any certificate or other document made or delivered pursuant hereto or thereto. 
 (b) As used herein and in the other Loan
Documents, and any certificate or other document made or delivered pursuant hereto or thereto, (i) accounting terms relating to any Loan Party not defined in Section 1.1 and accounting terms partly defined in
Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP, (ii) the words “include”, “includes” and “including” shall be deemed to be followed by the phrase
“without limitation”, (iii) the word “incur” shall be construed to mean incur, create, issue, assume, become liable in respect of or suffer to exist (and the words “incurred” and “incurrence” shall have
correlative meanings), (iv) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, Capital Stock,
securities, accounts, leasehold interests and contract rights, and (v) references to agreements or other Obligations shall, unless otherwise specified, be deemed to refer to such agreements or Obligations as amended, supplemented, restated or
otherwise modified from time to time. 

  
 -84- 

 (c) The words “hereof”, “herein” and “hereunder” and words of
similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise specified. 

(d) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms. 

ARTICLE X 
 THE
ADMINISTRATIVE AGENT 
 10.1 Appointment; Nature of Relationship. U.S. Bank National Association is hereby appointed by each
of the Lenders as its contractual representative (herein referred to as the “Administrative Agent”) hereunder and under each other Loan Document, and each of the Lenders irrevocably authorizes the Administrative Agent to act
as the contractual representative of such Lender with the rights and duties expressly set forth herein and in the other Loan Documents. The Administrative Agent agrees to act as such contractual representative upon the express conditions contained
in this Article X. Notwithstanding the use of the defined term “Administrative Agent,” it is expressly understood and agreed that the Administrative Agent shall not have any fiduciary responsibilities to any Lender by reason of this
Agreement or any other Loan Document and that the Administrative Agent is merely acting as the contractual representative of the Lenders with only those duties as are expressly set forth in this Agreement and the other Loan Documents. In its
capacity as the Lenders’ contractual representative, the Administrative Agent (i) does not hereby assume any fiduciary duties to any of the Lenders, (ii) is a “representative” of the Lenders within the meaning of the term
“secured party” as defined in the New York Uniform Commercial Code and (iii) is acting as an independent contractor, the rights and duties of which are limited to those expressly set forth in this Agreement and the other Loan
Documents. Each of the Lenders hereby agrees to assert no claim against the Administrative Agent on any agency theory or any other theory of liability for breach of fiduciary duty, all of which claims each Lender hereby waives. 

10.2 Powers. The Administrative Agent shall have and may exercise such powers under the Loan Documents as are specifically delegated to
the Administrative Agent by the terms of each thereof, together with such powers as are reasonably incidental thereto. The Administrative Agent shall have no implied duties to the Lenders, or any obligation to the Lenders to take any action
thereunder except any action specifically provided by the Loan Documents to be taken by the Administrative Agent. 
 10.3 General
Immunity. Neither the Administrative Agent nor any of its directors, officers, agents or employees shall be liable to the Borrower, the Lenders or any Lender for any action taken or omitted to be taken by it or them hereunder or under any other
Loan Document or in connection herewith or therewith except to the extent such action or inaction is determined in a final non-appealable judgment by a court of competent jurisdiction to have arisen from the gross negligence or willful misconduct of
such Person. 

  
 -85- 

 10.4 No Responsibility for Loans, Recitals, etc.. Neither the Administrative Agent nor any
of its directors, officers, agents or employees shall be responsible for or have any duty to ascertain, inquire into, or verify (a) any statement, warranty or representation made in connection with any Loan Document or any borrowing hereunder;
(b) the performance or observance of any of the covenants or agreements of any obligor under any Loan Document, including, without limitation, any agreement by an obligor to furnish information directly to each Lender; (c) the satisfaction
of any condition specified in Article IV, except receipt of items required to be delivered solely to the Administrative Agent; (d) the existence or possible existence of any Default or Event of Default; (e) the validity, enforceability,
effectiveness, sufficiency or genuineness of any Loan Document or any other instrument or writing furnished in connection therewith; (f) the value, sufficiency, creation, perfection or priority of any Lien in any collateral security, if any; or
(g) the financial condition of the Borrower or any guarantor of any of the Obligations or of any of the Borrower’s or any such guarantor’s respective Subsidiaries. 

10.5 Action on Instructions of Lenders. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from
acting, hereunder and under any other Loan Document in accordance with written instructions signed by the Required Lenders, and such instructions and any action taken or failure to act pursuant thereto shall be binding on all of the Lenders. The
Lenders hereby acknowledge that the Administrative Agent shall be under no duty to take any discretionary action permitted to be taken by it pursuant to the provisions of this Agreement or any other Loan Document unless it shall be requested in
writing to do so by the Required Lenders. The Administrative Agent shall be fully justified in failing or refusing to take any action hereunder and under any other Loan Document unless it shall first be indemnified to its satisfaction by the Lenders
pro rata against any and all liability, cost and expense that it may incur by reason of taking or continuing to take any such action. 

10.6 Employment of Administrative Agents and Counsel. The Administrative Agent may execute any of its duties as Administrative Agent
hereunder and under any other Loan Document by or through employees, agents, and attorneys-in-fact and shall not be answerable to the Lenders, except as to money or securities received by it or its authorized agents, for the default or misconduct of
any such agents or attorneys-in-fact selected by it with reasonable care. The Administrative Agent shall be entitled to advice of counsel concerning the contractual arrangement between the Administrative Agent and the Lenders and all matters
pertaining to the Administrative Agent’s duties hereunder and under any other Loan Document. 
 10.7 Reliance on Documents;
Counsel. The Administrative Agent shall be entitled to rely upon any Note, notice, consent, certificate, affidavit, letter, telegram, facsimile, telex, electronic mail message, statement, paper or document believed by it to be genuine and
correct and to have been signed or sent by the proper person or persons, and, in respect to legal matters, upon the opinion of counsel selected by the Administrative Agent, which counsel may be employees of the Administrative Agent. For purposes of
determining compliance with the conditions specified in Sections 4.1 and 4.2, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the applicable date specifying its objection thereto. 

  
 -86- 

 10.8 Administrative Agent’s Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Administrative Agent ratably in proportion to their respective Commitments (or, if the Commitments have been terminated, in proportion to their Commitments immediately prior to such termination) (i) for any amounts
not reimbursed by the Borrower for which the Administrative Agent is entitled to reimbursement by the Borrower under the Loan Documents, (ii) for any other expenses incurred by the Administrative Agent on behalf of the Lenders, in connection
with the preparation, execution, delivery, administration and enforcement of the Loan Documents (including, without limitation, for any expenses incurred by the Administrative Agent in connection with any dispute between the Administrative Agent and
any Lender or between two or more of the Lenders) and (iii) for any liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Administrative Agent in any way relating to or arising out of the Loan Documents or any other document delivered in connection therewith or the transactions contemplated thereby (including, without limitation, for
any such amounts incurred by or asserted against the Administrative Agent in connection with any dispute between the Administrative Agent and any Lender or between two or more of the Lenders), or the enforcement of any of the terms of the Loan
Documents or of any such other documents, provided that (i) no Lender shall be liable for any of the foregoing to the extent any of the foregoing is found in a final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the Administrative Agent and (ii) any indemnification required pursuant to Section 3.5(d) shall, notwithstanding the provisions of this Section 10.8, be paid by the
relevant Lender in accordance with the provisions thereof. The obligations of the Lenders under this Section 10.8 shall survive payment of the Obligations and termination of this Agreement. 

10.9 Notice of Event of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any
Default or Event of Default hereunder unless the Administrative Agent has received written notice from a Lender or the Borrower referring to this Agreement describing such Default or Event of Default and stating that such notice is a “notice of
default”. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall give prompt notice thereof to the Lenders; provided that, except as expressly set forth in the Loan Documents, the Administrative
Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the bank serving as Administrative Agent or
any of its Affiliates in any capacity. 
 10.10 Rights as a Lender. In the event the Administrative Agent is a Lender, the
Administrative Agent shall have the same rights and powers hereunder and under any other Loan Document with respect to its Commitment and its Loans as any Lender and may exercise the same as though it were not the Administrative Agent, and the term
“Lender” or “Lenders” shall, at any time when the Administrative Agent is a Lender, unless the context otherwise indicates, include the Administrative Agent in its individual capacity. The
Administrative Agent and its Affiliates may accept deposits from, lend money to, and generally engage in any kind of trust, debt, equity or other transaction, in addition to those contemplated by this Agreement or any other Loan Document, with the
Borrower or any of its Subsidiaries in which the Borrower or such Subsidiary is not restricted hereby from engaging with any other Person. 

  
 -87- 

 10.11 Lender Credit Decision, Legal Representation. 

(a) Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent, the Arrangers or any other Lender
and based on the financial statements prepared by the Borrower and such other documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement and the other Loan Documents. Each Lender
also acknowledges that it will, independently and without reliance upon the Administrative Agent, the Arranger or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement and the other Loan Documents. Except for any notice, report, document or other information expressly required to be furnished to the Lenders by the Administrative Agent or any Arranger
hereunder, neither the Administrative Agent nor the Arranger shall have any duty or responsibility (either initially or on a continuing basis) to provide any Lender with any notice, report, document, credit information or other information
concerning the affairs, financial condition or business of the Borrower or any of its Affiliates that may come into the possession of the Administrative Agent or any Arranger (whether or not in their respective capacity as Administrative Agent or
any Arranger) or any of their Affiliates. 
 (b) Each Lender further acknowledges that it has had the opportunity to be represented by legal
counsel in connection with its execution of this Agreement and the other Loan Documents, that it has made its own evaluation of all applicable laws and regulations relating to the transactions contemplated hereby, and that the counsel to the
Administrative Agent represents only the Administrative Agent and not the Lenders in connection with this Agreement and the transactions contemplated hereby. 

10.12 Successor Administrative Agent. The Administrative Agent may resign at any time by giving written notice thereof to the Lenders
and the Borrower, such resignation to be effective upon the appointment of a successor Administrative Agent or, if no successor Administrative Agent has been appointed, forty-five (45) days after the retiring Administrative Agent gives notice
of its intention to resign. Upon any such resignation, the Required Lenders shall have the right to appoint, on behalf of the Borrower and the Lenders, a successor Administrative Agent. If no successor Administrative Agent shall have been so
appointed by the Required Lenders within thirty (30) days after the resigning Administrative Agent’s giving notice of its intention to resign, then the resigning Administrative Agent may appoint, on behalf of the Borrower and the Lenders,
a successor Administrative Agent. Notwithstanding the previous sentence, the Administrative Agent may at any time without the consent of the Borrower or any Lender, appoint any of its Affiliates which is a commercial bank as a successor
Administrative Agent hereunder. If the Administrative Agent has resigned and no successor Administrative Agent has been appointed, the Lenders may perform all the duties of the Administrative Agent hereunder and the Borrower shall make all payments
in respect of the Obligations to the applicable Lender and for all other purposes shall deal directly with the Lenders. No successor Administrative Agent shall be deemed to be appointed hereunder until such successor Administrative Agent has
accepted the appointment. Any such successor Administrative Agent shall be a commercial bank having capital and retained earnings of at least $100,000,000. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon succeed to and 

  
 -88- 

 
become vested with all the rights, powers, privileges and duties of the resigning Administrative Agent. Upon the effectiveness of the resignation of the Administrative Agent, the resigning
Administrative Agent shall be discharged from its duties and obligations hereunder and under the Loan Documents. After the effectiveness of the resignation of an Administrative Agent, the provisions of this Article X shall continue in effect for the
benefit of such Administrative Agent in respect of any actions taken or omitted to be taken by it while it was acting as the Administrative Agent hereunder and under the other Loan Documents. In the event that there is a successor to the
Administrative Agent by merger, or the Administrative Agent assigns its duties and obligations to an Affiliate pursuant to this Section 10.12. 

10.13 Administrative Agent and Arranger Fees. The Borrower agrees to pay to the Administrative Agent and the Arrangers, for their
respective accounts, the fees agreed to by the Borrower, the Administrative Agent and the Arrangers pursuant to the Fee Letter, or as otherwise agreed from time to time. 

10.14 Delegation to Affiliates. The Borrower and the Lenders agree that the Administrative Agent may delegate any of its duties under
this Agreement to any of its Affiliates. Any such Affiliate (and such Affiliate’s directors, officers, agents and employees) which performs duties in connection with this Agreement shall be entitled to the same benefits of the indemnification,
waiver and other protective provisions to which the Administrative Agent is entitled under Articles IX and X. 
 10.15 No Advisory or
Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower acknowledges and
agrees that: (i) (a) the arranging and other services regarding this Agreement provided by the Lenders are arm’s-length commercial transactions between the Borrower and its Affiliates, on the one hand, and the Lenders, on the other
hand, (b) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (c) the Borrower is capable of evaluating, and understands and accepts, the terms, risks and
conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (a) each of the Lenders is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been,
is not, and will not be acting as an advisor, agent or fiduciary for the Borrower or any of its Affiliates, or any other Person and (b) no Lender has any obligation to the Borrower or any of its Affiliates with respect to the transactions
contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) each of the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that
differ from those of the Borrower and its Affiliates, and no Lender has any obligation to disclose any of such interests to the Borrower or its Affiliates. To the fullest extent permitted by law, the Borrower hereby waives and releases any claims
that it may have against each of the Lenders with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby. 

  
 -89- 

 ARTICLE XI 

SETOFF; RATABLE PAYMENTS 

11.1 Setoff. The Borrower hereby grants each Lender a security interest, to secure the Obligations owing to such Lender, in all
deposits, credits and deposit accounts (including all account balances, whether provisional or final and whether or not collected or available) of the Borrower with such Lender or any Affiliate of such Lender (the
“Deposits”). In addition to, and without limitation of, any rights of the Lenders under applicable law, if any Event of Default occurs and is continuing, Borrower authorizes each Lender to offset and apply all such Deposits
toward the payment of the Obligations owing to such Lender, whether or not the Obligations, or any part thereof, shall then be due and regardless of the existence or adequacy of any collateral, guaranty or other security, right or remedy available
to such Lender or the Lenders; provided, that in the event that any Defaulting Lender shall exercise such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in
accordance with the provisions of Section 2.22 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent, the LC Issuer, and the Lenders,
and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. Notwithstanding the
foregoing, no Lender shall exercise any such right of set off without the prior written consent of all Lenders and Administrative Agent. 

11.2 Ratable Payments. If any Lender, whether by setoff or otherwise, has payment made to it upon its Outstanding Credit Exposure
(other than payments received pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than that received by any other Lender, such Lender agrees, promptly upon demand, to purchase a portion of the Aggregate Outstanding Credit Exposure
held by the other Lenders so that after such purchase each Lender will hold its Pro Rata Share of the Aggregate Outstanding Credit Exposure. If any Lender, whether in connection with setoff or amounts which might be subject to setoff or otherwise,
receives collateral or other protection for its Obligations or such amounts which may be subject to setoff, such Lender agrees, promptly upon demand, to take such action necessary such that all Lenders share in the benefits of such collateral or
other protection ratably in proportion to their respective Pro Rata Shares of the Aggregate Outstanding Credit Exposure. In case any such payment is disturbed by legal process, or otherwise, appropriate further adjustments shall be made. 

ARTICLE XII 
 BENEFIT
OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS 
 12.1 Successors and Assigns. The terms and provisions of the Loan Documents
shall be binding upon and inure to the benefit of the Borrower and the Lenders and their respective successors and assigns permitted hereby, except that (i) the Borrower shall not have the right to assign its rights or obligations under the
Loan Documents without the prior written consent of each Lender, (ii) any assignment by any Lender must be made in compliance with Section 12.3, and (iii) any transfer by participation must be made in compliance with
Section 12.2. Any attempted assignment or transfer by any party not made in compliance with this Section 12.1 

  
 -90- 

 
shall be null and void, unless such attempted assignment or transfer is treated as a participation in accordance with the terms of this Agreement. The parties to this Agreement acknowledge that
clause (ii) of this Section 12.1 relates only to absolute assignments and this Section 12.1 does not prohibit assignments creating security interests, including, without limitation, (x) any pledge or assignment by any Lender of
all or any portion of its rights under this Agreement and any Note to a Federal Reserve Bank or (y) in the case of a Lender which is a Fund, any pledge or assignment of all or any portion of its rights under this Agreement and any Note to its
trustee in support of its obligations to its trustee; provided, however, that no such pledge or assignment creating a security interest shall release the transferor Lender from its obligations hereunder unless and until the parties
thereto have complied with the provisions of Section 12.3. The Administrative Agent may treat the Person which made any Loan or which holds any Note as the owner thereof for all purposes hereof unless and until such Person complies with
Section 12.3; provided, however, that the Administrative Agent may in its discretion (but shall not be required to) follow instructions from the Person which made any Loan or which holds any Note to direct payments relating to such Loan or Note
to another Person. Any assignee of the rights to any Loan or any Note agrees by acceptance of such assignment to be bound by all the terms and provisions of the Loan Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the owner of the rights to any Loan (whether or not a Note has been issued in evidence thereof), shall be conclusive and binding on any subsequent holder or assignee of the rights to such
Loan. 
 12.2 Participations. 

(a) Permitted Participants; Effect. So long as Borrower consents in writing (which consent shall not be necessary at any time that an
Event of Default has occurred and is continuing, and may not at any time be unreasonably withheld or delayed by Borrower), any Lender may at any time sell to one or more banks or other entities (“Participants”) participating
interests in any Outstanding Credit Exposure owing to such Lender, any Note held by such Lender, any Commitment of such Lender or any other interest of such Lender under the Loan Documents. In the event of any such sale by a Lender of participating
interests to a Participant, such Lender’s obligations under the Loan Documents shall remain unchanged, such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, such Lender shall remain the
owner of its Outstanding Credit Exposure and the holder of any Note issued to it in evidence thereof for all purposes under the Loan Documents, all amounts payable by the Borrower under this Agreement shall be determined as if such Lender had not
sold such participating interests, and the Borrower and the Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under the Loan Documents. 

(b) Voting Rights. Each Lender shall retain the sole right to approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents provided that each such Lender may agree in its participation agreement with its Participant that such Lender will not vote to approve any amendment, modification or waiver with
respect to any Outstanding Credit Exposure or Commitment in which such Participant has an interest which would require consent of all of the Lenders pursuant to the terms of Section 8.3 or of any other Loan Document. 

  
 -91- 

 (c) Benefit of Certain Provisions. The Borrower agrees that each Participant shall be
deemed to have the right of setoff provided in Section 11.1 in respect of its participating interest in amounts owing under the Loan Documents to the same extent as if the amount of its participating interest were owing directly to it as a
Lender under the Loan Documents, provided that each Lender shall retain the right of setoff provided in Section 11.1 with respect to the amount of participating interests sold to each Participant. The Lenders agree to share with each
Participant, and each Participant, by exercising the right of setoff provided in Section 11.1, agrees to share with each Lender, any amount received pursuant to the exercise of its right of setoff, such amounts to be shared in accordance with
Section 11.2 as if each Participant were a Lender. The Borrower further agrees that each Participant shall be entitled to the benefits of Sections 3.1, 3.2, 3.4, 3.5, 9.6 and 9.10 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to Section 12.3, provided that (i) a Participant shall not be entitled to receive any greater payment under Section 3.1 or 3.2 than the Lender who sold the participating interest to such
Participant would have received had it retained such interest for its own account, unless the sale of such interest to such Participant is made with the prior written consent of the Borrower, and (ii) a Participant shall not be entitled to
receive any greater payment under Section 3.5 than the Lender who sold the participating interest to such Participant would have received had it retained such interest for its own account (a) except to the extent such entitlement to
receive a greater payment results from a change in treaty, law or regulation (or any change in the interpretation or administration thereof by any governmental authority) that occurs after the Participant acquired the applicable participation and
(B), in the case of any Participant that would be a Non-U.S. Lender if it were a Lender, such Participant agrees to comply with the provisions of Section 3.5 to the same extent as if it were a Lender (it being understood that the documentation
required under Section 3.5(f) shall be delivered to the participating Lender). Each Lender that sells a participation shall, acting solely for this purpose as an agent of the Borrower, maintain a register on which it enters the name and
address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in any Outstanding Credit Exposure, any Note, any Commitment or any other obligations under the Loan Documents (the
“Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a
Participant’s interest in any Outstanding Credit Exposure, any Note, any Commitment or any other obligations under the Loan Documents) to any Person except to the extent that such disclosure is necessary to establish that such Outstanding
Credit Exposure, any Note, any Commitment or any other obligations under the Loan Documents is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be
conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the
avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register. 

12.3 Assignments. 
 (a)
Permitted Assignments. Subject to clause (b) below, any Lender may at any time assign to one or more Eligible Assignees (“Purchasers”) all or any part of its rights and obligations under the Loan Documents. Such
assignment shall be substantially in the form of Exhibit J or in such other form reasonably acceptable to the Administrative Agent as may be 

  
 -92- 

 
agreed to by the parties thereto. Each such assignment with respect to a Purchaser which is not a Lender or an Affiliate of a Lender or an Approved Fund shall either be in an amount equal to the
entire applicable Commitment and Outstanding Credit Exposure of the assigning Lender or (unless each of the Borrower and the Administrative Agent otherwise consents) be in an aggregate amount not less than $5,000,000. The amount of the assignment
shall be based on the Commitment or Outstanding Credit Exposure (if the Commitment has been terminated) subject to the assignment, determined as of the date of such assignment or as of the “Trade Date,” if the “Trade Date” is
specified in the assignment. 
 (b) Consents. The consent of the Borrower shall be required prior to an assignment becoming
effective, unless the Purchaser is a Lender, an Affiliate of a Lender or an Approved Fund, provided that the consent of the Borrower shall not be required if an Event of Default has occurred and is continuing and such consent may not at any
time be unreasonably withheld or delayed by Borrower. The consent of the Administrative Agent shall be required prior to an assignment becoming effective, unless the Purchaser is a Lender, an Affiliate of a Lender or an Approved Fund. The consent of
the LC Issuer shall be required prior to an assignment of a Commitment becoming effective, unless the Purchaser is a Lender, an Affiliate of a Lender or an Approved Fund. Any consent required under this Section 12.3(b) shall not be
unreasonably withheld or delayed. 
 (c) Effect; Effective Date. Upon (i) delivery to the Administrative Agent of an assignment,
together with any consents required by Sections 12.3(a) and 12.3(b), and (ii) payment of a $3,500 fee to the Administrative Agent for processing such assignment (unless such fee is waived by the Administrative Agent), such assignment shall
become effective on the effective date specified in such assignment. The assignment shall contain a representation by the Purchaser to the effect that none of the consideration used to make the purchase of the Commitment and Outstanding Credit
Exposure under the applicable assignment agreement constitutes “plan assets” as defined under ERISA and that the rights and interests of the Purchaser in and under the Loan Documents will not be “plan assets” under ERISA. On and
after the effective date of such assignment, such Purchaser shall for all purposes be a Lender party to this Agreement and any other Loan Document executed by or on behalf of the Lenders and shall have all the rights and obligations of a Lender
under the Loan Documents, to the same extent as if it were an original party thereto, and the transferor Lender shall be released with respect to the Commitment and Outstanding Credit Exposure assigned to such Purchaser without any further consent
or action by the Borrower, the Lenders or the Administrative Agent. In the case of an assignment covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a Lender hereunder but shall
continue to be entitled to the benefits of, and subject to, those provisions of this Agreement and the other Loan Documents which survive payment of the Obligations and termination of the applicable agreement. Any assignment or transfer by a Lender
of rights or obligations under this Agreement that does not comply with this Section 12.3 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with
Section 12.2. Upon the consummation of any assignment to a Purchaser pursuant to this Section 12.3(c), the transferor Lender, the Administrative Agent and the Borrower shall, if the transferor Lender or the Purchaser desires that its Loans
be evidenced by Notes, make appropriate arrangements so that new Notes or, as appropriate, replacement Notes are issued to such transferor Lender and new Notes or, as appropriate, replacement Notes, are issued to such Purchaser, in each case in

  
 -93- 

 
principal amounts reflecting their respective Commitments, as adjusted pursuant to such assignment. 

(d) Register. The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at one of its
offices in the United States of America, a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of
the Loans owing to, each Lender, and participations of each Lender in Facility LCs, pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower at any reasonable time and from time to time upon reasonable prior notice. 
 (e) Dissemination
of Information. The Borrower authorizes each Lender to disclose to any Participant or Purchaser or any other Person acquiring an interest in the Loan Documents by operation of law (each a “Transferee”) and any prospective
Transferee any and all information in such Lender’s possession concerning the creditworthiness of the Borrower and its Subsidiaries, including without limitation any information contained in any Reports; provided that each Transferee and
prospective Transferee agrees to be bound by Section 9.11 of this Agreement. 
 ARTICLE XIII 

NOTICES 
 13.1
Notices; Effectiveness; Electronic Communication. 
 (a) Notices Generally. Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as provided in paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by facsimile as follows: 
 (i) if to the Borrower, to it at 655 Brea Canyon Road,
Walnut, California 91788, Attention: Chief Financial Officer, Facsimile: 909-543-1874; with a copy (which shall not constitute notice) to: Gibson, Dunn & Crutcher LLP, Attention: Cromwell Montgomery, 2029 Century Park East, Los Angeles, CA
90067-3026, Facsimile: 310.552.7063; and with a copy (which shall not constitute notice) to: 655 Brea Canyon Road, Walnut, California 91788, Attention: Robert O’Dell, Treasurer, Telephone: 602-303-3247, Facsimile: (612) 303-3851, e-mail:
robert.odell@jfshea.com; 
 (ii) if to the Administrative Agent, to it at c/o Soua R. Yang, Senior Agency Specialist, U.S. Bank
Agency Services, 800 Nicollet Mall, 3rd Floor, Minneapolis, MN 55402-7020, Telephone: 602-303-3247, Facsimile: (612) 303-3851, e-mail: soua.yang1@usbank.com and c/o Young Hahn, Agency
Specialist, U.S. Bank Agency Services, 

  
 -94- 

 
1420 Fifth Avenue, 9th Floor, Seattle, WA 98101, Telephone: (206) 344-5055, Facsimile: (203) 587-7022, e-mail:
elaine.hahn@usbank.com and c/o Susanie Samson, Loan Administration, 4100 Newport Place, Suite 900, Newport Beach, CA 92680, Telephone: (949) 863-2376, Facsimile: (949) 252-1759, e-mail: susanie.samson@usbank.com; 

(iii) if to the LC Issuer, to it at c/o Susanie Samson, Loan Administration, 4100 Newport Place, Suite 900, Newport Beach, CA 92680,
Telephone: (949) 863-2376, Facsimile: (949) 252-1759, e-mail: susanie.samson@usbank.com and c/o International Banking Documentary Services, 555 SW Oak Street, Suite 400-P, Portland, OR 97204, Facsimile: (503) 464- 4125, e-mail:
portlandlcdept@usbank.com; 
 (iv) if to a Lender, to it at its address (or facsimile number) set forth in its Administrative
Questionnaire. 
 Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when
received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for
the recipient). Notices delivered through electronic communications to the extent provided in paragraph (b) below, shall be effective as provided in said paragraph (b). 

(b) Electronic Communications. Notices and other communications to the Lenders and the LC Issuer hereunder may be delivered or
furnished by electronic communication (including e-mail and internet or intranet websites) pursuant to procedures approved by the Administrative Agent or as otherwise determined by the Administrative Agent, provided that the foregoing shall not
apply to notices to any Lender or the LC Issuer pursuant to Article II if such Lender or the LC Issuer, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication.
The Administrative Agent or the Borrower may, in its respective discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it or as it otherwise determines,
provided that such determination or approval may be limited to particular notices or communications. 
 Unless the Administrative
Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not given during the normal business hours of the recipient, such notice or communication shall be deemed
to have been given at the opening of business on the next Business Day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at
its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor. 

(c) Change of Address, Etc. Any party hereto may change its address or facsimile number for notices and other communications hereunder
by notice to the other parties hereto given in the manner set forth in this Section 13.1. 

  
 -95- 

 ARTICLE XIV 

COUNTERPARTS; INTEGRATION; EFFECTIVENESS; 

ELECTRONIC EXECUTION 

14.1 Counterparts; Effectiveness . This Agreement may be executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Except as provided in Article IV, this Agreement shall become effective when it shall have been executed by the
Administrative Agent, and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the parties hereto, and thereafter shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or other electronic imaging shall be effective as delivery of a manually executed counterpart of this
Agreement. 
 14.2 Electronic Execution of Assignments. The words “execution,”
“signed,” “signature,” and words of like import in any assignment and assumption agreement shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which
shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal
Electronic Signatures in Global and National Commerce Act, or any other state laws based on the Uniform Electronic Transactions Act. 

ARTICLE XV 
 CHOICE
OF LAW; CONSENT TO JURISDICTION; 
 WAIVER OF JURY TRIAL 

15.1 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS. 

15.2 CONSENT TO JURISDICTION; OTHER MATTERS; WAIVERS. 

(a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG BORROWER, THE ADMINISTRATIVE AGENT OR ANY OF THE LENDERS
WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE LENDERS, THE ADMINISTRATIVE AGENT AND BORROWER HEREBY WAIVES ITS
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE 

  
 -96- 

 
IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR IN CONNECTION WITH ANY
COLLATERAL OR ANY LIEN OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG ANY BORROWER, THE ADMINISTRATIVE AGENT OR ANY OF THE LENDERS OF ANY KIND OR NATURE. 

(b) EACH OF THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY AGREES THAT ANY FEDERAL DISTRICT COURT LOCATED IN NEW YORK, NEW
YORK, OR, AT THE OPTION OF THE ADMINISTRATIVE AGENT, ANY STATE COURT LOCATED IN NEW YORK, NEW YORK, SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG ANY BORROWER, THE ADMINISTRATIVE AGENT OR ANY OF THE
LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE LOAN, THE NOTES OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR THEREFROM. BORROWER AND EACH OF THE LENDERS EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS. BORROWER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER
PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO BORROWER AT ITS ADDRESS FOR NOTICES PROVIDED FOR HEREIN. 

(c) EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH
COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. 
 (d)
THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE ADMINISTRATIVE AGENT OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM
IN ANY OTHER APPROPRIATE JURISDICTION. 
 (e) BORROWER AGREES THAT ALL OF ITS PAYMENT OBLIGATIONS HEREUNDER SHALL BE ABSOLUTE AND
UNCONDITIONAL, AND FOR THE PURPOSES OF MAKING PAYMENTS HEREUNDER, SUCH BORROWER HEREBY WAIVES ANY RIGHT TO ASSERT ANY SETOFF, COUNTERCLAIM OR CROSS-CLAIM. 

(f) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND
SHALL SURVIVE THE PAYMENT OF THE 

  
 -97- 

 
LOAN AND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS AND THE TERMINATION OF THIS AGREEMENT. 

ARTICLE XVI 

NON-RECOURSE 
 16.1
Notwithstanding any other term of provision of this Agreement, any other Loan Document or applicable law: 
 (a) The Administrative Agent,
LC Issuer and each Lender and other holder of an Obligation (for themselves individually and their respective successors and assigns) (collectively, the “Lender Parties”) each hereby agrees that (1) it shall not be entitled to assert
any claim or enforce any liability against and, subject to the proviso set forth at the end of this paragraph, will waive any and all rights, obligations, claims, causes of action and demand against any general and limited partner(s) of the
Borrower, any direct or indirect general or limited partner of such general or limited partner(s), and any direct or indirect partners (general or limited), shareholders, members, managers, officers, directors, trustees, affiliates, parents,
employees, or agents of the foregoing entities and of any Guarantor or any Subsidiary with respect to which Rate Management Obligations or obligations with respect to Cash Management services exist (each such Person being referred to herein as a
“Non-Recourse Party”), or against the assets of any such Persons, on account of, or arising from, any Obligation, and (2) it shall not look to any Non-Recourse Party for the enforcement of any Obligation, Rate Management Obligations
or obligations with respect to Cash Management services; provided, however, Lender Parties may look to, pursue, assert a claim against and/or otherwise enforce liability against any Non-Recourse Party to recover any payments received by, or
other property or assets in the possession of, such person resulting from the payment of a dividend, the making of a distribution, or other similar action by any Non-Recourse Party in violation of the terms of the Loan Documents or due to any
fraud or willful misconduct of such Non-Recourse Party. 
 (b) Nothing contained in the Article XVI shall be construed to limit or restrict
the Obligations of any Loan Party under the Loan Documents or any applicable Subsidiary with respect to any applicable Rate Management Obligations or obligations with respect to Cash Management services, and in connection therewith the Borrower
acknowledges that the payment and performance of the Obligations shall be fully recourse to each Loan Party and its respective assets, and the assets of any applicable Subsidiary with respect to any applicable Rate Management Obligations or
obligations with respect to Cash Management services. 
 [Signature Pages Follow] 

  
 -98- 

 IN WITNESS WHEREOF, the Borrower, the Lenders, the LC Issuer and the Administrative Agent have
executed this Agreement as of the date first above written. 
  

			
	 SHEA HOMES LIMITED PARTNERSHIP,
 a
California limited partnership

		
	By:		 /s/ Andrew Parnes

	Name:		Andrew Parnes
	Title:		Chief Financial Officer
		
	By:		 /s/ Robert R. O’Dell

	Name:		Robert R. O’Dell
	Title:		Treasurer

  
 S-1 

 
			
	 U.S. BANK NATIONAL ASSOCIATION,
 as
a Lender, as LC Issuer and as Administrative Agent

		
	By:		 /s/ Adrian B. Montero

	Name:		 Adrian B. Montero

	Title:		 Senior Vice President

	
	WELLS FARGO BANK, N.A., as a Lender
		
	By:		 /s/ Elena Bennett

	Name:		 Elena Bennett

	Title:		 Senior Vice President

	
	JP MORGAN, as a Lender
		
	By:		 /s/ Nadeige Dang

	Name:		 Nadeige Dang

	Title:		 Vice President

  
 S-2 

 PRICING SCHEDULE 

The Applicable Margin and Applicable Undrawn Fee Rate shall be determined in accordance with the following table based on the Borrower’s
Adjusted Leverage Ratio as reflected in the then most recent Financials: 
  

													
	 Adjusted Leverage Ratio
	  	Applicable Margin
for Eurocurrency
Loans	 	 	Applicable Margin
for Daily
Eurocurrency Loans	 	 	Applicable
Undrawn Fee Rate	 
	 > 1.50x
	  	 	2.50	% 	 	 	2.50	% 	 	 	.45	% 
	 < 1.50x but > 1.00x
	  	 	2.25	% 	 	 	2.25	% 	 	 	.40	% 
	 < 1.00x but > 0.75x
	  	 	2.00	% 	 	 	2.00	% 	 	 	.35	% 
	 < 0.75x
	  	 	1.75	% 	 	 	1.75	% 	 	 	.30	% 

 Adjustments, if any, to the Applicable Margin or Applicable Undrawn Fee Rate, to the extent determined on the
basis of the Adjusted Leverage Ratio, shall be effective from and after the first day of the first fiscal month immediately following the date on which the delivery of the Financials is required until the first day of the first fiscal month
immediately following the next such date on which delivery of such Financials of the Borrower is so required. If the Borrower fails to deliver the Financials to the Administrative Agent at the time required pursuant to Section 6.1, then the
Applicable Margin and Applicable L/C Fee Rate shall be the highest Applicable Margin and Applicable L/C Fee Rate set forth in the foregoing table until five (5) days after such Financials are so delivered. 

“Financials” means the annual or quarterly financial statements of the Borrower delivered pursuant to Section 6.1(a) or (b).

  
 Pricing Schedule 

 SCHEDULE 1 

Authorized Officer(s) 
 For Borrowing Base
Certificates and other documents: 
 Andrew Parnes, Chief Financial Officer 

James G. Shontere, Secretary 
 Robert R. O’Dell, Treasurer

 For Borrowing Notices, Conversion/Continuation Notices and any other notices pursuant to Section 2.14: 

Andrew Parnes, Chief Financial Officer 
 James G. Shontere,
Secretary 
 Robert R. O’Dell, Treasurer 
 Heather Tang,
Senior Treasury Analyst 
 Yves Hebert, Cash Manager 

  
 SCH. 1-1 

 SCHEDULE 1(a) 

Commitments 
  

									
	 Lender:
	  	Commitment:	 	  	Percentage:	 
	 U.S. BANK NATIONAL ASSOCIATION
	  	$	75,000,000	  	  	 	42.857142857	% 
	 WELLS FARGO BANK
	  	$	40,000,000	  	  	 	22.857142857	% 
	 JP MORGAN
	  	$	60,000,000	  	  	 	34.285714285	% 
	 TOTAL COMMITMENTS
	  	$	175,000,000	  	  	 	100	% 

  
 SCH. 1(a)-1 

 SCHEDULE 1(b) 

Guarantors 
 Shea Homes Funding Corp., a
Delaware corporation 
 Highlands Ranch Development Corporation, a Colorado corporation 

Monty Green Holdings, LLC, a Delaware limited liability company 

Mountainbrook Village Company, an Arizona corporation 
 Serenade
at Natomas, LLC, a California limited liability company 
 Seven Summits Lodge, LLC, a Delaware limited liability company 

Seville Golf and Country Club, LLC, an Arizona limited liability company 

SH AA Development, LLC, a Delaware limited liability company 
 SH
AA Tehaleh, LLC, a Delaware limited liability company 
 SH Jubilee, LLC, a Delaware limited liability company 

SH Jubilee Management, LLC, a Delaware limited liability company 

SH Lake Norman Associates, LLC, a Delaware limited liability company 

SH Lake Norman Manager, LLC, a Delaware limited liability company 

SH Tegavah Associates, LLC, a Delaware limited liability company 

SH Tegavah Manager, LLC, a Delaware limited liability company 
 SH
Vistancia West Associates, LLC, a Delaware limited liability company 
 SH Vistancia West Manager, LLC, a Delaware limited liability company 

SH WR Marketing, LLC, a Delaware limited liability company 
 SHALC
GC, Inc., a Delaware corporation 
 Shea Arizona Limited Partnership, an Arizona limited partnership 

Shea Capital II, LLC, a Delaware limited liability company 
 Shea
Communities Marketing Company, a Delaware corporation 
 Shea Financial Services, Inc., a California corporation 

Shea Homes Active Adult, LLC, a Delaware limited liability company 

Shea Homes at Montage, LLC, a California limited liability company 

Shea Homes Houston, LLC, a Delaware limited liability company 

Shea Homes, Inc., a Delaware corporation 
 Shea Homes Southwest,
Inc., an Arizona corporation 
 Shea Homes Vantis, LLC, a California limited liability company 

Shea Insurance Services, Inc., a California corporation 
 Shea La
Quinta LLC, a California limited liability company 
 Shea Otay Village 11, LLC, a California limited liability company 

Shea Proctor Valley, LLC, a California limited liability company 

Shea Properties of Colorado, Inc., a Colorado corporation 
 Shea
Riverpark Developers, LLC, a Delaware limited liability company 
 Shea Tonner Hills, LLC, a Delaware limited liability company 

Shea Victoria Gardens, LLC, a Florida limited liability company 

SHI JV Holdings, LLC, a Delaware limited liability company 
 SHLP
JV Holdings, LLC, a Delaware limited liability company 
 SHPA2 Development, LLC, a Delaware limited liability company 

Tower 104 Gathering, LLC, a Colorado limited liability company 

Tower 104 Oil, LLC, a Colorado limited liability company 
 Trilogy
Antioch, LLC, a California limited liability company 

  
 SCH. 1(b)-1 

 UDC Advisory Services, Inc., an Illinois corporation 

UDC Homes Construction, Inc., an Arizona corporation 
 Vistancia,
LLC, a Delaware limited liability company 
 Vistancia Construction, LLC, a Delaware limited liability company 

Vistancia Marketing, LLC, a Delaware limited liability company 

  
 SCH. 1(b)-2 

 SCHEDULE 5.8 

Subsidiaries; Existing Investments 
  

					
	 Direct Subsidiaries and Joint Ventures of Shea Homes Limited Partnership
	  	 	 
	 Name
	  	Equity
Percent	 
	 4S Area 37 LLC
	  	 	24.79	  
	 Armstrong Ranch LLC
	  	 	19.84	  
	 Benicia CS Developers, LLC
	  	 	50	  
	 Bridgeway Lakes Lot Development LLC
	  	 	50	  
	 Highlands Ranch Development Corporation
	  	 	100	  
	 Laing Forster Ranch II, LLC
	  	 	35	  
	 Marina Community Partners, LLC
	  	 	33.333333	  
	 MSSH Malibu Terrace Residential, LLC
	  	 	50	  
	 Novato Community Partners, LLC
	  	 	50	  
	 Polo Estates Ventures, LLC
	  	 	50	  
	 RRWS Holding Company
	  	 	50	  
	 Seville Golf and Country Club, LLC
	  	 	100	  
	 SFHB I, LLC
	  	 	74	  
	 Shea Arvada Ridge, LLC
	  	 	50	  
	 Shea Baker Ranch, LLC
	  	 	.0006	  
	 Shea Capital II, LLC
	  	 	96.5	  
	 Shea Homes, Inc.
	  	 	100	  
	 Shea Homes Arizona Limited Partnership
	  	 	85	  
	 Shea Homes Funding Corp
	  	 	100	  
	 Shea Laguna Hills LLC
	  	 	50	  
	 Shea Long Beach LLC
	  	 	50	  
	 Shea Otay Village 11, LLC
	  	 	100	  
	 Shea Proctor Valley, LLC
	  	 	100	  
	 Shea Properties of Colorado, Inc.
	  	 	100	  
	 Shea Riverpark Developers, LLC
	  	 	71	  
	 Shea Tonner Hills, LLC
	  	 	100	  
	 SHLP JV Holdings, LLC
	  	 	100	  
	 SHPA2 Development, LLC
	  	 	100	  
	 Tower 104 Gathering, LLC
	  	 	100	  
	 Tower 104 Oil, LLC
	  	 	100	  
	 Tustin Legacy Community Partners, LLC
	  	 	25	  
	 Vistancia, LLC
	  	 	16.667	  

  
 SCH. 5.8-1 

 Other Investments: 

Investments of Shea Homes, Inc. contained in account [redacted] at J.P. Morgan as of the Effective Date. 

  
 SCH. 5.8-2 

 SCHEDULE 6.17 

Existing Liens 
  

									
	 DEBTOR
	  	 JURISDICTION

SEARCHED
	  	 SECURED PARTY
	  	 FILE NO./ 
FILE
DATE
	  	 COLLATERAL

DESCRIPTION

	 Shea Homes, Inc.
	  	DE SOS	  	Deere Credit, Inc.	  	 20791776
03/08/02
  

Continuation
14525955
11/28/11
	  	Equipment
					
	 Shea Homes, Inc.
	  	DE SOS	  	General Electric Capital Corporation	  	 50946757
3/28/05
  

Continuation
93584833
11/07/09
	  	Equipment
					
	 Shea Homes, Inc.
	  	DE SOS	  	Agricredit Acceptance, LLC	  	 74044037
12/01/09
  

Continuation
2354424
08/10/12
	  	Equipment
					
	 Vistancia, LLC
	  	DE SOS	  	U.S. Bancorp Equipment Finance, Inc.	  	 42351148
8/19/04
  

Continuation
91322327
4/27/09
	  	Equipment
					
	 Seville Golf and Country Club, LLC
	  	AZ SOS	  	Textron Financial Corporation	  	 2007-146-8583-1
3/2/07
  

Continuation
2/9/12
	  	Equipment
					
	 Seville Golf and Country Club, LLC
	  	AZ SOS	  	General Electric Capital Corporation	  	2010-161-5981-3
5/13/10	  	Equipment

  
 SCH. 6.17-1 

 SCHEDULE 6.20 

Transactions with Affiliates 
 None.

  
 SCH. 6.20-1 

 EXHIBIT A 

FORM OF BORROWING BASE CERTIFICATE 

[Date] 
 U.S. Bank National Association,
Administrative Agent 
                      

                     

Ladies/Gentlemen: 
 This Borrowing Base Certificate is delivered
to you pursuant to Section 6.1(c) of the Credit Agreement, dated as of             , 2015 (as amended, supplemented, restated or otherwise modified from time to time, the
“Credit Agreement”; unless otherwise defined herein, terms defined therein being used herein as therein defined), among Shea Homes Limited Partnership, a California limited partnership (the “Borrower”), the lenders
or other financial institutions that are parties as lenders (collectively, the “Lenders”), and U.S. Bank National Association, as administrative agent for the Lenders (the “Administrative Agent”). 

 

	1.	[Name of officer signing on behalf of the Borrower] is a duly elected, qualified and acting Authorized Officer of the Borrower; and 

  

	2.	The Borrowing Base Availability as of                      (the “Report Date”) and the components
thereof are calculated and set forth on the spreadsheet attached hereto as Attachment 1. 

 [Signature page
follows.] 
 IN WITNESS WHEREOF, the undersigned has executed this Borrowing Base Certificate this      day
of         , 20    . 
  

			
	[Borrower]
		
	By:		  

	Name:		  

	Title:		  

  
 EXH. A-1 

 Attachment 1 to Exhibit A 

  
 EXH. A-2 

 EXHIBIT B 

GUARANTY 
 THIS
GUARANTY (this “Guaranty”), dated as of March 23, 2015, is made by each of the parties who have initially executed this Guaranty AND EACH OTHER PERSON WHO SHALL BECOME A PARTY HERETO BY EXECUTION OF A GUARANTY JOINDER
AGREEMENT AS PROVIDED HEREIN (each a “Guarantor” and collectively the “Guarantors”) in favor of U.S. Bank National Association, in its capacity as administrative agent (the “Administrative
Agent”) for each of the lenders from time to time party to the Credit Agreement (defined below). All capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement. 

RECITALS 
 A. Pursuant to
the terms of that certain Credit Agreement dated as of March 23, 2015, by and among Shea Homes Limited Partnership, a California limited partnership (the “Borrower”), the Administrative Agent and the Lenders (as amended,
restated, supplemented or otherwise modified form time to time, the “Credit Agreement”), the Lenders have agreed to make available to the Borrower a revolving credit facility subject to the terms, conditions and limitations
contained therein for the purposes specified in the Credit Agreement, which purposes include, among others, investing in and advancing funds to certain of the Guarantors. 

B. Each Guarantor is an Affiliate of the Borrower and will benefit directly by the credit facility provided under the Credit Agreement. 

C. The Lenders are willing to make the credit facility under the Credit Agreement available on the condition, among other things, that each
Guarantor execute and deliver this Guaranty. 
 AGREEMENT 

NOW, THEREFORE, to induce Lenders to enter into the Credit Agreement and to make the Credit Extensions described therein and in consideration thereof, each
Guarantor agrees as follows: 
 1. Guaranty. 

(a) The Guarantors unconditionally guarantee, jointly and severally, the full and prompt payment and performance, when due,
whether upon demand, maturity, by required prepayment, acceleration or otherwise, and at all times thereafter, of all of the Obligations (for the avoidance of doubt, all references to the “Obligations” in this Guaranty shall not include
Excluded Swap Obligations, as more particularly described in the definition of “Obligations” in the Credit Agreement) which may now be or may hereafter become due and owing, including, without limitation, interest accruing following the
filing of a bankruptcy petition by or against any Loan Party at the 

  
 -1- 

 
applicable rate set forth in the Credit Agreement whether or not such interest is allowed as a claim in such bankruptcy. Each of the Guarantors hereby agrees that this Guaranty is an absolute
guarantee of payment and performance and is not a guaranty of collection. 
 (b) Notwithstanding anything contained herein to
the contrary, the Guarantors’ liability with respect to the payment of the Obligations shall include all fees, costs and expenses (including, without limitation, all court costs and reasonable attorneys’ fees and costs and expenses) paid
or incurred by the Administrative Agent, the LC Issuer or any Lender (individually a “Guaranteed Party” or collectively the “Guaranteed Parties”) in: (i) endeavoring to collect all or any part of
the Obligations from, or in prosecuting any action against, the Guarantors; (ii) taking any action with respect to any security or collateral securing the obligations of the Guarantors under this Guaranty; and (iii) preserving, protecting
or defending the enforceability of this Guaranty or its rights hereunder (all such costs and expenses are referred to hereinafter collectively as the “Expenses”). 

2. Payment of Obligations. At any time, and from time to time, the Guarantors shall pay to the Administrative Agent for the benefit of
the Lenders, on written demand and in immediately available funds, all Obligations then due and outstanding, together with all Expenses. 

3. Obligations Unconditional. 

(a) Each of the Guarantors hereby agrees that its obligations under this Guaranty shall be unconditional, irrespective of: 

(1) the validity or enforceability, avoidance or subordination of any of the Obligations; 

(2) the absence of any attempt by, or on behalf of, any Guaranteed Party to collect, or take any other action to enforce, all
or any part of the Obligations from the Borrower, any other Guarantor or any other Person; 
 (3) the election of any remedy
by, or on behalf of, any Guaranteed Party with respect to all or any part of the Obligations; 
 (4) the waiver, consent,
extension, forbearance or granting of any indulgence by, or on behalf of, any Guaranteed Party or any Affiliate thereof with respect to any provision of the Loan Documents; 

(5) the failure of any Guaranteed Party to take any steps to perfect and maintain its security interest in, or to preserve its
respective right to, any collateral for all or any part of the Obligations; 
 (6) the election by, or on behalf of, any
Guaranteed Party, in any proceeding instituted under the United States Bankruptcy Code (the “Bankruptcy Code”) of the application of Section 1111 (b)(2) of the Bankruptcy Code; 

  
 -2- 

 (7) any borrowing or grant of a security interest by the Borrower, as
debtor-in-possession, under Section 364 of the Bankruptcy Code, or the disallowance under Section 502 of the Bankruptcy Code of all or any portion of the claims of any Guaranteed Party for repayment of all or any part of the Obligations or
any Expenses relating thereto; or 
 (8) any other circumstances other than payment in full which might otherwise constitute
a legal or equitable discharge or defense of the Borrower or any one or more of the Guarantors. 
 (b) The Guarantors hereby
(i) waive (except to the extent, if any, that such a waiver is prohibited by applicable law) any requirement of diligence, presentment, demand of payment, filing of claims with a court in the event of receivership or bankruptcy of the Borrower
or any other Loan Party, protest or notice with respect to all or any part of the Obligations, the benefit of any statutes of limitation, and all demands whatsoever (and the Guarantors shall not require that the same be made on Borrower or any other
Guarantor as a condition precedent to any Guarantor’s obligations hereunder), and (ii) covenant that this Guaranty will not be discharged, except by full and complete payment of the Obligations (other than any (1) contingent
indemnification obligation (subject to Section 4 below) for which no claim has been made, (2) Letters of Credit which have been Cash Collateralized and (3) obligations with respect to Cash Management Services and Rate Management
Obligations as to which arrangements satisfactory to the applicable cash management bank or counterparty have been made). 
 4. Payment;
Reinstatement; Debtor Relief. 
 (a) Administrative Agent may proceed directly and at once, without further notice,
against any one or more of the Guarantors to obtain performance of and to collect and recover the full amount, or any portion, of the Obligations then due without first proceeding against any other Loan Party, any other Person or any security or
collateral for all or any part thereof. Payments and credits, if any, from the Guarantors, the Borrower or any other Person on account of the Obligations, shall be applied to the Obligations as determined by the Administrative Agent, but subject to
the terms of the Credit Agreement, and none of the Guarantors, Borrower or any other Person shall have any further liability with respect to any such payments and credits if such payments and credits have been made as provided herein; provided,
however, that if such payments or credits, or any part thereof, are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to the Guarantors, Borrower or any other Person, or their respective
estates, trustees, receivers or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then, to the extent of such payment or repayment, the Obligations or any part thereof which has been paid, reduced or
satisfied by such amount shall be reinstated and shall continue in full force and effect as of the time immediately preceding the time such initial payment, credit, reduction or satisfaction occurred. Notwithstanding Section 8(f) hereof or any
other provision of this Guaranty which may be construed to the contrary, the repayment of the Loan and other Obligations owing under the Credit Agreement shall not limit, terminate or otherwise diminish Guarantors’ obligations or liability
under this Guaranty for the 

  
 -3- 

 
payment of any indemnification obligations of Borrower under Section 9.6 of the Credit Agreement or under any other provisions of the Credit Agreement which, by their terms, survive the
repayment of the Loan and other Obligations owing under the Credit Agreement. 
 (b) So long as any of the Obligations (other
than any (1) contingent indemnification obligation for which no claim has been made, (2) Letters of Credit which have been Cash Collateralized and (3) obligations with respect to Cash Management Services and Rate Management
Obligations as to which arrangements satisfactory to the applicable cash management bank or counterparty have been made) are owing to the Guaranteed Parties, Guarantors shall not, without the prior written consent of the Guaranteed Parties, commence
or join with any other party in commencing any bankruptcy, reorganization or insolvency proceedings of or against Borrower. The obligations of each Guarantor under this Guaranty shall not be altered, limited or affected by any case, voluntary or
involuntary, involving the bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of Borrower or by any defense which Borrower may have by reason of the order, decree or decision of any court or administrative body
resulting from any such case. Guaranteed Parties shall have the sole right to accept or reject any plan on behalf of Guarantors proposed in such case and to take any other action which Guarantors would be entitled to take, including, without
limitation, the decision to file or not file a claim. Guarantors acknowledge and agree that any interest on the Obligations which accrues after the commencement of any such proceeding, (or, if interest on any portion of the Obligations ceases to
accrue by operation of law by reason of the commencement of said proceeding, such interest as would have accrued on any such portion of the Obligations if said proceedings had not been commenced) will be included in the Obligations because it is the
intention of the parties that the Obligations should be determined without regard to any rule or law or order which may relieve Borrower of any portion of such Obligations. Guarantor hereby permits and consents to any trustee in bankruptcy,
receiver, debtor in possession, assignee for the benefit of creditors or similar Person to pay Guaranteed Parties, or allow the claim of Guaranteed Parties in respect of, any such interest accruing after the date on which such proceeding is
commenced. If all or any portion of the Obligations are paid or performed by Borrower, the obligations of Guarantors hereunder shall continue and remain in full force and effect in the event that all or any part of such payment(s) or performance(s)
is avoided or recovered directly or indirectly from Guaranteed Parties as a preference, fraudulent transfer or otherwise in such case irrespective of payment in full of all obligations under the Loan Documents. 

5. Inability to Collect. Each of the Guarantors agrees that, notwithstanding anything set forth in this Guaranty to the contrary, if
for whatever reason, any Guaranteed Party is prevented by applicable law or the terms of any subordination agreement from exercising any of its rights to receive payment from the Borrower of all or any part of the Obligations, to collect interest on
all or any part of the Obligations or to enforce or exercise any other right or remedy with respect to all or any part of the Obligations, or is prevented from taking any action to realize on all or any part of any collateral securing the
Obligations or the liabilities of any Loan Party, the Guarantors agree, jointly and severally, to pay to the Administrative Agent for the benefit of the Lenders and the other Guaranteed Parties, on demand therefor and in immediately available

  
 -4- 

 
funds, the amount that would otherwise have been due and payable had such rights and remedies been permitted to be exercised by the applicable Guaranteed Party. 

6. The Guaranteed Parties’ Actions. 

(a) The Lenders, either themselves or through the Administrative Agent, are hereby authorized, without notice or demand and
without affecting the liability of any of the Guarantors hereunder, from time to time: (i) to renew, extend, accelerate or otherwise change the time for payment of, or other terms relating to, all or any part of the Obligations or to otherwise
modify, amend or change the terms of the Loan Documents including, without limitation, increasing the amount of available credit or extending additional credit thereunder (including, without limitation, the increase in the Aggregate Commitment as
provided in Section 2.23 of the Credit Agreement); (ii) to accept partial payments on all or any part of the Obligations; (iii) to take and hold security or collateral for the payment of all or any part of the Obligations, this
Guaranty, or any other guaranties of all or any part of the Obligations or other liabilities of the Borrower; (iv) to exchange, enforce, waive and release any such security or collateral; (v) release any other Guarantor; and (vi) to
settle, release, compromise, collect or otherwise liquidate all or any part of the Obligations and exchange, enforce, release or waive any security or collateral for all or any part of the Obligations, and any of the foregoing may be done in any
manner, without affecting or impairing all or any part of the obligations of any of the Guarantors hereunder. 
 (b) Subject
to the provisions of the Loan Documents, at any time after all or any part of the Obligations have become due and payable, until all of such Obligations have been paid in full (other than any (1) contingent indemnification obligation for which
no claim has been made, (2) Letters of Credit which have been Cash Collateralized and (3) obligations with respect to Cash Management Services and Rate Management Obligations as to which arrangements satisfactory to the applicable cash
management bank or counterparty have been made), any Guaranteed Party may, in its sole discretion, without notice to the Guarantors and regardless of the acceptance of any security or collateral for the payment hereof, appropriate and apply toward
the payment of all or any part of such Obligations: (i) any indebtedness due or to become due from such Guaranteed Party or any of its Affiliates to any of the Guarantors; and (ii) any monies, credits or other property belonging to any of
the Guarantors, at any time held by or coming into the possession of such Guaranteed Party, such Guaranteed Party’s Affiliates or any of their respective custodians or nominees. 

(c) Each of the Guarantors hereby assumes responsibility for keeping informed of the financial condition of the Borrower and
each other Loan Party, and of all other circumstances bearing upon the risk of nonpayment of the Obligations, or any part thereof, or the value or condition of any collateral, if any, for the Obligations, that diligent inquiry would reveal, and the
Guarantors hereby agree that no Guaranteed Party shall have any duty to advise the Guarantors of information known to it regarding such condition or any such circumstances. Each of the Guarantors hereby acknowledges that they have been furnished
copies of the Loan Documents, and have had the opportunity to review any documents relating thereto or financial information relevant thereto and 

  
 -5- 

 
understands the terms and conditions in this Guaranty and such Loan Documents. Each of the Guarantors further acknowledges and agrees that in the event any Guaranteed Party, in its sole
discretion, undertakes at any time or from time to time to provide any such information to the Guarantors, then the party providing such information shall be under no obligation: (i) to undertake any investigation not a part of its regular
business routine; (ii) to disclose any information which, pursuant to accepted or reasonable banking or commercial finance practices, such party wishes to maintain confidential; or (iii) to make any other or future disclosures of such
information or any other information to the Guarantors. 
 (d) Each of the Guarantors consents and agrees that each
Guaranteed Party, or any Person acting for or on behalf of such Guaranteed Party, shall not be under any obligation to marshal any assets in favor of the Guarantors or against or in payment of all or any part of the Obligations. 

7. Credit Agreement. Until all of the Obligations have been fully paid (other than any (1) contingent indemnification obligation
for which no claim has been made, (2) Letters of Credit which have been Cash Collateralized and (3) obligations with respect to Cash Management Services and Rate Management Obligations as to which arrangements satisfactory to the
applicable cash management bank or counterparty have been made) and the Commitments shall have terminated, each Guarantor hereby makes all representations and warranties and agrees to comply with all covenants set forth in the Credit Agreement to
the extent applicable to it, mutatis mutandis. 
 8. Delay of Subrogation, Subordination; Waivers and Other Matters. 

(a) Until the Obligations shall have been paid in full (other than any (1) contingent indemnification obligation for which
no claim has been made, (2) Letters of Credit which have been Cash Collateralized and (3) obligations with respect to Cash Management Services and Rate Management Obligations as to which arrangements satisfactory to the applicable cash
management bank or counterparty have been made), the Guarantors shall have no right of subrogation or contribution on account of payments made by any Guarantor under this Guaranty and each of the Guarantors hereby agrees to postpone any right to
enforce any remedy which any Guaranteed Party now has or may hereafter have against the Borrower or any other Guarantor, and each of the Guarantors hereby agrees to postpone any benefit of, and any right to participate in, any security or collateral
given to the Guaranteed Parties to secure payment of the Obligations or any other liability of the Borrower to the Guaranteed Parties. 

(b) The Guarantors further agree that, subject to the terms and conditions of the Credit Agreement, any and all claims of the
Guarantors against the Borrower or any other Guarantor or against any of their respective properties, whether arising by reason of any payment by any of the Guarantors pursuant to the provisions hereof, or otherwise, and all indebtedness of the
Borrower, to the Guarantors or any of them, shall be subordinate and subject in right of payment to the prior payment, in full, of all the Obligations and Expenses (other than any (1) contingent indemnification obligation for which no claim has
been made, (2) Letters of Credit which have been Cash 

  
 -6- 

 
Collateralized and (3) obligations with respect to Cash Management Services and Rate Management Obligations as to which arrangements satisfactory to the applicable cash management bank or
counterparty have been made). The Guarantors also waive all setoffs and counterclaims and all presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, and notices of acceptance of this
Guaranty by any Person who is at any time an obligee with respect to any of the Obligations. The Guarantors further waive all notices of the existence, creation or incurring of new or additional indebtedness, arising either from additional loans
extended to the Borrower or otherwise, and also waives all notices that the principal amount, or any portion thereof, and/or any interest with respect to any of the Obligations is due, notices of any and all proceedings to collect from the Borrower,
any endorser, any other Guarantor, or any other Person of all or any part of the Obligations, and, to the extent permitted by law, notices of exchange, sale, surrender or other handling of any security or collateral given to any Guaranteed Party to
secure payment of all or any part of the Obligations. 
 (c) Each of the Guarantors, to the fullest extent permitted by law,
waives any defense arising by reason of: (i) any disability or other defense of the Borrower or any other Person, including but not limited to the insolvency or bankruptcy of the Borrower or any other Person, or any stay in connection with any
such bankruptcy proceedings; (ii) the cessation from any cause whatsoever, other than payment in full or other satisfaction, of the Obligations; (iii) the application by the Borrower of the proceeds of any Obligation secured hereby for
purposes other than the purposes represented by the Borrower to the Guaranteed Parties or intended or understood by the Guaranteed Parties or the Guarantors; or (iv) any act or omission by any Guaranteed Party which directly or indirectly
results in or aids the discharge or release of the Borrower, any other Person, any Obligation, or any collateral, by operation of law or otherwise. Each of the Guarantors, to the fullest extent permitted by law, waives all rights which it may have
under: (i) any law which may limit the amount of a deficiency judgment based on any Obligation, (ii) any bar to deficiency judgments, (iii) any requirement of law that any Guaranteed Party exhaust any security for the Obligations
before proceeding against the Guarantors, (iv) any law which may prohibit any Guaranteed Party from enforcing its rights and remedies against the Borrower by both a private sale and an action in court, (v) any law which requires that a
court action to enforce any Guaranteed Party’s rights be an action to foreclose any security instrument securing the Obligations, (vi) any defense based on any lack of authority of the officers, directors, partners, managers, members, or
agents acting or purporting to act on behalf of Borrower or any Affiliate of Borrower, or any defect in the formation of Borrower or any Affiliate of Borrower, (vii) any defense based on any statute or rule of law which provides that the
obligation of a surety must be neither larger in amount nor in any other respects more burdensome than that of a principal, (viii) any defense based upon Administrative Agent’s or any Lender’s election, in any proceeding instituted
under the Federal Bankruptcy Code, or the application of Section 1111(b)(2) of the Federal Bankruptcy Code or any successor statute, (ix) any defense based upon any borrowing or any grant of a security interest under Section 364 of
the Federal Bankruptcy Code, or (x) the benefit of any statute of limitations affecting the liability of any Guarantor hereunder or the enforcement hereof. 

  
 -7- 

 (d) Each of the Guarantors warrants and agrees that each of the waivers set forth
above are made with its full knowledge of their significance and consequences, with the understanding that events giving rise to any defense waived may diminish, destroy or otherwise adversely affect rights which the Guarantors otherwise may have
against the Borrower, any Guaranteed Party or others, or against collateral, and that under the circumstances existing in connection herewith, the waivers are reasonable and not contrary to public policy or law. If any of the waivers are determined
to be contrary to any applicable law or public policy, such waivers shall be effective to the maximum extent permitted by law. 

(e) No delay on the part of the Administrative Agent in the exercise of any right or remedy arising under this Guaranty, or any
of the Loan Documents, or otherwise with respect to all or any part of the Obligations, any collateral securing the Obligations or any other guaranty of or security for all or any part of the Obligations shall operate as a waiver thereof, and no
single or partial exercise by the Administrative Agent of any such right or remedy shall preclude any further exercise thereof. No modification or waiver of any of the provisions of this Guaranty shall be binding upon the Administrative Agent except
as expressly set forth in a writing duly executed and delivered by the Administrative Agent. Failure by any Guaranteed Party at any time or times hereafter to require strict performance by the Borrower, the Guarantors or any other Person of any of
the provisions, warranties, terms and conditions contained in the Loan Documents shall not waive, affect or diminish any right of the Administrative Agent at any time or times hereafter to demand strict performance thereof, and such right shall not
be deemed to have been modified or waived by any act or knowledge of the Administrative Agent, unless such waiver is contained in an instrument in writing, and directed and delivered to the Guarantors, specifying such waiver signed by the
Administrative Agent. No waiver by any Guaranteed Party of any default under any of the Loan Documents shall operate as a waiver of any other default or the same default on a future occasion. Any final determination by a court of competent
jurisdiction of the amount of the Obligations shall be conclusive and binding on the Guarantors irrespective of whether any of the Guarantors was party to the suit or action in which such determination was made. Without in any way limiting the
generality of the foregoing, in the event that any Guaranteed Party is awarded a judgment in any suit brought to enforce and Guarantor’s covenant to perform a portion of the Obligation, such judgment will in no way be deemed to release such
Guarantor from its covenant to perform any portion of the Obligation which is not the subject of such suit. 
 (f) This
Guaranty shall continue in full force and effect until the Obligations (other than any (1) contingent indemnification obligation for which no claim has been made, subject to Section 4(a) hereof, (2) Letters of Credit which have been
Cash Collateralized and (3) obligations with respect to Cash Management Services and Rate Management Obligations as to which arrangements satisfactory to the applicable cash management bank or counterparty have been made) shall have been fully
and indefeasibly paid and no Guaranteed Party shall have further obligation to make additional financial accommodations available to the Borrower under the Loan Documents. 

  
 -8- 

 9. In furtherance of the foregoing: 

(a) Each Guarantor further waives, without limitation, any and all rights or defenses such Guarantor may have by reason of
protection afforded to the principal with respect to any of the Obligations or to any other guarantor of any of the Obligations with respect to such guarantor’s obligations under its guaranty, in either case, pursuant to any applicable
anti-deficiency or other laws limiting or discharging the principal’s indebtedness or such other guarantor’s obligations; and 

(b) Each Guarantor waives all rights and defenses arising out of an election of remedies by Guaranteed Parties, even though
that election of remedies (such as non-judicial foreclosure with respect to any security for Borrower’s obligations) has destroyed Guarantors’ rights of subrogation and reimbursement against Borrower by the operation of applicable law or
otherwise, and even though that election of remedies by Guaranteed Party has destroyed Guarantors’ rights of contribution against another guarantor of any of the Obligations. 

(c) Subject to Section 8, each Guarantor waives all rights and defenses that it may have because the Obligations at any
time may be secured by real property. This means, among other things: 
 (1) That Guaranteed Parties may collect or receive
performance from any Guarantor without first foreclosing on any real or personal property collateral pledged by Borrower or any other Party; and 

(2) If any Guaranteed Party forecloses on any real property collateral pledged by Borrower, any Guarantor or any other Party,

 (A) the amount of the Obligations may be reduced only by the price for which that collateral is sold at the foreclosure
sale, even if the collateral is worth more than the sale price; and 
 (B) the Guaranteed Parties may collect or receive
performance from any Guarantor even if Guaranteed Parties, by foreclosing on the real property collateral, have destroyed any right such Guarantor may have to collect from Borrower. 

The foregoing is an unconditional and irrevocable waiver of any rights and defenses Guarantor may have because the Obligations
may at any time be secured by real property. 
 (d) Each Guarantor hereby waives any right it might otherwise have under
applicable law or otherwise to have Borrower designate the portion of any such obligation to be satisfied in the event that Borrower provides partial satisfaction of such obligation. Guarantors acknowledges and agrees that Borrower may already have
agreed with Guaranteed Parties, or may hereafter agree, that in any such event the designation of the portion of the obligation to be satisfied shall, to the extent not expressly made by the terms of the Loan Documents, be made by Guaranteed Parties
rather than by Borrower. 

  
 -9- 

 No other provision of this Guaranty shall be construed as limiting the generality of any of the covenants and
waivers set forth in this paragraph 9. 
 10. CHOICE OF LAW; JURISDICTION AND SERVICE OF PROCESS; WAIVER OF JURY TRIAL. 

(a) THIS GUARANTY SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS)
OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS. 
 (b) EACH PARTY HERETO
ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG ANY GUARANTOR, THE ADMINISTRATIVE AGENT OR ANY OF THE LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES.
ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE GUARANTORS AND THE ADMINISTRATIVE AGENT HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY
BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS GUARANTY, OR ANY OTHER LOAN DOCUMENT OR IN CONNECTION WITH ANY COLLATERAL OR ANY LIEN OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE
ADMINISTRATIVE AGENT OR ANY OF THE GUARANTORS OF ANY KIND OR NATURE. 
 (c) THE ADMINISTRATIVE AGENT AND EACH GUARANTOR
HEREBY AGREES THAT ANY FEDERAL DISTRICT COURT LOCATED IN NEW YORK, NEW YORK OR, AT THE OPTION OF THE ADMINISTRATIVE AGENT, ANY STATE COURT LOCATED IN NEW YORK, NEW YORK SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR
AMONG THE ADMINISTRATIVE AGENT OR ANY OF THE GUARANTORS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTY, OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR THEREFROM. EACH OF THE GUARANTORS EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE
TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS. EACH GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT,
OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH GUARANTOR AT ITS ADDRESS FOR NOTICES PROVIDED FOR HEREIN. 

(d) EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION

  
 -10- 

 
OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. 

(e) THE CHOICE OF FORUM SET FORTH IN THIS PARAGRAPH 10 SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE
ADMINISTRATIVE AGENT OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION. 

(f) EACH GUARANTOR AGREES THAT ALL OF ITS PAYMENT OBLIGATIONS HEREUNDER SHALL BE ABSOLUTE AND UNCONDITIONAL, AND FOR THE
PURPOSES OF MAKING PAYMENTS HEREUNDER, SUCH GUARANTOR HEREBY WAIVES ANY RIGHT TO ASSERT ANY SETOFF, COUNTERCLAIM OR CROSS-CLAIM. 

(g) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES
THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE OBLIGATIONS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER AND THE TERMINATION OF THIS GUARANTY. 

11. Severability. Wherever possible, each provision of this Guaranty shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or
the remaining provisions of this Guaranty. 
 12. Notices. Any notice required or desired to be served, given or delivered under this
Guaranty shall be in writing, and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile, all of which shall be properly addressed to the party to be notified and sent to the applicable
address for such party set forth on Schedule 1 attached hereto (or to such other address as the parties shall, from time to time, designate in writing). Notices sent by hand or overnight courier service, or mailed by certified or registered mail,
shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of
business on the next Business Day for the recipient). If any Guarantor refuses any delivery, a notice so refused shall be deemed delivered. 

13. Obligations of Others; Reference to the Guarantors. Each of the Guarantor’s obligations under this Guaranty will also be
binding on such Guarantor’s successors, assigns and legal representatives. Each Guarantor’s successors and assigns shall include, without limitation, a receiver, successor trustee or debtor in possession for such Guarantor. This Guaranty
shall be joint and several as among all of the Guarantors and the obligations under this Guaranty shall not be modified, delayed or impaired as to any one or more of the Guarantors by the modification, extension or release of any obligations
hereunder of any of the Guarantors. 

  
 -11- 

 14. Limitation on Guaranteed Obligations; Contribution. 

(a) Notwithstanding anything to the contrary contained in this Guaranty, it is the intention of each of the Guarantors and the
Administrative Agent that each of the Guarantor’s obligations hereunder, as of any date, shall be in (but not in excess of) such maximum amount not subject (but for the provisions of this paragraph) to avoidance under any Debtor Relief Laws.
The limitation of this paragraph (as to each of the Guarantors, its “Limitation”) shall apply to each of the Guarantors, only to the extent its obligations would otherwise be subject to avoidance under any Debtor Relief Laws
if such Guarantor is not deemed to have received valuable consideration, fair value or reasonably equivalent value for its obligations hereunder, in which case, such Guarantor’s obligations hereunder shall be reduced to that amount
(“Maximum Liability”) which, after giving effect thereto, would not render such Guarantor insolvent, or leave such Guarantor with an unreasonably small capital to conduct its business, or cause such Guarantor to have incurred
debts (or intended to have incurred debts) beyond its ability to pay such debts as they mature, at the time such obligations are deemed to have been incurred. As used herein, the terms “insolvent” and “unreasonably small capital”
shall be determined in accordance with the U.S. Bankruptcy Code. The rights of each of the Guarantors to any right of contribution or subrogation against any and all other Loan Parties shall be taken into account in making any determination
described in the foregoing sentence. This paragraph with respect to the Limitation of each of the Guarantors is intended solely to preserve the rights of the Guaranteed Parties hereunder to the maximum extent not subject to avoidance under any
Debtor Relief Laws, and neither the Guarantors nor any other Person shall have any right or claim under this paragraph with respect to the Limitation, except to the extent necessary so that the obligations of the Guarantors or any of them hereunder
shall not be rendered voidable under any Debtor Relief Laws. 
 (b) If any Guarantor makes a payment in respect of the
Obligations that is greater than its Pro Rata Percentage (hereinafter defined) of the Obligations so paid, calculated as of the date such payment is made, the Guarantor making such payment shall have the right to receive from each of the other
Guarantors, and the other Guarantors jointly and severally agree to pay to such Guarantor, when permitted by subparagraph (a) above, an amount such that the net payments made by the Guarantors in respect of the Obligations shall be shared among
the Guarantors pro rata in proportion to their respective Pro Rata Percentage of the Obligations so paid by the Guarantors. The Guarantors hereby jointly and severally indemnify each of the other Guarantors and jointly and severally agree to hold
each of them harmless from and against any and all amounts which any such Guarantor shall ever be required to pay in respect of the Obligations in excess of such Guarantor’s respective Pro Rata Percentage of the Obligations so paid. As used
herein, the term “Pro Rata Percentage” shall mean, for each Guarantor, the percentage derived by dividing (1) the amount by which the present fair saleable value of such Guarantor’s assets on the date hereof (or, if
later, the date on which such Guarantor becomes a party hereto) exceeds its liabilities (without giving effect to the Guaranty) (such excess for each Guarantor, its “Net Worth”) by (2) the Net Worth of all of the
Guarantors as of such date. 

  
 -12- 

 (c) To the extent any dispute exists at any time between or among any Guarantor
and any other guarantor of the Obligations as to such Guarantors’ or any other guarantor’s right to contribution or otherwise, Guarantor agrees to indemnify, defend and hold Guaranteed Parties harmless from and against any loss, damage,
claim, demand, cost or any other liability (including, without limitation, reasonable attorneys’ fees and costs) Guaranteed Parties may suffer as a result of such dispute. 

15. Counterparts. This Guaranty may be executed in any number of counterparts, all of which taken together shall constitute one
agreement, and any of the parties hereto may execute this Guaranty by signing any such counterpart. This Guaranty shall be effective as against each of the Guarantors when it has been executed by such Guarantor. A facsimile or pdf copy of a
signature of any of the Guarantors to this Guaranty shall have the same force and effect as an original manual signature. 
 16. Effect
of Waivers; Entirety of Agreement. Each waiver of any rights of the Guarantors contained herein is given by each Guarantor knowingly and intentionally and unless otherwise expressly otherwise provided herein, each such waiver is given for all
times and forever. This Guaranty sets forth the entire agreement of the Guarantors and Guaranteed Parties with respect to the matters described herein and supersedes all prior written or oral understandings and agreements with respect thereto. No
modification or waiver of any provision of this Guaranty shall be effective unless set forth in writing and signed by the Guarantors and Administrative Agent. If there is any conflict between the terms, conditions and provisions of this Guaranty and
those of any other agreement or instrument executed by Guarantors, including any of the other Loan Documents, the terms, conditions and provisions of this Guaranty shall prevail. Each Guarantor, by executing this Guaranty or a Guaranty Joinder
Agreement pursuant to paragraph 17, expressly represents and warrants that it did not rely on any representation, assurance or agreement, oral or written, not expressly set forth in this Guaranty in reaching its decisions to enter into this Guaranty
and that no promises or other representations have been made to such Guarantor which conflict with the written terms of this Guaranty. Each Guarantor represents to the Guaranteed Parties that (i) it has read and understands the terms and
conditions contained in this Guaranty and the other Loan Documents executed in connection with this Guaranty, (ii) its legal counsel has carefully reviewed all of the Loan Documents (including, without limitation, this Guaranty) and it has
received legal advice from counsel of its choice regarding the meaning and legal significance of this Guaranty and all other Loan Documents, (iii) it is satisfied with its legal counsel and the advice received from it, and (iv) it has
relied only on its review of this Guaranty and the other Loan Documents and its own legal counsel’s advice and representations (and it has not relied on any advice or representations from Administrative Agent and Lender, or any of their
respective officers, employees, agents or attorneys). This Guaranty may not be modified, amended or terminated except by a written agreement signed by Guarantors and Administrative Agent. No course of prior dealing among the parties, no usage of
trade, and no parol or extrinsic evidence of any nature may be used to supplement, modify or vary any of the terms hereof. There are no conditions to the full effectiveness of this Guaranty. 

17. Guaranty Joinder Agreement. Each Wholly Owned Subsidiary which is required to become a Guarantor hereunder in accordance with
Section 6.24 of the Credit Agreement (and any other Person who is a Guarantor pursuant to Section 6.24 of the Credit Agreement) shall execute and deliver to the Administrative Agent a “Guaranty Joinder Agreement” substantially in

  
 -13- 

 
the form attached as Exhibit A hereto (a “Guaranty Joinder Agreement”) and shall thereupon irrevocably, absolutely and unconditionally become a party hereto and obligated
hereunder as a Guarantor, and all references herein and in the other Loan Documents to the Guarantors or to the parties to this Guaranty shall be deemed to include such Person as a Guarantor hereunder. 

18. Eligible Contract Participant Provisions. 

(a) As used in this paragraph 18: (i) the terms “Commodities Exchange Act” and “Swap Obligation” have
the meanings given to such terms in the Loan Agreement; (ii) a “Swap” means any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange
Act, as further defined under CFTC regulations, including any adopted jointly with the Securities and Exchange Commission; (iii) a “Non-Lender Swap Counterparty” means, with respect to any Swap with an LC Issuer, any
person or entity (other than the LC Issuer) that is or becomes a party to such Swap; and (iv) “Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Guarantor that has total assets exceeding $10,000,000
at the time the relevant guaranty (including, without limitation, this Guaranty) or grant of the relevant security interest becomes effective with respect to such Swap Obligation, or such other person as constitutes an “eligible contract
participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwell agreement under
Section 1a(18)(A)(v)(II) of the Commodity Exchange Act. 
 (b) Each Guarantor hereby represents that as of the date
hereof, and shall be deemed to represent on any and each day that Borrower enters into a Swap, that it is an “eligible contract participant” as defined in the Commodities Exchange Act. Each Qualified ECP Guarantor hereby jointly and
severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Guarantor to honor all of its obligations under this Guaranty in respect of all Swap Obligations
(provided, however, that each Qualified ECP Guarantor shall only be liable under this paragraph 18 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this paragraph 18, or otherwise under
this Guaranty, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this paragraph 18 shall remain in full force and effect
until all Obligations guaranteed by this Guaranty have been paid in full. Each Qualified ECP Guarantor intends that this paragraph 18 constitute, and this paragraph 18 shall be deemed to constitute, a “keepwell, support, or other
agreement” for the benefit of each other Guarantor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act. Notwithstanding anything to the contrary set forth in this Guaranty, the obligations of each Guarantor under
this paragraph 18 shall constitute guaranteed Obligations under this Guaranty.  
 EACH GUARANTOR ACKNOWLEDGES THAT GUARANTOR
HAS BEEN AFFORDED THE OPPORTUNITY TO READ THIS DOCUMENT CAREFULLY AND TO REVIEW IT WITH AN ATTORNEY OF GUARANTORS’ CHOICE BEFORE SIGNING IT. 

  
 -14- 

 
EACH GUARANTOR ACKNOWLEDGES HAVING READ AND UNDERSTOOD THE MEANING AND EFFECT OF THIS DOCUMENT BEFORE SIGNING IT. 

[Signatures on the following page] 

  
 -15- 

 IN WITNESS WHEREOF, this Guaranty has been duly executed as of the day and year first set forth
above. 
  

					
	GUARANTORS:
	
	 SHEA HOMES LIMITED PARTNERSHIP,
 a
California limited partnership

		
	By: 		  

			Name:		Andrew Parnes
			Title:		Chief Financial Officer
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 SHEA HOMES FUNDING CORP.,
 a
Delaware corporation

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-1

							
	 HIGHLANDS RANCH DEVELOPMENT CORPORATION,

a Colorado corporation

		
	By: 		  

			Name:		James G. Shontere
			Title:		Secretary
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 MONTY GREEN HOLDINGS, LLC,
 a
Delaware limited liability company

		
	By:		Shea Homes, Inc.,
			a Delaware corporation
			Its Sole Member
			
			By:		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 MOUNTAINBROOK VILLAGE COMPANY,
 an
Arizona corporation

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-2

													
	SERENADE AT NATOMAS, LLC,
	a California limited liability company
		
	By: 		Shea Homes, Inc.,
			a Delaware corporation,
			Its sole Member
			
			By: 		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SHEA HOMES ARIZONA LIMITED PARTNERSHIP

an Arizona limited partnership

		
	By:		 Shea Homes Limited Partnership,

			a California limited partnership,
			Its General Partner
			
			By:		J.F. Shea, G.P.,
					a Delaware general partnership,
					Its sole General Partner
				
					By:		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name:		James G. Shontere
											Title:		Secretary
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-3

													
	SEVILLE GOLF AND COUNTRY CLUB, LLC,
	an Arizona limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Sole Member and Manager
			
			By: 		J.F. Shea, G.P.,
					a Delaware limited partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name:		Andrew Parnes
											Title:		Vice President
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-4

													
	SHEA RIVERPARK DEVELOPERS, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Managing Member
			
			By: 		J.F. Shea, G.P.,
					a Delaware general partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name:		James G. Shontere
											Title:		Secretary
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-5

													
	SHEA CAPITAL II, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Manager
			
			By:		J.F. Shea, G.P..,
					a Delaware limited partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name:		Andrew Parnes
											Title:		Vice President
						
									By: 		  

											Name:		Robert R. O’Dell
											Title:		Treasurer
	
	 SHEA COMMUNITIES MARKETING COMPANY,

a Delaware corporation

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-6

					
	SHEA FINANCIAL SERVICES, INC.,
	a California corporation
		
	By: 		  

			Name:		James G. Shontere
			Title:		Secretary
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 SHEA HOMES, INC.,
 a Delaware
corporation

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 SHEA HOMES AT MONTAGE, LLC,
 a
California limited liability company

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-7

							
	SHEA HOMES SOUTHWEST, INC.,
	an Arizona corporation
		
	By: 		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 SHEA HOMES VANTIS, LLC,
 a
California limited liability company

		
	By:		Shea Homes, Inc.,
			a Delaware corporation,
			Its sole Member
			
			By:		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SHEA INSURANCE SERVICES, INC.,
 a
California corporation

		
	By:		  

			Name:		James G. Shontere
			Title:		Secretary
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-8

													
	SHEA LA QUINTA LLC,
	a California limited liability company
		
	By: 		Shea Homes, Inc.,
			a Delaware corporation,
			Its sole Member
			
			By: 		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SHEA OTAY VILLAGE 11, LLC,
 a
California limited liability company

		
	By:		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Sole Member
			
			By:		J.F. Shea, G.P..,
					a Delaware limited partnership,
					Its sole General Partner
				
					By:		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name:		Andrew Parnes
											Title:		Vice President
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-9

													
	SHEA PROCTOR VALLEY, LLC,
	a California limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Sole Member
			
			By:		J.F. Shea, G.P..,
					a Delaware limited partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name:		Andrew Parnes
											Title:		Vice President
						
									By:		  

											Name: 		Robert R. O’Dell
											Title:		Treasurer
	
	 SHEA PROPERTIES OF COLORADO, INC.,

a Colorado corporation

		
	By:		  

			Name:		James G. Shontere
			Title:		Secretary
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-10

													
	SHEA TONNER HILLS, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its sole Member and Manager
			
			By:		J.F. Shea, G.P..,
					a Delaware limited partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name: 		Andrew Parnes
											Title:		Vice President
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer
	
	 SHEA VICTORIA GARDENS, LLC,
 a
Florida limited liability company

		
	By:		  

			Name: 		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-11

					
	SH JUBILEE, LLC,
	a Delaware limited liability company
		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 SH JUBILEE MANAGEMENT, LLC,
 a
Delaware limited liability company

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 SHI JV HOLDINGS, LLC,
 a Delaware
limited liability company

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 SHLP JV HOLDINGS, LLC,
 a Delaware
limited liability company

		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-12

													
	TOWER 104 GATHERING, LLC,
	a Colorado limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Sole Member and Manager
			
			By: 		J.F. Shea, G.P..,
					a Delaware limited partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name: 		Andrew Parnes
											Title:		Vice President
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-13

													
	TOWER 104 OIL, LLC,
	a Colorado limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Sole Member and Manager
			
			By: 		J.F. Shea, G.P..,
					a Delaware limited partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name: 		Andrew Parnes
											Title:		Vice President
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-14

																	
	TRILOGY ANTIOCH, LLC,
	a California limited liability company
			
			By:		SHEA CAPITAL II, LLC,
					a Delaware limited liability company,
					Its sole Member
				
					By: 		Shea Homes Limited Partnership,
							a California limited partnership,
							Its Manager
					
							By: 		J.F. Shea, G.P..,
									a Delaware limited partnership,
									Its sole General Partner
						
									By: 		JFS Management, L.P.,
											a Delaware limited partnership,
											Its sole General Partner
							
											By: 		J.F. Shea Construction Management, Inc.,
													a California corporation,
													Its sole General Partner
								
													By: 		  

															Name: 		Andrew Parnes
															Title:		Vice President
								
													By:		  

															Name:		Robert R. O’Dell
															Title:		Treasurer
	
	 UDC ADVISORY SERVICES, INC.,
 an
Illinois corporation

		
	By: 		  

			Name: 		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-15

							
	UDC HOMES CONSTRUCTION, INC.,
	an Arizona corporation
		
	By:		  

			Name:		Andrew Parnes
			Title:		Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer
	
	 VISTANCIA CONSTRUCTION, LLC,
 a
Delaware limited liability company

		
	By:		Shea Homes Southwest, Inc.,
			an Arizona corporation,
			Its Manager
			
			By:		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 VISTANCIA MARKETING, LLC,
 a
Delaware limited liability company

		
	By:		Shea Homes Southwest, Inc.,
			an Arizona corporation,
			Its Manager
			
			By:		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-16

							
	SHEA HOMES HOUSTON, LLC,
	a Delaware limited liability company
		
	By:		Shea Homes, Inc.,
			a Delaware corporation
			Its Sole Member
			
			By:		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SHEA HOMES ACTIVE ADULT, LLC,
 a
Delaware limited liability company

		
	By:		Shea Homes, Inc.,
			a Delaware corporation
			Its Sole Member
			
			By:		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SH AA DEVELOPMENT, LLC,
 a Delaware
limited liability company

		
	By:		Shea Homes, Inc.,
			a Delaware corporation
			Its Sole Member
			
			By:		  

					Name:		Andrew Parnes
					Title:		Vice President
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-17

					
	SHALC GC, INC.,
	a Delaware corporation
		
	By:		  

			Name:		Andrew Parnes
			Title:		Executive Vice President
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-18

													
	SHEA RIVERPARK DEVELOPERS, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Managing Member
			
			By: 		J.F. Shea, G.P.,
					a Delaware general partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name: 		James G. Shontere
											Title:		Secretary
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-19

													
	SHEA HOMES ARIZONA LIMITED PARTNERSHIP
	an Arizona limited partnership
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its General Partner
			
			By: 		J.F. Shea, G.P.,
					a Delaware general partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By: 		  

											Name: 		James G. Shontere
											Title:		Secretary
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-20

													
	SHPA2 Development, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes Limited Partnership,
			a California limited partnership,
			Its Manager/ sole Member
			
			By: 		J.F. Shea, G.P.,
					a Delaware general partnership,
					Its sole General Partner
				
					By: 		JFS Management, L.P.,
							a Delaware limited partnership,
							Its sole General Partner
					
							By: 		J.F. Shea Construction Management, Inc.,
									a California corporation,
									Its sole General Partner
						
									By:		  

											Name: 		James G. Shontere
											Title:		Secretary
						
									By:		  

											Name:		Robert R. O’Dell
											Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-21

							
	VISTANCIA, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes Southwest, LLC
			a Arizona corporation
			Its: Member
			
			By: 		  

					Name:		James G. Shontere
					Title:		Secretary
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SEVEN SUMMITS LODGE, LLC,
 a
Delaware limited liability company

		
	By:		Shea Homes Active Adult, LLC,
			a Delaware limited liability company
			Its: sole Member
			
			By:		Shea Homes, Inc.
					a Delaware corporation
					Its: sole Member
			
			By:		  

					Name:		James G. Shontere
					Title:		Secretary
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SH AA TEHALEH, LLC,
 a Delaware
limited liability company

		
	By:		  

			Name:		James G. Shontere
			Title:		Secretary
		
	By:		  

			Name:		Robert R. O’Dell
			Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-22

							
	SH LAKE NORMAN ASSOCIATES, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes, Inc.,
			a Delaware corporation,
			Its sole Member
			
			By: 		  

					Name:		James G. Shontere
					Title:		Secretary
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SH LAKE NORMAN MANAGER, LLC,
 a
Delaware limited liability company

		
	By:		SH Lake Norman Associates, LLC
			a Delaware limited liability company
			Its: sole Member
			
			By:		Shea Homes, Inc.
					a Delaware corporation
					Its: sole Member
			
			By:		  

					Name:		James G. Shontere
					Title:		Secretary
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-23

									
	SH TEGAVAH ASSOCIATES, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes, Inc.,
			a Delaware corporation,
			Its sole Member
			
			By: 		  

					Name: 		James G. Shontere
					Title:		Secretary
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SH TEGAVAH MANAGER, LLC,
 a Delaware
limited liability company

		
	By:		SH Tegavah Associates, LLC
			a Delaware limited liability company
			Its: sole Member
			
			By:		Shea Homes, Inc.
					a Delaware corporation
					Its: sole Member
				
					By:		  

							Name: 		James G. Shontere
							Title:		Secretary
				
					By:		  

							Name:		Robert R. O’Dell
							Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-24

									
	SH VISTANCIA WEST ASSOCIATES, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes, Inc.,
			a Delaware corporation,
			Its sole Member
			
			By: 		  

					Name:		James G. Shontere
					Title:		Secretary
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer
	
	 SH VISTANCIA WEST MANAGER, LLC,
 a
Delaware limited liability company

		
	By:		SH Vistancia Associates, LLC
			a Delaware limited liability company
			Its: sole Member
			
			By:		Shea Homes, Inc.
					a Delaware corporation
					Its: sole Member
				
					By:		  

							Name:		James G. Shontere
							Title:		Secretary
				
					By:		  

							Name:		Robert R. O’Dell
							Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-25

							
	SH WR MARKETING, LLC,
	a Delaware limited liability company
		
	By: 		Shea Homes, Inc.,
			a Delaware corporation,
			Its sole Member
			
			By: 		  

					Name:		James G. Shontere
					Title:		Secretary
			
			By:		  

					Name:		Robert R. O’Dell
					Title:		Treasurer

  

	
	SIGNATURES TO GUARANTY
	S-26

 Schedule 1 

Addresses for Notices 
 If to any Guarantor: 

Shea Homes Limited Partnership 

655 Brea Canyon Road 
 Walnut,
California 91789 
 Attn: Chief Financial Officer and General Counsel 

Facsimile Number: (909) 869-0849 

Telephone Number: (909) 594-9500 
 If to
Administrative Agent: 
 U.S. Bank National Association 

c/o Soua R. Yang, Senior Agency Specialist, U.S. Bank Agency Services 

800 Nicollet Mall, 3rd Floor 

Minneapolis, MN 55402-7020 

Telephone: 602-303-3247 

Facsimile: (612) 303-3851 
 With a copy to:

 c/o Young Hahn, Agency Specialist, U.S. Bank Agency Services 

1420 Fifth Avenue, 9th Floor, Seattle, WA 98101 

Telephone: (206) 344-5055 

Facsimile: (203) 587-7022 
 With a copy to:

 c/o Susanie Samson, Loan Administration 

4100 Newport Place, Suite 900 

Newport Beach, CA 92680 

Telephone: (949) 863-2376 

Facsimile: (949) 252-1759 

  
 SCHEDULE 1 

 EXHIBIT A 

GUARANTY JOINDER AGREEMENT 
 THIS
GUARANTY JOINDER AGREEMENT (this “Guaranty Joinder Agreement”), dated as of             , 20     is made by
                    , a              (the “Joining Guarantor”),
and delivered to U.S. Bank National Association in its capacity as Administrative Agent for the Lenders under that certain Credit Agreement (as from time to time amended, revised, modified, supplemented or amended and restated, the
“Credit Agreement”), dated as of             , 2015 by and among Shea Homes Limited Partnership, a California limited partnership (the
“Borrower”), the Lenders from time to time party thereto and the Administrative Agent. All capitalized terms not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement. 

A. Reference is hereby made to that certain Guaranty dated as of             
    , 2015 made by the Guarantors named therein (including any additional Guarantors that execute a Guaranty Joinder Agreement) in favor of the Administrative Agent for the benefit of the Lenders and the LC Issuer (the
“Guaranty”). 
 B. The Joining Guarantor will materially benefit directly and indirectly from the credit facility
made available and to be made available to the Borrower by the Lenders under the Credit Agreement and desires to become a Guarantor under the Guaranty. 

NOW, THEREFORE, the Joining Guarantor hereby agrees as follows: 

1. Joinder. The Joining Guarantor hereby irrevocably, absolutely and unconditionally agrees to become a party to the Guaranty as a
Guarantor and be bound by all the terms, conditions, obligations, liabilities and undertakings of each Guarantor or to which each Guarantor is subject thereunder, including, without limitation, the guaranty pursuant to paragraph 1 of the Guaranty of
the payment and performance in full of the Obligations and Expenses, all with the same force and effect as if the Joining Guarantor were a signatory to the Guaranty. 

2. Affirmations. The Joining Guarantor hereby acknowledges and affirms as of the date hereof with respect to itself, its properties and
its affairs each of the waivers, representations, warranties, acknowledgements and certifications applicable to any Guarantor contained in the Guaranty. 

3. Severability. The provisions of this Guaranty Joinder Agreement are independent of and separable from each other. If any provision
hereof shall for any reason be held invalid or unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability of any other provision hereof, but this Guaranty Joinder Agreement shall be construed as if such
invalid or unenforceable provision had never been contained herein. 

  

	
	EXHIBIT A
	-1-

 4. Counterparts. This Guaranty Joinder Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an original, and it shall not be necessary in making proof of this Guaranty Joinder Agreement to produce or account for more than one such counterpart executed by the Joining
Guarantor. A facsimile or email copy of a signature of a Guarantor to this Guaranty Joinder Agreement shall have the same force and effect as an original manual signature. 

5. Delivery. The Joining Guarantor hereby irrevocably waives notice of acceptance of this Guaranty Joinder Agreement and acknowledges
that the Obligations are and shall be deemed to be incurred, and Credit Extensions under the Loan Documents made and maintained, in reliance on this Guaranty Joinder Agreement and the Guarantor’s joinder as a party to the Guaranty as herein
provided. 
 6. Governing Law; Venue; Waiver of Jury Trial; Judicial Reference. The provisions of paragraphs 8, 9 and 10 of the
Guaranty are hereby incorporated by reference as if fully set forth herein. 
 IN WITNESS WHEREOF, the Joining Guarantor has duly executed
and delivered this Guaranty Joinder Agreement as of the day and year first written above. 
  

					
	JOINING GUARANTOR:
		
	  
		,
	a		  
		
			
	By:		  
		
	Name:		  
		
	Title:		  
		

  

	
	EXHIBIT A
	 -2-

 EXHIBIT C 

FORM OF BORROWING NOTICE 
 TO: U.S. Bank
National Association, as administrative agent (the “Administrative Agent”) under that certain Credit Agreement (as amended, restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), dated as of [            ], 2015 among Shea Homes Limited Partnership (the “Borrower”), the financial institutions party
thereto, as lenders (the “Lenders”), and the Administrative Agent. 
 Capitalized terms used herein shall have the
meanings ascribed to such terms in the Credit Agreement. 
 The undersigned Borrower hereby gives to the Administrative Agent a request for
borrowing pursuant to Section 2.8 of the Credit Agreement, and the Borrower hereby requests to borrow on [            ], 20[    ] (the
“Borrowing Date”) from the Lenders, on a pro rata basis, an aggregate principal Dollar Amount of $[            ] in Loans as: 

 

	 	1.	a Daily Eurocurrency Advance 

  

	 	2.	a Eurocurrency Advance with the following characteristics: 

 Interest Period of
[                    ] month(s) 

The undersigned hereby certifies to the Administrative Agent and the Lenders that (i) all of the representations and warranties of the
Borrower set forth in the Credit Agreement (a) that contain a materiality qualifier are true and correct in all respects and (b) that do not contain a materiality qualifier are true and correct in all material respects (or, if any such
representation or warranty is expressly stated to have been made as of a specific date, as of such specific date) on and as of the date of the Advance requested herein; (ii) at the time of and immediately after giving effect to such Advance, no
Default shall have occurred and be continuing; and (iii) all other relevant conditions set forth in Section 4.2 of the Credit Agreement have been satisfied. 

****** 
 IN WITNESS WHEREOF, the
undersigned has caused this Borrowing Notice to be executed by its authorized officer as of the date set forth below. 
 Dated:
            , 20     
  

			
	  

		
	By:		  

	Name:		  

	Title:		  

  
 EXH. C-1 

 EXHIBIT D 

NOTE 
 [Date] 

Shea Homes Limited Partnership, a California limited partnership (the “Borrower”), promises to pay to the order
of [                                    ] (the
“Lender”) the aggregate unpaid principal amount of all Loans made by the Lender to the Borrower pursuant to Article II of the Agreement (as hereinafter defined), in immediately available funds at the applicable office of U.S.
Bank National Association, as Administrative Agent, together with interest on the unpaid principal amount hereof at the rates and on the dates set forth in the Agreement. The Borrower shall pay the principal of and accrued and unpaid interest on the
Loans in full on the Facility Termination Date. 
 The Lender shall, and is hereby authorized to, record on the schedule attached hereto, or
to otherwise record in accordance with its usual practice, the date and amount of each Loan and the date and amount of each principal payment hereunder. 

This Note is one of the Notes issued pursuant to, and is entitled to the benefits of, the Credit Agreement dated as of
[            ], 2015 (which, as it may be amended or modified and in effect from time to time, is herein called the “Agreement”), among the Borrower, the
lenders party thereto, including the Lender, the LC Issuer and U.S. Bank National Association, as Administrative Agent, to which Agreement reference is hereby made for a statement of the terms and conditions governing this Note, including the terms
and conditions under which this Note may be prepaid or its maturity date accelerated. This Note is guaranteed pursuant to the Guaranty, all as more specifically described in the Agreement, and reference is made thereto for a statement of the terms
and provisions thereof. Capitalized terms used herein and not otherwise defined herein are used with the meanings attributed to them in the Agreement. 

In the event of default hereunder, the undersigned agree to pay all costs and expenses of collection, including reasonable attorneys’
fees. The undersigned waive demand, presentment, notice of nonpayment, protest, notice of protest and notice of dishonor. 
 THE VALIDITY,
CONSTRUCTION AND ENFORCEABILITY OF THIS NOTE SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF, BUT GIVING EFFECT TO FEDERAL LAWS OF THE UNITED STATES APPLICABLE TO
NATIONAL BANKS. 
  

			
	SHEA HOMES LIMITED PARTNERSHIP,
	A California limited partnership
		
	By:		  

	Name:		  

	Title:		  

  
 EXH. D-1 

 SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL 

TO 
 NOTE OF
[                    ], 
 DATED
[            ], 20[    ] 
  

									
	 Date
	  	Principal
Amount of
Loan	  	Maturity
of Interest
Period	  	Principal
Amount
Paid	  	Unpaid
Balance
		  		  		  		  	
		  		  		  		  	
		  		  		  		  	

  
 EXH. D-2 

 EXHIBIT E 

FORM OF INCREASING LENDER SUPPLEMENT 

INCREASING LENDER SUPPLEMENT, dated [            ],
20[    ] (this “Supplement”), by and among each of the signatories hereto, to the Credit Agreement, dated as of [            ] (as
amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Shea Homes Limited Partnership (the “Borrower”), the Lenders party thereto and U.S. Bank National
Association, as administrative agent (in such capacity, the “Administrative Agent”). 
 W I T N E S S E T H 

WHEREAS, pursuant to Section 2.23 of the Credit Agreement, the Borrower has the right, subject to the terms and conditions thereof, to
effectuate from time to time an increase in the Aggregate Commitment under the Credit Agreement by requesting one or more Lenders to increase the amount of its Commitment; 

WHEREAS, the Borrower has given notice to the Administrative Agent of its intention to increase the Aggregate Commitment pursuant to such
Section 2.23 of the Credit Agreement; and 
 WHEREAS, pursuant to Section 2.23 of the Credit Agreement, the undersigned Increasing
Lender now desires to increase the amount of its Commitment under the Credit Agreement by executing and delivering to the Borrower and the Administrative Agent this Supplement; 

NOW, THEREFORE, each of the parties hereto hereby agrees as follows: 

1. The undersigned Increasing Lender agrees, subject to the terms and conditions of the Credit Agreement, that on the date of this Supplement
it shall have its Commitment increased by $[        ], thereby making the aggregate amount of its total Commitments equal to $[        ]. 

2. The Borrower hereby represents and warrants that no Default or Event of Default has occurred and is continuing on and as of the date
hereof. 
 3. Terms defined in the Credit Agreement shall have their defined meanings when used herein. 

4. This Supplement shall be governed by, and construed in accordance with, the laws of the State of New York. 

5. This Supplement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when
so executed shall be deemed to be an original and all of which taken together shall constitute one and the same document. 

  
 EXH. E-1 

 IN WITNESS WHEREOF, each of the undersigned has caused this Supplement to be executed and
delivered by a duly authorized officer on the date first above written. 
  

			
	[INSERT NAME OF INCREASING LENDER]
		
	By:		  

	Name:		  

	Title:		  

 Accepted and agreed to as of the date first written above: 

 

			
	[                                    
    ]
		
	By:		  

	Name:		  

	Title:		  

 Acknowledged as of the date first written above: 
  

			
	 U.S. BANK NATIONAL ASSOCIATION
 as
Administrative Agent

		
	By:		  

	Name:		  

	Title:		  

  
 EXH. E-2 

 EXHIBIT F 

FORM OF AUGMENTING LENDER SUPPLEMENT 

AUGMENTING LENDER SUPPLEMENT, dated [            ],
20[    ] (this “Supplement”), to the Credit Agreement, dated as of [                    ]
(as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Shea Homes Limited Partnership (the “Borrower”), the Lenders party thereto and U.S. Bank
National Association, as administrative agent (in such capacity, the “Administrative Agent”). 
 W I T N E S S E T H

 WHEREAS, the Credit Agreement provides in Section 2.23 thereof that any bank, financial institution or other entity may extend
Commitments under the Credit Agreement subject to the approval of the Borrower and the Administrative Agent, by executing and delivering to the Borrower and the Administrative Agent a supplement to the Credit Agreement in substantially the form of
this Supplement; and 
 WHEREAS, the undersigned Augmenting Lender was not an original party to the Credit Agreement but now desires to
become a party thereto; 
 NOW, THEREFORE, each of the parties hereto hereby agrees as follows: 

1. The undersigned Augmenting Lender agrees to be bound by the provisions of the Credit Agreement and agrees that it shall, on the date of
this Supplement, become a Lender for all purposes of the Credit Agreement to the same extent as if originally a party thereto, with a Commitment with respect to Loans of $[        ]. 

2. The undersigned Augmenting Lender (a) represents and warrants that it is legally authorized to enter into this Supplement;
(b) confirms that it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 6.1 thereof, as applicable, and has reviewed such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to enter into this Supplement; (c) agrees that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents
and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement or any other instrument or document furnished pursuant hereto or thereto; (d) appoints
and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Credit Agreement or any other instrument or document furnished pursuant hereto or thereto as are delegated to the
Administrative Agent by the terms thereof, together with such powers as are incidental thereto; and (e) agrees that it will be bound by the provisions of the Credit Agreement and will perform in accordance with its terms all the obligations
which by the terms of the Credit Agreement are required to be performed by it as a Lender. 

  
 EXH. F-1 

 3. The undersigned’s address for notices for the purposes of the Credit Agreement is as
follows: 
 [                    ] 

4. The Borrower hereby represents and warrants that no Default or Event of Default has occurred and is continuing on and as of the date
hereof. 
 5. Terms defined in the Credit Agreement shall have their defined meanings when used herein. 

6. This Supplement shall be governed by, and construed in accordance with, the laws of the State of New York. 

7. This Supplement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when
so executed shall be deemed to be an original and all of which taken together shall constitute one and the same document. 
 [remainder of
this page intentionally left blank] 

  
 EXH. F-2 

 IN WITNESS WHEREOF, each of the undersigned has caused this Supplement to be executed and
delivered by a duly authorized officer on the date first above written. 
  

			
	[INSERT NAME OF AUGMENTING LENDER]
		
	 By:
	 	  

	 Name:
	 	
	 Title:
	 	

 Accepted and agreed to as of the date first written above: 

 

			
	[                                    
    ]
		
	By:	 	  

	Name:	 	  

	Title:	 	  

 Acknowledged as of the date first written above: 
  

			
	U.S. BANK NATIONAL ASSOCIATION
	as Administrative Agent
		
	By:	 	  

	Name:	 	  

	Title:	 	  

  
 EXH. F-3 

 EXHIBIT G 

[RESERVED] 

  
 EXH. G-1 

 EXHIBIT H 

LIST OF CLOSING DOCUMENTS 

Attached 

  
 EXH. H-1 

 EXHIBIT H 

LIST OF CLOSING DOCUMENTS 

Shea Homes Limited Partnership, LLC, a California limited partnership 

February 20, 2015 

LIST OF CLOSING DOCUMENTS 
 1.
Credit Agreement 
 2. Note – U.S. Bank 

3. Note – Wells Fargo Bank 

4. Note – JP Morgan 
 5.
Guaranty 
 6. All documents evidencing the formation, organization, valid existence, good standing, and due authorization of and for
Borrower and each Guarantor and the authorization for the execution, delivery, and performance of the Loan Documents and the transactions contemplated therein by Borrower and each Guarantor. 

7. Opinions of Borrower’s and Guarantors’ Counsel 

  
 EXH. H-2 

 EXHIBIT I 

FORM OF COMPLIANCE CERTIFICATE 

This Compliance Certificate is delivered to you by the Borrower pursuant to Section 6.1(e) of the Credit Agreement, dated as of
            , 2015 (as amended, supplemented, restated or otherwise modified from time to time, the “Credit Agreement”; unless otherwise defined herein, terms defined
therein being used herein as therein defined), among Shea Homes Limited Partnership (the “Borrower”), the lenders or other financial institutions that are parties as lenders (collectively, the “Lenders”), and U.S.
Bank National Association, as administrative agent for the Lenders (the “Administrative Agent”). This Compliance Certificate relates to the accounting period ending
[                    ]. I, the undersigned, on behalf of the Borrower, do certify on behalf of the Borrower that: 

1. I am the chief financial officer of the Borrower. 

2. I have reviewed and am familiar with the contents of this Compliance Certificate. 

3. I, on behalf of the Borrower, have read the Credit Agreement and have made or caused to be made under my supervision, a review in
reasonable detail of the transactions and condition of the Loan Parties and their Subsidiaries during the accounting period covered by the financial statements attached hereto as Schedule I (the “Financial Statements”). Such review
did not disclose, and I have no knowledge of the existence, as of the date of this Compliance Certificate, of any condition or event which constitutes a Default or Event of Default (except as set forth on Schedule III). 

4. Attached hereto as Schedule II are the computations showing compliance with the covenants set forth in Section 6.23 of the Credit
Agreement as of the end of the accounting period set forth above. 
 [Signature page follows.] 

  
 EXH. I-1 

 IN WITNESS WHEREOF, the undersigned has executed this Compliance Certificate
this    day of         , 20    . 
  

			
	SHEA HOMES LIMITED PARTNERSHIP, a California limited partnership
		
	By:		  

	Name:		  

	Title:		  

  
 EXH. I-2 

 Schedule I 

to Exhibit I 
 Financial
Statements 
 [See Attached] 

  
 EXH. I-3 

 Schedule II 

to Exhibit I 
 Compliance Certificate
Calculations 
 ($ in 000’s) 
 For the [Quarter]
[Year] ended                      (the “Reporting Date”) 
  

	I.	Section 6.23(a) - Interest Coverage Ratio 

  

									
	 A.
		  Consolidated EBITDA for the period of four fiscal quarters ending on the Reporting Date:				
				
			1.		Consolidated Net Income (excluding net income from Excluded Subsidiaries):		$	            	  
				
			2.		Cash distributions of income from Joint Ventures:		$	            	  
				
			3.		Consolidated Interest Expense:		$	            	  
				
			4.		Expense for income taxes paid or accrued:		$	            	  
				
			5.		Depreciation:		$	            	  
				
			6.		Amortization:		$	            	  
				
			7.		Non-cash (including impairment) charges:		$	            	  
				
			8.		Extraordinary losses:		$	            	  
				
			9.		Loss (gain) on early extinguishment of indebtedness:		$	            	  
				
			10.		Transaction costs and restructuring charges required to be expensed under FASB ASC 805:		$	            	  
				
			11.		The amount of any net losses from discontinued operations, including net losses from the sale or disposition of discontinued operations:		$	            	  
				
			12.		Any fees, expenses or charges related to any issuance or Capital Stock, Investment, acquisition, disposition, recapitalization or the incurrence or repayment of Indebtedness permitted to be incurred hereunder including a refinancing
thereof (whether or not successful) and any amendment or modification to the terms of any such transactions, including such fees, expenses or charges related to the Transaction, in each case, deducted in computing Consolidated Net Income:		$	            	  

  
 EXH. I-4 

									
			13.		Unusual or non-recurring costs and expenses in an amount not to exceed 10% of Consolidated EBITDA in any four fiscal quarter period:		$	            	  
				
			14.		To the extent not duplicative of any of the foregoing, cash distributions received from Excluded Subsidiaries:		$	            	  
				
			15.		Non cash gains and extraordinary gains:		$	            	  
				
			16.		Income (loss) from Joint Ventures and from Financial Services Subsidiaries:		$	            	  
				
			17.		Consolidated EBITDA (Lines I.A.1 + 2 + 3+ 4 + 5 + 6 + 7 + 8 + 9 + 10 + 11 + 12 + 13 + 14 – 15 – 16):		$	            	  
			
	 B.
		Consolidated Interest Incurred: $            				
			
	 C.
		Interest Coverage Ratio (Lines I.A.12. to I.B.):             				
			
	 D.
		Minimum Interest Coverage Ratio required (1.5 to 1.0)				

  

	II.	Section 6.23(b) - Maximum Adjusted Leverage Ratio 

  

											
	A.		 	Consolidated Debt:				
				
			 	1.	  		all funded debt of the Loan Parties and their Subsidiaries:		$	            	  
				
			 	2.	  		funded debt of partnerships that are Subsidiaries with recourse to any Loan Party or their Subsidiaries:		$	            	  
				
			 	3.	  		the sum of (i) all reimbursement obligations with respect to amounts drawn and not reimbursed under Financial Letters of Credit and amounts drawn and not reimbursed under Performance Letters of Credit (excluding any portion of
the actual or potential obligations that are secured by cash collateral) and (ii) the maximum amount available to be drawn under all undrawn Financial Letters of Credit, in each case issued for the account of, or guaranteed by, any Loan Party
or any of their respective Subsidiaries (excluding any portion of the actual or potential obligations that are secured by cash collateral)		$	            	  
				
			 	4.	  		all Contingent Obligations of the Loan Parties or their Subsidiaries of funded debt of third parties:		$	            	  
				
			 	5.	  		Obligations due and payable:		$	            	  

  
 EXH. I-5 

													
					 	6.	  		All Contingent Obligations due and payable		$	            	  
				
					 	7.	  		Total Consolidated Debt (Lines II.A.1. + 2. + 3. + 4. + 5.):		$	            	  
			
	 	B.	  		 	Unrestricted Cash (to the extent it exceeds $5,000,000):				
				
					 	1.	  		Unrestricted Cash:		$	            	  
				
					 	2.	  		Unrestricted Cash for use in Adjusted Leverage Ratio (Lines II.B.1 - $5,000,000):		$	            	  
			
	 	C.	  		 	Consolidated Tangible Net Worth:				
				
					 	1.	  		consolidated stockholders equity:		$	            	  
				
					 	2.	  		intangible assets:		$	            	  
				
					 	3.	  		up to $70,000,000 of the funds paid as required by the CCM Proceeding		$	            	  
				
					 	4.	  		Adjustment (up or down as applicable) to account for changes in stockholders’ equity that do not flow to Borrower’s income statement solely to the extent such changes are due to unusual transfers of assets between Borrower
and its Affiliates permitted under the Credit Agreement, excluding contributions or distributions of equity, as approved by Administrative Agent		$	            	  
				
					 	5.	  		Consolidated Tangible Net Worth (Lines II.C.1 - II.C.2 + II.C.3 + II.C.4):		$	            	  
			
	 	D.	  		 	Adjusted Leverage Ratio				
					 	(Lines II.A.6 - II.B.2) divided by (II.C.5):     %				
			
	 	E.	  		 	Maximum Adjusted Leverage Ratio:     %				

 (Must be (i) 2.0 to 1.0 prior to and including March 31, 2017, and (ii) 1.85 to 1.0 at any time
after March 31, 2017) 
  

	III.	Section 6.23(d) - Minimum Consolidated Net Worth Test 

  

									
	A.		Consolidated Tangible Net Worth (from Line II.C.5):		$	            	  
			
	B.		$400,000,000;				
				
			1.
		 50% of the cumulative Net Cash Proceeds of any Equity Issuances received by Borrower from and

after [            ];
		$	            	  

  
 EXH. I-6 

									
			2.		50% of an amount equal to (i) the cumulative Consolidated Net Income (without deductions for losses sustained during any fiscal quarter) of the Loan Parties and their Subsidiaries from and after
[            ] minus (ii) income taxes on such income at a presumed combined Federal and State rate of fifty percent (50%):		$	            	  
				
			3.		Required Minimum Consolidated Tangible Net Worth				
					(Lines IV.B + IV.B.1. + IV.B.2.)		$	            	  
			
	 C.
		Test: Line IV.A. 3 IV.B.3.:				

  

	IV.	Section 6.23(e) - Maximum Ratio of Land Assets to Consolidated Tangible Net Worth 

  

							
	 A.
		Land Assets		$	            	  
			
	 B.
		Consolidated Tangible Net Worth (from Line II.C.5)		$	            	  
			
	 C.
		Actual Ratio of Line IV.A to Line IV.B:				

					
			
	D.		Maximum Ratio of Land Assets to Consolidated Tangible Net Worth		1.75 to 1.0

  

	V.	Minimum Liquidity 

  

							
	 A.
		Unrestricted Cash:		$	            	  
		
	 (Must be greater than or equal to $5,000,000)
				

  
 EXH. I-7 

 Schedule III 

to Exhibit I 
 Defaults and
Events of Default 

  
 EXH. I-8 

 EXHIBIT J 

ASSIGNMENT AND ASSUMPTION AGREEMENT 

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and
is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined
herein shall have the meanings given to them in the Credit Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Terms and Conditions set forth
in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full. 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases
and assumes from the Assignor, subject to and in accordance with the Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below, the interest in and to all of the
Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto that represents the amount and percentage interest identified below of all of the
Assignor’s outstanding rights and obligations under the respective facilities identified below (including without limitation any letters of credit, guaranties and swing line loans included in such facilities and, to the extent permitted to be
assigned under applicable law, all claims (including without limitation contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity), suits, causes of action and any other right of the Assignor against
any Person whether known or unknown arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby) (the “Assigned Interest”).
Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor. 

 

					
	1.		Assignor:		                                      
  
			
	2.		Assignee:		                                     
    [and is an Affiliate/ Approved Fund of [identify Lender]1]
			
	3.		Borrower(s):		                                      
  
			
	4.		Administrative
Agent:
		[                                     
   ], as the agent under the Credit Agreement.
			
	5.		Credit
Agreement:		The [amount] Credit Agreement dated as of [                    ],
20[    ] among Shea Homes Limited Partnership, the Lenders party thereto, U.S. Bank National Association, as Administrative Agent, and the other agents party thereto.

  
  

	1 	Select as applicable. 

  
 EXH. J-1 

			
	 6.      Assigned Interest:

  

									
	 Aggregate Amount of
Commitment/

Loans for all Lenders2
	 	 Amount of Commitment/

Loans Assigned3
	 	 Percentage Assigned of
Commitment/

Loans4
	 	Commitment of Assignor
Following Assignment	 	Commitment of Assignee
Following Assignment
	 $[        ]
	 	$[        ]	 	[    %]	 	$[        ]	 	$[        ]

  

	
	 7.      Trade Date: [            ]5

	
	Effective Date: [            ], 20[    ] [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE
ADMINISTRATIVE AGENT.]

 The terms set forth in this Assignment and Assumption are hereby agreed to: 

 

			
	 ASSIGNOR
 [NAME OF
ASSIGNOR]

		
	By:	 	  

	Title:	 	
	
	 ASSIGNEE
 [NAME OF
ASSIGNEE]

		
	By:	 	  

	Title:	 	

 [Consented to and]6 Accepted: 

 
  

	2 	Amount to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date. 

	3 	Amount to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date. 

	4 	Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder. 

	5 	Insert if satisfaction of minimum amounts is to be determined as of the Trade Date. 

	6 	To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement. 

  
 EXH. J-2 

			
	U.S. BANK NATIONAL ASSOCIATION
	as Administrative Agent
		
	By:		  

	Name:		  

	Title:		  

 [Consented
to:]7

  

			
	[NAME OF RELEVANT PARTY]
		
	By:		  

	Name:		  

	Title:		  

  
  

	7	To be added only if the consent of the Borrower and/or other parties (e.g. L/C Issuer) is required by the terms of the Credit Agreement. 

  
 EXH. J-3 

 ANNEX 1 

TERMS AND CONDITIONS FOR 

ASSIGNMENT AND ASSUMPTION 

1. Representations and Warranties. 

1.1 Assignor. The Assignor represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest,
(ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby. Neither the Assignor nor any of its officers, directors, employees, agents or attorneys shall be responsible for (i) any statements, warranties or representations made in or in connection with
the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency, perfection, priority, collectability, or value of the Loan Documents or any collateral thereunder, (iii) the
financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document, (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Documents, (v) inspecting any of the property, books or records of the Borrower, or any guarantor, or (vi) any mistake, error of judgment, or action taken or omitted to be taken
in connection with the Loans or the Loan Documents. 
 1.2 Assignee. The Assignee (a) represents and warrants that (i) it
has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) from and
after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iii) agrees that its payment
instructions and notice instructions are as set forth in Schedule 1 to this Assignment and Assumption, (iv) confirms that none of the funds, monies, assets or other consideration being used to make the purchase and assumption hereunder are
“plan assets” as defined under ERISA and that its rights, benefits and interests in and under the Loan Documents will not be “plan assets” under ERISA, (v) agrees to indemnify and hold the Assignor harmless against all
losses, costs and expenses (including, without limitation, reasonable attorneys’ fees) and liabilities incurred by the Assignor in connection with or arising in any manner from the Assignee’s non-performance of the obligations assumed
under this Assignment and Assumption, (vi) it has received a copy of the Credit Agreement, together with copies of financial statements and such other documents and information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and
(vii) attached as Schedule 1 to this Assignment and Assumption is any documentation required to be delivered by the Assignee with respect to its tax status pursuant to the terms of the Credit Agreement, duly completed and executed by the
Assignee and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with 

  
 EXH. J-4 

 
their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender. 

2. Payments. The Assignee shall pay the Assignor, on the Effective Date, the amount agreed to by the Assignor and the Assignee. From
and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, Reimbursement Obligations, fees and other amounts) to the Assignor for amounts which have
accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date. 
 3.
General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment
and Assumption. This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York. 

  
 EXH. J-5Exhibit 10.1

 

EXECUTION COPY

 

	
 
    

 

CREDIT AGREEMENT

 

dated as of

 

March 19, 2015

 

among

 

REGENERON PHARMACEUTICALS, INC.

REGENERON HEALTHCARE SOLUTIONS, INC.

REGENERON GENETICS CENTER LLC
 REGENERON INTERNATIONAL

REGENERON IRELAND HOLDINGS

REGENERON IRELAND

REGENERON CAPITAL INTERNATIONAL B.V.

 

The Other Subsidiary Borrowers Party Hereto

 

The Lenders Party Hereto

 

JPMORGAN CHASE BANK, N.A.
 as Administrative Agent

 

BANK OF AMERICA, N.A. and U.S. BANK NATIONAL ASSOCIATION
 as Co-Syndication Agents

 

and

 

BARCLAYS BANK PLC, CITIBANK, N.A.,

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, FIFTH THIRD BANK and

MORGAN STANLEY MUFG LOAN PARTNERS, LLC

as Co-Documentation Agents

 

 

J.P. MORGAN SECURITIES LLC,

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

and

U.S. BANK NATIONAL ASSOCIATION
 as Joint Bookrunners and Joint Lead Arrangers

	
 
    

 

 

Table Of Contents

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    
	
ARTICLE I   Definitions
    	
1
    
	
 
    	
 
    
	
SECTION 1.01.
    	
DEFINED TERMS
    	
1
    
	
Section 1.02.
    	
Classification of Loans and Borrowings
    	
29
    
	
Section 1.03.
    	
Terms Generally
    	
29
    
	
Section 1.04.
    	
Accounting Terms; GAAP; Pro Forma Calculations
    	
29
    
	
 
    	
 
    
	
ARTICLE II   The Credits
    	
30
    
	
 
    	
 
    
	
SECTION 2.01.
    	
COMMITMENTS
    	
30
    
	
Section 2.02.
    	
Loans and Borrowings
    	
31
    
	
Section 2.03.
    	
Requests for Revolving Borrowings
    	
31
    
	
Section 2.04.
    	
Determination of Dollar Amounts
    	
32
    
	
Section 2.05.
    	
Swingline Loans
    	
32
    
	
Section 2.06.
    	
Letters of Credit
    	
34
    
	
Section 2.07.
    	
Funding of Borrowings
    	
39
    
	
Section 2.08.
    	
Interest Elections
    	
39
    
	
Section 2.09.
    	
Termination and Reduction of Commitments
    	
41
    
	
Section 2.10.
    	
Repayment of Loans; Evidence of Debt
    	
41
    
	
Section 2.11.
    	
Prepayment of Loans
    	
42
    
	
Section 2.12.
    	
Fees
    	
43
    
	
Section 2.13.
    	
Interest
    	
44
    
	
Section 2.14.
    	
Alternate Rate of Interest
    	
45
    
	
Section 2.15.
    	
Increased Costs
    	
46
    
	
Section 2.16.
    	
Break Funding Payments
    	
47
    
	
Section 2.17.
    	
Taxes
    	
48
    
	
Section 2.18.
    	
Payments Generally; Pro Rata Treatment; Sharing of   Set-offs
    	
51
    
	
Section 2.19.
    	
Mitigation Obligations; Replacement of Lenders
    	
53
    
	
Section 2.20.
    	
Expansion Option
    	
54
    
	
Section 2.21.
    	
Extension of Maturity Date
    	
55
    
	
Section 2.22.
    	
Judgment Currency
    	
57
    
	
Section 2.23.
    	
Designation of Subsidiary Borrowers
    	
57
    
	
Section 2.24.
    	
Defaulting Lenders
    	
58
    
	
 
    	
 
    	
 
    
	
ARTICLE III   Representations and Warranties
    	
60
    
	
 
    	
 
    	
 
    
	
SECTION 3.01.
    	
ORGANIZATION; POWERS;   SUBSIDIARIES
    	
60
    
	
Section 3.02.
    	
Authorization; Enforceability
    	
61
    
	
Section 3.03.
    	
Governmental Approvals; No Conflicts
    	
61
    
	
Section 3.04.
    	
Financial Condition; No Material Adverse Change
    	
61
    
	
Section 3.05.
    	
Properties
    	
61
    
	
Section 3.06.
    	
Litigation and Environmental Matters
    	
62
    
	
Section 3.07.
    	
Compliance with Laws
    	
62
    
	
Section 3.08.
    	
Investment Company Status
    	
62
    
	
Section 3.09.
    	
Taxes
    	
62
    
	
Section 3.10.
    	
ERISA
    	
63
    
	
Section 3.11.
    	
Disclosure
    	
63
    
	
Section 3.12.
    	
Federal Reserve Regulations
    	
63
    
	
Section 3.13.
    	
No Default
    	
63
    

 

 

Table Of Contents

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
section 3.14.
    	
Anti-Corruption Laws and Sanctions
    	
63
    
	
 
    	
 
    	
 
    
	
ARTICLE IV   Conditions 
    	
63
    
	
 
    	
 
    	
 
    
	
SECTION 4.01.
    	
EFFECTIVE DATE
    	
63
    
	
Section 4.02.
    	
Each Credit Event
    	
64
    
	
Section 4.03.
    	
Designation of a Subsidiary Borrower
    	
65
    
	
 
    	
 
    
	
ARTICLE V   Affirmative Covenants
    	
66
    
	
 
    	
 
    
	
SECTION 5.01.
    	
FINANCIAL STATEMENTS AND   OTHER INFORMATION
    	
66
    
	
Section 5.02.
    	
Notices of Material Events
    	
67
    
	
Section 5.03.
    	
Existence; Conduct of Business
    	
68
    
	
Section 5.04.
    	
Payment of Taxes
    	
68
    
	
Section 5.05.
    	
Maintenance of Properties; Insurance
    	
68
    
	
Section 5.06.
    	
Books and Records; Inspection Rights
    	
68
    
	
Section 5.07.
    	
Compliance with Laws
    	
69
    
	
Section 5.08.
    	
Use of Proceeds
    	
69
    
	
Section 5.09.
    	
Subsidiary Guaranty
    	
69
    
	
 
    	
 
    	
 
    
	
ARTICLE VI   Negative Covenants
    	
70
    
	
 
    	
 
    	
 
    
	
SECTION 6.01.
    	
INDEBTEDNESS
    	
70
    
	
Section 6.02.
    	
Liens
    	
72
    
	
Section 6.03.
    	
Fundamental Changes and Asset Sales
    	
74
    
	
Section 6.04.
    	
Swap Agreements
    	
75
    
	
Section 6.05.
    	
Transactions with Affiliates
    	
75
    
	
Section 6.06.
    	
Restricted Payments
    	
76
    
	
Section 6.07.
    	
Financial Covenants
    	
77
    
	
 
    	
 
    	
 
    
	
ARTICLE VII   Events of Default
    	
77
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII   The Administrative Agent
    	
80
    
	
 
    	
 
    	
 
    
	
ARTICLE IX   Miscellaneous
    	
82
    
	
 
    	
 
    
	
SECTION 9.01.
    	
NOTICES
    	
82
    
	
Section 9.02.
    	
Waivers; Amendments
    	
85
    
	
Section 9.03.
    	
Expenses; Indemnity; Damage Waiver
    	
87
    
	
Section 9.04.
    	
Successors and Assigns
    	
89
    
	
Section 9.05.
    	
Survival
    	
92
    
	
Section 9.06.
    	
Counterparts; Integration; Effectiveness; Electronic   Execution
    	
93
    
	
Section 9.07.
    	
Severability
    	
93
    
	
Section 9.08.
    	
Right of Setoff
    	
93
    
	
Section 9.09.
    	
Governing Law; Jurisdiction; Consent to Service of   Process
    	
93
    
	
Section 9.10.
    	
WAIVER OF JURY TRIAL
    	
95
    
	
Section 9.11.
    	
Headings
    	
95
    
	
Section 9.12.
    	
Confidentiality
    	
95
    

 

2

 

Table Of Contents

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 9.13.
    	
USA PATRIOT Act
    	
96
    
	
Section 9.14.
    	
Releases of Subsidiary Guarantors
    	
96
    
	
Section 9.15.
    	
Interest Rate Limitation
    	
97
    
	
Section 9.16.
    	
No Advisory or Fiduciary Responsibility
    	
97
    
	
Section 9.17.
    	
Attorney Representation
    	
98
    
	
Section 9.18.
    	
Swap Obligations and Banking Services Obligations
    	
98
    
	
 
    	
 
    	
 
    
	
ARTICLE X   Company Guarantee
    	
98
    

 

3

 

Table Of Contents

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
SCHEDULES:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Schedule 2.01
    	
—   Commitments
    	
 
    
	
Schedule 3.01
    	
—   Subsidiaries
    	
 
    
	
Schedule 6.01
    	
—   Existing Indebtedness
    	
 
    
	
Schedule 6.02
    	
—   Existing Liens
    	
 
    
	
 
    	
 
    	
 
    
	
EXHIBITS:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Exhibit A
    	
— Form of Assignment and Assumption
    	
 
    
	
Exhibit B
    	
— [Intentionally Omitted]
    	
 
    
	
Exhibit C
    	
— Form of Increasing Lender Supplement
    	
 
    
	
Exhibit D
    	
— Form of Augmenting Lender Supplement
    	
 
    
	
Exhibit E
    	
— List of Closing Documents
    	
 
    
	
Exhibit F-1
    	
— Form of Borrowing Subsidiary   Agreement
    	
 
    
	
Exhibit F-2
    	
— Form of Borrowing Subsidiary   Termination
    	
 
    
	
Exhibit G
    	
— Form of Subsidiary Guaranty
    	
 
    
	
Exhibit H-1
    	
— Form of U.S. Tax Certificate   (Foreign Lenders That Are Not Partnerships)
    	
 
    
	
Exhibit H-2
    	
— Form of U.S. Tax Certificate   (Foreign Participants That Are Not Partnerships)
    	
 
    
	
Exhibit H-3
    	
— Form of U.S. Tax Certificate   (Foreign Participants That Are Partnerships)
    	
 
    
	
Exhibit H-4
    	
— Form of U.S. Tax Certificate   (Foreign Lenders That Are Partnerships)
    	
 
    
	
Exhibit I-1
    	
— Form of Borrowing Request
    	
 
    
	
Exhibit I-2
    	
— Form of Interest Election Request
    	
 
    
	
Exhibit L
    	
— Form of Note
    	
 
    

 

4

 

CREDIT AGREEMENT

 

CREDIT AGREEMENT (this “Agreement”) dated as of March 19, 2015 among REGENERON PHARMACEUTICALS, INC., a New York corporation, REGENERON HEALTHCARE SOLUTIONS, INC., a New York corporation, REGENERON GENETICS CENTER LLC, a Delaware limited liability company, REGENERON INTERNATIONAL, an unlimited company incorporated in Ireland, REGENERON IRELAND HOLDINGS, an unlimited company incorporated in Ireland, REGENERON IRELAND, an unlimited company incorporated in Ireland, REGENERON CAPITAL INTERNATIONAL B.V., a besloten vennootschap met beperkte aansprakelijkheid organized under the laws of the Netherlands, the other SUBSIDIARY BORROWERS from time to time party hereto, the LENDERS from time to time party hereto, JPMORGAN CHASE BANK, N.A., as Administrative Agent, BANK OF AMERICA, N.A. and U.S. BANK NATIONAL ASSOCIATION, as Co-Syndication Agents, and BARCLAYS BANK PLC, CITIBANK, N.A., CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, FIFTH THIRD BANK and MORGAN STANLEY MUFG LOAN PARTNERS, LLC, as Co-Documentation Agents.

 

The parties hereto agree as follows:

 

ARTICLE I

 

Definitions

 

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

 

“ABR”, when used in reference to any Loan or Borrowing, refers to such Loan, or the Loans comprising such Borrowing, bearing interest at a rate determined by reference to the Alternate Base Rate.

 

“Acquisition” means (i) any acquisition (whether by purchase, merger, consolidation or otherwise) or series of related acquisitions by the Company or any Subsidiary of (a) all or substantially all the assets of (or all or substantially all the assets constituting a business unit, division, product line (including rights in respect of any drug or other pharmaceutical product) or line of business of) any Person, or (b) all or substantially all the Equity Interests in a Person or division or line of business of a Person, (ii) a Drug Acquisition or (iii) an Exclusive License to develop and commercialize a drug or other product line of any Person.

 

“Additional Commitment Lender” has the meaning assigned to such term in Section 2.21(d).

 

“Adjusted LIBO Rate” means, with respect to any Eurocurrency Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

 

“Administrative Agent” means JPMorgan Chase Bank, N.A. (including its branches and affiliates), in its capacity as administrative agent for the Lenders hereunder.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

 

 

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

 

“Agent Party” has the meaning assigned to such term in Section 9.01(d).

 

“Aggregate Commitment” means the aggregate of the Commitments of all of the Lenders, as reduced or increased from time to time pursuant to the terms and conditions hereof.  As of the Effective Date, the Aggregate Commitment is $750,000,000.

 

“Agreed Currencies” means (i) Dollars, (ii) euro and (iii) any other currency (x) that is a lawful currency (other than Dollars) that is readily available and freely transferable and convertible into Dollars, (y) for which a LIBOR Screen Rate is available in the Administrative Agent’s reasonable determination and (z) (1) with respect to Loans, that is agreed to by the Administrative Agent and each of the Lenders and (2) with respect to Letters of Credit, that is agreed to by the Administrative and the applicable Issuing Bank.

 

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 1⁄2 of 1% and (c) the Adjusted LIBO Rate for a one month Interest Period in Dollars on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%; provided that the Adjusted LIBO Rate for any day shall be based on the LIBO Rate at approximately 11:00 a.m. London time on such day, subject to the interest rate floors set forth therein.  Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.

 

“Alternative Rate” has the meaning assigned to such term in Section 2.14(a).

 

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Company or its Subsidiaries from time to time concerning or relating to bribery or corruption.

 

“Applicable LC Sublimit” means (i) with respect to JPMorgan Chase Bank, N.A. in its capacity as an Issuing Bank under this Agreement, $33,350,000, (ii) with respect to Bank of America, N.A. in its capacity as an Issuing Bank under this Agreement, $33,350,000, (iii) with respect to U.S. Bank National Association in its capacity as an Issuing Bank under this Agreement, $33,350,000 and (iv) with respect to any other Person that becomes an Issuing Bank pursuant to the terms of this Agreement, such amount as agreed to in writing by the Company, the Administrative Agent and such Person at the time such Person becomes an Issuing Bank pursuant to the terms of this Agreement, as each of the foregoing amounts may be decreased or increased from time to time with the written consent of the Company, the Administrative Agent and the Issuing Banks (provided that any increase in the Applicable LC Sublimit with respect to any Issuing Bank shall only require the consent of the Company and such Issuing Bank).

 

“Applicable Percentage” means, with respect to any Lender, the percentage of the Aggregate Commitment represented by such Lender’s Commitment; provided that, in the case of Section 2.24 when a Defaulting Lender shall exist, “Applicable Percentage” shall mean the percentage of the Aggregate Commitment (disregarding any Defaulting Lender’s Commitment) represented by such Lender’s Commitment.  If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments and to any Lender’s status as a Defaulting Lender at the time of determination.

 

2

 

“Applicable Rate” means, for any day, with respect to any Eurocurrency Loan or any ABR Loan or with respect to the commitment fees payable hereunder, as the case may be, the applicable rate per annum set forth below under the caption “Eurocurrency Spread”, “ABR Spread” or “Commitment Fee Rate”, as the case may be, based upon the Pricing Level applicable on such date:

 

	
Pricing Level:
    	
 
    	
Eurocurrency
   Spread
    	
 
    	
ABR
   Spread
    	
 
    	
Commitment
   Fee Rate
    	
 
    
	
Level I  
    	
 
    	
1.125
    	
%
    	
0.125
    	
%
    	
0.125
    	
%
    
	
Level II  
    	
 
    	
1.25
    	
%
    	
0.25
    	
%
    	
0.15
    	
%
    
	
Level III  
    	
 
    	
1.375
    	
%
    	
0.375
    	
%
    	
0.175
    	
%
    
	
Level IV  
    	
 
    	
1.50
    	
%
    	
0.50
    	
%
    	
0.20
    	
%
    

 

For purposes hereof: (i) Pricing Level I and Ratings Level A are equivalent and correspond to each other, and they are the highest levels for purposes of this definition, (ii) Pricing Level II, Leverage Level 2 and Ratings Level B are equivalent and correspond to each other, and they are the second highest levels for purposes of this definition, (iii) Pricing Level III, Leverage Level 3 and Ratings Level C are equivalent and correspond to each other, and they are the third highest levels for purposes of this definition and (iv) Pricing Level IV, Leverage Level 4 and Ratings Level D are equivalent and correspond to each other, and they are the lowest levels for purposes of this definition.

 

At any time of determination, the Pricing Level shall be determined by reference to the higher of the Leverage Level and the Ratings Level then in effect (or if Ratings Level A is then in effect, solely by reference to Ratings Level A).

 

Leverage Level Determination

 

	
Leverage Level
    	
 
    	
Total Leverage Ratio
    	
 
    
	
Level 2
    	
 
    	
< 1.00 to 1.00
    	
 
    
	
Level 3
    	
 
    	
> 1.00 to 1.00 but < 2.00 to   1.00
    	
 
    
	
Level 4
    	
 
    	
> 2.00 to 1.00
    	
 
    

 

Unless Ratings Level A is then in effect, if at any time the Company fails to deliver the Financials on or before the date such Financials are due pursuant to Section 5.01, Leverage Level 4 shall be deemed applicable for the period commencing three (3) Business Days after such required date of delivery and ending on the date which is three (3) Business Days after such Financials are actually delivered, after which the Leverage Level shall be determined in accordance with this definition, as applicable.

 

Except as otherwise provided in the paragraph below or in the immediately preceding paragraph, adjustments, if any, to the Leverage Level then in effect shall be effective three (3) Business Days

 

3

 

after the Administrative Agent has received the applicable Financials (it being understood and agreed that each change in Leverage Level shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change).

 

Notwithstanding anything to the contrary set forth in this definition, Leverage Level 2 shall be deemed to be applicable until the Administrative Agent’s receipt of the applicable financial statements for the Company’s first full fiscal quarter ending after the Effective Date and adjustments to the Leverage Level then in effect shall thereafter be effected in accordance with the terms of this definition.

 

Ratings Level Determination

 

	
Ratings Level
    	
 
    	
Index Debt Ratings
    (S&P/Moody’s)
    	
 
    
	
Level A
    	
 
    	
BBB+/Baa1 or higher
    	
 
    
	
Level B  
    	
 
    	
BBB/Baa2
    	
 
    
	
Level C  
    	
 
    	
BBB-/Baa3
    	
 
    
	
Level D  
    	
 
    	
BB+/Ba1 or lower
    	
 
    

 

For purposes of the foregoing, (i) if neither Moody’s nor S&P shall have in effect a rating for the Index Debt (other than by reason of the circumstances referred to in the last sentence of this definition), then such rating agency shall be deemed to have established a Ratings Level in Level D; (ii) if the ratings established or deemed to have been established by Moody’s and S&P for the Index Debt shall fall within different Ratings Levels, the Ratings Level shall be based on the higher of the two ratings unless one of the two ratings is two or more Ratings Levels lower than the other, in which case the Ratings Level shall be determined by reference to the Ratings Level next below that of the higher of the two ratings; (iii) if only one of S&P and Moody’s shall have in effect a rating for the Index Debt, the Ratings Level shall be determined by reference to the available rating; and (iv) if the ratings established or deemed to have been established by Moody’s and S&P for the Index Debt shall be changed (other than as a result of a change in the rating system of Moody’s or S&P), such change shall be effective as of the date on which it is first announced by the applicable rating agency, irrespective of when notice of such change shall have been furnished by the Company to the Administrative Agent and the Lenders pursuant to Section 5.01 or otherwise.  Each change in the Ratings Level shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change.  If the rating system of Moody’s or S&P shall change, or if either such rating agency shall cease to be in the business of rating corporate debt obligations, the Company and the Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such rating agency and, pending the effectiveness of any such amendment, the Ratings Level shall be determined by reference to the rating most recently in effect prior to such change or cessation.

 

“Approved Fund” has the meaning assigned to such term in Section 9.04(b).

 

4

 

“Assignment and Assumption” means an assignment and assumption agreement entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.

 

“Augmenting Lender” has the meaning assigned to such term in Section 2.20.

 

“Availability Period” means the period from and including the Effective Date to but excluding the earlier of the Maturity Date and the date of termination of the Commitments.

 

“Available Revolving Commitment” means, at any time with respect to any Lender, the Commitment of such Lender then in effect minus the Revolving Credit Exposure of such Lender at such time; it being understood and agreed that any Lender’s Swingline Exposure shall not be deemed to be a component of the Revolving Credit Exposure for purposes of calculating the commitment fee under Section 2.12(a).

 

“Banking Services” means each and any of the following bank services provided to the Company or any Subsidiary by any Lender or any of its Affiliates:  (a) credit cards for commercial customers (including, without limitation, commercial credit cards and purchasing cards), (b) stored value cards and (c) treasury management services (including, without limitation, controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository network services).

 

“Banking Services Agreement” means any agreement entered into by the Company or any Subsidiary in connection with Banking Services.

 

“Banking Services Obligations” means any and all obligations of the Company or any Subsidiary, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor) in connection with Banking Services.

 

“Bankruptcy Event” means, with respect to any Person, such Person becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business appointed for it, or, in the good faith determination of the Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment; provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permits such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.

 

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

 

“Borrower” means the Company or any Subsidiary Borrower.

 

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

 

5

 

“Borrowing Request” means (a) with respect to any request for a Revolving Borrowing, a request by any Borrower, together with the Company in the case of a Revolving Borrowing requested by a Subsidiary Borrower, for a Revolving Borrowing in accordance with Section 2.03 and (b) with respect to any request for a Swingline Loan, a request by any Swingline Borrower, together with the Company in the case of a Swingline Loan requested by a Subsidiary Borrower, for a Swingline Loan in accordance with Section 2.05, in any such case, in the form attached hereto as Exhibit I-1.

 

“Borrowing Subsidiary Agreement” means a Borrowing Subsidiary Agreement substantially in the form of Exhibit F-1.

 

“Borrowing Subsidiary Termination” means a Borrowing Subsidiary Termination substantially in the form of Exhibit F-2.

 

“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, when used in connection with a Eurocurrency Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in the relevant Agreed Currency in the London interbank market or the principal financial center of such Agreed Currency (and, if the Borrowings or LC Disbursements which are the subject of a borrowing, drawing, payment, reimbursement or rate selection are denominated in euro, the term “Business Day” shall also exclude any day on which the TARGET2 payment system is not open for the settlement of payments in euro).

 

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital lease obligations on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.  The foregoing is subject to Section 1.04(a).

 

“CFC” means a Person that is a “controlled foreign corporation” within the meaning of section 957 of the Code.

 

“CFC Debt” means, with respect to any Person, any Indebtedness or accounts receivable that is owed, or treated as owed for United States federal income tax purposes, by any CFC to such Person.

 

“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or “group” (within the meaning of the Securities Exchange Act of 1934 and the rules of the SEC thereunder, each as in effect on the date hereof) of Equity Interests representing more than 50% of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of the Company; (b) within any period of 24 consecutive months, occupation of a majority of the seats (other than vacant seats) on the board of directors of the Company other than by individuals who were (i) directors at the beginning of such period, (ii) nominated by the board of directors of the Company or (iii) appointed (or, in the case of a vacancy, elected) by directors so nominated, in each case which nomination or appointment (or, in the case of a vacancy, election) to such board of directors was made by individuals referred to in the foregoing clauses (i), (ii) or (iii) constituting at the time of such nomination or appointment (or, in the case of a vacancy, election) at least a majority of such board; (c) the occurrence of a change in control, or other similar provision, as defined in any agreement or instrument evidencing any Material Indebtedness, that has triggered a default under or mandatory prepayment of such Material Indebtedness, which default or mandatory prepayment has not been waived in writing; or (d) the Company ceases to (1) Control, directly or indirectly, any Subsidiary Borrower or (2) own,

 

6

 

directly or indirectly, 100% (other than (x) directors’ qualifying shares; (y) shares issued to foreign nationals to the extent required by applicable law; and (z) shares held by a Person on trust for, or otherwise where the beneficial interest is held by, the Company (directly or indirectly)) of the ordinary voting and economic interests in any Subsidiary Borrower’s issued and outstanding Equity Interests unless, in any such case, a Borrowing Subsidiary Termination delivered pursuant to Section 2.23 (i) has become effective with respect to such Subsidiary Borrower or (ii) will become effective with respect to such Subsidiary Borrower substantially concurrently with any transaction permitted hereby pursuant to which such Subsidiary Borrower ceases to be a wholly-owned Subsidiary of the Company.

 

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

 

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

 

“Code” means the United States Internal Revenue Code of 1986.

 

“Co-Documentation Agent” means each of Barclays Bank PLC, Citibank, N.A., Credit Suisse AG, Cayman Islands Branch, Fifth Third Bank and Morgan Stanley MUFG Loan Partners, LLC in its capacity as co-documentation agent for the credit facility evidenced by this Agreement.

 

“Collaboration Arrangement” means any license, sublicense, lease, sublease, collaboration agreement or other profit-loss sharing arrangement relating to the discovery, research, development, manufacture or commercialization of any drug, product line or service.

 

“Commitment” means, with respect to each Lender, the commitment of such Lender to make Revolving Loans and to acquire participations in Letters of Credit and Swingline Loans hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Revolving Credit Exposure hereunder, as such commitment may be reduced, terminated or increased from time to time in accordance with the terms of this Agreement.  The initial amount of each Lender’s Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption or other documentation contemplated hereby pursuant to which such Lender shall have assumed its Commitment, as applicable.

 

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

 

“Communications” has the meaning assigned to such term in Section 9.01(d).

 

“Company” means Regeneron Pharmaceuticals, Inc., a New York corporation.

 

7

 

“Computation Date” is defined in Section 2.04.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

 

“Consolidated EBITDA” means, with reference to any period and without duplication, an amount equal to (a) Consolidated Net Income, plus (b) to the extent deducted in determining Consolidated Net Income, (i) Consolidated Interest Expense, (ii) income tax expenses, (iii) depreciation, (iv) amortization, (v) non-cash charges, expenses or losses (including any non-cash charges attributable to impairment of goodwill or other intangible assets or impairment of long-lived assets and non-cash expenses related to equity-based compensation, benefits or incentives), (vi) extraordinary, non-recurring or unusual charges, expenses or losses (including, without limitation, with respect to restructuring activities, consolidations, integration, headcount reductions or other similar actions, including severance charges in respect of employee terminations) and in an aggregate amount not in excess of $50,000,000 during any such period, (vii) losses due to fluctuations in currency exchange rates, (viii) unrealized losses under Swap Agreements, (ix) net after-tax losses (including all fees and expenses or charges relating thereto) on any sale or disposition of any asset of the Company or any of its Subsidiaries outside of the ordinary course of business and net after-tax losses from discontinued operations, (x) net after-tax losses (including all fees and expenses or charges relating thereto) on the retirement or extinguishment of debt, (xi) write-off of non-cash deferred revenue in connection with purchase accounting adjustments applied in respect of any Acquisition (it being understood that such non-cash deferred revenue shall be recognized in such period(s) as it would have been recognized but for such Acquisition), (xii) out-of-pocket fees, expenses and other transaction costs paid to unaffiliated third parties in connection with any actual or proposed Acquisitions, merger, joint venture, Collaboration Arrangements, other investments, sales or dispositions of assets, incurrence of indebtedness and issuance of Equity Interests or other securities by the Company or any of its Subsidiaries, in each case, to the extent incurred within twelve (12) months of the completion or abandonment (as applicable) of such transactions and so long as such transactions are not prohibited under the Loan Documents and whether or not consummated, (xiii) charges or losses that are, or could reasonably be expected to be, reimbursed or covered by insurance policies or contractual indemnities and not disputed by the insurer or contractual indemnitor thereunder, in each case so long as such amounts are actually reimbursed to the Company or applicable Subsidiary in cash within two (2) fiscal quarters after the related amount is first added to Consolidated EBITDA pursuant to this clause (xiii) (and if not so reimbursed within two (2) fiscal quarters, such amount shall be deducted from Consolidated EBITDA during the next applicable period), (xiv) acquired in-process research and development expenditures, minus (c) to the extent included in Consolidated Net Income, (1) interest income, (2) income tax credits and refunds (to the extent not netted from income tax expense), (3) any cash payments made during such period in respect of items described in clauses (v) or (xi) above subsequent to the fiscal quarter in which the relevant non-cash expenses or losses were incurred, (4) non-cash or extraordinary, unusual or non-recurring income or gains, (5) gains due to fluctuations in currency exchange rates, (6) unrealized gains under Swap Agreements, (7) net after-tax gains (less all fees and expenses or charges relating thereto) on any sale or disposition of any asset of the Company or any of its Subsidiaries outside of the ordinary course of business and net after-tax gains from discontinued operations (without reduction on account of any amounts added back in clause (b)(ii) of this definition) and (8) any net after-tax gains (less and fees and expenses or charges related thereto) on the retirement or extinguishment of debt, all calculated for the Company and its Subsidiaries in accordance with GAAP on a consolidated basis.  For the purposes of calculating Consolidated EBITDA for any period of four consecutive fiscal quarters (each such period, a “Reference Period”), (i) if at any time during such Reference Period the Company or any Subsidiary shall have made any Material Disposition, the Consolidated EBITDA for such Reference Period shall be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the property that is the subject of such Material Disposition for such Reference Period or increased by an amount equal to the Consolidated EBITDA (if

 

8

 

negative) attributable thereto for such Reference Period, and (ii) if during such Reference Period the Company or any Subsidiary shall have made a Material Acquisition and the Consolidated EBITDA attributable to the property that is the subject of such Material Acquisition is positive for such Reference Period, Consolidated EBITDA for such Reference Period shall be calculated after giving pro forma effect thereto as if such Material Acquisition occurred on the first day of such Reference Period.  As used in this definition, “Material Acquisition” means any acquisition of property or series of related acquisitions of property by the Company or any Subsidiary that (a) constitutes (i) assets comprising all or substantially all or any significant portion of a business or operating unit of a business, or (ii) all or substantially all of the common stock or other Equity Interests of a Person, and (b) involves the payment of consideration by the Company and its Subsidiaries in excess of $25,000,000 (calculated to include the aggregate amount of Indebtedness assumed in connection with such acquisition); and “Material Disposition” means any sale, transfer or disposition of property of the Company or any Subsidiary or series of related sales, transfers, or dispositions of property of the Company or such Subsidiary (other than any Exclusive License or transactions between or among any of the Loan Parties or any of their Subsidiaries (or any combination thereof)) that yields gross cash proceeds to the Company or any of its Subsidiaries in excess of $25,000,000 in the aggregate on or prior to the consummation thereof (and which, for the avoidance of doubt, shall not include any royalty, earnout, contingent payment or any other deferred payment that may be payable thereafter).

 

“Consolidated Interest Expense” means, with reference to any period, the excess of (a) the interest expense (including without limitation interest expense under Capital Lease Obligations that is treated as interest in accordance with GAAP) of the Company and its Subsidiaries calculated on a consolidated basis for such period with respect to all outstanding Indebtedness of the Company and its Subsidiaries allocable to such period in accordance with GAAP (including, without limitation, all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers acceptance financing and net costs under interest rate Swap Agreements to the extent such net costs are allocable to such period in accordance with GAAP) minus (b) to the extent included in clause (a) above, (i) non-cash amounts attributable to amortization of financing costs paid in a previous period, (ii) non-cash amounts attributable to amortization of debt discounts or accrued interest payable in kind for such period, and (iii) any break funding payment made pursuant to Section 2.16.  In the event that the Company or any Subsidiary shall have completed a Material Acquisition or a Material Disposition since the beginning of the relevant period, Consolidated Interest Expense shall be determined for such period on a pro forma basis as if such acquisition or disposition, and any related incurrence or repayment of Indebtedness, had occurred at the beginning of such period.

 

“Consolidated Net Income” means, with reference to any period, the net income (or loss) of the Company and its Subsidiaries calculated in accordance with GAAP on a consolidated basis (without duplication) for such period; provided that there shall be excluded any income (or loss) of any Person other than the Company or a Subsidiary, but any such income so excluded may be included in such period or any later period to the extent of any dividends, distributions or other payments actually paid in cash (or to the extent converted into cash) in the relevant period to the Company or any wholly-owned Subsidiary of the Company.

 

“Consolidated Net Worth” means, as of the date of any determination thereof, the consolidated stockholders’ equity of the Company and its Subsidiaries calculated on a consolidated basis in accordance with GAAP.

 

“Consolidated Total Assets” means, as of the date of any determination thereof, total assets of the Company and its Subsidiaries calculated in accordance with GAAP on a consolidated basis as of such date.

 

9

 

“Consolidated Total Indebtedness” means at any date the sum, without duplication, of (a) the aggregate Indebtedness of the Company and its Subsidiaries (other than intercompany Indebtedness among the Company and its Subsidiaries) that is of a type that would be reflected on a consolidated balance sheet of the Company prepared as of such date in accordance with GAAP, (b) the aggregate amount of Indebtedness of the Company and its Subsidiaries relating to the maximum drawing amount of all letters of credit outstanding and bankers acceptances and (c) Indebtedness of the type referred to in clauses (a) or (b) hereof of another Person (other than the Company or any Subsidiary) guaranteed by the Company or any of its Subsidiaries; provided that Consolidated Total Indebtedness (i) shall not include obligations in respect of letters of credit, bankers acceptances and similar obligations to the extent of the amount of collateral provided therefor as cash and/or cash equivalents and (ii) shall be subject, in all respects, to the limitations and exclusions set forth in the definition of Indebtedness, including as to the calculation of the amount of any limited recourse guarantee under clause (c) above.

 

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

 

“Co-Syndication Agent” means each of Bank of America, N.A. and U.S. Bank National Association in its capacity as co-documentation agent for the credit facility evidenced by this Agreement.

 

“Credit Event” means a Borrowing, the issuance, amendment, renewal or extension of a Letter of Credit, an LC Disbursement or any of the foregoing.

 

“Credit Party” means the Administrative Agent, any Issuing Bank, the Swingline Lender or any other Lender.

 

“CRR” means the Council Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012.

 

“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

 

“Defaulting Lender” means any Lender that (a) has failed, within two (2) Business Days of the date required to be funded or paid, to (i) fund any portion of its Loans, (ii) fund any portion of its participations in Letters of Credit or Swingline Loans or (iii) pay over to any Credit Party any other amount required to be paid by it hereunder, unless, in the case of clause (i) above, such Lender notifies the Administrative Agent in writing that such failure is the result of such Lender’s good faith determination that a condition precedent to funding (specifically identified and including the particular default, if any) has not been satisfied, (b) has notified the Company or any Credit Party in writing, or has made a public statement to the effect, that it does not intend or expect to comply with any of its funding obligations under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the particular default, if any) to funding a Loan under this Agreement cannot be satisfied) or generally under other agreements in which it commits to extend credit, (c) has failed, within three (3) Business Days after request by a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations (and is financially able to meet such obligations) to fund prospective Loans and participations in then outstanding Letters of Credit and Swingline Loans under this Agreement; provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Credit Party’s receipt of such certification in

 

10

 

form and substance satisfactory to it and the Administrative Agent, or (d) has become the subject of a Bankruptcy Event.

 

“Designated Foreign Subsidiary Borrower” means a Foreign Subsidiary Borrower that is organized under the laws of Luxembourg or any other jurisdiction (other than Ireland or the Netherlands) designated from time to time by the Administrative Agent.

 

“Designated Loan” means a Revolving Loan denominated in Dollars to a Designated Foreign Subsidiary Borrower.

 

“Disclosed Matters” means any event, circumstance, condition or other matter disclosed in the reports and other documents furnished to or filed with the SEC by the Company and that are publicly available on or prior to the Effective Date.

 

“Disinterested Director” means, with respect to any Person and transaction, a member of the board of directors (or similar governing body) of such Person who does not have any material direct or indirect financial interest in or with respect to such transaction.  It is understood and agreed that no such Person shall be deemed to have a material indirect financial interest if such Person would not be deemed to have an “indirect material interest” within the meaning of Item 404(a) of Regulation S-K.

 

“Disregarded Entity” means any entity treated as disregarded as an entity separate from its owner under Treasury Regulations Section 301.7701-3.

 

“Dollar Amount” of any currency at any date means (i) the amount of such currency if such currency is Dollars or (ii) the equivalent amount thereof in Dollars if such currency is a Foreign Currency, calculated on the basis of the Exchange Rate for such currency, on or as of the most recent Computation Date provided for in Section 2.04.

 

“Dollars” or “$” refers to lawful money of the United States of America.

 

“Domestic Foreign Holdco Subsidiary” means a Domestic Subsidiary (a) substantially all of the assets of which consist of the Equity Interests of one or more CFCs or CFC Debt or (b) that is a Disregarded Entity that holds Equity Interests of one or more CFCs or CFC Debt, in the case of clause (a) above, so long as such Domestic Subsidiary (i) does not conduct any substantial business or activities other than the ownership of such Equity Interests or CFC Debt (except for immaterial assets and activities reasonably related or ancillary thereto) and (ii) does not incur, and is not otherwise liable for, any material Indebtedness or other material liabilities (other than intercompany indebtedness permitted pursuant to Section 6.01(c) and, if such Domestic Subsidiary is a Borrower hereunder, Indebtedness permitted pursuant to Section 6.01(a)).

 

“Domestic Subsidiary” means a Subsidiary organized under the laws of a jurisdiction located in the United States of America.

 

“Drug Acquisition” means any acquisition (including any license or any acquisition of any license) solely or primarily of all or any portion of the rights in respect of one or more drugs or pharmaceutical products, whether in development or on the market (including related intellectual property), but not of Equity Interests in any Person or any operating business unit.

 

“Dutch Borrower” means (i) the Initial Dutch Borrower and (ii) any other Borrower that is organized under the laws of the Netherlands.

 

11

 

“Dutch Non-Public Lender” means:

 

(i) until the publication of an interpretation of “public” as referred to in the CRR by the relevant authority/ies: an entity that provides repayable funds to a Dutch Borrower for a minimum initial amount of EUR 100,000 (or its equivalent in another currency) or an entity otherwise qualifying as not forming part of the public), and

 

(ii) following the publication of an interpretation of “public” as referred to in the CRR by the relevant authority/ies: such amount or such criterion as a result of which such entity shall qualify as not forming part of the public.

 

“ECP” means an “eligible contract participant” as defined in Section 1(a)(18) of the Commodity Exchange Act or any regulations promulgated thereunder and the applicable rules issued by the Commodity Futures Trading Commission and/or the SEC.

 

“Effective Date” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).

 

“Electronic Signature” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record.

 

“Electronic System” means any electronic system, including e-mail, e-fax, Intralinks®, ClearPar®, Debt Domain, Syndtrak and any other Internet or extranet-based site, whether such electronic system is owned, operated or hosted by the Administrative Agent and any Issuing Bank and any of its respective Related Parties or any other Person, providing for access to data protected by passcodes or other security system.

 

“Eligible Foreign Jurisdiction” means the Netherlands, Ireland, Luxembourg and any other jurisdiction that is approved from time to time by the Administrative Agent and each of the Lenders.

 

“Eligible Subsidiary” means (i) the Initial Subsidiary Borrowers, (ii) a Domestic Subsidiary, (iii) any Subsidiary organized under the laws of an Eligible Foreign Jurisdiction and (iv) any other Subsidiary that is approved from time to time by the Administrative Agent and each of the Lenders.

 

“Environmental Laws” means all laws, rules, regulations, codes, ordinances, or binding orders, decrees, judgments, injunctions, written notices or agreements issued, promulgated or entered into by any Governmental Authority, relating to pollution or protection of the environment, preservation or reclamation of natural resources, the management, release or threatened release of any Hazardous Material, or to the protection of human health and safety in respect of Hazardous Materials.

 

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

 

“Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in

 

12

 

a Person, and any warrants, options or other similar rights entitling the holder thereof to purchase or acquire any of the foregoing.  Notwithstanding the foregoing, (a) Permitted Convertible Notes, (b) Permitted Call Spread Swap Agreements and (c) any Indebtedness that is convertible into Equity Interests and/or cash by reference to the value (howsoever defined or determined) of Equity Interests shall not constitute Equity Interests.

 

“Equivalent Amount” of any currency with respect to any amount of Dollars at any date means the equivalent in such currency of such amount of Dollars, calculated on the basis of the Exchange Rate for such other currency at 11:00 a.m., London time, on the date on or as of which such amount is to be determined.

 

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

 

“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Company, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

 

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived); (b) the existence with respect to any Plan of an “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Company or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Company or any ERISA Affiliate from the PBGC or a plan administrator of any written notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Company or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal of the Company or any of its ERISA Affiliates from any Plan or Multiemployer Plan; or (g) the receipt by the Company or any ERISA Affiliate of any written notice, or the receipt by any Multiemployer Plan from the Company or any ERISA Affiliate of any written notice, concerning the imposition upon the Company or any of its ERISA Affiliates of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

 

“euro” and/or “EUR” means the single currency of the Participating Member States.

 

“Eurocurrency”, when used in reference to a currency means an Agreed Currency and when used in reference to any Loan or Borrowing, means that such Loan, or the Loans comprising such Borrowing, bears interest at a rate determined by reference to the Adjusted LIBO Rate.

 

“Eurocurrency Payment Office” of the Administrative Agent means, for each Foreign Currency and each Designated Loan, the office, branch, affiliate or correspondent bank of the Administrative Agent for such currency or Designated Loan, as applicable, as specified from time to time by the Administrative Agent to the Company and each Lender.

 

“Event of Default” has the meaning assigned to such term in Article VII.

 

“Exchange Rate” means, on any day, with respect to any Foreign Currency, the rate at which such Foreign Currency may be exchanged into Dollars, as set forth at approximately 11:00 a.m.,

 

13

 

Local Time, on such date on the Reuters World Currency Page for such Foreign Currency.  In the event that such rate does not appear on any Reuters World Currency Page, the Exchange Rate with respect to such Foreign Currency shall be determined by reference to such other publicly available service for displaying exchange rates as may be reasonably selected by the Administrative Agent or, in the event no such service is selected, such Exchange Rate shall instead be calculated on the basis of the arithmetical mean of the buy and sell spot rates of exchange of the Administrative Agent for such Foreign Currency on the London market at 11:00 a.m., Local Time, on such date for the purchase of Dollars with such Foreign Currency, for delivery two Business Days later; provided, that if at the time of any such determination, for any reason, no such spot rate is being quoted, the Administrative Agent, after consultation with the Company, may use any reasonable method it deems appropriate to determine such rate, and such determination shall be conclusive absent manifest error.

 

“Excluded Subsidiary” means (a) any Domestic Foreign Holdco Subsidiary, (b) any Domestic Subsidiary whose Equity Interests are owned directly or indirectly by a CFC, (c) any Subsidiary that is prohibited by applicable law or contractual obligations (other than any contractual obligation in favor of the Company or any of its Subsidiaries) existing on the Effective Date (or, in the case of any newly acquired Subsidiary, in existence at the time of acquisition but not entered into in contemplation thereof) from guaranteeing the Obligations or if guaranteeing the Obligations would require governmental (including regulatory) consent, approval, license or authorization (unless such consent, approval, license or authorization has been obtained) and (d) any captive insurance company.

 

“Excluded Swap Obligation” means, with respect to any Loan Party, any Specified Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Loan Party of, or the grant by such Loan Party of a security interest to secure, such Specified Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Loan Party’s failure for any reason to constitute an ECP at the time the Guarantee of such Loan Party or the grant of such security interest becomes effective with respect to such Specified Swap Obligation.  If a Specified Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Specified Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender (including a Participant treated as a Lender pursuant to Section 9.04(c)), U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan, Letter of Credit or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan, Letter of Credit or Commitment (other than pursuant to an assignment request by any Borrower under Section 2.19(b)) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.17, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender acquired the applicable interest in a Loan, Letter of Credit or Commitment or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 2.17(f) and (d) any U.S. federal withholding Taxes imposed under FATCA.

 

“Exclusive License” means any license to develop and commercialize a drug or other product line of any Person with a term greater than five (5) years and made on an exclusive basis.

 

14

 

“Existing Maturity Date” has the meaning assigned to such term in Section 2.21(a).

 

“Extending Lender” has the meaning assigned to such term in Section 2.21(b).

 

“Extension Date” has the meaning assigned to such term in Section 2.21(a).

 

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

 

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

 

“Financial Officer” means the chief financial officer, principal accounting officer, treasurer, assistant treasurer, senior vice president-finance or controller of the Company.

 

“Financials” means the annual or quarterly financial statements of the Company and its consolidated Subsidiaries required to be delivered pursuant to Section 5.01(a) or 5.01(b) and accompanying certificates required to be delivered pursuant to Section 5.01(c).

 

“Foreign Currencies” means Agreed Currencies other than Dollars.

 

“Foreign Currency LC Exposure” means, at any time, the sum of (a) the Dollar Amount of the aggregate undrawn and unexpired amount of all outstanding Foreign Currency Letters of Credit at such time plus (b) the aggregate principal Dollar Amount of all LC Disbursements in respect of Foreign Currency Letters of Credit that have not yet been reimbursed at such time.

 

“Foreign Currency Letter of Credit” means a Letter of Credit denominated in a Foreign Currency.

 

“Foreign Lender” means (a) if the applicable Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if the applicable Borrower is not a U.S. Person, a Lender that is resident or organized under the laws of a jurisdiction other than that in which such Borrower is resident for tax purposes.

 

“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

 

“Foreign Subsidiary Borrower” means any Borrower that is a Foreign Subsidiary.

 

“GAAP” means generally accepted accounting principles in the United States of America.

 

“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority,

 

15

 

instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

 

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided, that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.  The amount of any Guarantee shall be deemed to be an amount equal to the lesser of (a) the stated or determinable amount of the primary payment obligation in respect of which such Guarantee is made and (b) the maximum amount for which the guaranteeing Person may be liable pursuant to the terms of the instrument embodying such Guarantee, unless such primary payment obligation and the maximum amount for which such guaranteeing Person may be liable are not stated or determinable, in which case the amount of the Guarantee shall be such guaranteeing Person’s maximum reasonably possible liability in respect thereof as reasonably determined by the Company in good faith.

 

“Guaranteed Obligations” has the meaning assigned to such term in Article X.

 

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“IFRS” means the body of pronouncements issued by the International Accounting Standards Board (“IASB”), including International Financial Reporting Standards and interpretations approved by the IASB, International Accounting Standards and Standing Interpretations Committee interpretations approved by the predecessor International Accounting Standards Committee and adapted for use in the European Union.

 

“Impacted Interest Period” has the meaning assigned to such term in the definition of “LIBO Rate”.

 

“Increasing Lender” has the meaning assigned to such term in Section 2.20.

 

“Incremental Term Loan” has the meaning assigned to such term in Section 2.20.

 

“Incremental Term Loan Amendment” has the meaning assigned to such term in Section 2.20.

 

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money, (b) the principal amount of all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person (excluding trade accounts payable incurred in the ordinary course of business), (d) all obligations of such Person in respect of the

 

16

 

deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (e) 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 property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed; provided that, if such Person has not assumed or otherwise become liable in respect of such Indebtedness, such obligations shall be deemed to be in an amount equal to the lesser of (i) the amount of such Indebtedness and (ii) fair market value of such property at the time of determination (in the Company’s good faith estimate), (f) all Guarantees by such Person of Indebtedness of others, (g) all Capital Lease Obligations of such Person, (h) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty, (i) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances and (j) all obligations of such Person under Sale and Leaseback Transactions.  The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor by operation of law as a result of such Person’s ownership interest in such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.  The amount of Indebtedness (including any Guarantees constituting Indebtedness) for which recourse is limited either to a specified amount or to an identified asset of such Person shall be deemed to be equal to the lesser of (x) such specified amount and (y) the fair market value of such identified asset as determined by such Person in good faith.  Notwithstanding anything to the contrary in this definition, the term “Indebtedness” shall not include (i) deferred or prepaid revenue, (ii) purchase price holdbacks to satisfy warranty or other unperformed obligations of a seller, (iii) obligations arising under any Swap Agreement, (iv) contingent or deferred payment obligations (including, without limitation, any purchase price adjustments, indemnification obligations, reimbursement obligations, funding or investment commitments, or earn-out, non-compete, consulting, royalty, milestone, option, development or other incentive payment obligations) with respect to (A) any Collaboration Arrangement or (B) any Acquisition, disposition, other acquisition of assets or other business combination, (v) obligations arising under any Permitted Call Spread Swap Agreement and (vi) all obligations of such Person arising under any Tax Abatement Transaction.

 

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a) hereof, Other Taxes.

 

“Index Debt” means senior, unsecured, long-term indebtedness for borrowed money of the Company that is not guaranteed by any other person or entity or subject to any other credit enhancement.

 

“Ineligible Institution” has the meaning assigned to such term in Section 9.04(b).

 

“Information Memorandum” means the Confidential Information Memorandum dated February 19, 2015 relating to the Company and the Transactions.

 

“Initial Dutch Borrower” means Regeneron Capital International B.V., a besloten vennootschap met beperkte aansprakelijkheid organized under the laws of the Netherlands, with its statutory seat in Amsterdam, the Netherlands.

 

“Initial Irish Borrowers” means Regeneron International, an unlimited company incorporated in Ireland with registered number 521246, Regeneron Ireland Holdings, an unlimited company incorporated in Ireland with registered number 519315 and Regeneron Ireland, an unlimited company incorporated in Ireland with registered number 519550.

 

17

 

“Initial Subsidiary Borrowers” means Regeneron Healthcare Solutions, Inc, a New York corporation, Regeneron Genetics Center LLC, a Delaware limited liability company, the Initial Dutch Borrower and the Initial Irish Borrowers.

 

“Interest Election Request” means a request by the applicable Borrower to convert or continue a Revolving Borrowing in accordance with Section 2.08 in the form attached hereto as Exhibit I-2.

 

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a Swingline Loan), the last day of each March, June, September and December and the Maturity Date, (b) with respect to any Eurocurrency Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurocurrency Borrowing with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period and the Maturity Date and (c) with respect to any Swingline Loan, the day that such Loan is required to be repaid and the Maturity Date.

 

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

 

“Interpolated Rate” means, at any time, for any Interest Period, the rate per annum determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the LIBOR Screen Rate for the longest period (for which the LIBOR Screen Rate is available for the applicable currency) that is shorter than the Impacted Interest Period and (b) the LIBOR Screen Rate for the shortest period (for which the LIBOR Screen Rate is available for the applicable currency) that exceeds the Impacted Interest Period, in each case, at such time.

 

“Irish Borrower” means (i) the Initial Irish Borrowers and (ii) any other Borrower that is incorporated under the laws of Ireland.

 

“IRS” means the United States Internal Revenue Service.

 

“Issuing Bank” means JPMorgan Chase Bank, N.A., Bank of America, N.A. and U.S. Bank National Association and each other Lender designated by the Company as an “Issuing Bank” hereunder that has agreed to such designation (and is reasonably acceptable to the Administrative Agent), each in its capacity as an issuer of Letters of Credit hereunder, and its successors in such capacity as provided in Section 2.06(i).  Each Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate.

 

18

 

“Joint Bookrunner” means each of J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and U.S. Bank National Association in its capacity as a joint bookrunner and joint lead arranger for the credit facility evidenced by this Agreement.

 

“LC Collateral Account” has the meaning assigned to such term in Section 2.06(j).

 

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

 

“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn Dollar Amount of all outstanding Letters of Credit at such time plus (b) the aggregate Dollar Amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Company at such time.  The LC Exposure of any Lender at any time shall be its Applicable Percentage of the total LC Exposure at such time.

 

“Lender Notice Date” has the meaning assigned to such term in Section 2.21(b).

 

“Lender Parent” means, with respect to any Lender, any Person as to which such Lender is, directly or indirectly, a subsidiary.

 

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a Lender hereunder pursuant to Section 2.19, 2.20 or 2.21 or pursuant to an Assignment and Assumption or other documentation contemplated hereby, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption or as otherwise contemplated hereby.  Unless the context otherwise requires, the term “Lenders” includes the Swingline Lender and the Issuing Banks.

 

“Letter of Credit” means any letter of credit issued pursuant to this Agreement.

 

“LIBO Rate” means, with respect to any Eurocurrency Borrowing denominated in any Agreed Currency and for any applicable Interest Period, the London interbank offered rate as administered by ICE Benchmark Administration (or any other Person that takes over the administration of such rate) for such Agreed Currency for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate, or, in the event such rate does not appear on either of such Reuters pages, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate as shall be selected by the Administrative Agent from time to time in its reasonable discretion (in each case the “LIBOR Screen Rate”) at approximately 11:00 a.m., London time, on the Quotation Day for such Agreed Currency and Interest Period; provided that, if the LIBOR Screen Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement; provided, further, that if a LIBOR Screen Rate shall not be available at such time for such Interest Period (the “Impacted Interest Period”), then the LIBO Rate for such Agreed Currency and such Interest Period shall be the Interpolated Rate; provided, that, if any Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.  It is understood and agreed that all of the terms and conditions of this definition of “LIBO Rate” shall be subject to Section 2.14.

 

“LIBOR Screen Rate” has the meaning assigned to such term in the definition of “LIBO Rate”.

 

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease, ground lease, master lease or title

 

19

 

retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset.

 

“Loan Documents” means this Agreement, each Borrowing Subsidiary Agreement, each Borrowing Subsidiary Termination, the Subsidiary Guaranty, any promissory notes issued pursuant to Section 2.10(e) of this Agreement and any Letter of Credit applications.  Any reference in this Agreement or any other Loan Document to a Loan Document shall include all appendices, exhibits or schedules thereto, and all amendments, restatements, supplements or other modifications thereto (including any Incremental Term Loan Amendment), and shall refer to this Agreement or such Loan Document as the same may be in effect at any and all times such reference becomes operative.

 

“Loan Parties” means, collectively, the Borrowers and the Subsidiary Guarantors.

 

“Loans” means the loans made by the Lenders to the Borrowers pursuant to this Agreement.

 

“Local Time” means (i) New York City time in the case of a Loan, Borrowing or LC Disbursement denominated in Dollars (other than Designated Loans) and (ii) local time in the case of a Loan, Borrowing or LC Disbursement denominated in a Foreign Currency and Designated Loans (it being understood that such local time shall mean London, England time unless otherwise notified by the Administrative Agent).

 

“Luxembourg Borrower” means any Luxembourg Subsidiary that becomes a Subsidiary Borrower pursuant to Section 2.23 and that has not ceased to be a Subsidiary Borrower pursuant to such Section.

 

“Luxembourg Insolvency Event” shall mean, with respect to any Luxembourg Borrower, (i) a situation of (cessation de paiements) and absence of access to credit (credit ébranlé) within the meaning of Article 437 of the Luxembourg Commercial Code, (ii) insolvency proceedings (faillite) within the meaning of Articles 437 ff. of the Luxembourg Commercial Code or any other insolvency proceedings pursuant to the Council Regulation (EC) N° 1346/2000 of 29 May 2000 on insolvency proceedings, (iii) controlled management (gestion contrôlée) within the meaning of the grand ducal regulation of 24 May 1935 on controlled management, (iv) voluntary arrangement with creditors (concordat préventif de faillite) within the meaning of the law of 14 April 1886 on arrangements to prevent insolvency, as amended, (v) suspension of payments (sursis de paiement) within the meaning of Articles 593 ff. of the Luxembourg Commercial Code, (vi) voluntary or compulsory winding-up pursuant to the law of 10 August 1915 on commercial companies, as amended or (vii) the appointment of an ad hoc director (administrateur provisoire) by a court in respect of such Luxembourg Borrower or a substantial part of its assets.

 

“Luxembourg Subsidiary” means any Subsidiary organized under the laws of Luxembourg.

 

“Material Adverse Effect” means a material adverse effect on (a) the business, assets, operations or financial condition of the Company and the Subsidiaries taken as a whole, (b) the ability of (i) the Company to perform its material obligations under this Agreement or (ii) the Loan Parties (taken as a whole) to perform their material obligations under the Loan Documents (taken as a whole) or (c) the material rights or remedies of the Administrative Agent and the Lenders thereunder.

 

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of Credit), or obligations in respect of one or more Swap Agreements, of any one or more of any Borrower or any

 

20

 

Material Subsidiary in an aggregate principal amount exceeding $75,000,000.  For purposes of determining Material Indebtedness, the “principal amount” of the obligations of any Borrower or any Material Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that such Borrower or such Material Subsidiary would be required to pay if such Swap Agreement were terminated at such time.

 

“Material Domestic Subsidiary” means each Material Subsidiary that is a Domestic Subsidiary and not an Excluded Subsidiary.

 

“Material Subsidiary” means each wholly-owned Subsidiary which, as of the most recent fiscal year of the Company (beginning with the fiscal year of the Company ending on or about December 31, 2015), for the period of four consecutive fiscal quarters then ended, for which financial statements have been delivered pursuant to Section 5.01(a), contributed greater than ten percent (10%) of Consolidated EBITDA for such period.

 

“Maturity Date” means March 19, 2020 subject to extension (in the case of each Lender consenting thereto) as provided in Section 2.21.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

 

“Non-Extending Lender” has the meaning assigned to such term in Section 2.21(a).

 

“Obligations” means all unpaid principal of and accrued and unpaid interest on the Loans, all LC Exposure, all accrued and unpaid fees and all expenses, reimbursements, indemnities and other obligations and indebtedness (including interest and fees accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), obligations and liabilities of any of the Company and its Subsidiaries to any of the Lenders, the Administrative Agent, any Issuing Bank or any indemnified party, individually or collectively, existing on the Effective Date or arising thereafter, direct or indirect, joint or several, absolute or contingent, matured or unmatured, liquidated or unliquidated, secured or unsecured, arising by contract, operation of law or otherwise, arising or incurred under this Agreement or any of the other Loan Documents or in respect of any of the Loans made or reimbursement or other obligations incurred or any of the Letters of Credit or other instruments at any time evidencing any thereof; provided that (i) the definition of “Obligations” shall not create or include any guarantee by any Loan Party of any Excluded Swap Obligations of such Loan Party for purposes of determining any obligations of any Loan Party and (ii) obligations arising under Permitted Call Spread Swap Agreements shall not be considered Obligations.

 

“OFAC” means the Office of Foreign Assets Control of the U.S. Department of the Treasury.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan, Letter of Credit or Loan Document).

 

21

 

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 2.19).

 

“Overnight Foreign Currency Rate” means, for any amount payable in a Foreign Currency, the rate of interest per annum as determined by the Administrative Agent at which overnight or weekend deposits in the relevant currency (or if such amount due remains unpaid for more than three (3) Business Days, then for such other period of time as the Administrative Agent may reasonably determine) for delivery in immediately available and freely transferable funds would be offered by the Administrative Agent to major banks in the interbank market upon request of such major banks for the relevant currency as determined above and in an amount comparable to the unpaid principal amount of the related Credit Event, plus any taxes, levies, imposts, duties, deductions, charges or withholdings (in any such case, other than Excluded Taxes) imposed upon, or charged to, the Administrative Agent by any relevant correspondent bank in respect of such amount in such relevant currency.

 

“Participant” has the meaning assigned to such term in Section 9.04(c).

 

“Participant Register” has the meaning assigned to such term in Section 9.04(c).

 

“Participating Member State” means any member state of the European Union that adopts or has adopted the euro as its lawful currency in accordance with legislation of the European Union relating to economic and monetary union.

 

“Patriot Act” means the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)).

 

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

 

“Permitted Call Spread Swap Agreement” means (a) any Swap Agreement (including, but not limited to, any bond hedge transaction or capped call transaction) pursuant to which the Company acquires an option requiring the counterparty thereto to deliver to the Company shares of common stock of the Company, the cash value of such shares or a combination thereof from time to time upon exercise of such option and (b) any Swap Agreement pursuant to which the Company issues to the counterparty thereto warrants to acquire common stock of the Company (whether such warrant is settled in shares, cash or a combination thereof), in each case entered into by the Company in connection with the issuance of Permitted Convertible Notes; provided that the terms, conditions and covenants of each such Swap Agreement shall be such as are customary for Swap Agreements of such type (as determined by the Board of Directors of the Company in good faith). For the avoidance of doubt, “Permitted Call Spread Swap Agreement” includes the convertible note hedge and warrant transactions entered into by the Company in connection with the Company’s 1.875% convertible senior notes due October 1, 2016.

 

“Permitted Convertible Notes” means any unsecured notes issued by the Company that are convertible into common stock of the Company, cash or any combination thereof.  For the avoidance of doubt, “Permitted Convertible Notes” includes the Company’s 1.875% convertible senior notes due October 1, 2016.

 

“Permitted Encumbrances” means:

 

22

 

(a) Liens imposed by law for Taxes that have not yet been paid (to the extent such non-payment does not violate Section 5.04) or are being contested in compliance with Section 5.04, and Liens for unpaid utility charges;

 

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, supplier’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than sixty (60) days or are being contested in compliance with Section 5.04;

 

(c)                                  pledges and deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security or retirement benefits laws or regulations or employment laws, to secure liability to insurance carriers under insurance or self-insurance arrangements or to secure other public, statutory or regulatory obligations;

 

(d)                                 pledges and deposits to secure the performance of bids, trade contracts, government contracts, leases, statutory obligations, customer deposits and advances, surety, customs and appeal bonds, performance and completion bonds and other obligations of a like nature, in each case in the ordinary course of business, and Liens to secure letters of credit or bank guarantees supporting any of the foregoing;

 

(e)                                  judgment Liens in respect of judgments that do not constitute an Event of Default under clause (k) of Article VII or Liens securing appeal or surety bonds related to such judgments;

 

(f)                                   easements, zoning restrictions, rights-of-way and similar charges or encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of the Company and its Subsidiaries, taken as a whole;

 

(g)                                  any interest or title of a landlord, lessor or sublessor under any lease of real estate or any Lien affecting solely the interest of the landlord, lessor or sublessor;

 

(h)                                 leases, licenses, subleases or sublicenses (i) that are granted to others and do not adversely interfere in any material respect with the business of the Company and its Subsidiaries as conducted at the time granted, taken as a whole, (ii) between or among any of the Loan Parties or any of their Subsidiaries (or any combination thereof) or (iii) granted to other Persons and permitted under Section 6.03;

 

(i)                                     purported Liens evidenced by the filing of precautionary UCC financing statements or similar filings relating to operating leases of personal property entered into by the Company or any of its Subsidiaries in the ordinary course of business;

 

(j)                                    any interest or title of a licensor under any license or sublicense entered into by the Company or any Subsidiary as a licensee or sublicensee (i) existing on the date hereof or (ii) in the ordinary course of its business;

 

(k)                                 with respect to any real property, immaterial title defects or irregularities that do not materially impair the use of such real property;

 

(l)                                     Liens on real property, fixtures, equipment, other fixed or capital assets or other related assets in connection with a Tax Abatement Transaction in favor of the Related Municipal Party.

 

23

 

“Permitted Restructurings” means a transaction or series of transactions pursuant to which direct and indirect Subsidiaries of the Company are converted, restructured or reorganized for tax planning or due to changes or potential changes in any relevant legal or regulatory framework, whether by (i) transfer, (ii) acquisition, (iii) contribution, (iv) merger, (v) consolidation, (vi) voluntary dissolution, (vii) liquidation, (viii) recapitalization, (ix) change in identity, form, place of organization, domicile or, to the extent relevant and subject to Section 5.03(b), centre of main interests (as that term is used in Article 3(1) of the Regulation), or (x) otherwise, in each case the result of which may cause a direct or indirect sale, assignment or transfer of Equity Interests and/or other assets between and among the Company and/or various Subsidiaries of the Company, and in each case to the extent the Administrative Agent (acting in its reasonable credit judgment) approves such Permitted Restructuring.

 

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

 

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Company or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

 

“Platform” means Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system.

 

“Pounds Sterling” means the lawful currency of the United Kingdom.

 

“Priority Indebtedness” means (a) Indebtedness of the Company or any Subsidiary secured by any Lien on any asset(s) of the Company or any Subsidiary and (b) unsecured Indebtedness of any Subsidiary that is not a Borrower or a Subsidiary Guarantor, in each case owing to a Person other than the Company or any Subsidiary.

 

“Prime Rate” means the rate of interest per annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its prime rate in effect at its principal office in New York City; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.

 

“Quotation Day” means, with respect to any Eurocurrency Borrowing for any Interest Period, (i) if the currency is Pounds Sterling, the first day of such Interest Period, (ii) if the currency is euro, the day that is two (2) TARGET2 Days before the first day of such Interest Period, and (iii) for any other currency, two (2) Business Days prior to the commencement of such Interest Period (unless, in each case, market practice differs in the relevant market where the LIBO Rate for such currency is to be determined, in which case the Quotation Day will be determined by the Administrative Agent in accordance with market practice in such market (and if quotations would normally be given on more than one day, then the Quotation Day will be the last of those days)).

 

“Recipient” means (a) the Administrative Agent, (b) any Lender and (c) any Issuing Bank, as applicable.

 

“Reference Bank Rate” means the arithmetic mean of the rates (rounded upwards to four decimal places) supplied to the Administrative Agent at its request by the Reference Banks (as the case may be) as of the applicable time on the Quotation Day for Loans in the applicable currency and the applicable Interest Period as the rate at which the relevant Reference Bank could borrow funds in the London (or other applicable) interbank market in the relevant currency and for the relevant period, were it

 

24

 

to do so by asking for and then accepting interbank offers in reasonable market size in that currency and for that period.

 

“Reference Banks” means the principal London (or other applicable) offices of JPMorgan Chase Bank, N.A. and such other banks as may be appointed by the Administrative Agent (and agreed by such bank) in consultation with the Company.  No Lender shall be obligated to be a Reference Bank without its consent.

 

“Register” has the meaning assigned to such term in Section 9.04(b).

 

“Regulation” means the Council of the European Union Regulation No. 1346/2000 on Insolvency Proceedings.

 

“Related Municipal Party” means the industrial development agency or other Governmental Authority party to a Tax Abatement Transaction and, if applicable, any trustee or agent with respect to such Tax Abatement Transaction.

 

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective partners, directors, officers, managers, employees, agents and advisors of such Person and such Person’s Affiliates.

 

“Required Lenders” means, subject to Section 2.24, at any time, Lenders having Revolving Credit Exposures and unused Commitments representing more than 50% of the sum of the total Revolving Credit Exposures and unused Commitments at such time.

 

“Responsible Officer” means the chief executive officer, president, a Financial Officer or chief legal officer of the Company or any other Person designated by any such Person in writing to the Administrative Agent and reasonably acceptable to the Administrative Agent.

 

“Restricted Payment” means (a) any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the Company or any Subsidiary, and (b) any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Equity Interests in the Company or any option, warrant or other similar right to acquire any such Equity Interests in the Company.  Notwithstanding the foregoing, and for the avoidance of doubt, any of the foregoing directly on account of any Permitted Convertible Notes or any Permitted Call Spread Swap Agreement, including (i) any issuance of, conversion of (including any cash payment upon conversion), or payment of any principal or premium on, or payment of any interest with respect to, or any other exercise of rights or performance of obligations under any Permitted Convertible Notes and (ii) any entry into, payment with respect to, or early unwind or settlement of, or any other exercise of rights or performance of obligations under any Permitted Call Spread Swap Agreement, in any such case, shall not constitute a Restricted Payment.

 

“Revolving Credit Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender’s Revolving Loans, its LC Exposure and its Swingline Exposure at such time.

 

“Revolving Loan” means a Loan made pursuant to Section 2.01.

 

“S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business.

 

25

 

“Sale and Leaseback Transaction” means any sale or other transfer of any property or asset by any Person with the intent to lease such property or asset as lessee.

 

“Sanctioned Country” means, at any time, a country or territory which is itself the subject or target of any comprehensive Sanctions (which for purposes of illustration and clarification includes, at the time of this Agreement, Crimea, Cuba, Iran, North Korea, Sudan and Syria).

 

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State, the United Nations Security Council, the European Union or any EU member state, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b).

 

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State or (b) the United Nations Security Council, the European Union, any European Union member state, Her Majesty’s Treasury of the United Kingdom or other relevant sanctions authority.

 

“SEC” means the United States Securities and Exchange Commission or any Governmental Authority succeeding to any of its principal functions.

 

“Securities Act” means the United States Securities Act of 1933.

 

“Specified Ancillary Obligations” means all obligations and liabilities (including interest and fees accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) of any of the Subsidiaries, existing on the Effective Date or arising thereafter, direct or indirect, joint or several, absolute or contingent, matured or unmatured, liquidated or unliquidated, secured or unsecured, arising by contract, operation of law or otherwise, to the Lenders or any of their Affiliates under any Swap Agreement or any Banking Services Agreement; provided that (i) the definition of “Specified Ancillary Obligations” shall not create or include any guarantee by any Loan Party of any Excluded Swap Obligations of such Loan Party for purposes of determining any obligations of any Loan Party and (ii) obligations arising under Permitted Call Spread Swap Agreements shall not be considered Specified Ancillary Obligations.

 

“Specified Swap Obligation” means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act or any rules or regulations promulgated thereunder.

 

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve, liquid asset, fees or similar requirements (including any marginal, special, emergency or supplemental reserves or other requirements) established by any central bank, monetary authority, the Board, the Financial Conduct Authority, the Prudential Regulation Authority, the European Central Bank or other Governmental Authority for any category of deposits or liabilities customarily used to fund loans in the applicable currency, expressed in the case of each such requirement as a decimal.  Such reserve, liquid asset, fees or similar requirements shall include those imposed pursuant to Regulation D of the Board.  Eurocurrency Loans shall be deemed to be subject to such reserve, liquid asset, fee or similar requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under any applicable law, rule or regulation, including Regulation D of the

 

26

 

Board.  The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve, liquid asset or similar requirement.

 

“subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, Controlled or held.

 

“Subsidiary” means any subsidiary of the Company.

 

“Subsidiary Borrower” means (i) Regeneron Healthcare Solutions, Inc, a New York corporation, (ii) Regeneron Genetics Center LLC, a Delaware limited liability company, (iii) the Initial Irish Borrowers, (iv) the Initial Dutch Borrower and (v) any Eligible Subsidiary that becomes a Subsidiary Borrower pursuant to Section 2.23 and, in the case of each of the foregoing, that has not ceased to be a Subsidiary Borrower pursuant to such Section.

 

“Subsidiary Guarantor” means each Material Domestic Subsidiary that is a party to the Subsidiary Guaranty.  The Subsidiary Guarantors on the Effective Date (if any) are identified as such in Schedule 3.01 hereto.

 

“Subsidiary Guaranty” means that certain Guaranty in the form of Exhibit G (including any and all supplements thereto) and executed by each Subsidiary Guarantor party thereto, as amended, restated, supplemented or otherwise modified from time to time.

 

“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Company or the Subsidiaries shall be a Swap Agreement.

 

“Swap Obligations” means any and all obligations of the Company or any Subsidiary, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (a) any and all Swap Agreements permitted hereunder with a Lender or an Affiliate of a Lender, and (b) any and all cancellations, buy backs, reversals, terminations or assignments of any such Swap Agreement transaction.

 

“Swingline Borrower” means (a) the Company, (b) the Initial Dutch Borrower and (c) any other Borrower requested by the Company and approved in writing by the Swingline Lender and the Administrative Agent in their discretion.

 

“Swingline Exposure” means, at any time, the aggregate principal amount of all Swingline Loans outstanding at such time.  The Swingline Exposure of any Lender at any time shall be its Applicable Percentage of the total Swingline Exposure at such time.

 

27

 

“Swingline Lender” means JPMorgan Chase Bank, N.A., in its capacity as lender of Swingline Loans hereunder.

 

“Swingline Loan” means a Loan made pursuant to Section 2.05.

 

“TARGET2” means the Trans-European Automated Real-time Gross Settlement Express Transfer (TARGET2) payment system (or, if such payment system ceases to be operative, such other payment system (if any) reasonably determined by the Administrative Agent to be a suitable replacement) for the settlement of payments in euro.

 

“TARGET2 Day” means a day that TARGET2 is open for the settlement of payments in euro.

 

“Tax Abatement Transactions” means a transaction between the Company or any of its Subsidiaries, on the one hand, and a Related Municipal Party, on the other hand (and, if applicable, other Person(s)), entered into for the purposes of reducing certain of the Company’s or any Subsidiary’s Tax liabilities through (a) the sale, other transfer, lease or license to such Related Municipal Party of title to or an interest in real property, fixtures, equipment, other fixed or capital assets or other related assets of the Company or such Subsidiary, (b) the granting to such Related Municipal Party of Liens on real property, fixtures, equipment, other fixed or capital assets or other related assets of the Company or such Subsidiary, (c) a Sale and Leaseback Transaction or other transfer and licensing arrangement between the Company or such Subsidiary and such Related Municipal Party (and, if applicable, such other Person(s)) with respect to real property, fixtures, equipment, other fixed or capital assets or other related assets of the Company or such Subsidiary, (d) PILOT agreements or (e) any combination of the foregoing or through arrangements similar thereto.

 

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

“Total Leverage Ratio” has the meaning assigned to such term in Section 6.07(a).

 

“Transactions” means the execution, delivery and performance by the Loan Parties of this Agreement and the other Loan Documents, the borrowing of Loans and other credit extensions, the use of the proceeds thereof and the issuance of Letters of Credit hereunder.

 

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

 

“U.S. Person” means a “United States person” within the meaning of Section 7701(a)(30) of the Code.

 

“U.S. Tax Compliance Certificate” has the meaning assigned to such term in Section 2.17(f)(ii)(B)(3).

 

“UCC” means the Uniform Commercial Code as in effect from time to time in any applicable jurisdiction or any other laws of any jurisdiction which are required to be applied in connection with the issue of creation, perfection or priority of security interests.

 

28

 

“wholly-owned Subsidiary” means a Subsidiary with respect to which 100% of the issued and outstanding Equity Interests are owned directly or indirectly by the Company (other than (x) directors’ qualifying shares; (y) shares issued to foreign nationals to the extent required by applicable law; and (z) shares held by a Person on trust for, or otherwise where the beneficial interest is held by, the Company (directly or indirectly)).

 

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

 

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

 

SECTION 1.03. Terms Generally.  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  The word “law” shall be construed as referring to all statutes, rules, regulations, codes and other laws (including official rulings and interpretations thereunder having the force of law or with which affected Persons customarily comply), and all judgments, orders and decrees, of all Governmental Authorities.  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, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, restatements, supplements or modifications set forth herein), (b) any definition of or reference to any statute, rule or regulation shall be construed as referring thereto as from time to time amended, supplemented or otherwise modified (including by succession of comparable successor laws), (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns (subject to any restrictions on assignment set forth herein) and, in the case of any Governmental Authority, any other Governmental Authority that shall have succeeded to any or all functions thereof, (d) 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, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

 

SECTION 1.04. Accounting Terms; GAAP; Pro Forma Calculations.  (a) Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Company notifies the Administrative Agent that the Company requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Company that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision  amended in accordance herewith.  Notwithstanding any other provision contained herein, (i) all terms of an

 

29

 

accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made (a) without giving effect to any election under Accounting Standards Codification 825-10-25 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Company or any Subsidiary at “fair value”, as defined therein, and (b) without giving effect to any treatment of Indebtedness in respect of convertible debt instruments under Accounting Standards Codification 470-20 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof and (ii) any obligations relating to a lease that was accounted for by such Person as an operating lease as of the Effective Date (including, without limitation, any facility lease obligations of the Company and its Subsidiaries related to leases of laboratory and office space at facilities in Tarrytown, New York) and any similar lease entered into after the Effective Date by such Person shall be deemed to be obligations relating to an operating lease and not as Capital Lease Obligations under this Agreement.

 

(b)  All pro forma computations required to be made hereunder giving effect to any Acquisition or disposition, or issuance, incurrence or assumption of Indebtedness, or other transaction shall in each case be calculated after giving pro forma effect thereto (and, in the case of any pro forma computation made hereunder, to determine whether such Acquisition, disposition or issuance, incurrence or assumption of Indebtedness or other transaction is permitted to be consummated hereunder) immediately after giving effect to such Acquisition, disposition or issuance, incurrence or assumption of Indebtedness (and to any other such transaction consummated since the first day of the period for which such pro forma computation is being made and on or prior to the date of such computation) as if such transaction had occurred on the first day of the period of four consecutive fiscal quarters ending with the most recent fiscal quarter for which financial statements shall have been delivered pursuant to Section 5.01(a) or 5.01(b) (or, prior to the delivery of any such financial statements, ending with the last fiscal quarter included in the financial statements referred to in Section 3.04(a)), and, to the extent applicable, to the historical earnings and cash flows associated with the assets acquired or disposed of, any related incurrence or reduction of Indebtedness and any related cost savings, operating expense reductions and synergies, all in accordance with (and, in the case of cost savings, operating expense reductions and synergies, to the extent permitted by) Article 11 of Regulation S-X under the Securities Act; provided that no pro forma computation required to be made hereunder shall make or result in any pro forma adjustment to Consolidated EBITDA for any Drug Acquisition or Exclusive License. If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Swap Agreement applicable to such Indebtedness).

 

ARTICLE II

 

The Credits

 

SECTION 2.01. Commitments.  Subject to the terms and conditions set forth herein, each Lender (severally and not jointly) agrees to make Revolving Loans to the Borrowers severally in Agreed Currencies from time to time during the Availability Period in an aggregate principal amount that will not result in (a) subject to Sections 2.04 and 2.11(b), the Dollar Amount of such Lender’s Revolving Credit Exposure exceeding such Lender’s Commitment or (b) subject to Sections 2.04 and 2.11(b), the sum of the Dollar Amount of the total Revolving Credit Exposures exceeding the Aggregate Commitment.  Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrowers may borrow, prepay and reborrow Revolving Loans.

 

30

 

SECTION 2.02. Loans and Borrowings.  (a) Each Revolving Loan (other than a Swingline Loan) shall be made as part of a Borrowing consisting of Revolving Loans made by the Lenders ratably in accordance with their respective Commitments.  The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.  Any Swingline Loan shall be made in accordance with the procedures set forth in Section 2.05.

 

(b)                                 Subject to Section 2.14, each Revolving Borrowing shall be comprised entirely of ABR Loans or Eurocurrency Loans as the relevant Borrower may request in accordance herewith; provided that each ABR Loan shall only be made in Dollars and no ABR Loan shall be made to a Designated Foreign Subsidiary Borrower.  Each Swingline Loan shall be an ABR Loan.  Each Lender at its option may make any Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan (and in the case of an Affiliate, the provisions of Sections 2.14, 2.15, 2.16 and 2.17 shall apply to such Affiliate to the same extent as to such Lender); provided that any exercise of such option shall not affect the obligation of the relevant Borrower to repay such Loan in accordance with the terms of this Agreement.

 

(c)                                  At the commencement of each Interest Period for any Eurocurrency Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $1,000,000 (or, if such Borrowing is denominated in a Foreign Currency, 1,000,000 units of such currency) and not less than $10,000,000 (or, if such Borrowing is denominated in a Foreign Currency, 10,000,000 units of such currency).  At the time that each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of $1,000,000 and not less than $10,000,000; provided that an ABR Revolving Borrowing may be in an aggregate amount that is equal to the entire unused balance of the Aggregate Commitment or that is required to finance the reimbursement of an LC Disbursement as contemplated by Section 2.06(e).  Each Swingline Loan shall be in an amount that is an integral multiple of $1,000,000 and not less than $10,000,000.  Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than a total of six (6) Eurocurrency Borrowings outstanding.

 

(d)                                 Notwithstanding any other provision of this Agreement, no Borrower shall be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.

 

(e)                                  Any Credit Event to any Dutch Borrower shall at all times be provided by a Lender that is a Dutch Non-Public Lender.

 

SECTION 2.03. Requests for Revolving Borrowings.  To request a Revolving Borrowing, the applicable Borrower, together with the Company in the case of a Revolving Borrowing by a Subsidiary Borrower, shall notify the Administrative Agent of such request (a) by irrevocable written notice (via a written Borrowing Request signed by the applicable Borrower, together with the Company in the case of a Revolving Borrowing by a Subsidiary Borrower, promptly followed by telephonic confirmation of such request) in the case of a Eurocurrency Borrowing, not later than 12:00 noon, Local Time, three (3) Business Days (in the case of a Eurocurrency Borrowing denominated in Dollars) or by irrevocable written notice (via a written Borrowing Request signed by such Borrower, together with the Company in the case of a Revolving Borrowing by a Subsidiary Borrower)  not later than 12:00 noon, Local Time, four (4) Business Days (in the case of a Eurocurrency Borrowing denominated in a Foreign Currency), in each case before the date of the proposed Borrowing or (b) by telephone in the case of an ABR Borrowing, not later than 11:00 a.m., New York City time, on the date of the proposed Borrowing.

 

31

 

Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing Request signed by the applicable Borrower, together with the Company in the case of a Revolving Borrowing by a Subsidiary Borrower.  Each such telephonic and written Borrowing Request shall specify the following information in compliance with Section 2.02:

 

(i)                                     the name of the applicable Borrower;

 

(ii)                                  the aggregate principal amount of the requested Borrowing;

 

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

 

(iv)                              whether such Borrowing is to be an ABR Borrowing or a Eurocurrency Borrowing;

 

(v)                                 in the case of a Eurocurrency Borrowing, the Agreed Currency and initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and

 

(vi)                              the location and number of the applicable Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of Section 2.07.

 

If no election as to the Type of Revolving Borrowing is specified, then, in the case of a Borrowing denominated in Dollars (other than a Designated Loan), the requested Revolving Borrowing shall be an ABR Borrowing.  If no Interest Period is specified with respect to any requested Eurocurrency Revolving Borrowing, then the relevant Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

 

SECTION 2.04. Determination of Dollar Amounts.  The Administrative Agent will determine the Dollar Amount of:

 

(a)                                 each Eurocurrency Borrowing as of the date two (2) Business Days prior to the date of such Borrowing or, if applicable, the date of conversion/continuation of any Borrowing as a Eurocurrency Borrowing,

 

(b)                                 the LC Exposure as of the date of each request for the issuance, amendment, renewal or extension of any Letter of Credit, and

 

(c)                                  all outstanding Credit Events on and as of the last Business Day of each calendar quarter and, during the continuation of an Event of Default, on any other Business Day elected by the Administrative Agent in its discretion or upon instruction by the Required Lenders.

 

Each day upon or as of which the Administrative Agent determines Dollar Amounts as described in the preceding clauses (a), (b) and (c) is herein described as a “Computation Date” with respect to each Credit Event for which a Dollar Amount is determined on or as of such day.

 

SECTION 2.05. Swingline Loans.  (a) Subject to the terms and conditions set forth herein, the Swingline Lender may in its sole discretion make Swingline Loans in Dollars to any Swingline Borrower from time to time during the Availability Period, in an aggregate principal amount at any time

 

32

 

outstanding that will not result in (i) the aggregate principal amount of outstanding Swingline Loans exceeding $25,000,000 or (ii) the Dollar Amount of the total Revolving Credit Exposures exceeding the Aggregate Commitment; provided that the Swingline Lender shall not be required to make a Swingline Loan to refinance an outstanding Swingline Loan.  Within the foregoing limits and subject to the terms and conditions set forth herein, each Swingline Borrower may borrow and reborrow Swingline Loans and prepay any Swingline Loan made to it.

 

(b)                                 To request a Swingline Loan, the applicable Swingline Borrower shall notify the Administrative Agent of such request by telephone (confirmed promptly by telecopy to the Administrative Agent of a written Borrowing Request signed by the applicable Swingline Borrower, together with the Company in the case of a request for a Swingline Loan by a Subsidiary Borrower), not later than 1:00 p.m., New York City time, on the day of a proposed Swingline Loan.  Each such notice shall be irrevocable and shall specify the requested date (which shall be a Business Day), the applicable Swingline Borrower requesting such Swingline Loan and amount of the requested Swingline Loan.  The Administrative Agent will promptly advise the Swingline Lender of any such notice received from any Swingline Borrower.  The Swingline Lender shall make each Swingline Loan available to the applicable Swingline Borrower by means of a credit to the general deposit account of such Swingline Borrower with the Swingline Lender or to such other account as directed in writing by such Swingline Borrower in the Borrowing Notice (or, in the case of a Swingline Loan made to finance the reimbursement of an LC Disbursement as provided in Section 2.06(e), by remittance to the relevant Issuing Bank) by 3:00 p.m., New York City time, on the requested date of such Swingline Loan.  Any Swingline Loan made to finance the reimbursement of an LC Disbursement shall be for the account of the Company.

 

(c)                                  The Swingline Lender may by written notice given to the Administrative Agent not later than 10:00 a.m., New York City time, on any Business Day require the Lenders to acquire participations on such Business Day in all or a portion of the Swingline Loans outstanding.  Such notice shall specify the aggregate amount of Swingline Loans in which Lenders will participate.  Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Lender, specifying in such notice such Lender’s Applicable Percentage of such Swingline Loan or Loans.  Each Lender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of the Swingline Lender, such Lender’s Applicable Percentage of such Swingline Loan or Loans.  Each Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.  Each Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, in the same manner as provided in Section 2.07 with respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Lenders.  The Administrative Agent shall notify the applicable Swingline Borrower of any participations in any Swingline Loan acquired pursuant to this paragraph, and thereafter payments made by such Swingline Borrower in respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender.  Any amounts received by the Swingline Lender from any Swingline Borrower (or other party on behalf of any Swingline Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent; any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative

 

33

 

Agent to the Lenders that shall have made their payments pursuant to this paragraph and to the Swingline Lender, as their interests may appear; provided that any such payment so remitted shall be repaid to the Swingline Lender or to the Administrative Agent, as applicable, if and to the extent such payment is required to be refunded to any Swingline Borrower for any reason.  The purchase of participations in a Swingline Loan pursuant to this paragraph shall not relieve any Swingline Borrower of any default in the payment of any Swingline Loan made to such Swingline Borrower.

 

SECTION 2.06. Letters of Credit.  (a) General.  Subject to the terms and conditions set forth herein, the Company or any Subsidiary Borrower may request the issuance of Letters of Credit denominated in Agreed Currencies as the applicant thereof for the support of its or its Subsidiaries’ obligations, in a form reasonably acceptable to the Administrative Agent and the relevant Issuing Bank, at any time and from time to time during the Availability Period.  In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Company or any Subsidiary Borrower to, or entered into by the Company or any Subsidiary Borrower with, the relevant Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control.  Notwithstanding anything herein to the contrary, no Issuing Bank shall have any obligation hereunder to issue, and shall not issue, any Letter of Credit the proceeds of which would be made available to any Person (i) to fund any activity or business of or with any Sanctioned Person, or in any country or territory that, at the time of such funding, is the subject of any Sanctions or (ii) in any manner that would result in a violation of any Sanctions by any party to this Agreement.  The Company unconditionally and irrevocably agrees that, in connection with any Letter of Credit issued for the support of any Subsidiary’s (including any Subsidiary Borrower’s) obligations as provided in the first sentence of this paragraph, the Company will be fully responsible for the reimbursement of LC Disbursements in accordance with the terms hereof, the payment of interest thereon and the payment of fees due under Section 2.12(b) to the same extent as if it were the sole account party in respect of such Letter of Credit (the Company hereby irrevocably waiving any defenses that might otherwise be available to it as a guarantor or surety of the obligations of such a Subsidiary that is an account party in respect of any such Letter of Credit).

 

(b)                                 Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.  To request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the Company (or applicable Subsidiary Borrower, together with the Company) shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by the relevant Issuing Bank) to the relevant Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance, amendment, renewal or extension) a notice signed by the Company (or if such Letter of Credit or amendment, renewal or extension is being requested by a Subsidiary Borrower, signed by such Subsidiary Borrower and the Company) requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the amount of such Letter of Credit, the Agreed Currency applicable thereto, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit.  If requested by an Issuing Bank, the Company (or applicable Subsidiary Borrower, together with the Company) also shall submit a letter of credit application on such Issuing Bank’s standard form in connection with any request for a Letter of Credit.  A Letter of Credit shall be issued, amended, renewed or extended only if (and upon issuance, amendment, renewal or extension of each Letter of Credit the Company shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or extension (i) subject to Sections 2.04 and 2.11(b), the Dollar Amount of the LC Exposure shall not exceed

 

34

 

$100,000,000, (ii) subject to Sections 2.04 and 2.11(b), the sum of the Dollar Amount of the total Revolving Credit Exposures shall not exceed the Aggregate Commitment and (iii) subject to Section 2.04, the Dollar Amount of the aggregate face amount of all Letters of Credit issued and then outstanding by any Issuing Bank shall not exceed such Issuing Bank’s Applicable LC Sublimit, unless such excess is consented to, or otherwise waived, by such Issuing Bank in its sole discretion.

 

(c)                                  Expiration Date.  Each Letter of Credit shall expire (or be subject to termination by notice from the relevant Issuing Bank to the beneficiary thereof) at or prior to the close of business on the earlier of (i) the date one year (or such longer period as may be consented to by the relevant Issuing Bank) after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (ii) the date that is five (5) Business Days prior to the Maturity Date; provided that any Letter of Credit with a one-year tenor may contain customary automatic renewal provisions agreed upon by the Company or the applicable Subsidiary Borrower and the relevant Issuing Bank that provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the date referenced in clause (ii) above), subject to a right on the part of such Issuing Bank to prevent any such renewal from occurring by giving notice to the beneficiary in advance of any such renewal.  Notwithstanding the foregoing, any Letter of Credit may expire no later than one year after the Maturity Date so long as the Company cash collateralizes an amount equal to 105% of the face amount of such Letter of Credit, concurrently with the issuance of such Letter of Credit, in the manner described in Section 2.06(j) and otherwise on terms and conditions reasonably acceptable to the relevant Issuing Bank and the Administrative Agent.

 

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

 

(e)                                  Reimbursement.  If the relevant Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Company shall reimburse such LC Disbursement by paying to the Administrative Agent in Dollars the Dollar Amount equal to such LC Disbursement, calculated as of the date such Issuing Bank made such LC Disbursement (or if such Issuing Bank shall so elect in its sole discretion by notice to the Company, in such other Agreed Currency which was paid by such Issuing Bank pursuant to such LC Disbursement in an amount equal to such LC Disbursement) not later than 12:00 noon, Local Time, on the Business Day immediately following the Business Day that the Company shall have received notice of such LC Disbursement; provided that the Company may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 or 2.05 that such payment be financed with (i) to

 

35

 

the extent such LC Disbursement was made in Dollars, an ABR Revolving Borrowing, Eurocurrency Revolving Borrowing or Swingline Loan in Dollars in an amount equal to such LC Disbursement or (ii) to the extent such LC Disbursement was made in a Foreign Currency, a Eurocurrency Revolving Borrowing in such Foreign Currency in an amount equal to such LC Disbursement and, in each case, to the extent so financed, the Company’s obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Borrowing, Eurocurrency Revolving Borrowing or Swingline Loan, as applicable.  If the Company fails to make such payment when due, the Administrative Agent shall notify each Lender of the applicable LC Disbursement, the payment then due from the Company in respect thereof and such Lender’s Applicable Percentage thereof.  Promptly following receipt of such notice, each Lender shall pay to the Administrative Agent its Applicable Percentage of the payment then due from the Company, in the same manner as provided in Section 2.07 with respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the relevant Issuing Bank the amounts so received by it from the Lenders.  Promptly following receipt by the Administrative Agent of any payment from the Company pursuant to this paragraph, the Administrative Agent shall distribute such payment to the relevant Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to reimburse such Issuing Bank, then to such Lenders and such Issuing Bank as their interests may appear.  Any payment made by a Lender pursuant to this paragraph to reimburse the relevant Issuing Bank for any LC Disbursement (other than the funding of ABR Revolving Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and shall not relieve the Company of its obligation to reimburse such LC Disbursement.  If the Company’s reimbursement of, or obligation to reimburse, any amounts in any Foreign Currency would subject the Administrative Agent, any Issuing Bank or any Lender to any stamp duty, ad valorem charge or similar tax that would not be payable if such reimbursement were made or required to be made in Dollars, the Company shall, at its option, either (x) pay the amount of any such tax requested by the Administrative Agent, the relevant Issuing Bank or the relevant Lender or (y) reimburse each LC Disbursement made in such Foreign Currency in Dollars, in an amount equal to the Equivalent Amount, calculated using the applicable Exchange Rates, on the date such LC Disbursement is made, of such LC Disbursement.

 

(f)                                   Obligations Absolute.  The Company’s obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by the relevant Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Company’s obligations hereunder.  Neither the Administrative Agent, the Lenders nor the Issuing Banks, nor any of their Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the relevant Issuing

 

36

 

Bank; provided that the foregoing shall not be construed to excuse the relevant Issuing Bank from liability to the Company to the extent of any direct damages (as opposed to special, indirect, consequential or punitive damages, claims in respect of which are hereby waived by the Company to the extent permitted by applicable law) suffered by the Company that are caused by such Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof.  The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of any Issuing Bank (as finally determined by a court of competent jurisdiction), such Issuing Bank shall be deemed to have exercised care in each such determination.  In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, each Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.

 

(g)                                  Disbursement Procedures.  Each Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit.  Each Issuing Bank shall promptly notify the Administrative Agent and the Company by telephone (confirmed by telecopy) of such demand for payment and whether such Issuing Bank has made or will make an LC Disbursement thereunder; provided that any failure to give or delay in giving such notice shall not relieve the Company of its obligation to reimburse such Issuing Bank and the Lenders with respect to any such LC Disbursement.

 

(h)                                 Interim Interest.  If any Issuing Bank shall make any LC Disbursement, then, unless the Company shall reimburse such LC Disbursement in full within one Business Day of the date on which such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is made to but excluding the date that the reimbursement is due and payable, at the rate per annum then applicable to ABR Revolving Loans (or in the case such LC Disbursement is denominated in a Foreign Currency, at the Overnight Foreign Currency Rate for such Agreed Currency plus the then effective Applicable Rate with respect to Eurocurrency Revolving Loans) and such interest shall be due and payable on the date when such reimbursement is payable; provided that, if the Company fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then Section 2.13(c) shall apply.  Interest accrued pursuant to this paragraph shall be for the account of the relevant Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant to paragraph (e) of this Section to reimburse such Issuing Bank shall be for the account of such Lender to the extent of such payment.

 

(i)                                     Replacement of Issuing Bank.  Any Issuing Bank may be replaced at any time by written agreement among the Company, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.  The Administrative Agent shall notify the Lenders of any such replacement of any Issuing Bank.  At the time any such replacement shall become effective, the Company shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.12(b).  From and after the effective date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require.  After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with

 

37

 

respect to Letters of Credit then outstanding and issued by it prior to such replacement, but shall not be required to issue additional Letters of Credit.

 

(j)                                    Cash Collateralization.  If any Event of Default shall occur and be continuing, on the Business Day that the Company receives notice from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans has been accelerated, Lenders with LC Exposure representing greater than 50% of the total LC Exposure) demanding the deposit of cash collateral pursuant to this paragraph, the Company shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders (the “LC Collateral Account”), an amount in cash equal to 105% of the Dollar Amount of the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that (i) the portions of such amount attributable to undrawn Foreign Currency Letters of Credit or LC Disbursements in a Foreign Currency that the Company is not late in reimbursing shall be deposited in the applicable Foreign Currencies in the actual amounts of such undrawn Letters of Credit and LC Disbursements and (ii) the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Company described in clause (h) or (i) of Article VII.  For the purposes of this paragraph, the Foreign Currency LC Exposure shall be calculated using the applicable Exchange Rate on the date notice demanding cash collateralization is delivered to the Company.  The Company also shall deposit cash collateral pursuant to this paragraph as and to the extent required by Section 2.11(b).  Such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the Obligations.  The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account.  Other than any interest earned on the investment of such deposits, which investments shall be made at the option of the Company with the consent of the Administrative Agent in its reasonable discretion and at the Company’s risk and expense, such deposits shall not bear interest.  Interest or profits, if any, on such investments shall accumulate in such account.  Moneys in such account shall be applied by the Administrative Agent to reimburse the relevant Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Company for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Lenders with LC Exposure  representing greater than 50% of the total LC Exposure), be applied to satisfy other Obligations.  If the Company is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Company within three (3) Business Days after all Events of Default have been cured or waived.  If the Company is required to provide an amount of cash collateral hereunder pursuant to Section 2.11(b), such amount (to the extent not applied as aforesaid) shall be returned to the Company as and to the extent that, after giving effect to such return, the aggregate Revolving Credit Exposures would not exceed the Aggregate Commitment and no Event of Default shall have occurred and be continuing.

 

(k)                                 Issuing Bank Agreements.  Each Issuing Bank agrees that, unless otherwise requested by the Administrative Agent, such Issuing Bank shall report in writing to the Administrative Agent (i) on the first Business Day of each week, the daily activity (set forth by day) in respect of Letters of Credit during the immediately preceding week, including all issuances, extensions, amendments and renewals, all expirations and cancellations and all disbursements and reimbursements, (ii) on or prior to each Business Day on which such Issuing Bank expects to issue, amend, renew or extend any Letter of Credit, the date of such issuance, amendment, renewal or extension, and the aggregate face amount of the Letters of Credit to be issued, amended, renewed or extended by it and outstanding after giving effect to such issuance,

 

38

 

amendment, renewal or extension occurred (and whether the amount thereof changed), it being understood that such Issuing Bank shall not permit any issuance, renewal, extension or amendment resulting in an increase in the amount of any Letter of Credit to occur without first obtaining written confirmation from the Administrative Agent that it is then permitted under this Agreement (such confirmation not to be unreasonably withheld, delayed or conditioned), (iii) on each Business Day on which such Issuing Bank pays any amount in respect of one or more drawings under Letters of Credit, the date of such payment(s) and the amount of such payment(s), (iv) on any Business Day on which the Company fails to reimburse any amount required to be reimbursed to such Issuing Bank on such day, the date of such failure and the amount and currency of such payment in respect of Letters of Credit and (v) on any other Business Day, such other information as the Administrative Agent shall reasonably request.

 

SECTION 2.07. Funding of Borrowings.  (a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds (i) in the case of Loans denominated in Dollars (other than a Designated Loan), by 12:00 noon, New York City time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders and (ii) in the case of each Loan denominated in a Foreign Currency and Designated Loans, by 12:00 noon, Local Time, in the city of the Administrative Agent’s Eurocurrency Payment Office for such currency and at such Eurocurrency Payment Office for such currency; provided that Swingline Loans shall be made as provided in Section 2.05.  The Administrative Agent will make such Loans available to the relevant Borrower by promptly crediting the amounts so received, in like funds, to (x) an account of such Borrower designated by such Borrower in the applicable Borrowing Request, in the case of Loans denominated in Dollars, (y) an account of such Borrower in the relevant jurisdiction and designated by such Borrower in the applicable Borrowing Request, in the case of Loans denominated in a Foreign Currency or (z) such other account designated by such Borrower in the applicable Borrowing Request and reasonably acceptable to the Administrative Agent; provided that ABR Revolving Loans made to finance the reimbursement of an LC Disbursement as provided in Section 2.06(e) shall be remitted by the Administrative Agent to the relevant Issuing Bank.

 

(b)                                 Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing (or in the case of an ABR Borrowing, prior to 12:00 noon, New York City time on the date of such Borrowing) that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the relevant Borrower a corresponding amount.  In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and such Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to such Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation (including without limitation the Overnight Foreign Currency Rate in the case of Loans denominated in a Foreign Currency) or (ii) in the case of such Borrower, the interest rate applicable to ABR Loans.  If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.

 

SECTION 2.08. Interest Elections.  (a) Each Revolving Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurocurrency Revolving Borrowing, shall have an initial Interest Period as specified in such Borrowing Request.  Thereafter, the

 

39

 

relevant Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurocurrency Revolving Borrowing, may elect Interest Periods therefor, all as provided in this Section.  A Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.  This Section shall not apply to Swingline Borrowings, which may not be converted or continued.

 

(b)                                 To make an election pursuant to this Section, the applicable Borrower shall notify the Administrative Agent of such election (by telephone or irrevocable written notice from such Borrower in the case of a Borrowing denominated in Dollars (other than Designated Loans) or by irrevocable written notice (via an Interest Election Request signed by such Borrower) in the case of a Borrowing denominated in a Foreign Currency or a Designated Loan) by the time that a Borrowing Request would be required under Section 2.03 if such Borrower were requesting a Revolving Borrowing of the Type resulting from such election to be made on the effective date of such election.  Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Interest Election Request signed by the relevant Borrower.  Notwithstanding any contrary provision herein, this Section shall not be construed to permit any Borrower to (i) change the currency of any Borrowing, (ii) elect an Interest Period for Eurocurrency Loans that does not comply with Section 2.02(d) or (iii) convert any Borrowing to a Borrowing of a Type not available under such Borrowing.

 

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

 

(i)                                     the name of the applicable Borrower and the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

 

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

 

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

 

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

 

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

 

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

 

40

 

(e)                                  If the relevant Borrower fails to deliver a timely Interest Election Request with respect to a Eurocurrency Revolving Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period (i) in the case of a Borrowing denominated in Dollars (other than Designated Loans), such Borrowing shall be converted to an ABR Borrowing and (ii) in the case of a Borrowing denominated in a Foreign Currency or a Designated Loan in respect of which the applicable Borrower shall have failed to deliver an Interest Election Request prior to the third (3rd) Business Day preceding the end of such Interest Period, such Borrowing shall automatically continue as a Eurocurrency Borrowing in the same Agreed Currency with an Interest Period of one month unless such Eurocurrency Borrowing is or was repaid in accordance with Section 2.11.  Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies the Company, then, so long as an Event of Default is continuing (i) no outstanding Revolving Borrowing denominated in Dollars (other than Designated Loans) may be converted to or continued as a Eurocurrency Borrowing, (ii) unless repaid, each Eurocurrency Revolving Borrowing denominated in Dollars (other than Designated Loans) shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto, but without duplication for interest payments made by any Borrower on such amount and (iii) unless repaid, each Eurocurrency Revolving Borrowing denominated in a Foreign Currency and each Designated Loan shall automatically be continued as a Eurocurrency Borrowing with an Interest Period of one month.

 

SECTION 2.09. Termination and Reduction of Commitments.  (a) Unless previously terminated, the Commitments shall terminate on the Maturity Date.

 

(b)                                 The Company may at any time terminate, or from time to time reduce, the Commitments; provided that (i) each reduction of the Commitments shall be in an amount that is an integral multiple of $1,000,000 and not less than $10,000,000 and (ii) the Company shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.11, the Dollar Amount of the sum of the Revolving Credit Exposures would exceed the Aggregate Commitment.

 

(c)                                  The Company shall notify the Administrative Agent of any election to terminate or reduce the Commitments under paragraph (b) of this Section at least three (3) Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof.  Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof.  Each notice delivered by the Company pursuant to this Section shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Company may state that such notice is conditioned upon the effectiveness of other credit facilities or one or more other events specified therein, in which case such notice may be revoked by the Company (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.  Any termination or reduction of the Commitments shall be permanent.  Each reduction of the Commitments shall be made ratably among the Lenders in accordance with their respective Commitments.

 

SECTION 2.10. Repayment of Loans; Evidence of Debt.  (a) Each Borrower (severally and not jointly) hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Revolving Loan made to such Borrower on the Maturity Date in the currency of such Loan and (ii) in the case of each Swingline Borrower, to the Swingline Lender the then unpaid principal amount of each Swingline Loan made to such Swingline Borrower on the earlier of the Maturity Date and the first date after such Swingline Loan is made to such Swingline Borrower that is the 15th or last day of a calendar month and is at least two (2) Business Days

 

41

 

after such Swingline Loan is made; provided that on each date that a Revolving Borrowing is made, each Swingline Borrower shall repay all Swingline Loans made to such Swingline Borrower then outstanding.

 

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

 

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

 

(d)                                 The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the Obligations.

 

(e)                                  Any Lender may request that Loans made by it to any Borrower be evidenced by a promissory note.  In such event, the relevant Borrower shall prepare, execute and deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in the form attached hereto as Exhibit L.  Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the payee named therein (or, if any such promissory note is a registered note, to such payee and its registered assigns).

 

SECTION 2.11. Prepayment of Loans.

 

(a)                                 Any Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, without premium or penalty (but subject to break funding payments required by Section 2.16) subject to prior notice in accordance with the provisions of this Section 2.11(a).  The applicable Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender) of any prepayment hereunder (i) in the case of prepayment of a Eurocurrency Revolving Borrowing denominated in Dollars (other than Designated Loans), by telephonic notice (promptly followed by written confirmation from such Borrower of such request) not later than 11:00 a.m., Local Time, three (3) Business Days before the date of prepayment, (ii) in the case of prepayment of a Eurocurrency Revolving Borrowing denominated in any Foreign Currency and Designated Loans, by written notice from such Borrower (promptly followed by telephonic confirmation of such request) not later than 11:00 a.m., Local Time, four (4) Business Days before the date of prepayment, (iii) in the case of prepayment of an ABR Revolving Borrowing, by telephonic notice (promptly followed by written confirmation from such Borrower of such request) not later than 11:00 a.m., New York City time, on the date of prepayment or (iv) in the case of prepayment of a Swingline Loan, by telephonic notice (promptly followed by written confirmation from such Borrower of such request) not later than 12:00 noon, New York City time, on the date of prepayment.  Each such notice from any Borrower shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid by such Borrower; provided that any such notice of prepayment delivered by any Borrower may state that such notice is

 

42

 

conditioned upon the effectiveness of other credit facilities or one or more other events specified therein, in which case such notice may be revoked by the applicable Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.  Promptly following receipt of any such notice relating to a Revolving Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof.  Each partial prepayment of any Revolving Borrowing shall be in an amount that would be permitted in the case of an advance of a Revolving Borrowing of the same Type as provided in Section 2.02.  Each prepayment of a Revolving Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing.  Prepayments shall be accompanied by (i) accrued interest to the extent required by Section 2.13 and (ii) break funding payments to the extent required by Section 2.16.

 

(b)                                 If at any time, (i) other than as a result of fluctuations in currency exchange rates, the sum of the aggregate principal Dollar Amount of all of the Revolving Credit Exposures (calculated, with respect to those Credit Events denominated in Foreign Currencies, as of the most recent Computation Date with respect to each such Credit Event) exceeds the Aggregate Commitment or (ii) solely as a result of fluctuations in currency exchange rates, the sum of the aggregate principal Dollar Amount of all of the Revolving Credit Exposures (so calculated) exceeds 105% of the Aggregate Commitment, the Company or the relevant Subsidiary Borrower shall in each case, within one (1) Business Day after receiving notice from the Administrative Agent in respect thereof, repay Borrowings (with respect to any payment made by or required from any Subsidiary Borrower, as directed by such Subsidiary Borrower to repay Borrowings of such Subsidiary Borrower) or cash collateralize LC Exposure in an account with the Administrative Agent pursuant to Section 2.06(j), as applicable, in an aggregate principal amount sufficient to cause the aggregate Dollar Amount of all Revolving Credit Exposures (so calculated) to be less than or equal to the Aggregate Commitment.

 

SECTION 2.12. Fees.  (a) The Company agrees to pay to the Administrative Agent for the account of each Lender a commitment fee, which shall accrue at the applicable Commitment Fee Rate (as specified in the definition of Applicable Rate) on the daily average amount of the Available Revolving Commitment of such Lender during the period from and including the Effective Date to but excluding the date on which such Commitment terminates.  Accrued commitment fees shall be payable in arrears on the last day of March, June, September and December of each year and on the date on which the Commitments terminate, commencing on the first such date to occur after the Effective Date; provided that any commitment fees accruing after the date on which the Commitments terminate shall be payable on demand.  All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

 

(b)                                 The Company agrees to pay (i) to the Administrative Agent for the account of each Lender a participation fee with respect to its participations in Letters of Credit, which shall accrue at the same Applicable Rate used to determine the interest rate applicable to Eurocurrency Revolving Loans on the average daily Dollar Amount of such Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the Effective Date to but excluding the later of the date on which such Lender’s Commitment terminates and the date on which such Lender ceases to have any LC Exposure and (ii) to the relevant Issuing Bank for its own account a fronting fee, which shall accrue at the rate of 0.125% per annum on the average daily Dollar Amount of the LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) attributable to Letters of Credit issued by such Issuing Bank during the period from and including the Effective Date to but excluding the later of the date of termination of the Commitments and the date on which there ceases to be any LC Exposure, as well as such Issuing Bank’s standard fees and commissions with respect to the issuance, amendment, cancellation, negotiation, transfer, presentment, renewal

 

43

 

or extension of any Letter of Credit or processing of drawings thereunder.  Participation fees and fronting fees accrued through and including the last day of March, June, September and December of each year shall be payable on or prior to the third (3rd) Business Day following such last day, commencing on the first such date to occur after the Effective Date; provided that all such fees shall be payable on the date on which the Commitments terminate and any such fees accruing after the date on which the Commitments terminate shall be payable on demand.  Any other fees payable to any Issuing Bank pursuant to this paragraph shall be payable within ten (10) days after demand.  All participation fees and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  Participation fees and fronting fees in respect of Letters of Credit denominated in Dollars shall be paid in Dollars, and participation fees and fronting fees in respect of Letters of Credit denominated in a Foreign Currency shall be paid in such Foreign Currency.

 

(c)                                  The Company agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between the Company and the Administrative Agent from time to time.

 

(d)                                 All fees payable hereunder shall be paid on the dates due, in Dollars (except as otherwise expressly provided in this Section 2.12) and immediately available funds, to the Administrative Agent (or to each Issuing Bank, in the case of fees payable to it) for distribution, in the case of commitment fees and participation fees, to the Lenders.  Fees paid shall not be refundable under any circumstances.

 

SECTION 2.13. Interest.  (a) The Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear interest at the Alternate Base Rate plus the Applicable Rate.

 

(b)                                 The Loans comprising each Eurocurrency Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.

 

(c)                                  Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by any Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section or (ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section.

 

(d)                                 Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable by the applicable Borrower(s) on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurocurrency Revolving Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

 

(e)                                  All interest hereunder shall be computed on the basis of a year of 360 days, except that interest (i) computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year) and (ii) for Borrowings denominated in Pounds Sterling

 

44

 

shall be computed on the basis of a year of 365 days, and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

 

SECTION 2.14. Alternate Rate of Interest.

 

(a)                                 If at the time that the Administrative Agent shall seek to determine the LIBOR Screen Rate on the Quotation Day for any Interest Period for a Eurocurrency Borrowing the LIBOR Screen Rate shall not be available for such Interest Period and/or for the applicable currency with respect to such Eurocurrency Borrowing for any reason, and the Administrative Agent shall reasonably determine that it is not possible to determine the Interpolated Rate (which conclusion shall be conclusive and binding absent manifest error), then the Reference Bank Rate shall be the LIBO Rate for such Interest Period for such Eurocurrency Borrowing; provided that if the Reference Bank Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement; provided, further, however, that if less than two Reference Banks shall supply a rate to the Administrative Agent for purposes of determining the LIBO Rate for such Eurocurrency Borrowing, (i) if such Borrowing shall be requested in Dollars (other than Designated Loans), then such Borrowing shall be made as an ABR Borrowing at the Alternate Base Rate and (ii) if such Borrowing shall be requested in any Foreign Currency or if such Borrowing is a Designated Loan, the LIBO Rate shall be equal to the rate determined by the Administrative Agent in its reasonable discretion and consented to in writing by the Company and the Required Lenders (the “Alternative Rate”); provided, however, that until such time as the Alternative Rate shall be determined and so consented to by the Company and the Required Lenders, Borrowings shall not be available in such Foreign Currency.

 

(b)                                 If prior to the commencement of any Interest Period for a Eurocurrency Borrowing:

 

(i)                                     the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for a Loan in the applicable currency or for the applicable Interest Period; or

 

(ii)                                  the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for a Loan in the applicable currency or for the applicable Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period;

 

then the Administrative Agent shall give notice thereof to the Company and any applicable Subsidiary Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent notifies the Company and any applicable Subsidiary Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Revolving Borrowing to, or continuation of any Revolving Borrowing as, a Eurocurrency Borrowing in the applicable currency or for the applicable Interest Period, as the case may be, shall be ineffective, (ii) if any Borrowing Request requests a Eurocurrency Revolving Borrowing in Dollars (other than a Designated Loan), such Borrowing shall be made as an ABR Borrowing and (iii) if any Borrowing Request requests a Eurocurrency Borrowing in a Foreign Currency or a Designated Loan, then the LIBO Rate for such Eurocurrency Borrowing shall be the Alternative Rate; provided that if the

 

45

 

circumstances giving rise to such notice affect only one Type of Borrowings, then the other Type of Borrowings shall be permitted.

 

SECTION 2.15. Increased Costs.  (a) If any Change in Law shall:

 

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

 

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

 

(iii)                               subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;

 

and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, continuing, converting into or maintaining any Loan or of maintaining its obligation to make any such Loan or to increase the cost to such Lender, such Issuing Bank or such other Recipient of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender, such Issuing Bank or such other Recipient hereunder, whether of principal, interest or otherwise, then the applicable Borrower will pay to such Lender, such Issuing Bank or such other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, such Issuing Bank or such other Recipient, as the case may be, for such additional costs incurred or reduction suffered as reasonably determined by the Administrative Agent, such Lender or such Issuing Bank (which determination shall be made in good faith (and not on an arbitrary or capricious basis) and generally consistent with similarly situated customers of the Administrative Agent, such Lender or such Issuing Bank, as applicable, under agreements having provisions similar to this Section 2.15, after consideration of such factors as the Administrative Agent, such Lender or such Issuing Bank, as applicable, then reasonably determines to be relevant).

 

(b)                                 If any Lender or any Issuing Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or such Issuing Bank’s capital or on the capital of such Lender’s or such Issuing Bank’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or such Issuing Bank’s policies and the policies of such Lender’s or such Issuing Bank’s holding company with respect to capital adequacy and liquidity), then from time to time the applicable Borrower will pay to such Lender or such Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s holding company for any such reduction suffered as reasonably determined by the Administrative Agent, such Lender or such Issuing Bank (which determination shall be made in good faith (and not on an arbitrary or capricious basis) and generally consistent with similarly situated customers of the Administrative

 

46

 

Agent, such Lender or such Issuing Bank, as applicable, under agreements having provisions similar to this Section 2.15, after consideration of such factors as the Administrative Agent, such Lender or such Issuing Bank, as applicable, then reasonably determines to be relevant).

 

(c)                                  A certificate of a Lender or an Issuing Bank setting forth, in reasonable detail, the basis and calculation of the amount or amounts necessary to compensate such Lender or such Issuing Bank or its respective holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Company and shall be conclusive absent manifest error.  The Company shall pay, or, subject to Section 2.23(b), cause the other applicable Borrowers to pay, such Lender or such Issuing Bank, as the case may be, the amount shown as due on any such certificate within thirty (30) days after receipt thereof.

 

(d)                                 Failure or delay on the part of any Lender or any Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or such Issuing Bank’s right to demand such compensation; provided that the Company shall not be required to compensate a Lender or an Issuing Bank pursuant to this Section for any increased costs or reductions incurred more than 120 days prior to the date that such Lender or such Issuing Bank, as the case may be, notifies the Company of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or such Issuing Bank’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 120-day period referred to above shall be extended to include the period of retroactive effect thereof.

 

SECTION 2.16. Break Funding Payments.  In the event of (a) the payment of any principal of any Eurocurrency Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default or as a result of any prepayment pursuant to Section 2.11), (b) the conversion of any Eurocurrency Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurocurrency Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.11(a) and is revoked in accordance therewith) or (d) the assignment of any Eurocurrency Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Company pursuant to Section 2.19, then, in any such event, the applicable Borrower(s) shall compensate each Lender for the loss, cost and expense attributable to such event (other than loss of anticipated profits).  Such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Loan (but not the Applicable Rate applicable thereto), for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for deposits in the relevant currency of a comparable amount and period from other banks in the eurocurrency market.  A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section, and setting forth in reasonable detail the calculations used by such Lender to determine such amount or amounts, shall be delivered to the applicable Borrower and shall be conclusive absent manifest error.  The applicable Borrower shall pay such Lender the amount shown as due on any such certificate within thirty (30) days after receipt thereof; provided that no Borrower shall be required to compensate a Lender pursuant to this Section for any amounts under this Section 2.16 incurred more than 120 days prior to the date that such Lender notifies such Borrower of such amount and of such Lender’s intention to claim compensation therefor.

 

47

 

SECTION 2.17. Taxes.  (a) Payments Free of Taxes.  Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law.  If any applicable law (as determined in the good faith discretion of an applicable withholding agent) requires the deduction or withholding of any Tax from any such payment by a withholding agent, then the applicable withholding agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 2.17(a)) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

 

(b)                                 Payment of Other Taxes by the Borrowers.  The relevant Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

 

(c)                                  Evidence of Payments.  As soon as practicable after any payment of Taxes by any Loan Party or by the Administrative Agent to a Governmental Authority pursuant to this Section 2.17, such Loan Party shall deliver to the Administrative Agent or the Administrative Agent shall deliver to the applicable Loan Party, as the case may be, the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent or the applicable Loan Party, as the case may be.

 

(d)                                 Indemnification by the Loan Parties.  The Loan Parties shall indemnify each Recipient, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 2.17) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable and documented out-of-pocket expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate setting forth in reasonable detail the basis and calculation of the amount of such payment or liability delivered to the relevant Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

 

(e)                                  Indemnification by the Lenders.  Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 9.04(c) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error.  Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).

 

48

 

(f)                                   Status of Lenders.  (i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrowers and the Administrative Agent, at the time or times reasonably requested by the Borrowers or the Administrative Agent, such properly completed and executed documentation reasonably requested by any Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding.  In addition, any Lender, if reasonably requested by any Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by any Borrower or the Administrative Agent as will enable the Borrowers or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements.  Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.17(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense (it being understood that the Borrowers shall be given a reasonable opportunity to reimburse such Lender with respect to such cost or expense) or would materially prejudice the legal or commercial position of such Lender.

 

(ii)                                  Without limiting the generality of the foregoing, in the event that any Borrower is a U.S. Person:

 

(A)                               any Lender that is a U.S. Person shall deliver to each such Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of any such Borrower or the Administrative Agent), duly executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

 

(B)                               any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to each such Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of each such Borrower or the Administrative Agent), whichever of the following is applicable:

 

(1)  in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, duly executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

 

(2)  in the case of a Foreign Lender claiming that its extension of credit will generate U.S. effectively connected income, duly executed originals of IRS Form W-8ECI;

 

(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit H-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent

 

49

 

shareholder” of such Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E; or

 

(4) to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit H-2 or Exhibit H-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit H-4 on behalf of each such direct and indirect partner;

 

(C)                               any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to each such Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of any such Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit each such Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

 

(D)                               if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to each such Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by any such Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by any such Borrower or the Administrative Agent as may be necessary for each such Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

 

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Company and the Administrative Agent in writing of its legal inability to do so.

 

(g)                                  Treatment of Certain Refunds.  If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.17 (including by the payment of additional amounts pursuant to this Section 2.17), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 2.17 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other

 

50

 

than any interest paid by the relevant Governmental Authority with respect to such refund).  Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority.  Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid.  This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

 

(h)                                 Survival.  Each party’s obligations under this Section 2.17 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

 

(i)                                     Defined Terms.  For purposes of this Section 2.17, the term “Lender” includes each Issuing Bank and the term “applicable law” includes FATCA.

 

(j)                                    Luxembourg Registration Duty.  In order to not unnecessarily cause application of Luxembourg’s registration duty applicable to documents in writing evidencing an obligation to pay, neither the Administrative Agent nor any Lender will take any action to file or register this Agreement or any of the Loan Documents with applicable Luxembourg authorities which would cause such registration duty to be payable unless the Administrative Agent reasonably deems such action necessary or advisable in connection with the protection of rights or pursuit of remedies during the continuance of an Event of Default.

 

SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

 

(a)                                 Each Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to (i) in the case of payments denominated in Dollars (other than in respect of Designated Loans), 2:00 p.m., New York City time and (ii) in the case of payments denominated in a Foreign Currency or in respect of Designated Loans, 1:00 p.m., Local Time, in the city of the Administrative Agent’s Eurocurrency Payment Office for such currency or Designated Loan, as applicable, in each case on the date when due, in immediately available funds, without set-off or counterclaim.  Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made (i) in the same currency in which the applicable Credit Event was made (or where such currency has been converted to euro, in euro) and (ii) to the Administrative Agent at its offices at 10 South Dearborn Street, Chicago, Illinois 60603 or, in the case of a Credit Event denominated in a Foreign Currency or a Designated Loan, the Administrative Agent’s Eurocurrency Payment Office for such currency or Designated Loan, as applicable, except payments to be made directly to any Issuing Bank or the Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons entitled thereto.  The Administrative Agent shall distribute any such payments denominated in the same currency received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof.  If any payment

 

51

 

hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.  Notwithstanding the foregoing provisions of this Section, if, after the making of any Credit Event in any Foreign Currency, currency control or exchange regulations are imposed in the country which issues such currency with the result that the type of currency in which the Credit Event was made (the “Original Currency”) no longer exists or the applicable Borrower is not able to make payment required to be made by it hereunder to the Administrative Agent for the account of the Lenders in such Original Currency, then all payments to be made by such Borrower hereunder in such currency shall instead be made when due in Dollars in an amount equal to the Dollar Amount (as of the date of repayment) of such payment due, it being the intention of the parties hereto that the Borrowers take all risks of the imposition of any such currency control or exchange regulations.

 

(b)                                 If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, unreimbursed LC Disbursements, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal and unreimbursed LC Disbursements then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and unreimbursed LC Disbursements then due to such parties.

 

(c)                                  [Intentionally Omitted].

 

(d)                                 Subject to Section 2.23(b), if any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Revolving Loans or participations in LC Disbursements or Swingline Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Revolving Loans and participations in LC Disbursements and Swingline Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Revolving Loans and participations in LC Disbursements and Swingline Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Revolving Loans and participations in LC Disbursements and Swingline Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered,  such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by any Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements and Swingline Loans to any assignee or participant, other than to the Company or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply).  Each Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation relating to any Obligations owed by such Borrower pursuant to the foregoing arrangements may exercise against such Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Borrower in the amount of such participation.

 

(e)                                  Unless the Administrative Agent shall have received notice from the Company or the relevant Subsidiary Borrower prior to the date on which any payment is due to the

 

52

 

Administrative Agent for the account of the Lenders or the Issuing Banks hereunder that such Borrower will not make such payment, the Administrative Agent may assume that such Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Banks, as the case may be, the amount due.  In such event, if such Borrower has not in fact made such payment, then each of the Lenders or the Issuing Banks, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or such Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation (including without limitation the Overnight Foreign Currency Rate in the case of Loans denominated in a Foreign Currency).

 

(f)                                   If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.05(c), 2.06(d) or (e), 2.07(b), 2.18(e) or 9.03(c), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), (i) apply any amounts thereafter received by the Administrative Agent for the account of such Lender and for the benefit of the Administrative Agent, the Swingline Lender or the Issuing Banks to satisfy such Lender’s obligations to it under such Section until all such unsatisfied obligations are fully paid and/or (ii) hold any such amounts in a segregated account over which the Administrative Agent shall have exclusive control as cash collateral for, and application to, any future funding obligations of such Lender under any such Section; in the case of each of clauses (i) and (ii) above, in any order as determined by the Administrative Agent in its discretion.

 

SECTION 2.19. Mitigation Obligations; Replacement of Lenders.  (a) If any Lender requests compensation under Section 2.15, or if any Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or Affiliates, if, in the good faith judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender.  The Company hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

 

(b)                                 If (i) any Lender requests compensation under Section 2.15, (ii) any Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17 or (iii) any Lender becomes a Defaulting Lender, then the Company may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights (other than its existing rights to payments pursuant to Sections 2.15 or 2.17) and obligations under the Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) to the extent such consent would be required pursuant to Section 9.04(b), the Company shall have received the prior written consent of the Administrative Agent (and if a Commitment is being assigned, the Swingline Lender and the Issuing Banks), which consent shall not unreasonably be withheld, delayed or conditioned, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it

 

53

 

hereunder (including amounts payable pursuant to Section 2.16), from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Company or relevant Subsidiary Borrower (in the case of all other amounts) and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.15 or payments required to be made pursuant to Section 2.17, such assignment will result in a reduction in such compensation or payments.  A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Company to require such assignment and delegation cease to apply.

 

SECTION 2.20. Expansion Option.  The Company may from time to time elect to increase the Commitments or enter into one or more tranches of term loans (each an “Incremental Term Loan”), in each case in minimum increments of $50,000,000 so long as, after giving effect thereto, the aggregate amount of such increases and all such Incremental Term Loans does not exceed $250,000,000.  The Company may arrange for any such increase or tranche to be provided by one or more Lenders (each Lender so agreeing to an increase in its Commitment, or to participate in such Incremental Term Loans, an “Increasing Lender”), or by one or more new banks, financial institutions or other entities (each such new bank, financial institution or other entity, an “Augmenting Lender”; provided that no Ineligible Institution may be an Augmenting Lender), which agree to increase their existing Commitments, or to participate in such Incremental Term Loans, or provide new Commitments, as the case may be; provided that (i) each Augmenting Lender, shall be subject to the approval of the Company, the Administrative Agent and, if the Augmenting Lender is providing new or increased Revolving Commitments, the Swingline Lender and the Issuing Banks (such approvals not to be unreasonably withheld, delayed or conditioned) and (ii) (x) in the case of an Increasing Lender, the Company and such Increasing Lender execute an agreement substantially in the form of Exhibit C hereto, and (y) in the case of an Augmenting Lender, the Company and such Augmenting Lender execute an agreement substantially in the form of Exhibit D hereto.  No consent of any Lender (other than the Lenders participating in the increase or any Incremental Term Loan) shall be required for any increase in Commitments or Incremental Term Loan pursuant to this Section 2.20.  Increases and new Commitments and Incremental Term Loans created pursuant to this Section 2.20 shall become effective on the date agreed by the Company, the Administrative Agent and the relevant Increasing Lenders or Augmenting Lenders, and the Administrative Agent shall notify each Lender thereof.  Notwithstanding the foregoing, no increase in the Commitments (or in the Commitment of any Lender) or tranche of Incremental Term Loans shall become effective under this paragraph unless, (i) on the proposed date of the effectiveness of such increase or Incremental Term Loans, (A) the conditions set forth in paragraphs (a) and (b) of Section 4.02 shall be satisfied or waived by the Required Lenders and the Administrative Agent shall have received a certificate on behalf of the Company to that effect dated such date and executed by a Responsible Officer of the Company and (B)  the Company shall be in compliance (on a pro forma basis) with the covenants contained in Section 6.07 and (ii) to the extent reasonably requested by the Administrative Agent, the Administrative Agent shall have received documents and opinions of the same type, to the extent applicable, as those delivered on the Effective Date as to the organizational power and authority of the Borrowers to borrow hereunder after giving effect to such increase (or to the extent the resolutions delivered on the Effective Date approve such matters, a certification from the Borrowers (or the Company on behalf of the Borrowers) that the resolutions delivered on the Effective Date remain in full force and effect and have not been amended or otherwise modified since the adoption thereof).  On the effective date of any increase in the Commitments or any Incremental Term Loans being made, (i) each relevant Increasing Lender and Augmenting Lender shall make available to the Administrative Agent such amounts in immediately available funds as the Administrative Agent shall determine, for the benefit of the other Lenders, as being required in order to cause, after giving effect to such increase and the use of such amounts to make payments to such other Lenders, each Lender’s portion of the outstanding Revolving Loans of all the Lenders to equal its Applicable Percentage of such outstanding Revolving Loans, and (ii) except in the case of any Incremental Term Loans, each of the relevant Borrowers shall be

 

54

 

deemed to have repaid and reborrowed all outstanding Revolving Loans owed by such Borrower as of the date of any increase in the Commitments (with such reborrowing to consist of the Types of Revolving Loans, with related Interest Periods if applicable, specified in a notice delivered by the applicable Borrower, together with the Company, in accordance with the requirements of Section 2.03).  The deemed payments made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by payment of all accrued interest on the amount prepaid and, in respect of each Eurocurrency Loan, shall be subject to indemnification by the applicable Borrower(s) pursuant to the provisions of Section 2.16 if the deemed payment occurs other than on the last day of the related Interest Periods.  The Incremental Term Loans (a) shall rank pari passu in right of payment with the Revolving Loans, (b) shall not mature earlier than the Maturity Date (but may have amortization and/or customary prepayments prior to such date) and (c) shall be treated substantially the same as (and in any event no more favorably than) the Revolving Loans; provided that (i) the terms and conditions applicable to any tranche of Incremental Term Loans maturing after the Maturity Date may provide for material additional or different financial or other covenants or prepayment requirements applicable only during periods after the Maturity Date and (ii) the Incremental Term Loans may be priced differently (whether in the form of interest rate margin, upfront fees, original issue discount, call protection or otherwise) than the Revolving Loans.  Incremental Term Loans may be made hereunder pursuant to an amendment or restatement (an “Incremental Term Loan Amendment”) of this Agreement and, as appropriate, the other Loan Documents, executed by the Borrowers, each Increasing Lender participating in such tranche, each Augmenting Lender participating in such tranche, if any, and the Administrative Agent.  The Incremental Term Loan Amendment may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent, to effect the provisions of this Section 2.20.  Nothing contained in this Section 2.20 shall constitute, or otherwise be deemed to be, a commitment on the part of any Lender to increase its Commitment hereunder, or provide Incremental Term Loans, at any time.

 

SECTION 2.21. Extension of Maturity Date.

 

(a)                                 Requests for Extension.  The Company may, by notice to the Administrative Agent (who shall promptly notify the Lenders) at any time (each such date, an “Extension Date”), request that each Lender extend such Lender’s Maturity Date to the date that is one year after the Maturity Date then in effect for such Lender (the “Existing Maturity Date”); provided that any such request shall be made no later than 30 days prior to the applicable Existing Maturity Date.

 

(b)                                 Lender Elections to Extend.  Each Lender, acting in its sole and individual discretion, shall, by notice to the Administrative Agent given not later than the date that is 15 days after the date on which the Administrative Agent received the Company’s extension request (the “Lender Notice Date”), advise the Administrative Agent whether or not such Lender agrees to such extension (each Lender that determines to so extend its Maturity Date, an “Extending Lender”).  Each Lender that determines not to so extend its Maturity Date (a “Non-Extending Lender”) shall notify the Administrative Agent of such fact promptly after such determination (but in any event no later than the Lender Notice Date), and any Lender that does not so advise the Administrative Agent on or before the Lender Notice Date shall be deemed to be a Non-Extending Lender.  The election of any Lender to agree to such extension shall not obligate any other Lender to so agree, and it is understood and agreed that no Lender shall have any obligation whatsoever to agree to any request made by the Company for extension of the Maturity Date.

 

(c)                                  Notification by Administrative Agent.  The Administrative Agent shall notify the Company of each Lender’s determination under this Section no later than the date that is 15 days prior to the applicable Extension Date (or, if such date is not a Business Day, on the next preceding Business Day).

 

55

 

(d)                                 Additional Commitment Lenders.  The Company shall have the right, but shall not be obligated, on or before the applicable Maturity Date for any Non-Extending Lender to replace such Non-Extending Lender with, and add as “Lenders” under this Agreement in place thereof, one or more financial institutions that are not Ineligible Institutions (each, an “Additional Commitment Lender”) approved by the Administrative Agent in accordance with the procedures provided in Section 2.19(b), each of which Additional Commitment Lenders shall have entered into an Assignment and Assumption (in accordance with and subject to the restrictions contained in Section 9.04, with the Company or replacement Lender obligated to pay any applicable processing or recordation fee) with such Non-Extending Lender, pursuant to which such Additional Commitment Lenders shall, effective on or before the applicable Maturity Date for such Non-Extending Lender, assume a Commitment (and, if any such Additional Commitment Lender is already a Lender, its Commitment shall be in addition to such Lender’s Commitment hereunder on such date).  Prior to any Non-Extending Lender being replaced by one or more Additional Commitment Lenders pursuant hereto, such Non-Extending Lender may elect, in its sole discretion, by giving irrevocable notice thereof to the Administrative Agent and the Company (which notice shall set forth such Lender’s new Maturity Date), to become an Extending Lender.  The Administrative Agent may effect such amendments to this Agreement as are reasonably necessary to provide for any such extensions with the consent of the Company but without the consent of any other Lenders.

 

(e)                                  Effective Date of Extension.  Effective as of the applicable Extension Date, the Maturity Date of each Extending Lender and of each Additional Commitment Lender shall be extended to the date that is one year after the Existing Maturity Date (except that, if such date is not a Business Day, such Maturity Date as so extended shall be the next preceding Business Day) and each Additional Commitment Lender shall thereupon become a “Lender” for all purposes of this Agreement and shall be bound by the provisions of this Agreement as a Lender hereunder and shall have the obligations of a Lender hereunder.

 

(f)                                   Conditions to Effectiveness of Extension.  Notwithstanding the foregoing, (x) no more than two (2) extensions of the Maturity Date shall be permitted hereunder and (y) any extension of any Maturity Date pursuant to this Section 2.21 shall not be effective with respect to any Extending Lender unless:

 

(i)                                     no Default or Event of Default shall have occurred and be continuing on the applicable Extension Date and immediately after giving effect thereto;

 

(ii)                                  the representations and warranties of the Borrowers set forth in this Agreement (excluding the representations and warranties set forth in Sections 3.04(b) and 3.06(a)) are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) on and as of the applicable Extension Date and after giving effect thereto, as though made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date); and

 

(iii)                               the Administrative Agent shall have received a certificate from the Company signed by a Responsible Officer of the Company, delivered on behalf of the Company, (A) certifying the accuracy of the foregoing clause (i) and (B) certifying and attaching the resolutions adopted by each Borrower approving or consenting to such extension (or to the extent the resolutions delivered on the Effective Date approve such matters, a certification from the Borrowers (or the Company on behalf of the Borrowers)

 

56

 

that the resolutions delivered on the Effective Date remain in full force and effect and have not been amended or otherwise modified since the adoption thereof).

 

(g)                                  Maturity Date for Non-Extending Lenders.  On the Maturity Date of each Non-Extending Lender, (i) the Commitment of each Non-Extending Lender shall automatically terminate and (ii) the Company shall repay such Non-Extending Lender in accordance with Section 2.10 (and shall pay to such Non-Extending Lender all of the other Obligations owing to it under this Agreement) and after giving effect thereto shall prepay any Revolving Loans outstanding on such date (and pay any additional amounts required pursuant to Section 2.16) to the extent necessary to keep outstanding Revolving Loans ratable with any revised Applicable Percentages of the respective Lenders effective as of such date, and the Administrative Agent shall administer any necessary reallocation of the Revolving Credit Exposures (without regard to any minimum borrowing, pro rata borrowing and/or pro rata payment requirements contained elsewhere in this Agreement).

 

(h)                                 Conflicting Provisions.  This Section shall supersede any provisions in Section 2.18 or Section 9.02 to the contrary.

 

SECTION 2.22. Judgment Currency.  If for the purposes of obtaining judgment in any court it is necessary to convert a sum due from any Borrower hereunder in the currency expressed to be payable herein (the “specified currency”) into another currency, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures the Administrative Agent could purchase the specified currency with such other currency at the Administrative Agent’s main New York City office on the Business Day preceding that on which final, non-appealable judgment is given.  The obligations of each Borrower in respect of any sum due to any Lender or the Administrative Agent by such Borrower hereunder shall, notwithstanding any judgment in a currency other than the specified currency, be discharged only to the extent that on the Business Day following receipt by such Lender or the Administrative Agent (as the case may be) of any sum adjudged to be so due in such other currency such Lender or the Administrative Agent (as the case may be) may in accordance with normal, reasonable banking procedures purchase the specified currency with such other currency.  If the amount of the specified currency so purchased is less than the sum originally due to such Lender or the Administrative Agent, as the case may be, in the specified currency, each Borrower agrees, to the fullest extent that it may effectively do so, as a separate obligation and notwithstanding any such judgment, to indemnify such Lender or the Administrative Agent, as the case may be, against such loss, and if the amount of the specified currency so purchased exceeds (a) the sum originally due to any Lender or the Administrative Agent by such Borrower, as the case may be, in the specified currency and (b) any amounts shared with other Lenders relating to amounts owed by such Borrower as a result of allocations of such excess as a disproportionate payment to such Lender under Section 2.18, such Lender or the Administrative Agent, as the case may be, agrees to remit such excess to such Borrower.

 

SECTION 2.23. Designation of Subsidiary Borrowers.  (a) On the Effective Date, and subject to the satisfaction of the conditions set forth in Section 4.01, the Initial Subsidiary Borrowers shall become Subsidiary Borrowers party to this Agreement until the Company shall have executed and delivered to the Administrative Agent a Borrowing Subsidiary Termination with respect to any such Subsidiary in accordance with the terms and conditions of this Section 2.23, whereupon such Subsidiary shall cease to be a Subsidiary Borrower and a party to this Agreement or any other Loan Document.  After the Effective Date, the Company may at any time and from time to time designate any Eligible Subsidiary as a Subsidiary Borrower by delivery to the Administrative Agent of a Borrowing Subsidiary Agreement executed by such Subsidiary and the Company and the satisfaction of the other conditions precedent set forth in Section 4.03, and upon such delivery and satisfaction such Subsidiary shall for all

 

57

 

purposes of this Agreement be a Subsidiary Borrower and a party to this Agreement.  Each Subsidiary Borrower shall remain a Subsidiary Borrower until the Company shall have executed and delivered to the Administrative Agent a Borrowing Subsidiary Termination with respect to such Subsidiary, whereupon such Subsidiary shall cease to be a Subsidiary Borrower and a party to this Agreement.  Notwithstanding the preceding sentence, no Borrowing Subsidiary Termination will become effective as to any Subsidiary Borrower at a time when any principal of or interest on any Loan to such Borrower shall be outstanding hereunder; provided that such Borrowing Subsidiary Termination shall be effective to terminate the right of such Subsidiary Borrower to make further Borrowings under this Agreement.  As soon as practicable upon receipt of a Borrowing Subsidiary Agreement, the Administrative Agent shall furnish a copy thereof to each Lender.  Each Subsidiary of the Company that is or becomes a Subsidiary Borrower pursuant to this Section 2.23 hereby irrevocably appoints the Company as its non-exclusive agent for all purposes relevant to this Agreement and each of the other Loan Documents, including (i) the giving and receipt of notices, (ii) the execution and delivery of all documents, instruments and certificates contemplated herein and all modifications hereto (other than any Borrowing Request, Interest Election Request, request for Swingline Loans, request for the issuance, amendment, renewal or extension of a Letter of Credit or prepayment notice), and (iii) the receipt of the proceeds of any Loans made by the Lenders to any such Subsidiary Borrower hereunder, but such appointment does not limit the right of each Subsidiary Borrower to take these actions directly for its own account; provided that in the event that the Administrative Agent shall receive conflicting instructions from the Company and a Subsidiary Borrower, the Administrative Agent shall follow the instruction of the Company.  Any acknowledgment, consent, direction, certification or other action which might otherwise be valid or effective only if given or taken by all Borrowers, or by each Borrower acting singly, shall be valid and effective if given or taken only by the Company, whether or not any such other Borrower joins therein; provided that any such appointment by a Subsidiary Borrower and any actions taken by the Company in such capacity shall be subject in all respects to Section 2.23(b). Subject to Section 2.23(b), any notice, demand, consent, acknowledgement, direction, certification or other communication delivered to the Company in accordance with the terms of this Agreement shall be deemed to have been delivered to each Subsidiary Borrower.

 

(b)  Notwithstanding anything set forth herein or in any other Loan Document to the contrary, (i) other than as expressly set forth in Article X solely with respect to the Company, the parties hereto agree that the Obligations of the Borrowers are several in nature (and not the joint obligations of the Borrowers), including any obligations of Borrowers hereunder to make payments of principal and interest regarding the Loans, and (ii) the parties agree that the Subsidiary Borrowers are not obligated to pay or otherwise liable for, and do not guaranty, collaterally support or otherwise have any responsibility (in any such case, either directly or indirectly, whether as a primary obligor, guarantor, indemnitor or otherwise) with respect to, any Obligations or Specified Ancillary Obligations of the Company, any Subsidiary Guarantor or any other Subsidiary Borrower.

 

SECTION 2.24. Defaulting Lenders.  Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:

 

(a)                                 fees shall cease to accrue on the unfunded portion of the Commitment of such Defaulting Lender pursuant to Section 2.12(a);

 

(b)                                 the Commitment and Revolving Credit Exposure of such Defaulting Lender shall not be included in determining whether the Required Lenders have taken or may take any action hereunder (including any consent to any amendment, waiver or other modification pursuant to Section 9.02); provided, that, except as otherwise provided in Section 9.02, this clause (b) shall not apply to the vote of a Defaulting Lender in the case of an amendment, waiver or other modification requiring the consent of such Lender or each Lender directly affected thereby;

 

58

 

(c)                                  if any Swingline Exposure or LC Exposure exists at the time such Lender becomes a Defaulting Lender then:

 

(i)                                     all or any part of the Swingline Exposure and LC Exposure of such Defaulting Lender shall be reallocated among the non-Defaulting Lenders in accordance with their respective Applicable Percentages but only to the extent that (A) no Default or Event of Default shall be continuing at the time of such reallocation and (B) the sum of all non-Defaulting Lenders’ Revolving Credit Exposures plus such Defaulting Lender’s Swingline Exposure and LC Exposure does not exceed the total of all non-Defaulting Lenders’ Commitments;

 

(ii)                                  if the reallocation described in clause (i) above cannot, or can only partially, be effected, the Company shall within one (1) Business Day following notice by the Administrative Agent (x) first, prepay such Swingline Exposure and (y) second, cash collateralize for the benefit of each relevant Issuing Bank only the Borrowers’ obligations corresponding to such Defaulting Lender’s LC Exposure (after giving effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section 2.06(j) for so long as such LC Exposure is outstanding;

 

(iii)                               if the Company cash collateralizes any portion of such Defaulting Lender’s LC Exposure pursuant to clause (ii) above, the Borrowers shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.12(b) with respect to such Defaulting Lender’s LC Exposure during the period such Defaulting Lender’s LC Exposure is cash collateralized;

 

(iv)                              if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to clause (i) above, then the fees payable to the Lenders pursuant to Section 2.12(a) and Section 2.12(b) shall be adjusted in accordance with such non-Defaulting Lenders’ Applicable Percentages; and

 

(v)                                 if all or any portion of such Defaulting Lender’s LC Exposure is neither reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then, without prejudice to any rights or remedies of the relevant Issuing Bank or any other Lender hereunder, all letter of credit fees payable under Section 2.12(b) with respect to such Defaulting Lender’s LC Exposure shall be payable to such Issuing Bank until and to the extent that such LC Exposure is reallocated and/or cash collateralized; and

 

(d)                                 so long as such Lender is a Defaulting Lender, the Swingline Lender shall not be required to fund any Swingline Loan and no Issuing Bank shall be required to issue, amend or increase any Letter of Credit, unless it is satisfied that the related exposure and the Defaulting Lender’s then outstanding LC Exposure will be 100% covered by the Commitments of the non-Defaulting Lenders and/or cash collateral will be provided by the Company in accordance with Section 2.24(c), and participating interests in any such newly made Swingline Loan or any newly issued or increased Letter of Credit shall be allocated among non-Defaulting Lenders in a manner consistent with Section 2.24(c)(i) (and such Defaulting Lender shall not participate therein).

 

If (i) a Bankruptcy Event with respect to a Lender Parent shall occur following the date hereof and for so long as such event shall continue or (ii) the Swingline Lender or any Issuing Bank has a good faith belief that any Lender has defaulted in fulfilling its obligations under one or more other agreements in which such Lender commits to extend credit, the Swingline Lender shall not be required to fund any Swingline Loan and no Issuing Bank shall be required to issue, amend or increase any Letter of Credit,

 

59

 

unless the Swingline Lender or the relevant Issuing Bank, as the case may be, shall have entered into arrangements with the Company or such Lender, reasonably satisfactory to the Swingline Lender or such Issuing Bank, as the case may be, to defease any risk to it in respect of such Lender hereunder.

 

In the event that the Administrative Agent, the Company, the Swingline Lender and each Issuing Bank each agrees that a Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then the Swingline Exposure and LC Exposure of the Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment and on such date such Lender shall purchase at par such of the Loans of the other Lenders (other than Swingline Loans) as the Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its Applicable Percentage, whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of a Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

ARTICLE III

 

Representations and Warranties

 

The Company, on behalf of itself and its Subsidiaries, and each Subsidiary Borrower, solely with respect to itself, severally represent and warrant to the Lenders that:

 

SECTION 3.01. Organization; Powers; Subsidiaries.  Each of the Loan Parties and the Material Subsidiaries is duly organized or incorporated, as the case may be, validly existing and in good standing (to the extent the concept is applicable in such jurisdiction) under the laws of the jurisdiction of its organization, has all requisite organizational power and authority to carry on its business as now conducted and, except where the failure to do so could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and (to the extent the concept is applicable in such jurisdiction) is in good standing in, every jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification.  Schedule 3.01 hereto identifies each Subsidiary as of the Effective Date, noting whether such Subsidiary is a Material Domestic Subsidiary and/or a Material Subsidiary as of the Effective Date, the jurisdiction of its incorporation or organization, as the case may be, the percentage of issued and outstanding shares of each class of its capital stock or other equity interests owned by the Company and the other Subsidiaries and, if such percentage is not 100% (excluding (i) directors’ qualifying shares and (ii) shares issued to foreign nationals to the extent required by applicable law), a description of each class issued and outstanding.  All of the outstanding shares of capital stock and other equity interests of each Subsidiary Borrower and Material Subsidiary are validly issued and outstanding and fully paid and nonassessable and all such shares and other equity interests indicated on Schedule 3.01 as owned by the Company or another Subsidiary are owned, beneficially and of record, by the Company or any Subsidiary free and clear of all Liens, other than Liens permitted pursuant to Section 6.02.  Except for Disclosed Matters or as set forth in Schedule 3.01, as of the Effective Date, there are no outstanding commitments or other obligations of any Borrower or any Material Subsidiary to issue, and no options, warrants or other rights of any Person to acquire, any shares of any class of capital stock or other equity interests of any Borrower or any Material Subsidiary.  Each Subsidiary Borrower organized or incorporated under the laws of a European Union jurisdiction shall cause its centre of main interests (as that term is used in Article 3(1) of the Regulation) to be situated in such jurisdiction (or in any Eligible Foreign Jurisdiction) for the purposes of the Regulation, unless failure to do so could not reasonably be expected to have a material adverse effect on the rights of the

 

60

 

Lenders or the Administrative Agent in any enforcement or insolvency proceedings relating to any Loan Document.

 

SECTION 3.02. Authorization; Enforceability.  The Transactions are within each Loan Party’s organizational powers and have been duly authorized by all necessary organizational actions and, if required, actions by equity holders.  The Loan Documents to which each Loan Party is a party have been duly executed and delivered by such Loan Party and constitute a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to (a)(i) applicable bankruptcy, insolvency, examinership, reorganization, moratorium or other laws affecting creditors’ rights generally, (ii) general principles of equity, regardless of whether considered in a proceeding in equity or at law and (iii) requirements of reasonableness, good faith and fair dealing and (b) solely with respect to any Foreign Subsidiary, (i) the time barring of claims under applicable legislation, (ii) defenses of set-off or counterclaim, (iii) other matters which are set out as qualifications or reservations as to matters of general law in any legal opinion in respect of any Loan Document delivered to the Administrative Agent or the Lenders and (iv) the making of registrations, filings, endorsements, notarizations, stampings and/or notifications, if any, of the Loan Documents as described in any legal opinion delivered to the Administrative Agent or the Lenders.

 

SECTION 3.03. Governmental Approvals; No Conflicts.  The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been, or will be by the time required, obtained or made and are, or will be by the time required, in full force and effect, (b) will not violate in any material respect any applicable material law or regulation or the charter, by-laws or other organizational documents of any Loan Party or any Material Subsidiary or any material order of any Governmental Authority binding upon any Loan Party or any of the Material Subsidiaries or its assets, (c) will not violate in any material respect or result in a default under any indenture, material agreement or other material instrument binding upon the Company or any of its Material Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by the Company or any of its Material Subsidiaries, except, in the case of this clause (c), for any such violations, defaults or rights that could not reasonably be expected to result in a Material Adverse Effect, and (d) will not result in the creation or imposition of any Lien on any asset of the Company or any of its Material Subsidiaries, other than requirements to provide cash collateral under this Agreement.  There is no works council with jurisdiction over the Transactions as envisaged by any Loan Document to which a Dutch Subsidiary Borrower is a party and  there is no obligation for such Dutch Subsidiary Borrower to establish a works council pursuant to the Works Council Act (Wet op de Ondernemingsraden).

 

SECTION 3.04. Financial Condition; No Material Adverse Change.  (a) The Company has heretofore furnished to the Lenders its consolidated balance sheet and statements of operations, stockholders equity and cash flows as of and for the fiscal year ended December 31, 2014 reported on by PricewaterhouseCoopers LLP, independent public accountants.  Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the Company and its consolidated Subsidiaries as of such dates and for such periods in accordance with GAAP.

 

(b)                                 As of the Effective Date and excluding any Disclosed Matters, since December 31, 2014, there has been no material adverse change in the business, assets, operations or financial condition of the Company and its Subsidiaries, taken as a whole.

 

SECTION 3.05. Properties.

 

(a)                                 Except for Liens permitted pursuant to Section 6.02, each of the Company and its Subsidiaries has good title to, or (to the knowledge of the Company) valid leasehold interests in,

 

61

 

all its real and personal property (other than intellectual property, which is subject to Section 3.05(b)) material to its business, except as could not reasonably be expected to result in a Material Adverse Effect.

 

(b)                                 Except for Disclosed Matters or as could not reasonably be expected to result in a Material Adverse Effect, (i) each of the Company and its Subsidiaries owns or is licensed to use (subject to the knowledge-qualified infringement representation in this Section 3.05(b)) all trademarks, trade names, copyrights, patents and other intellectual property material to its business, and (ii) the use thereof by the Company and its Subsidiaries, to the Company’s knowledge, does not infringe upon the rights of any other Person.

 

SECTION 3.06. Litigation and Environmental Matters.  (a) As of the Effective Date and except for Disclosed Matters, there are no actions, suits, proceedings or investigations by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Company, threatened in writing against or affecting the Company or any of its Subsidiaries (i) that could reasonably be expected to result in a Material Adverse Effect or (ii) that involve this Agreement or the Transactions.

 

(b)                                 Except with respect to Disclosed Matters and other matters that could not reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries (i) are in compliance with all applicable Environmental Laws (which compliance includes possession of and compliance with all permits, licenses or other approvals required under applicable Environmental Laws), (ii) are not subject to any Environmental Liability or (iii) have not received written notice of any claim with respect to any Environmental Liability.

 

SECTION 3.07. Compliance with Laws.  Each of the Company and its Subsidiaries is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property, except (i) for Disclosed Matters or (ii) where the failure to do so could not reasonably be expected to result in a Material Adverse Effect.  The entry into this Agreement by the Irish Borrowers and the performance by the Irish Borrowers of the transactions contemplated hereby and the obligations incurred hereunder by the Irish Borrowers does not constitute the provision of financial assistance by the Irish Borrowers within the meaning of Section 60 of the Companies Act, 1963 of Ireland. The prohibition contained in Section 31 of the Companies Act, 1990 of Ireland does not apply to this Agreement or the transactions contemplated thereby by reason of the fact that the Irish Borrowers and each other company whose liabilities are hereby guaranteed are members of a group of companies consisting of a holding company and its subsidiaries within the meaning of Section 155(1) of the Companies Act, 1963 of Ireland.

 

SECTION 3.08. Investment Company Status.  Neither the Company nor any of its Subsidiaries is required to be registered as an “investment company” as defined in the Investment Company Act of 1940 or subject to regulation as an “investment company” thereunder.

 

SECTION 3.09. Taxes.  Each of the Company and its Subsidiaries has timely filed or caused to be filed all federal income Tax returns and all other material Tax returns and reports required to have been filed by it and has paid, caused to be paid or made a provision for the payment of, all federal income Taxes and all other material Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which the Company or such Subsidiary, as applicable, has set aside on its books adequate reserves in accordance with GAAP or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect.

 

62

 

SECTION 3.10. ERISA.  No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect.

 

SECTION 3.11. Disclosure.  All written information (including the information set forth in the Information Memorandum) and all information that is formally presented at a general meeting (which may be a telephonic meeting) of the Lenders, other than any projections, estimates, forecasts and other forward-looking information  and information of a general economic or industry-specific nature furnished by or on behalf of the Company or any Subsidiary to the Administrative Agent or any Lender pursuant to or in connection with this Agreement or any other Loan Document, when taken as a whole and after giving effect to all supplements and updates thereto, does not (when furnished) contain any untrue statement of material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading (when taken as a whole) in light of the circumstances under which such statements are made; provided that, with respect to forecasts or projections, the Company represents only that such information was prepared in good faith based upon assumptions believed by the Company to be reasonable at the time prepared (it being understood by the Administrative Agent and the Lenders that any such projections are not to be viewed as facts and are subject to significant uncertainties and contingencies, many of which are beyond the control of the Company or its Subsidiaries, that no assurances can be given that such projections will be realized and that actual results may differ materially from such projections).

 

SECTION 3.12. Federal Reserve Regulations.  No part of the proceeds of any Loan have been used or will be used, whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board, including Regulations T, U and X.

 

SECTION 3.13. No Default.  No Default has occurred and is continuing.

 

SECTION 3.14. Anti-Corruption Laws and Sanctions.  The Company has implemented and maintains in effect policies and is implementing procedures reasonably designed to achieve compliance by the Company, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and the Company, its Subsidiaries and their respective officers and employees and to the knowledge of the Company its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.  None of (a) the Company, any Subsidiary or to the knowledge of the Company or such Subsidiary any of their respective directors, officers or employees, or (b) to the knowledge of the Company, any agent of the Company or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person.  No Borrowing or Letter of Credit, use of proceeds or other Transactions will violate any Anti-Corruption Law or applicable Sanctions.

 

ARTICLE IV

 

Conditions

 

SECTION 4.01. Effective Date.  The obligations of the Lenders to make Loans and of the Issuing Banks to issue Letters of Credit hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.02):

 

(a)                                 The Administrative Agent (or its counsel) shall have received (i) from each party hereto either (A) a counterpart of this Agreement signed on behalf of such party or (B) written evidence reasonably satisfactory to the Administrative Agent (which may include telecopy or electronic transmission of a signed signature page of this Agreement) that such party has signed a

 

63

 

counterpart of this Agreement and (ii) duly executed copies of the Loan Documents and such other certificates, documents, instruments and agreements, in each case, to the extent described in the list of documents attached as Exhibit E.

 

(b)                                 The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent and the Lenders and dated the Effective Date) of each of (i)  Skadden, Arps Slate, Meagher & Flom LLP, special New York counsel for the Company, (ii) Arthur Cox, special Irish counsel for the Initial Irish Borrowers, and (iii) Baker & McKenzie Amsterdam N.V., special Dutch counsel for the Initial Dutch Borrower, in each case in form and substance reasonably satisfactory to the Administrative Agent and covering such customary matters relating to the Loan Parties, the Loan Documents or the Transactions as the Administrative Agent shall reasonably request.  The Company and the other Borrowers hereby request such counsels to deliver such opinions.

 

(c)                                  The Administrative Agent shall have received such documents and certificates relating to the organization, existence and good standing of the initial Loan Parties in their respective jurisdictions of organization, the authorization of the Transactions and any other legal matters relating to such Loan Parties (which shall include, in the case of any Initial Irish Borrower, where applicable, evidence that such Loan Party has complied with Section 60 of the Companies Act 1963 of Ireland), the Loan Documents or the Transactions, all in form and substance reasonably satisfactory to the Administrative Agent and its counsel and as further described in the list of documents identified in Section B of Exhibit E.

 

(d)                                 The Administrative Agent shall have received a certificate, dated the Effective Date and signed by a Responsible Officer of the Company, certifying on behalf of the Company (i) that the representations and warranties contained in Article III are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of such date except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of such earlier date and (ii) that no Default or Event of Default has occurred and is continuing as of such date.

 

(e)                                  The Administrative Agent shall have received all fees and other amounts due and payable on or prior to the Effective Date, including, to the extent invoiced at least one (1) Business Day prior to the Effective Date, reimbursement or payment of all reasonable and documented out-of-pocket expenses required to be reimbursed or paid by the Company hereunder.

 

The Administrative Agent shall notify the Company and the Lenders of the Effective Date, and such notice shall be conclusive and binding.

 

SECTION 4.02. Each Credit Event.  The obligation of each Lender to make a Loan on the occasion of any Borrowing (other than a conversion or continuation of any Loans), and of the Issuing Banks to issue, amend, renew or extend any Letter of Credit, is subject to the satisfaction (or waiver of in accordance with Section 9.02) of the following conditions:

 

(a)                                 The representations and warranties of the Borrowers set forth in this Agreement (excluding the representations and warranties set forth in Sections 3.04(b) and 3.06(a)) shall be true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) on and as of the date of such Borrowing

 

64

 

or the date of issuance, amendment, renewal or extension of such Letter of Credit, as applicable, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of such earlier date.

 

(b)                                 At the time of and immediately after giving effect to such Borrowing or the issuance, amendment, renewal or extension of such Letter of Credit, as applicable, no Default or Event of Default shall have occurred and be continuing.

 

Each Borrowing (other than a conversion or continuation of any Loans) and each issuance, amendment, renewal or extension of a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrowers on the date thereof as to the matters specified in paragraphs (a) and (b) of this Section.

 

SECTION 4.03. Designation of a Subsidiary Borrower.  After the Effective Date, the designation of a Subsidiary Borrower pursuant to Section 2.23 is subject to the condition precedent that the Company or such proposed Subsidiary Borrower shall have furnished or caused to be furnished to the Administrative Agent:

 

(a)                                 Copies, certified by the Secretary or Assistant Secretary (or other appropriate officer, manager or director) of such Subsidiary, of its Board of Directors’ (or other governing body’s) resolutions (and, to the extent necessary, shareholder resolutions) approving the Borrowing Subsidiary Agreement and any other Loan Documents to which such Subsidiary is becoming a party and such documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization, existence and good standing of such Subsidiary in its jurisdiction of organization;

 

(b)                                 An incumbency certificate, certified by the Secretary or Assistant Secretary (or other appropriate officer, manager or director) of such Subsidiary, which shall identify by name and title and bear the signature of the officers, managers, directors and other persons of such Subsidiary authorized to request Borrowings hereunder and sign the Borrowing Subsidiary Agreement and the other Loan Documents to which such Subsidiary is becoming a party, upon which certificate the Administrative Agent and the Lenders shall be entitled to rely until informed of any change in writing by the Company or such Subsidiary;

 

(c)                                  Opinions of counsel to such Subsidiary, in form and substance reasonably satisfactory to the Administrative Agent and its counsel, with respect to the laws of its jurisdiction of organization and such other customary matters as are reasonably requested by counsel to the Administrative Agent (but, in any case, limited to the types of matters covered in the legal opinions delivered pursuant to Section 4.01, in the case of a jurisdiction of a Borrower in respect of which a legal opinion was delivered pursuant to Section 4.01) and addressed to the Administrative Agent and the Lenders; and

 

(d)                                 Any promissory notes requested by any Lender pursuant to Section 2.10(e), and any other instruments and documents reasonably requested by the Administrative Agent.

 

(e)                                  Any documentation and other information that is reasonably requested by the Administrative Agent or any of the Lenders (acting through the Administrative Agent) in connection with requirements by regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the Patriot Act; provided that any

 

65

 

such request shall be made no later than three (3) Business Days after written notice by the Company to the Administrative Agent of such designation pursuant to Section 2.23.

 

ARTICLE V

 

Affirmative Covenants

 

Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees due and payable hereunder shall have been paid in full (other than Obligations expressly stated to survive such payment and termination) and all Letters of Credit shall have expired or terminated, in each case, without any pending draw (or shall have been cash collateralized or backstopped pursuant to arrangements reasonably satisfactory to the Administrative Agent), and all LC Disbursements shall have been reimbursed, the Company covenants and agrees with the Lenders that:

 

SECTION 5.01. Financial Statements and Other Information.  The Company will furnish to the Administrative Agent for distribution to each Lender:

 

(a)                                 within ninety (90) days after the end of each fiscal year of the Company, its audited consolidated balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, prepared in accordance with GAAP consistently applied, with such audited balance sheet and related consolidated financial statements reported on by PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Company and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP;

 

(b)                                 within forty-five (45) days after the end of each of the first three fiscal quarters of each fiscal year of the Company, its consolidated balance sheet and related statements of operations and cash flows as of the end of and for such fiscal quarter and the period commencing at the beginning of such fiscal year and ending with such fiscal quarter, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified on behalf of the Company by a Financial Officer of the Company as presenting fairly in all material respects the financial condition and results of operations of the Company and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

 

(c)                                  concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of the Company, delivered on behalf of the Company, (i) certifying as to whether, to the knowledge of such Financial Officer, a Default has occurred and is continuing and, if a Default has occurred that is continuing, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.07 and (iii) to the extent that any change in GAAP or application thereof has a material impact on the financial statements accompanying such certificate and such change and impact has not been noted in such financial statements, stating whether any such change in GAAP or in the application thereof has occurred since the date of the audited financial statements referred to in Section 3.04 and, if any

 

66

 

such change has occurred, specifying the effect of such change on such financial statements accompanying such certificate;

 

(d)                                 promptly after the same become publicly available, copies of all annual, regular, periodic and special reports, proxy statements and registration statements (i) filed by the Company with the SEC (or any Governmental Authority succeeding to any or all of the functions of the SEC) or with any national securities exchange, or (ii) distributed by the Company to its shareholders generally, as the case may be;

 

(e)                                  promptly after Moody’s or S&P shall have announced a change in the rating established or deemed to have been established for the Index Debt, written notice of such rating change; and

 

(f)                                   promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of the Company or any Subsidiary, or compliance with the terms of this Agreement, as the Administrative Agent or by any Lender (acting through the Administrative Agent) may reasonably request.

 

Documents required to be delivered pursuant to clauses (a), (b) and (d) of this Section 5.01 (A) may be delivered electronically and (B) shall be deemed to have been delivered on the date on which such documents are (i) filed for public availability on the SEC’s Electronic Data Gathering and Retrieval System, (ii) posted or the Company provides a link thereto on http://www.regeneron.com or http://www.investor.regeneron.com or at another website identified in a notice from the Company and accessible by the Lenders without charge; or (iii) posted on the Company’s behalf on an Internet or intranet website, if any, to which the Administrative Agent has access (whether a commercial, third-party website or whether sponsored by the Administrative Agent).

 

SECTION 5.02. Notices of Material Events.  The Company will furnish to the Administrative Agent (for distribution to each Lender) written notice of the following, promptly after a Responsible Officer of the Company having actual knowledge thereof:

 

(a)                                 the occurrence of any Default;

 

(b)                                 the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting the Company or any Subsidiary thereof that could reasonably be expected to result in a Material Adverse Effect;

 

(c)                                  the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect; and

 

(d)                                 any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect.

 

Each notice delivered under this Section shall be accompanied by a statement of a Responsible Officer of the Company setting forth in reasonable detail the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.  Information required to be delivered pursuant to clause (b), (c) and (d) of this Section shall be deemed to have been delivered if such information, or one or more annual, quarterly, current or other reports containing such information, is (i) filed for public availability on the SEC’s Electronic Data Gathering and Retrieval System, (ii) posted or the Company

 

67

 

provides a link thereto on http://www.regeneron.com or http://www.investor.regeneron.com; or (iii) posted on the Company’s behalf on an Internet or intranet website, if any, to which the Administrative Agent and the Lenders have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent).  Information required to be delivered pursuant to this Section may also be delivered by electronic communications pursuant to procedures approved by the Administrative Agent.

 

SECTION 5.03. Existence; Conduct of Business.

 

(a)                                 The Company will, and will cause each other Loan Party and each of the Material Subsidiaries to, do or cause to be done (i) all things necessary to preserve, renew and keep in full force and effect its legal existence and (ii) take, or cause to be taken, all reasonable actions to preserve, renew and keep in full force and effect the rights, qualifications, licenses, permits, privileges, franchises, governmental authorizations and intellectual property rights material to the conduct of the business of the Company and its Subsidiaries taken as a whole, and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted, except, in the case of this clause (ii), to the extent failure to do so could not reasonably be expected to result in a Material Adverse Effect; provided that this Section 5.03 shall not prohibit any Permitted Restructurings, merger, consolidation, disposition, liquidation, dissolution or other transaction permitted under Section 6.03.

 

(b)                                 Each Subsidiary Borrower organized or incorporated under the laws of a European Union jurisdiction shall cause its centre of main interests (as that term is used in Article 3(1) of the Regulation) to be situated in such jurisdiction (or in any Eligible Foreign Jurisdiction) for the purposes of the Regulation, unless failure to do so could not reasonably be expected to have a material adverse effect on the rights of the Lenders or the Administrative Agent in any enforcement or insolvency proceedings relating to any Loan Document.

 

SECTION 5.04. Payment of Taxes.  The Company will, and will cause each of its Subsidiaries to, pay its Tax liabilities that, if not paid, could reasonably be expected to result in a Material Adverse Effect before the same shall become delinquent or in default, except where Taxes that are being contested in good faith by appropriate proceedings and for which the Company or such Subsidiary, as applicable, has set aside on its books adequate reserves in accordance with GAAP.

 

SECTION 5.05. Maintenance of Properties; Insurance.  The Company will, and will cause each of its Subsidiaries to, (a) keep and maintain all tangible property material to the conduct of its business in good working order and condition, ordinary wear and tear and casualty excepted and except (i) pursuant to transactions permitted by Section 6.03 or (ii) where the failure to do so could not reasonably be expected to result in a Material Adverse Effect, and (b) maintain, in all material respects, with carriers reasonably believed by the Company to be financially sound and reputable or through reasonable and adequate self-insurance insurance in such amounts and against such risks and such other hazards, as is customarily maintained by companies engaged in the same or similar businesses operating in the same or similar locations.

 

SECTION 5.06. Books and Records; Inspection Rights.  The Company will, and will cause each of its Material Subsidiaries to, keep proper books of record and account in which full, true and correct entries in conformity in all material respects with applicable law are made of all material financial dealings and transactions in relation to its business and activities and, subject to Section 5.01(b), in form permitting financial statements conforming with GAAP or IFRS (as applicable) to be derived therefrom.  The Company will, and will cause each of its Subsidiaries to, permit any representatives designated by the Administrative Agent, at reasonable times upon reasonable prior written notice, to visit and inspect its properties, to examine and make extracts from its books and records and to discuss its affairs, finances

 

68

 

and condition with its Financial Officers and, provided that the Company or such Subsidiary is afforded the opportunity to participate in such discussion, its independent accountants, all at such reasonable times and as often as reasonably requested; provided that so long as no Event of Default has occurred and is continuing, the Company shall not be required to reimburse the Administrative Agent or any of its representatives for fees, costs and expenses in connection with the Administrative Agent’s exercise of such rights set forth in this sentence more than one time in any calendar year.  The Company acknowledges that, subject to Section 9.12, the Administrative Agent, after exercising its rights of inspection, may prepare and distribute to the Lenders certain reports pertaining to the Company and its Subsidiaries’ assets for internal use by the Administrative Agent and the Lenders.  Notwithstanding anything to the contrary in this Section 5.06, neither the Company nor any of its Subsidiaries will be required to disclose, permit the inspection, examination or making of extracts, or discussion of, any documents, information or other matter that (i) constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which disclosure to the Administrative Agent (or any designated representative) is then prohibited by law, rule or regulation or any agreement binding on the Company or any of its Subsidiaries or (iii) is subject to attorney-client or similar privilege or constitutes attorney work-product.

 

SECTION 5.07. Compliance with Laws.  The Company will, and will cause each of its Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property (including without limitation Environmental Laws and, in the case of each Irish Borrower, Section 60 of the Companies Act 1963 of Ireland), except where the failure to do so could not reasonably be expected to result in a Material Adverse Effect.  The Company will maintain in effect and enforce policies and is implementing and will maintain procedures reasonably designed to achieve compliance by the Company, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.

 

SECTION 5.08. Use of Proceeds.  The proceeds of the Loans will be used only to finance the working capital needs, and for general corporate or other lawful purposes, of the Company and its Subsidiaries.  No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board, including Regulations T, U and X.  No Borrower will request any Borrowing or Letter of Credit, and no Borrower shall use, and the Company shall procure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country or (iii) in any manner that would result in the violation of  any Sanctions applicable to any party hereto.

 

SECTION 5.09. Subsidiary Guaranty.  Within forty-five (45) days (or such later date as may be agreed upon by the Administrative Agent) after which financial statements have been delivered pursuant to Section 5.01(a) and any Person qualifies as a Material Domestic Subsidiary pursuant to the definition of “Material Subsidiary” in accordance with the calculations in such financial statements, the Company shall provide the Administrative Agent with written notice thereof and shall cause each such Subsidiary to execute and deliver to the Administrative Agent the Subsidiary Guaranty (or a joinder thereto in the form contemplated thereby) pursuant to which such Subsidiary agrees to be bound by the terms and provisions thereof, such Subsidiary Guaranty (or joinder thereto) to be accompanied by requisite organizational resolutions, other organizational documentation and legal opinions as may be reasonably requested by the Administrative Agent (with any such opinion so requested to be in form and substance reasonably satisfactory to the Administrative Agent but, in any case, limited to the types of

 

69

 

matters covered in the legal opinions delivered pursuant to Section 4.01).  Notwithstanding the foregoing no Excluded Subsidiary shall be required to become a Subsidiary Guarantor.

 

ARTICLE VI

 

Negative Covenants

 

Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees  payable hereunder have been paid in full (other than Obligations expressly stated to survive such payment and termination) and all Letters of Credit have expired or terminated, in each case, without any pending draw (or shall have been cash collateralized or backstopped pursuant to arrangements reasonably satisfactory to the Administrative Agent), and all LC Disbursements shall have been reimbursed, the Company covenants and agrees with the Lenders that:

 

SECTION 6.01. Indebtedness.  The Company will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist any Indebtedness, except:

 

(a)                                 the Obligations and any Specified Ancillary Obligations;

 

(b)                                 Indebtedness existing on the date hereof and set forth in Schedule 6.01 and amendments, modifications, extensions, refinancings, renewals and replacements of any such Indebtedness that does not increase the outstanding principal amount thereof (other than with respect to unpaid accrued interest and premium thereon, any committed or undrawn amounts and underwriting discounts, fees, commissions, premiums and expenses associated with such Indebtedness);

 

(c)                                  Indebtedness of the Company to any Subsidiary and of any Subsidiary to the Company or any other Subsidiary;

 

(d)                                 Guarantees by the Company of Indebtedness or other obligations of any Subsidiary and by any Subsidiary of Indebtedness or other obligations of the Company or any other Subsidiary;

 

(e)                                  Indebtedness of the Company or any Subsidiary incurred to finance the acquisition, construction, repair, replacement, lease or improvement of any fixed or capital assets, including Capital Lease Obligations and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and amendments, modifications, extensions, refinancings, renewals and replacements of any such Indebtedness; provided that (i) such Indebtedness is incurred prior to or within 180 days after such acquisition or the completion of such construction, repair, replacement, lease or improvement and (ii) the aggregate outstanding principal amount of Indebtedness permitted by this clause (e) shall not exceed $75,000,000 at any time outstanding;

 

(f)                                   Indebtedness of the Company or any Subsidiary as an account party in respect of letters of credit or bank guarantees;

 

(g)                                  unfunded pension fund and other employee benefit plan obligations and liabilities to the extent they are permitted to remain unfunded under applicable law;

 

(h)                                 Indebtedness representing deferred compensation to employees incurred in the ordinary course of business;

 

70

 

(i)                                     Guarantees, surety bonds or performance bonds securing the performance of the Company or any of its Subsidiaries, in each case incurred or assumed in connection with an Acquisition or disposition or other acquisition of assets not prohibited hereunder;

 

(j)                                    Indebtedness of the Company or any of its Subsidiaries in respect of performance bonds, bid bonds, appeal bonds, surety bonds and similar obligations, in each case provided in the ordinary course of business, including guarantees or obligations with respect to letters of credit supporting such performance bonds, bid bonds, appeal bonds, surety bonds and similar obligations;

 

(k)                                 Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business or otherwise in respect of any netting services, overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing-house transfers of funds;

 

(l)                                     Indebtedness in respect to judgments or awards under circumstances not giving rise to an Event of Default;

 

(m)                             Indebtedness in respect of obligations that are being contested in accordance with Section 5.04;

 

(n)                                 Indebtedness consisting of (i) deferred payments or financing of insurance premiums incurred in the ordinary course of business of the Company or any of its Subsidiaries and (ii) take or pay obligations contained in any supply agreement entered into in the ordinary course of business;

 

(o)                                 Indebtedness representing deferred compensation, severance, pension, and health and welfare retirement benefits or the equivalent to current and former employees of the Company and its Subsidiaries incurred in the ordinary course of business or existing on the Effective Date;

 

(p)                                 customer advances or deposits or other endorsements for collection, deposit or negotiation and warranties of products or services, in each case received or incurred in the ordinary course of business;

 

(q)                                 Priority Indebtedness (excluding any Indebtedness (i) that is otherwise permitted by any other clause of this Section 6.01 and (ii) to the extent secured by a Lien, that is secured by a Lien permitted by Section 6.02 (other than by clause (s) thereof)) in an aggregate outstanding principal amount not to exceed, at the time of incurrence of any such Priority Indebtedness and when taken together with the aggregate outstanding amount of other obligations secured by a Lien pursuant to Section 6.02(s)(ii), fifteen percent (15%) of the Company’s Consolidated Net Worth (determined as of the last day of the most recent fiscal quarter for which financial statements shall have been delivered pursuant to Section 5.01(a) or Section 5.01(b) (or, prior to the delivery of any such financial statements, ending with the last fiscal quarter included in the financial statements referred to in Section 3.04(a));

 

(r)                                    unsecured Indebtedness of the Company or any other Loan Party so long as at the time of and immediately after giving effect (including giving effect on a pro forma basis) to the incurrence of such Indebtedness (i) no Default or Event of Default shall have occurred and be

 

71

 

continuing and (ii) the Company shall be in compliance with the financial covenants set forth in Section 6.07;

 

(s)                                   other Indebtedness in an aggregate outstanding principal amount not to exceed $50,000,000; and

 

(t)                                    Indebtedness assumed by the Company or any Subsidiary in connection with any Acquisition or other acquisition of any property or assets or Indebtedness of any Person that becomes a Subsidiary after the Effective Date in a transaction not prohibited hereby, and amendments, modifications, extensions, refinancings, renewals and replacements of any such Indebtedness; provided that (i) such Indebtedness is not incurred in contemplation of such acquisition and (ii) the aggregate outstanding principal amount of such Indebtedness does not exceed $200,000,000.

 

SECTION 6.02. Liens.  The Company will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it except:

 

(a)                                 Liens (if any) created pursuant to any Loan Document including with respect to any obligation to provide cash collateral;

 

(b)                                 Permitted Encumbrances;

 

(c)                                  any Lien on any property or asset of the Company or any Subsidiary existing on the date hereof and set forth in Schedule 6.02 and any amendments, modifications, extensions, renewals, refinancings and replacements thereof; provided that (i) such Lien shall not apply to any other property or asset of the Company or any Subsidiary other than improvements thereon and proceeds from the disposition of such property or asset and (ii) the amount secured or benefited thereby is not increased (other than as permitted by Section 6.01) and amendments, modifications, extensions, refinancings, renewals and replacements thereof that do not increase the outstanding principal amount thereof (other than as permitted by Section 6.01);

 

(d)                                 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 after the date hereof prior to the time such Person becomes a Subsidiary and any amendments, modifications, extensions, renewals and replacements thereof; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not apply to any other property or assets of the Company or any Subsidiary (other than the proceeds or products thereof and other than after-acquired property subjected to a Lien securing Indebtedness and other obligations incurred prior to such time and which Indebtedness and other obligations are permitted hereunder that require, pursuant to their terms at such time, a pledge of after-acquired property) 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, as the case may be, and amendments, modifications, extensions, refinancings, renewals and replacements thereof that do not increase the outstanding principal amount thereof (other than as permitted by Section 6.01);

 

(e)                                  Liens on fixed or capital assets (including capital leases) acquired (including as a replacement), constructed, repaired, leased or improved by the Company or any Subsidiary; provided that (i) such Liens secure Indebtedness or Capital Lease Obligations permitted by clause (e) of Section 6.01, (ii) such Liens and the Indebtedness secured thereby are incurred prior to or

 

72

 

within 180 days after such acquisition or lease or the completion of such construction, replacement, repair or improvement and (iii) such Liens shall not apply to any other property or assets of the Company or any Subsidiary other than improvements thereon, replacements and products thereof, additions and accessions thereto or proceeds from the disposition of such property or assets and customary security deposits; provided that individual financings of equipment provided by one lender (or a syndicate of lenders) may be cross-collateralized to other financings of equipment provided by such lender (or syndicate);

 

(f)                                   Liens granted by a Subsidiary that is not a Loan Party in favor of the Company or another Loan Party in respect of Indebtedness owed by such Subsidiary to the Company or such other Loan Party;

 

(g)                                  Liens arising out of any conditional sale, title retention, consignment or other similar arrangements for the sale of goods entered into by the Company or any of its Subsidiaries the ordinary course of business;

 

(h)                                 Liens securing Indebtedness permitted hereunder to finance insurance premiums solely to the extent of such premiums;

 

(i)                                     statutory and common law rights of setoff and other Liens, similar rights and remedies arising as a matter of law encumbering deposits of cash, securities, commodities and other funds in favor of banks, financial institutions, other depository institutions, securities or commodities intermediaries or brokerage, and Liens of a collecting bank arising under Section 4-208 or 4-210 of the UCC in effect in the relevant jurisdiction or any similar law of any foreign jurisdiction on items in the course of collection;

 

(j)                                    Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods in the ordinary course of business;

 

(k)                                 Liens on any cash earnest money deposits made by the Company or any of its Subsidiaries in connection with an Acquisition, including, without limitation, in connection with any letter of intent or purchase agreement relating thereto;

 

(l)                                     Liens in connection with the sale or transfer of any assets in a transaction permitted under Section 6.03, customary rights and restrictions contained in agreements relating to such sale or transfer pending the completion thereof;

 

(m)                             Liens in the nature of the right of setoff in favor of counterparties to contractual agreements with the Loan Parties (i) in the ordinary course of business or (ii) otherwise permitted hereunder other than in connection with Indebtedness;

 

(n)                                 dispositions and other sales of assets permitted under Section 6.03;

 

(o)                                 to the extent constituting a Lien, Liens with respect to repurchase obligations in the ordinary course of business in connection with the cash management activities of the Company or any Subsidiary;

 

(p)                                 Liens that are contractual rights of set-off (i) relating to the establishment of depositary relations with banks or other financial institutions not given in connection with the issuance of Indebtedness, or (ii) relating to pooled deposit or sweep accounts of any Loan Party

 

73

 

or any Subsidiary to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business of the any such Loan Party or Subsidiary;

 

(q)                                 any Lien (and rights of set-off) arising under Section 24 or 25 of the general terms and conditions (algemene bankvoorwaarden) of any member of the Dutch Bankers’ Association (nederlandse vereniging van Banken)

 

(r)                                    Liens of sellers of goods to any Loan Party and any of their respective Subsidiaries arising under Article 2 of the UCC or similar provisions of applicable law in the ordinary course of business, covering only the goods sold and securing only the unpaid purchase price for such goods and related expenses;

 

(s)                                   Liens securing (i) Indebtedness described in clause (a) of the definition of Priority Indebtedness and permitted to be incurred under Section 6.01(q) and (ii) other obligations (excluding any Indebtedness) of the Company or any Subsidiary, in an aggregate outstanding amount, for the foregoing clauses (i) and (ii) taken together, not to exceed, at the time such Liens are created and when taken together with the aggregate outstanding principal amount of Indebtedness incurred pursuant to Section 6.01(q), fifteen percent (15%) of the Company’s Consolidated Net Worth (determined as of the last day of the most recent fiscal quarter for which financial statements shall have been delivered pursuant to Section 5.01(a) or Section 5.01(b) (or, prior to the delivery of any such financial statements, ending with the last fiscal quarter included in the financial statements referred to in Section 3.04(a));

 

(t)                                    Liens in favor of a credit card or debit card processor arising in the ordinary course of business under any processor agreement and relating solely to the amounts paid or payable thereunder, or customary deposits on reserve held by such credit card or debit card processor;

 

(u)                                 pledges or deposits to secure Indebtedness permitted to be incurred under Section 6.01(f) so long as the aggregate principal amount of such Indebtedness so secured does not exceed $50,000,000;

 

(v)                                 pledges or transfers of collateral to support bilateral mark-to-market security arrangements in respect of uncleared swap or derivative transactions; and

 

(w)                               Liens on assets of the Company and its Subsidiaries not otherwise permitted above so long as the aggregate principal amount of the Indebtedness and other obligations subject to such Liens does not at any time exceed $50,000,000.

 

SECTION 6.03. Fundamental Changes and Asset Sales.  (a) The Company will not, and will not permit any Subsidiary to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a series of transactions, including pursuant to a Sale and Leaseback Transaction) all or substantially all of the assets of the Company and its Subsidiaries (taken as a whole) (whether now owned or hereafter acquired), or liquidate or dissolve, except that:

 

(i)                                     if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing, any Person (other than the Company or any of its Subsidiaries) may merge or consolidate with the Company or any of its Subsidiaries; provided that any such merger or consolidation involving (A) subject to the following clause (B), a Borrower must result in such Borrower as the surviving entity,

 

74

 

(B) the Company must result in the Company as the surviving entity and (C) a Subsidiary Guarantor must result in such Subsidiary Guarantor as the surviving entity;

 

(ii)                                  any Subsidiary may merge into or consolidate with a Loan Party in a transaction in which the surviving entity is such Loan Party (provided that any such merger involving (A) a Borrower must result in such Borrower as the surviving entity (unless also involving the Company, in which case, subclause (B) shall also apply) and (B) the Company must result in the Company as the surviving entity);

 

(iii)                               any Subsidiary that is not a Loan Party may merge into or consolidate with, or sell, transfer, lease or otherwise dispose of any or all of its assets to, another Subsidiary that is not a Loan Party;

 

(iv)                              any Subsidiary may sell, transfer, lease or otherwise dispose of any or all of its assets to a Loan Party (in connection with a liquidation, winding up or dissolution or otherwise);

 

(v)                                 any Subsidiary that is not a Loan Party may liquidate, wind up or dissolve (A) if the Company determines in good faith that such liquidation, winding up or dissolution is in the best interests of the Company and is not materially disadvantageous to the Lenders or (B) to the extent undertaken in good faith for the purpose of improving the overall tax efficiency of the Company and its Subsidiaries;

 

(vi)                              the Company and its Subsidiaries may consummate Permitted Restructurings;

 

(vii)                           the Company and its Subsidiaries may enter into, terminate or modify leases, subleases, licenses and sublicenses of technology and other property (A) in the ordinary course of business or (B) between or among any Loan Parties and any of their Subsidiaries (or any combination thereof); and

 

(viii)                        the Company and its Subsidiaries may incur Liens permitted under Section 6.02.

 

(b)                                 The Company will not, and will not permit any of its Subsidiaries to, engage to any material extent in any business substantially different from businesses of the type conducted by the Company and its Subsidiaries (taken as a whole) on the Effective Date and businesses reasonably related, ancillary, similar, complementary or synergistic thereto or reasonable extensions, development or expansion thereof.

 

SECTION 6.04. Swap Agreements.  The Company will not, and will not permit any of its Subsidiaries to, enter into any Swap Agreement, except (a) Swap Agreements entered into to hedge or mitigate risks to which the Company or any Subsidiary has actual exposure (other than those in respect of Equity Interests of the Company or any of its Subsidiaries), (b) Swap Agreements entered into in order to effectively cap, collar or exchange interest rates (from fixed to floating rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment of the Company or any Subsidiary and (c) Permitted Call Spread Swap Agreements.

 

SECTION 6.05. Transactions with Affiliates.  The Company will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of

 

75

 

its Affiliates, except (a) transactions on terms and conditions not materially less favorable to the Company or such Subsidiary than could be obtained on an arm’s-length basis from a Person that is not an Affiliate for a comparable transaction, (b) transactions between or among the Company and its Subsidiaries (or an entity that becomes a Subsidiary of the Company as a result of such transaction) (or any combination thereof), (c) the payment of customary fees to directors of the Company or any of its Subsidiaries, and customary compensation, reasonable out-of-pocket expense reimbursement and indemnification (including the provision of directors and officers insurance) of, and other employment agreements and arrangements, employee benefit plans and stock incentive plans paid to, future, present or past directors, officers, managers and employees of the Company or any of its Subsidiaries, (d) transactions undertaken in good faith for the purpose of improving the overall tax efficiency of the Company and its Subsidiaries, (e) loans, advances and other transactions to the extent permitted by the terms of this Agreement, including without limitation any Restricted Payment permitted by Section 6.06 and transactions permitted by Section 6.03, (f) issuances of Equity Interests to Affiliates and the registration rights associated therewith, (g) any Collaboration Arrangement or any other license, sublicense, lease or sublease (i) in existence on the Effective Date (together with any amendments, restatements, extensions, replacements or other modifications thereto that are not materially adverse to the interests of the Lenders in their capacities as such), (ii) in the ordinary course of business or (iii) substantially consistent with past practices, (h) transactions with Affiliates that are Disclosed Matters, (i) transactions pursuant to agreements in effect on the Effective Date (together with any amendments, restatements, extensions, replacements or other modifications thereto that are not materially adverse to the interests of the Lenders in their capacities as such), (j) transactions with joint ventures for the purchase or sale of property or other assets and services entered into in the ordinary course of business and investments in joint ventures, (k) transactions approved by a majority of Disinterested Directors of the Company or of the applicable Subsidiary in good faith and (l) any transactions or series of related transactions with respect to which the aggregate consideration paid, or fair market value of property Disposed of, by the Company and its Subsidiaries is less than $2,000,000.

 

SECTION 6.06. Restricted Payments.  The Company will not, and will not permit any of its Subsidiaries to, make, directly or indirectly, any Restricted Payment, except (a) the Company may pay dividends or make other Restricted Payments with respect to its Equity Interests payable solely in additional Equity Interests, (b) the Company may repurchase Equity Interests upon the exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options or warrants or with the proceeds received from the substantially concurrent issue of new Equity Interests, (c) the Company may make cash payments (i) on securities convertible into or exchangeable for Equity Interests in the Company in accordance with their terms or (ii) in lieu of the issuance of fractional Equity Interests in connection with any dividend, split or combination thereof or the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests in the Company, (d) Subsidiaries may (i) make dividends or other distributions to their respective equityholders with respect to their Equity Interests (which distributions shall be (x) made on at least a ratable basis to any such equityholders that are Loan Parties and (y) in the case of a Subsidiary that is not a wholly-owned Subsidiary, made on at least a ratable basis to any such equityholders that are the Company or a Subsidiary), (ii) make other Restricted Payments to any Loan Party (either directly or indirectly through one or more Subsidiaries that are not Loan Parties) and (iii) make any Restricted Payments that the Company would have otherwise been permitted to make pursuant to this Section 6.06, (e) the Company may make Restricted Payments (i) for the repurchase, retirement or other acquisition or retirement for value of Equity Interests of the Company from any future, present or former employee, officer, director or manager or consultant of the Company or any Subsidiary  upon the death, disability, retirement or termination of employment of any such Person or (ii) pursuant to and in accordance with any agreement (including any employment agreement), stock option or stock ownership plans, incentive plans or other benefit plans, in each case for future, present or former directors, officers, managers or employees of the Company and its Subsidiaries (including, without limitation, in respect of tax withholding or other similar tax obligation related to the

 

76

 

foregoing) and (f) the Company and its Subsidiaries may make any other Restricted Payment so long as no Event of Default has occurred and is continuing prior to making such Restricted Payment or would arise immediately after giving effect (including giving effect on a pro forma basis) thereto and the aggregate amount of all such Restricted Payments pursuant to this clause (f) during any fiscal year of the Company does not exceed $75,000,000; provided that such Dollar limitation shall not be applicable, and such Restricted Payment shall not count against such Dollar limitation, if at the time of the making of such Restricted Payment and immediately after giving effect (on a pro forma basis) thereto, the Total Leverage Ratio is equal to or less than 2.75 to 1.00.

 

SECTION 6.07. Financial Covenants.

 

(a)                                 Maximum Total Leverage Ratio.  The Company will not permit the ratio (the “Total Leverage Ratio”), determined as of the end of each of its fiscal quarters ending on and after March 31, 2015, of (i) Consolidated Total Indebtedness to (ii) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters ending with the end of such fiscal quarter, all calculated for the Company and its Subsidiaries on a consolidated basis, to be greater than 3.00 to 1.00.  Notwithstanding the foregoing, the Company shall be permitted (such permission, the “Acquisition Holiday”) on one (1) occasion during the term of this Agreement to allow the maximum Total Leverage Ratio under this Section 6.07(a) to be increased to 3.50 to 1.00 for a period of four consecutive fiscal quarters in connection with an Acquisition occurring during the first of such four fiscal quarters if the aggregate consideration paid or to be paid in respect of such Acquisition exceeds $500,000,000, so long as the Company is in compliance on a pro forma basis with the maximum Total Leverage Ratio of 3.50 to 1.00 on the closing date of such Acquisition immediately after giving effect to such Acquisition; provided that (x) the Company shall provide notice in writing to the Administrative Agent of such increase and a transaction description of such Acquisition (regarding the name of the person or summary description of the assets being acquired and the approximate purchase price) and (y) at the end of such period of four consecutive fiscal quarters, the maximum Total Leverage Ratio permitted under this Section 6.07(a) shall revert to 3.00 to 1.00.

 

(b)                                 Minimum Interest Coverage Ratio.  The Company will not permit the ratio, determined as of the end of each of its fiscal quarters ending on and after March 31, 2015, of (i) Consolidated EBITDA to (ii) Consolidated Interest Expense, in each case for the period of four (4) consecutive fiscal quarters ending with the end of such fiscal quarter, all calculated for the Company and its Subsidiaries on a consolidated basis, to be less than 3.00 to 1.00.

 

ARTICLE VII

 

Events of Default

 

If any of the following events (“Events of Default”) shall occur:

 

(a)                                 any Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC Disbursement owed by such Borrower or the Company shall fail to make a payment pursuant to Article X, in each case when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;

 

(b)                                 any Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable by such Borrower

 

77

 

under this Agreement or any other Loan Document, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of five (5) Business Days;

 

(c)                                  any representation or warranty made or deemed made by or on behalf of any Borrower or any other Loan Party in or in connection with any Loan Document or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement or any other Loan Document (including any amendment or modification thereof or waiver thereunder) shall prove to have been incorrect in any material respect when made or deemed made;

 

(d)                                 any Borrower shall fail to observe or perform any covenant, condition or agreement applicable to it (or its Subsidiaries, to the extent applicable) contained in Section 5.02(a), 5.03 (solely with respect to any Borrower’s existence), 5.08 or 5.09, in Article VI or in Article X;

 

(e)                                  any Borrower or any Subsidiary Guarantor, as applicable, shall fail to observe or perform any covenant, condition or agreement applicable to it contained in this Agreement (other than those specified in clause (a), (b) or (d) of this Article) or any other Loan Document, and such failure shall continue unremedied for a period of thirty (30) days after notice thereof from the Administrative Agent or the Required Lenders to the Company;

 

(f)                                   any Borrower or any Material Subsidiary shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness of such Borrower or Material Subsidiary, as applicable, when and as the same shall become due and payable, which is not cured within any applicable grace period therefor;

 

(g)                                  any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits, after the expiration of any applicable grace period, and delivery of any applicable required notice, provided in the applicable agreement or instrument under which such Indebtedness was created, the holder or holders of such Material Indebtedness or any trustee or agent on its or their behalf to cause such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (g) shall not apply to (i) secured Material Indebtedness that becomes due as a result of the sale, transfer or other disposition (including as a result of a casualty or condemnation event) of the property or assets securing such Indebtedness (to the extent such sale, transfer or other disposition is not prohibited under this Agreement), (ii) any Material Indebtedness that becomes due as a result of a refinancing thereof permitted by Section 6.01, (iii) any reimbursement obligation in respect of a letter of credit, bankers acceptance or similar obligation as a result of a drawing thereunder by a beneficiary thereunder in accordance with its terms, (iv) any such Material Indebtedness that is mandatorily prepayable prior to the scheduled maturity thereof with the proceeds of the issuance of capital stock, the incurrence of other Indebtedness or the sale or other disposition of any assets, so long as such Material Indebtedness that has become due is so prepaid in full with such net proceeds required to be used to prepay such Material Indebtedness when due (or within any applicable grace period) and such event shall not have otherwise resulted in an event of default with respect to such Material Indebtedness, (v) any redemption, repurchase, conversion or settlement with respect to any Permitted Convertible Notes pursuant to their terms unless such redemption, repurchase, conversion or settlement results from a default thereunder or an event of the type that constitutes an Event of Default and (vi) any early payment requirement or unwinding or termination with respect to any Permitted Call Spread Swap Agreement;

 

78

 

(h)                                 (1) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, examinership, reorganization or other relief in respect of any Loan Party or any Material Subsidiary or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, examinership, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, examiner, sequestrator, conservator or similar official for any Loan Party or any Material Subsidiary or for a substantial part of its assets, and, in any such case, except to the extent it relates to proceedings or petitions in the Netherlands, such proceeding or petition shall continue undismissed, undischarged or unstayed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered or (2) a Luxembourg Insolvency Event shall occur in respect of any Luxembourg Borrower;

 

(i)                                     any Loan Party or any Material Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, examinership, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, examiner, sequestrator, conservator or similar official for any Loan Party or any Material Subsidiary or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

 

(j)                                    any Loan Party or any Material Subsidiary shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;

 

(k)                                 one or more judgments for the payment of money in an aggregate amount in excess of $75,000,000 (to the extent not paid, fully bonded or covered by a solvent and unaffiliated insurer that has not denied coverage) shall be rendered against any Loan Party, any Material Subsidiary or any combination thereof and the same shall remain undischarged, unvacated or undismissed for a period of sixty (60) consecutive days during which execution shall not be effectively stayed (by reason of pending appeal or otherwise), or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of any Loan Party or any Material Subsidiary to enforce any such judgment and such action shall not have been stayed;

 

(l)                                     an ERISA Event shall have occurred that, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect;

 

(m)                             a Change in Control shall occur; or

 

(n)                                 any Loan Document, after execution thereof and for any reason other than as expressly permitted hereunder or thereunder or in satisfaction in full of the Obligations, ceases to be valid, binding and enforceable against the Company or any other Loan Party party thereto in accordance with its terms in all material respects (or any Loan Party or any Material Subsidiary shall challenge the enforceability of any Loan Document or shall assert in writing, or engage in any action or inaction based on any such assertion, that any provision of any of the Loan Documents has ceased to be or otherwise is not valid, binding and enforceable in accordance with its terms, other than as expressly permitted thereunder or in satisfaction in full in cash of the Obligations then due and payable);

 

79

 

then, and in every such event (other than an event with respect to any Borrower described in clause (h) or (i) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Company, take either or both of the following actions, at the same or different times:  (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, and (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other Obligations of the Borrowers accrued hereunder and under the other Loan Documents, shall become  due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrowers; and in case of any event with respect to any Borrower described in clause (h) or (i) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other Obligations accrued hereunder and under the other Loan Documents, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrowers.  Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent may, and at the request of the Required Lenders shall, exercise any rights and remedies provided to the Administrative Agent under the Loan Documents or at law or equity.

 

ARTICLE VIII

 

The Administrative Agent

 

Each of the Lenders and the Issuing Banks hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf, including execution of the other Loan Documents, and to exercise such powers as are delegated to the Administrative Agent by the terms of the Loan Documents, together with such actions and powers as are reasonably incidental thereto.

 

The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Company or any Subsidiary or other Affiliate thereof as if it were not the Administrative Agent hereunder.

 

The Administrative Agent shall not have any duties or obligations except those expressly set forth in the Loan Documents.  Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated by the Loan Documents that the Administrative Agent is required to exercise in writing as directed by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02), and (c) except as expressly set forth in the Loan Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Company or any of its Subsidiaries that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity.  The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02) or in the absence of its own gross negligence or willful misconduct as determined by a final nonappealable judgment of a court of competent jurisdiction.  The Administrative Agent shall be deemed not to have knowledge of any Default

 

80

 

unless and until written notice thereof is given to the Administrative Agent by the Company or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or in connection with any Loan Document, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth in any Loan Document, (iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

 

The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person.  The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability for relying thereon.  The Administrative Agent may consult with legal counsel (who may be counsel for the Company), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

 

The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any one or more sub-agents appointed by the Administrative Agent.  The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties.  The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.

 

Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the Administrative Agent may resign at any time by notifying the Lenders, the Issuing Banks and the Company.  Upon any such resignation, the Required Lenders shall have the right (with the consent of the Company (such consent not to be unreasonably withheld or delayed); provided that no consent of the Company shall be required if an Event of Default has occurred and is continuing) to appoint a successor.  If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may, on behalf of the Lenders and the Issuing Banks, appoint a successor Administrative Agent which shall be a bank with an office in New York, New York, or an Affiliate of any such bank.  Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder.  The fees payable by any Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between such Borrower and such successor.  After the Administrative Agent’s resignation hereunder, the provisions of this Article and Section 9.03 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while it was acting as Administrative Agent.

 

Each Lender acknowledges and agrees that the extensions of credit made hereunder are commercial loans and letters of credit and not investments in a business enterprise or securities.  Each Lender further confirms that it is engaged in making, acquiring or holding commercial loans in the ordinary course of its business and  has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate,

 

81

 

made its own credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Loans hereunder.  Each Lender shall, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information (which may contain material, non-public information within the meaning of the United States securities laws concerning the Company and its Affiliates and their respective securities) as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any related agreement or any document furnished hereunder or thereunder and in deciding whether or to the extent to which it will continue as a Lender or assign or otherwise transfer its rights, interests and obligations hereunder.

 

None of the Lenders or their Affiliates, if any, identified in this Agreement as a Joint Bookrunner, Co-Syndication Agent or Co-Documentation Agent shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than, in the case of Lenders, those applicable to all Lenders as such (or applicable to Lenders of the same Class of Loans).  Without limiting the foregoing, none of the Joint Bookrunners or such Lenders shall have or be deemed to have a fiduciary relationship with any Lender.  Each Lender hereby makes the same acknowledgments with respect to the relevant Lenders and their Affiliates in their respective capacities as Joint Bookrunners, Co-Syndication Agents or Co-Documentation Agents, as applicable, as it makes with respect to the Administrative Agent in the preceding paragraph.

 

The Lenders are not partners or co-venturers, and no Lender shall be liable for the acts or omissions of, or (except as otherwise set forth herein in case of the Administrative Agent) authorized to act for, any other Lender.  The Administrative Agent shall have the exclusive right on behalf of the Lenders to enforce the payment of the principal of and interest on any Loan after the date such principal or interest has become due and payable pursuant to the terms of this Agreement.

 

ARTICLE IX

 

Miscellaneous

 

SECTION 9.01.           Notices.  (a) Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:

 

(i)                                     if to any Loan Party, to it:

 

c/o Regeneron Pharmaceuticals, Inc.

777 Old Saw Mill River Road

Tarrytown, New York  10591

Attention: Dominick Agron, Vice President & Treasurer

Telecopy No. (914) 847-1555

Telephone No. (914) 847-5892

E-mail: dominick.agron@regeneron.com

 

with a copy (in the case of a notice of an actual or potential Default, Event of Default, non-compliance with this Agreement or any other similar matter) to:

 

c/o Regeneron Pharmaceuticals, Inc.

777 Old Saw Mill River Road

 

82

 

Tarrytown, New York  10591

Attention: Joseph J. LaRosa, Senior Vice President, General Counsel

Telecopy No. (914) 847-7721

Telephone No. (914) 847-7498

E-mail: joseph.larosa@regeneron.com

 

and

 

Skadden, Arps, Slate, Meagher & Flom LLP

Four Times Square

New York, New York 10036

Attention: Sarah M. Ward

Telecopy No. (917) 777-2126

Telephone No. (212) 735-2126

E-mail: sarah.ward@skadden.com

 

(ii)                                  if to the Administrative Agent, (A) in the case of Borrowings denominated in Dollars (other than Designated Loans), to JPMorgan Chase Bank, N.A., 10 South Dearborn Street, Floor L2, Chicago, Illinois 60603, Attention of Yuvette Owens (Telecopy No. (888) 292-9533; E-mail: jpm.agency.servicing.4@jpmorgan.com) and (B) in the case of Borrowings denominated in Foreign Currencies and Designated Loans, to J.P. Morgan Europe Limited, 25 Bank Street, Canary Wharf, London E14 5JP, Attention of The Manager, Loan & Agency Services (Telecopy No. 44 207 777 2360), and in each case with a copy to JPMorgan Chase Bank, N.A., Two Corporate Drive, Suite 730, Shelton, Connecticut 06484, Attention of Scott Farquhar (Telecopy No. (203) 944-8495);

 

(iii)                               if to JPMorgan Chase Bank, N.A. in its capacity as an Issuing Bank, to it at JPMorgan Chase Bank, N.A., 10 South Dearborn Street, Floor L2, Chicago, Illinois 60603 (Telecopy No. (312) 356-2608; E-mail: Chicago.LC.agency.closing.team@jpmorgan.com);

 

(iv)                              if to the Swingline Lender, to it at JPMorgan Chase Bank, N.A., 10 South Dearborn Street, Floor L2, Chicago, Illinois 60603, Attention of Yuvette Owens (Telecopy No. (888) 292-9533; E-mail: jpm.agency.servicing.4@jpmorgan.com); and

 

(v)                                 if to any other Lender or Issuing Bank, to it at its address (or telecopy number) set forth in its Administrative Questionnaire.

 

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient).  Notices delivered through Electronic Systems, to the extent provided in paragraph (b) below, shall be effective as provided in said paragraph (b).

 

(b)                                 Notices and other communications to the Lenders and the Issuing Banks hereunder may be delivered or furnished by using Electronic Systems pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article II unless otherwise agreed by the Administrative Agent and the applicable Lender.  The Administrative Agent or the Company may, in its discretion, agree to accept notices

 

83

 

and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

 

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.

 

(c)                                  Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto.

 

(d)                                 Electronic Systems.

 

(i)                                     The Company agrees that the Administrative Agent may, but shall not be obligated to, make Communications (as defined below) available to the Issuing Banks and the other Lenders by posting the Communications on Debt Domain, Intralinks, Syndtrak, ClearPar or a substantially similar Electronic System.

 

(ii)                                  Any Electronic System used by the Administrative Agent is provided “as is” and “as available.”  The Agent Parties (as defined below) do not warrant the adequacy of such Electronic Systems and expressly disclaim liability for errors or omissions in the Communications (except as otherwise expressly provided in this Section 9.01(d)(ii)).  No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or any Electronic System.  In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to any Loan Party, any Lender, any Issuing Bank or any other Person or entity for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Loan Party’s or the Administrative Agent’s transmission of Communications through an Electronic System except with respect to actual or direct damages to the extent determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the willful misconduct or gross negligence of any Agent Party; provided that any Communication to any Lenders, prospective Lenders, Participants or prospective Participants or, to the extent such disclosure is otherwise permitted, to any other Person through an Electronic System shall be made subject to the acknowledgement and acceptance by such Person that such Communication is being disseminated or disclosed on a confidential basis (on terms substantially the same as set forth in Section 9.12 or otherwise reasonably acceptable to the Administrative Agent and the Company), which shall in any event require “click through” or other affirmative actions on the part of the recipient to access such Communication.  “Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of any Loan Party pursuant to any Loan Document or the transactions contemplated therein which is distributed by the Administrative Agent, any Lender or any Issuing

 

84

 

Bank by means of electronic communications pursuant to this Section, including through an Electronic System.

 

SECTION 9.02.           Waivers; Amendments.  (a) No failure or delay by the Administrative Agent, any Issuing Bank or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.  The rights and remedies of the Administrative Agent, the Issuing Banks and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of this Agreement or consent to any departure by any Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent, any Lender or any Issuing Bank may have had notice or knowledge of such Default at the time.

 

(b)                                 Except as provided in Section 2.20 with respect to an Incremental Term Loan Amendment, neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrowers and the Required Lenders or by the Borrowers and the Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the amount of the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender directly affected thereby (provided that (x) any amendment or modification of the financial covenants in this Agreement (or defined terms used in the financial covenants in this Agreement) shall not constitute a reduction in the rate of interest or fees for purposes of this clause (ii) even if the effect of such amendment or modification would be to reduce the rate of interest on any Loan or any LC Disbursement or to reduce any fee payable hereunder and (y) only the consent of the Required Lenders shall be necessary to amend the provisions of Section 2.13(c) or to waive any obligation of any Borrower to pay interest or any other amount at the interest rate prescribed in such Section), (iii) postpone the scheduled date of payment of the principal amount of any Loan or LC Disbursement , or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender directly affected thereby (other than (x) any reduction of the amount of, or any extension of the payment date for, the mandatory prepayments required under Section 2.11, in each case which shall only require the approval of the Required Lenders and (y) with respect to the matters set forth in clauses (ii)(x) and (ii)(y) above), (iv) change Section 2.18(b) or (d) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender, (v) change any of the provisions of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender (it being understood that, solely with the consent of the parties prescribed by Section 2.20 to be parties to an Incremental Term Loan Amendment, Incremental Term Loans may be included in the determination of Required Lenders on substantially the same basis as the Commitments and the Revolving Loans are included on the Effective Date), (vi) release the Company from its obligations under Article X without the written consent of each Lender or (vii) release Subsidiary Guarantors which, as of the most recent fiscal year of the Company, for the

 

85

 

period of four consecutive fiscal quarters then ended, for which financial statements have been delivered pursuant to Section 5.01(a), contributed, in the aggregate, greater than 50% of Consolidated EBITDA for such period from their obligations under the Subsidiary Guaranty without the written consent of each Lender; provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent, any Issuing Bank or the Swingline Lender hereunder without the prior written consent of the Administrative Agent, such Issuing Bank or the Swingline Lender, as the case may be (it being understood that any change to Section 2.24 shall require the consent of the Administrative Agent, the Issuing Banks and the Swingline Lender).  Notwithstanding the foregoing, no consent with respect to any amendment, waiver or other modification of this Agreement shall be required of any Defaulting Lender, except with respect to any amendment, waiver or other modification referred to in clause (i), (ii) or (iii) of the first proviso of this paragraph and then only in the event such Defaulting Lender shall be directly affected by such amendment, waiver or other modification.

 

(c)                                  Notwithstanding the foregoing, this Agreement and any other Loan Document may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent and the Borrowers (x) to add one or more credit facilities (in addition to the Incremental Term Loans pursuant to an Incremental Term Loan Amendment) to this Agreement and to permit extensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents with the Revolving Loans, Incremental Term Loans and the accrued interest and fees in respect thereof and (y) to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders and Lenders (it being understood and agreed that any such amendment (i) in connection with new or increases to the Commitments and/or Incremental Term Loans in accordance with Section 2.20 or (ii) in connection with any extension in accordance with Section 2.21 shall, in any such case, require solely only the consent of the parties prescribed by such Section and shall not require the consent of the Required Lenders).

 

(d)                                 If, in connection with any proposed amendment, waiver or consent  requiring the consent of “each Lender” or “each Lender directly affected thereby,” the consent of the Required Lenders is obtained, but the consent of other necessary Lenders is not obtained (any such Lender whose consent is necessary but not obtained being referred to herein as a “Non-Consenting Lender”), then the Company may elect to replace a Non-Consenting Lender as a Lender party to this Agreement; provided that, concurrently with such replacement, (i) another bank or other entity which is reasonably satisfactory to the Company and the Administrative Agent shall agree, as of such date, to purchase for cash the Loans and other Obligations due to the Non-Consenting Lender pursuant to an Assignment and Assumption and to become a Lender for all purposes under this Agreement and to assume all obligations of the Non-Consenting Lender to be terminated as of such date and to comply with the requirements of clause (b) of Section 9.04, and (ii) each Borrower shall pay to such Non-Consenting Lender in same day funds on the day of such replacement (1) the outstanding principal amount of its Loans and participations in LC Disbursements and all interest, fees and other amounts then accrued but unpaid to such Non-Consenting Lender by such Borrower hereunder to and including the date of termination, including without limitation payments due to such Non-Consenting Lender under Sections 2.15 and 2.17, and (2) an amount, if any, equal to the payment which would have been due to such Lender on the day of such replacement under Section 2.16 had the Loans of such Non-Consenting Lender been prepaid on such date rather than sold to the replacement Lender.

 

(e)                                  Notwithstanding anything to the contrary herein the Administrative Agent may, with the consent of the Company only, amend, modify or supplement this Agreement or any of the other Loan Documents (i) to cure any ambiguity, omission, mistake, defect or inconsistency

 

86

 

or correct any typographical error or other manifest error in any Loan Document, (ii) to comply with local law or advice of local counsel in any Eligible Foreign Jurisdiction or (iii) to amend any administrative provision relating to borrowing mechanics, notice requirements, the method of determining interest or other rates or any similar agency or administrative matter with respect to any Foreign Subsidiary Borrower, in each case in a manner not adverse to any Lender (subject to the consent of the Issuing Banks and/or the Swingline Lender to the extent any such changes relate to Letters of Credit or Swingline Loans, respectively).

 

SECTION 9.03. Expenses; Indemnity; Damage Waiver.  (a) The Company shall pay (i) all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent and its Affiliates (which shall be limited, in the case of legal fees and expenses, to the reasonable and documented fees, disbursements and other charges of a single firm as primary counsel, along with such specialist counsel as may reasonably be required by the Administrative Agent, and a single firm of local counsel in each applicable jurisdiction, for the Administrative Agent) in connection with the syndication and distribution (including, without limitation, via the internet or through a service such as Intralinks) of the credit facilities provided for herein, the preparation and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable and documented out-of-pocket expenses incurred by the Issuing Banks in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent, any Issuing Bank or any Lender (which shall be limited, in the case of legal fees and expenses, to the reasonable and documented fees, disbursements and other charges of a single firm as primary counsel, along with such specialist counsel as may reasonably be required by the Administrative Agent, and a single firm of local counsel in each applicable jurisdiction, for the Administrative Agent, and not more than a single firm of outside counsel, and a single firm of local counsel in each applicable jurisdiction, for all of the other Lenders and, in the event of an actual or reasonably perceived conflict of interest (as reasonably determined by the Administrative Agent or applicable Lender), one additional firm of counsel for each group of similarly affected persons) in connection with the enforcement or protection of its rights in connection with this Agreement and any other Loan Document, including its rights under this Section, or in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses (subject to the foregoing limitations with respect to legal fees and expenses) incurred during  any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

 

(b)                                 The Company shall indemnify the Administrative Agent, each Issuing Bank and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and reasonable and documented out-of-pocket expenses (including the reasonable and documented out-of-pocket fees, charges and disbursements of (x) a single firm as primary counsel, along with such specialist counsel as may reasonably be required by the Administrative Agent, and a single firm of local counsel in each applicable jurisdiction for the Administrative Agent and its Related Parties, and (y) not more than a single firm of outside counsel, and a single firm of local counsel in each applicable jurisdiction, for all of the other Indemnitees and, in the event of an actual or reasonably perceived conflict of interest (as reasonably determined by the applicable Indemnitee), one additional firm of counsel to each group of similarly affected Indemnitees), incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of any Loan Document or any agreement or instrument contemplated thereby, the performance by the parties hereto of their respective obligations thereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom (including any refusal by any Issuing Bank to honor a demand for payment under a

 

87

 

Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Company or any of its Subsidiaries, or any Environmental Liability related in any way to the Company or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether or not such claim, litigation, investigation or proceeding is brought by the Company or any other Loan Party or its or their respective equity holders, Affiliates, creditors or any other third Person and whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from (i) the willful misconduct or gross negligence of such Indemnitee or any of its Controlled Related Parties, (ii) a breach in bad faith by such Indemnitee of its material obligations under the applicable Loan Documents pursuant to a claim initiated by any Loan Party or (iii) any dispute solely among Indemnitees (not arising as a result of any act or omission by the Company or any of its Subsidiaries or Affiliates) other than claims against any Credit Party in its capacity as, or in fulfilling its role as, the Administrative Agent, an Issuing Bank, the Swingline Lender, a lead arranger, bookrunner, agent or any similar role under or in connection with this Agreement.  As used in this Section 9.03, a “Controlled Related Party” of an Indemnitee means (1) any Controlling Person or Controlled Affiliate of such Indemnitee, (2) the respective directors, officers, or employees of such Indemnitee or any of its Controlling Persons or Controlled Affiliates and (3) the respective agents or representatives of such Indemnitee or any of its Controlling Persons or Controlled Affiliates, in the case of this clause (3), acting on behalf of or at the instructions of such Indemnitee, Controlling Person or such Controlled Affiliate; provided that each reference to a Controlling Person, Controlled Affiliate, director, officer or employee in this sentence pertains to a Controlling Person, Controlled Affiliate, director, officer or employee involved in the structuring, arrangement, negotiation or syndication of the credit facility evidenced by this Agreement.  This Section 9.03(b) shall not apply with respect to Taxes other than any Taxes that represent losses, claims or damages arising from any non-Tax claim.

 

(c)                                  To the extent that the Company fails to pay any amount required to be paid by it to the Administrative Agent, any Issuing Bank or the Swingline Lender under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent, such Issuing Bank or the Swingline Lender, as the case may be, such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount (it being understood that the Company’s failure to pay any such amount shall not relieve the Company of any default in the payment thereof); provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent, such Issuing Bank or the Swingline Lender in its capacity as such.

 

(d)                                 To the extent permitted by applicable law, and subject to the proviso set forth in Section 9.01(d)(ii), no Borrower shall assert, and each Borrower hereby waives, any claim against any Indemnitee for any damages arising from the use by others of information or other materials obtained through telecommunications, electronic or other information transmission systems (including the Internet) other than damages that are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or any of its Controlled Related Parties.  To the extent permitted by applicable law, no Indemnitee shall assert against any Loan Party or its Related Parties and no Loan Party shall assert against any Indemnitee, and each Indemnitee and Loan

 

88

 

Party hereby waives, any claim on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof; provided, that nothing contained in this sentence shall limit the Company’s indemnity obligations to the extent set forth in Section 9.03(b).

 

(e)                                  All amounts due under this Section shall be payable not later than fifteen (15) days after written demand therefor.

 

SECTION 9.04. Successors and Assigns.  (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of any Issuing Bank that issues any Letter of Credit), except that (i) no Borrower may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by any Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section.  Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of any Issuing Bank that issues any Letter of Credit), Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the Issuing Banks and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)                                 (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more Persons (other than an Ineligible Institution) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld or delayed) of:

 

(A)                               the Company (provided that the Company shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within ten (10) Business Days after having received written notice thereof); provided, further, that no consent of the Company shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an Event of Default under clause (a), (b), (h), (i) or (j) of Article VII has occurred and is continuing, any other assignee;

 

(B)                               the Administrative Agent;

 

(C)                               each Issuing Bank; and

 

(D)                               the Swingline Lender.

 

(ii)                                  Assignments shall be subject to the following additional conditions:

 

(A)                               except in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such

 

89

 

assignment is delivered to the Administrative Agent) shall not be less than $5,000,000 unless each of the Company and the Administrative Agent otherwise consent; provided that no such consent of the Company shall be required if an Event of Default under clause (a), (b), (h), (i) or (j) of Article VII has occurred and is continuing;

 

(B)                               each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement; provided that this clause shall not be construed to prohibit the assignment of a proportionate part of all the assigning Lender’s rights and obligations in respect of one Class of Commitments or Loans;

 

(C)                               the parties to each assignment shall execute and deliver to the Administrative Agent (x) an Assignment and Assumption or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to a Platform as to which the Administrative Agent and the parties to the Assignment and Assumption are participants, together with a processing and recordation fee of $3,500, such fee to be paid by either the assigning Lender or the assignee Lender or shared between such Lenders;

 

(D)                               the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which the assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Company and its Affiliates and their Related Parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including Federal and state securities laws; and

 

(E)                                any assignment to any Person of Commitments or Loans with respect to a Dutch Borrower shall only be permitted if the person to whom the Commitments or Loans are assigned is a Dutch Non-Public Lender at all times.

 

For the purposes of this Section 9.04(b), the terms “Approved Fund” and “Ineligible Institution” have the following meanings:

 

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

 

“Ineligible Institution” means (a) a natural person, (b) a Defaulting Lender or its Lender Parent, (c) the Company, any of its Subsidiaries or any of its Affiliates, or (d) a company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person or relative(s) thereof.

 

(iii)                               Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations (including, without limitation, the obligation to timely deliver the documentation

 

90

 

described in Section 2.17(f)) of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.15, 2.16, 2.17 and 9.03).  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section.

 

(iv)                              The Administrative Agent, acting for this purpose as a non-fiduciary agent of each Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount (and stated interest) of the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive (absent manifest error), and the Borrowers, the Administrative Agent, the Issuing Banks and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.  The Register shall be available for inspection by the Company, any Issuing Bank and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

 

(v)                                 Upon its receipt of (x) a duly completed Assignment and Assumption executed by an assigning Lender and an assignee or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to a Platform as to which the Administrative Agent and the parties to the Assignment and Assumption are participants, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.05(c), 2.06(d) or (e), 2.07(b), 2.18(e) or 9.03(c), the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon.  No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.

 

(c)                                  Any Lender may, without the consent of any Borrower, the Administrative Agent, the Issuing Banks or the Swingline Lender, sell participations to one or more banks or other entities (a “Participant”), other than an Ineligible Institution, in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged; (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations; and (C) the Borrowers, the Administrative Agent, the Issuing Banks and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that

 

91

 

such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant.  Each Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 (subject to the requirements and limitations therein, including the requirements under Section 2.17(f) (it being understood that the documentation required under Section 2.17(f) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant (A) agrees to be subject to the provisions of Sections 2.18 and 2.19 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Sections 2.15 or 2.17, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.18(d) as though it were a Lender.  Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrowers, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans, Letters of Credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Commitment, Loan, Letter of Credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.  For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

 

(d)                                 Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank or other central banking authority having jurisdiction over such Lender, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

 

SECTION 9.05. Survival.  All covenants, agreements, representations and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, any Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement or any other Loan Document is outstanding and unpaid or any Letter of Credit is outstanding (unless such Letter of Credit has been cash collateralized or backstopped pursuant to

 

92

 

arrangements reasonably satisfactory to the Administrative Agent) and so long as the Commitments have not expired or terminated.  The provisions of Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any other Loan Document or any provision hereof or thereof.

 

SECTION 9.06.  Counterparts; Integration; Effectiveness; Electronic Execution.  This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Agreement, the other Loan Documents and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.  Delivery of an executed counterpart of a signature page of this Agreement by telecopy, e-mailed .pdf or any other electronic means that reproduces an image of the actual executed signature page shall be effective as delivery of a manually executed counterpart of this Agreement.  The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to any  document to be signed in connection with this Agreement and the transactions contemplated hereby shall be deemed to include Electronic Signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

 

SECTION 9.07. Severability.  Any provision of any Loan Document held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

 

SECTION 9.08. Right of Setoff.  Subject to Section 2.23(b) and any limitations expressly agreed to by any Lender or its Affiliate, as applicable, pursuant to any Bank Services Agreement or Swap Agreement to which such Lender or Affiliate is a party, if an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final and in whatever currency denominated) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of any Loan Party against any of and all of the Obligations owed by such Loan Party held by such Lender, irrespective of whether or not such Lender shall have made any demand under the Loan Documents and although such obligations may be unmatured.  The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.

 

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.  (a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

 

93

 

(b)                                 Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in the Borough of Manhattan, and of the United States District Court for the Southern District of New York sitting in the Borough of Manhattan, and any appellate court from any thereof, in any action or proceeding arising out of or relating to any Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court.  Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent, any Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Loan Party or its properties in the courts of any jurisdiction.

 

(c)                                  Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

(d)                                 Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01.  Each Subsidiary Borrower irrevocably designates and appoints the Company, as its authorized agent, to accept and acknowledge on its behalf, service of any and all process which may be served in any suit, action or proceeding of the nature referred to in Section 9.09(b) in any federal or New York State court sitting in New York City.  The Company hereby represents, warrants and confirms that the Company has agreed to accept such appointment (and any similar appointment by a Subsidiary Guarantor).  Said designation and appointment shall be irrevocable by each such Subsidiary Borrower until all Loans, all reimbursement obligations, interest thereon and all other amounts payable by such Subsidiary Borrower hereunder and under the other Loan Documents shall have been paid in full in accordance with the provisions hereof and thereof and such Subsidiary Borrower shall have been terminated as a Borrower hereunder pursuant to Section 2.23.  Each Subsidiary Borrower hereby consents to process being served in any suit, action or proceeding of the nature referred to in Section 9.09(b) in any federal or New York State court sitting in New York City by service of process upon the Company as provided in this Section 9.09(d); provided that, to the extent lawful and possible, notice of said service upon such agent shall be mailed by registered or certified air mail, postage prepaid, return receipt requested, to the Company and (if applicable to) such Subsidiary Borrower at its address set forth in the Borrowing Subsidiary Agreement to which it is a party or to any other address of which such Subsidiary Borrower shall have given written notice to the Administrative Agent (with a copy thereof to the Company).  Each Subsidiary Borrower irrevocably waives, to the fullest extent permitted by law, all claim of error by reason of any such service in such manner and agrees that such service shall be deemed in every respect effective service of process upon such Subsidiary Borrower in any such suit, action or proceeding and shall, to the fullest extent permitted by law, be taken and held to be valid and personal service upon and personal delivery to such Subsidiary Borrower.  To the extent any Subsidiary Borrower has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether from service or notice, attachment prior to judgment, attachment in aid of execution of a judgment, execution or otherwise), each Subsidiary Borrower hereby irrevocably waives such immunity in respect of its obligations under the Loan Documents.  Nothing in this

 

94

 

Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

 

SECTION 9.10.        WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

SECTION 9.11. Headings.  Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

 

SECTION 9.12. Confidentiality.  Each of the Administrative Agent, the Issuing Banks and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); provided that the disclosing Administrative Agent, Issuing Bank or Lender, as applicable, shall be responsible for compliance by such Persons with the provisions of this Section 9.12, (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it or its Affiliates (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process (provided that the Administrative Agent or such Lender, as applicable, agrees that it will, to the extent practicable and other than with respect to any audit or examination conducted by bank accountants or any governmental bank regulatory authority exercising examination or regulatory authority, notify the Borrowers promptly thereof, unless such notification is prohibited by law, rule or regulation), (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies under this Agreement or any other Loan Document or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (1) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (2) any actual or prospective party (or its managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives) to any swap or derivative or similar transaction to which the Administrative Agent, any Issuing Bank or any Lender is a party and under which payments are to be made by reference to a Borrower and its obligations, this Agreement or payments hereunder, (g) on a confidential basis to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the credit facilities provided for herein, (h) with the prior written consent of the Company or (i) to the extent such Information (1) becomes publicly available other than as a result of a breach of this Section or (2) becomes available to the Administrative Agent, any Issuing Bank or any Lender on a nonconfidential basis from a source other than any Loan Party or any of their respective Related Parties.  For the purposes of this Section, “Information” means all information received from or on behalf of any Loan Party or any of their respective Related Parties relating to any Loan Party or Subsidiary or its business or securities,

 

95

 

other than any such information that is available to the Administrative Agent, any Issuing Bank or any Lender on a nonconfidential basis prior to disclosure by or on behalf of any Loan Party and other than information pertaining to this Agreement of the type that is routinely provided by arrangers to data service providers, including league table providers, that serve the lending industry.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

EACH OF THE ADMINISTRATIVE AGENT, EACH ISSUING BANK AND EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN THE IMMEDIATELY PRECEDING PARAGRAPH FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE COMPANY AND  ITS RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

 

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE COMPANY OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE COMPANY, THE OTHER LOAN PARTIES AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES.  ACCORDINGLY, EACH LENDER REPRESENTS TO THE COMPANY AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

 

SECTION 9.13. USA PATRIOT Act.  Each Lender that is subject to the requirements of the Patriot Act hereby notifies each Loan Party that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies such Loan Party, which information includes the name and address of such Loan Party and other information that will allow such Lender to identify such Loan Party in accordance with the Patriot Act.

 

SECTION 9.14. Releases of Subsidiary Guarantors.

 

(a)                                 A Subsidiary Guarantor shall automatically be released from its obligations under the Subsidiary Guaranty upon the consummation of any transaction permitted by this Agreement as a result of which such Subsidiary Guarantor ceases to be a Subsidiary; provided that, if so required by this Agreement, the Required Lenders shall have consented to such transaction and the terms of such consent shall not have provided otherwise.  In connection with any termination or release pursuant to this Section (including pursuant to clause (b) or (c) below), the Administrative Agent shall (and is hereby irrevocably authorized by each Lender to) execute and deliver to any Loan Party, at such Loan Party’s expense, all documents that such Loan Party shall reasonably request to evidence such termination or release.  Any execution and delivery of documents pursuant to this Section shall be without recourse to or warranty by the Administrative Agent except with respect to any customary further assurances that are expressly agreed to in writing by the Administrative Agent.

 

96

 

(b)                                 Further, the Administrative Agent may (and is hereby irrevocably authorized by each Lender to), upon the request of the Company, release any Subsidiary Guarantor from its obligations under the Subsidiary Guaranty if (i) such Subsidiary Guarantor is no longer a Material Domestic Subsidiary, becomes an Excluded Subsidiary or is otherwise not required pursuant to this terms of this Agreement to provide a Subsidiary Guaranty or (ii) such release is approved, authorized or ratified by the requisite Lenders pursuant to Section 9.02.

 

(c)                                  At such time as the principal and interest on the Loans, all LC Disbursements, the fees, expenses and other amounts payable under the Loan Documents and the other Obligations (other Obligations expressly stated to survive such payment and termination and excluding, for the avoidance of doubt, any Specified Ancillary Obligations or other obligations under any Swap Agreement or any Banking Services Agreement) then due and payable shall have been paid in full in cash, the Commitments shall have been terminated and no Letters of Credit shall be outstanding (or any outstanding Letters of Credit shall have been cash collateralized or backstopped pursuant to arrangements reasonably satisfactory to the Administrative Agent) (the foregoing, collectively, the “Final Release Conditions”), the Subsidiary Guaranty and the Company’s Guarantee pursuant to Article X and all obligations (other than those expressly stated to survive such termination) of each Subsidiary Guarantor and the Company thereunder shall automatically terminate, all without delivery of any instrument or performance of any act by any Person.

 

(d)                                 Upon request by the Administrative Agent at any time, the Lenders will confirm in writing the Administrative Agent’s authority to release any particular Subsidiary Guaranty pursuant hereto.

 

SECTION 9.15. Interest Rate Limitation.  Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.

 

SECTION 9.16. No Advisory or Fiduciary Responsibility.  In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), each Borrower acknowledges and agrees that: (i) (A) the arranging and other services regarding this Agreement provided by the Lenders are arm’s-length commercial transactions between such Borrower and its Affiliates, on the one hand, and the Lenders and their Affiliates, on the other hand, (B) such Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) such Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) each of the Lenders and their Affiliates is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for such Borrower or any of its Affiliates, or any other Person and (B) no Lender or any of its Affiliates has any obligation to such Borrower or any of its Affiliates with respect to the transactions contemplated hereby except, in the case of the Credit Parties,

 

97

 

those obligations expressly set forth herein and in the other Loan Documents; and (iii) each of the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of such Borrower and its Affiliates, and no Lender or any of its Affiliates has any obligation to disclose any of such interests to such Borrower or its Affiliates.  To the fullest extent permitted by law, each Borrower hereby waives and releases any claims that it may have against each of the Lenders and their Affiliates with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

 

SECTION 9.17. Attorney Representation.  If a Dutch Borrower is represented by an attorney in connection with the signing and/or execution of this Agreement and/or any other Loan Document it is hereby expressly acknowledged and accepted by the parties to this Agreement and/or any other Loan Document that the existence and extent of the attorney’s authority and the effects of the attorney’s exercise or purported exercise of his or her authority shall be governed by the laws of the Netherlands.

 

SECTION 9.18. Swap Obligations and Banking Services Obligations.  No Lender or any of its Affiliates that obtains the benefits of Article X or any Subsidiary Guaranty by virtue of the provisions hereof or of such Subsidiary Guaranty to Guarantee any Specified Ancillary Obligations owed to such Lender or any of its Affiliates shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise (including the release or impairment of any Subsidiary Guaranty or the Company’s Guarantee set forth in Article X) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents.

 

ARTICLE X

 

Company Guarantee

 

In order to induce the Lenders to extend credit to the Borrowers hereunder and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the Company hereby absolutely and irrevocably and unconditionally guarantees, as a primary obligor and not merely as a surety, the payment when and as due of the Obligations of the Subsidiary Borrowers and the Specified Ancillary Obligations (collectively, the “Guaranteed Obligations”).  The Company further agrees that the due and punctual payment of such Guaranteed Obligations may be extended or renewed, in whole or in part, without notice to or further assent from it, and that it will remain bound upon its guarantee under this Article X notwithstanding any such extension or renewal of any such Guaranteed Obligation.  The Company hereby irrevocably and unconditionally agrees that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent and primary obligation, indemnify the Administrative Agent, the Issuing Banks and the Lenders immediately on demand against any out-of-pocket and documented cost, loss or liability they incur as a result of any Subsidiary or any of its Affiliates not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by the Company under this Article X on the date when it would have been due (but so that the amount payable by the Company under this indemnity will not exceed the amount which it would have had to pay under this Article X if the amount claimed had been recoverable on the basis of a guarantee).  Notwithstanding anything to the contrary in this Article X, the Company shall not have been deemed to have guaranteed any of its own Obligations or its own Specified Ancillary Obligations.

 

The Company waives presentment to, demand of payment from and protest to any Subsidiary of any of the Guaranteed Obligations, and also waives notice of acceptance of its obligations

 

98

 

and notice of protest for nonpayment.  The obligations of the Company under this Article X shall not be affected by (a) the failure of the Administrative Agent, any Issuing Bank or any Lender to assert any claim or demand or to enforce any right or remedy against any Subsidiary under the provisions of this Agreement, any other Loan Document or otherwise; (b) any extension or renewal of any of the Guaranteed Obligations; (c) any rescission, waiver, amendment or modification of, or release from, any of the terms or provisions of this Agreement, or any other Loan Document; (d) any default, failure or delay, willful or otherwise, in the performance of any of the Guaranteed Obligations; (e) the failure of the Administrative Agent to take any steps to perfect and maintain any security interest in, or to preserve any rights to, any security or collateral for the Guaranteed Obligations, if any; (f) any change in the corporate, partnership or other existence, structure or ownership of any Subsidiary or any other guarantor of any of the Guaranteed Obligations; (g) the enforceability or validity of the Guaranteed Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto or with respect to any collateral securing the Guaranteed Obligations or any part thereof, or any other invalidity or unenforceability relating to or against any Subsidiary or any other guarantor of any of the Guaranteed Obligations, for any reason related to this Agreement, any other Loan Document, any Swap Agreement, any Banking Services Agreement, or any provision of applicable law, decree, order or regulation of any jurisdiction purporting to prohibit the payment by such Subsidiary or any other guarantor of the Guaranteed Obligations, of any of the Guaranteed Obligations or otherwise affecting any term of any of the Guaranteed Obligations; or (h) any other act, omission or delay to do any other act which may or might in any manner or to any extent vary the risk of the Company or otherwise operate as a discharge of a guarantor as a matter of law or equity or which would impair or eliminate any right of the Company to subrogation.

 

The Company further agrees that its agreement under this Article X constitutes a guarantee of payment when due (whether or not any bankruptcy, examinership or similar proceeding shall have stayed the accrual or collection of any of the Guaranteed Obligations or operated as a discharge thereof) and not merely of collection, and waives any right to require that any resort be had by the Administrative Agent, any Issuing Bank or any Lender (or any of its Affiliates) to any balance of any deposit account or credit on the books of the Administrative Agent, any Issuing Bank or any Lender in favor of any Subsidiary or any other Person.

 

The obligations of the Company under this Article X shall not be subject to any reduction, limitation, impairment or termination for any reason, and shall not be subject to any defense or set-off, counterclaim, recoupment or termination whatsoever, by reason of the invalidity, illegality or unenforceability of any of the Guaranteed Obligations, any impossibility in the performance of any of the Guaranteed Obligations or otherwise, in any such case, other than payment in full in cash of such Guaranteed Obligations or satisfaction otherwise of the Final Release Conditions.

 

The Company further agrees that its obligations under this Article X shall constitute a continuing and irrevocable guarantee of all Guaranteed Obligations now or hereafter existing and shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of any Guaranteed Obligation (including a payment effected through exercise of a right of setoff) is rescinded, or is or must otherwise be restored or returned by the Administrative Agent, any Issuing Bank or any Lender upon the insolvency, bankruptcy, examinership or reorganization of any Subsidiary or otherwise (including pursuant to any settlement entered into by a holder of Guaranteed Obligations in its discretion).

 

In furtherance of the foregoing and not in limitation of any other right which the Administrative Agent, any Issuing Bank or any Lender may have at law or in equity against the Company by virtue of this Article X, upon the failure of any Subsidiary to pay any Guaranteed Obligation when and as the same shall become due, whether at maturity, by acceleration, after notice of prepayment or

 

99

 

otherwise, the Company hereby promises to and will, upon receipt of written demand by the Administrative Agent, any Issuing Bank or any Lender, forthwith pay, or cause to be paid, to the Administrative Agent, such Issuing Bank or such Lender (or any of such Lender’s Affiliates) in cash an amount equal to the unpaid principal amount of the Guaranteed Obligations then due, together with accrued and unpaid interest thereon.  The Company further agrees that if payment in respect of any Guaranteed Obligation shall be due in a currency other than Dollars and/or at a place of payment other than New York, Chicago or any other Eurocurrency Payment Office and if, by reason of any Change in Law, disruption of currency or foreign exchange markets, war or civil disturbance or other event, payment of such Guaranteed Obligation in such currency or at such place of payment shall be impossible or, in the reasonable judgment of the Administrative Agent, any Issuing Bank or any Lender, disadvantageous to the Administrative Agent, such Issuing Bank or such Lender in any material respect, then, at the election of the Administrative Agent or such Lender, the Company shall make payment of such Guaranteed Obligation in Dollars (based upon the applicable Equivalent Amount in effect on the date of payment) and/or in New York, Chicago or such other Eurocurrency Payment Office as is designated by the Administrative Agent or such Lender and, as a separate and independent obligation, shall indemnify the Administrative Agent, such Issuing Bank and such Lender, as applicable, against any losses or reasonable out-of-pocket expenses that it shall sustain as a result of such alternative payment.

 

Upon payment by the Company of any sums as provided above, all rights of the Company against any Subsidiary arising as a result thereof by way of right of subrogation or otherwise shall in all respects be subordinated and junior in right of payment to the prior indefeasible payment in full in cash of all the Guaranteed Obligations owed by such Subsidiary to the Administrative Agent, the Issuing Banks and the Lenders.

 

The Company hereby absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each Subsidiary Guarantor to honor all of its obligations under the Subsidiary Guaranty in respect of Specified Swap Obligations (provided, however, that the Company shall only be liable under this paragraph for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this paragraph or otherwise under this Article X voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount).  The Company intends that this paragraph constitute, and this paragraph shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each Subsidiary Guarantor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

Nothing shall discharge or satisfy the liability of the Company under this Article X except the full performance and payment in cash of the Guaranteed Obligations or satisfaction otherwise of the Final Release Conditions.

 

[Signature Pages Follow]

 

100

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective authorized officers or other authorized signatories as of the day and year first above written.

 

	
 
    	
REGENERON PHARMACEUTICALS, INC.,
    
	
 
    	
as   the Company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Dominick Agron
    
	
 
    	
 
    	
Name:   
    	
Dominick   Agron
    
	
 
    	
 
    	
Title:   
    	
Vice   President and Treasurer
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
REGENERON HEALTHCARE SOLUTIONS, INC.,
    
	
 
    	
as   a Subsidiary Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Robert J. Terifay
    
	
 
    	
 
    	
Name:   
    	
Robert   J. Terifay
    
	
 
    	
 
    	
Title:   
    	
General   Manager
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
REGENERON GENETICS CENTER LLC,
    
	
 
    	
as   a Subsidiary Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Christopher Fenimore
    
	
 
    	
 
    	
Name:
    	
Christopher   Fenimore
    
	
 
    	
 
    	
Title:   
    	
Manager
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
REGENERON IRELAND HOLDINGS,
    
	
 
    	
as   a Subsidiary Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/ Douglas S. McCorkle
    
	
 
    	
 
    	
Name:
    	
Douglas   S. McCorkle
    
	
 
    	
 
    	
Title:   
    	
Director
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
REGENERON IRELAND,
    
	
 
    	
as   a Subsidiary Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/ Niall O’Leary
    
	
 
    	
 
    	
Name:
    	
Niall   O’Leary
    
	
 
    	
 
    	
Title:   
    	
Director
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
REGENERON INTERNATIONAL,
    
	
 
    	
as   a Subsidiary Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Kerry Reinertsen
    
	
 
    	
 
    	
Name:
    	
Kerry   Reinertsen
    
	
 
    	
 
    	
Title:   
    	
Director
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
REGENERON CAPITAL INTERNATIONAL B.V.,
    
	
 
    	
as   a Subsidiary Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Franklin Louis Weidema
    
	
 
    	
 
    	
Name:
    	
Franklin Louis Weidema
    
	
 
    	
 
    	
Title:   
    	
Managing   director A
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/   Leonard Neil Brooks
    
	
 
    	
 
    	
Name:
    	
Leonard   Neil Brooks
    
	
 
    	
 
    	
Title:   
    	
Managing   director B
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
JPMORGAN   CHASE BANK, N.A., individually as a Lender, as the Swingline Lender, as an   Issuing Bank and as Administrative Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   D. Scott Farquhar
    
	
 
    	
 
    	
Name:
    	
D.   Scott Farquhar
    
	
 
    	
 
    	
Title:   
    	
Executive   Director
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
BANK   OF AMERICA, N.A., individually as a Lender, as an Issuing Bank and as a   Co-Syndication Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Brian J. Walsh
    
	
 
    	
 
    	
Name:
    	
Brian   J. Walsh
    
	
 
    	
 
    	
Title:   
    	
Vice   President
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
U.S.   BANK NATIONAL ASSOCIATION, individually as a Lender, as an Issuing Bank and   as a Co-Syndication Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Jennifer Hwang
    
	
 
    	
 
    	
Name:
    	
Jennifer   Hwang
    
	
 
    	
 
    	
Title:   
    	
Senior   Vice President
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
BARCLAYS   BANK PLC, individually as a Lender and as a Co-Documentation Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Christine Aharonian
    
	
 
    	
 
    	
Name:
    	
Christine   Aharonian
    
	
 
    	
 
    	
Title:   
    	
Vice   President
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
CITIBANK,   N.A., individually as a Lender and as a Co-Documentation Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Laura Fogarty
    
	
 
    	
 
    	
Name:
    	
Laura   Fogarty
    
	
 
    	
 
    	
Title:
    	
Vice   President
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

 

	
 
    	
CREDIT   SUISSE AG, CAYMAN ISLANDS BRANCH, individually as a Lender and as a   Co-Documentation Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Christopher Day
    
	
 
    	
 
    	
Name:
    	
Christopher   Day
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/   Karim Rahimtoola
    
	
 
    	
 
    	
Name:
    	
Karim   Rahimtoola
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
FIFTH   THIRD BANK, individually as a Lender and as a Co-Documentation Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Vera B. McEvoy
    
	
 
    	
 
    	
Name:
    	
Vera   B. McEvoy
    
	
 
    	
 
    	
Title:
    	
Vice   President
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
MORGAN   STANLEY BANK, N.A., as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Michael King
    
	
 
    	
 
    	
Name:
    	
Michael   King
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
THE   BANK OF TOKYO-MITSUBISHI UFJ, LTD., as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Teuta Ghilaga
    
	
 
    	
 
    	
Name:
    	
Teuta   Ghilaga
    
	
 
    	
 
    	
Title:
    	
Director
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
THE   GOVERNOR AND COMPANY OF THE BANK OF IRELAND, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Dorothy Halligan
    
	
 
    	
 
    	
Name:
    	
Dorothy   Halligan
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
/s/   Conor Linehan
    
	
 
    	
 
    	
Conor   Linehan
    
	
 
    	
 
    	
Authorized   Signatory
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
GOLDMAN   SACHS BANK USA, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Nicole Ferry-Lacchia
    
	
 
    	
 
    	
Name:
    	
Nicole   Ferry-Lacchia
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

	
 
    	
THE   NORTHERN TRUST COMPANY, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/   Sophia Love
    
	
 
    	
 
    	
Name:
    	
Sophia   Love
    
	
 
    	
 
    	
Title:
    	
Senior   Vice President
    

 

Signature Page to Credit Agreement
 Regeneron Pharmaceuticals, Inc.

 

 

SCHEDULE 2.01

 

COMMITMENTS

 

	
LENDER
    	
 
    	
COMMITMENT
    	
 
    
	
JPMORGAN CHASE   BANK, N.A.
    	
 
    	
$
    	
106,666,666.67
    	
 
    
	
BANK OF AMERICA,   N.A.
    	
 
    	
$
    	
106,666,666.67
    	
 
    
	
U.S. BANK NATIONAL   ASSOCIATION
    	
 
    	
$
    	
106,666,666.66
    	
 
    
	
BARCLAYS BANK PLC
    	
 
    	
$
    	
65,000,000.00
    	
 
    
	
CITIBANK, N.A.
    	
 
    	
$
    	
65,000,000.00
    	
 
    
	
CREDIT SUISSE AG
    	
 
    	
$
    	
65,000,000.00
    	
 
    
	
FIFTH THIRD BANK
    	
 
    	
$
    	
65,000,000.00
    	
 
    
	
MORGAN STANLEY   BANK, N.A.
    	
 
    	
$
    	
32,500,000.00
    	
 
    
	
THE BANK OF   TOKYO-MITSUBISHI UFJ, LTD.
    	
 
    	
$
    	
32,500,000.00
    	
 
    
	
THE GOVERNOR AND   COMPANY OF THE BANK OF IRELAND
    	
 
    	
$
    	
35,000,000.00
    	
 
    
	
GOLDMAN SACHS BANK   USA
    	
 
    	
$
    	
35,000,000.00
    	
 
    
	
THE NORTHERN TRUST   COMPANY
    	
 
    	
$
    	
35,000,000.00
    	
 
    
	
AGGREGATE   COMMITMENT
    	
 
    	
$
    	
750,000,000.00
    	
 
    

 

 

SCHEDULE 3.01

 

SUBSIDIARIES

 

	
Owner
    	
 
    	
Subsidiary
    	
 
    	
Material
   Subsidiary
    	
 
    	
Jurisdiction of
   Organization
    	
 
    	
Ownership
    
	
Regeneron  Pharmaceuticals, Inc.
    	
 
    	
Regeneron Genetics Center LLC
    	
 
    	
No.
    	
 
    	
Delaware
    	
 
    	
100%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Regeneron Healthcare Solutions, Inc.
    	
 
    	
No.
    	
 
    	
New York
    	
 
    	
100%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Regeneron International Holdings LLC
    	
 
    	
No.
    	
 
    	
Delaware
    	
 
    	
100%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Regeneron UK Limited
    	
 
    	
No.
    	
 
    	
United Kingdom
    	
 
    	
100%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Regeneron International Holdings LLC
    	
 
    	
OSMR Holdings
    	
 
    	
No.
    	
 
    	
Bermuda
    	
 
    	
100%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
OSMR International
    	
 
    	
No.
    	
 
    	
Bermuda
    	
 
    	
100%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Regeneron International
    	
 
    	
No.
    	
 
    	
Ireland
    	
 
    	
99.98%(1)
    (8,999 A Ordinary Shares;
    999 B Ordinary Shares)
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Regeneron International
    	
 
    	
Regeneron Ireland Holdings
    	
 
    	
No.
    	
 
    	
Ireland
    	
 
    	
99.99%(2)
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Regeneron Ireland Holdings
    	
 
    	
Regeneron Ireland
    	
 
    	
No.
    	
 
    	
Ireland
    	
 
    	
99.99%(3)
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Regeneron Ireland
    	
 
    	
Regeneron Capital International B.V.
    	
 
    	
No.
    	
 
    	
Netherlands
    	
 
    	
100%
    

 

(1)                     0.02% held by OSMR International (1 A Ordinary Share; 1 B Ordinary Share).

(2)                     0.01% held by OSMR Holdings.

(3)                     0.01% held by OSMR Holdings (1 share as nominee).

 

 

EXHIBIT A

 

ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including any letters of credit, guarantees, and swingline loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”).  Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

 

	
1.
    	
 
    	
Assignor:
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
2.
    	
 
    	
Assignee:
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
[and   is an Affiliate/Approved Fund of [identify Lender](1)]
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
3.
    	
 
    	
Borrowers:
    	
 
    	
Regeneron   Pharmaceuticals, Inc. and certain Subsidiary Borrowers
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
4.
    	
 
    	
Administrative   Agent:
    	
 
    	
JPMorgan   Chase Bank, N.A., as the administrative agent under the Credit Agreement
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
5.
    	
 
    	
Credit   Agreement:
    	
 
    	
The   Credit Agreement dated as of March 19, 2015 among Regeneron   Pharmaceuticals, Inc., the Subsidiary Borrowers from time to time   parties thereto, the Lenders parties thereto, JPMorgan Chase Bank, N.A., as   Administrative Agent, and the other agents parties thereto
    

 

(1)  Select as applicable.

 

 

	
6.
    	
 
    	
Assigned   Interest:
    	
 
    	
 
    

 

	
Aggregate Amount of
   Commitment/Loans for all
   Lenders
    	
 
    	
Amount of Commitment/Loans
   Assigned
    	
 
    	
Percentage Assigned of
   Commitment/Loans(2)
    	
 
    
	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
 
    	
%
    
	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
 
    	
%
    
	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
 
    	
%
    

 

Effective Date:                                   , 20       [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

 

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

	
 
    	
ASSIGNOR
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
[NAME   OF ASSIGNOR]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
ASSIGNEE
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
[NAME   OF ASSIGNEE]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Consented   to and Accepted:
    	
 
    
	
 
    	
 
    
	
JPMORGAN   CHASE BANK, N.A., as Administrative Agent, an Issuing Bank and Swingline   Lender
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
BANK OF AMERICA, N.A., as an Issuing Bank
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    

 

(2)  Set forth, so at least 9 decimals, as percentage of the Commitment/Loans of all Lenders thereunder.

 

2

 

	
U.S. BANK NATIONAL ASSOCIATION, as an Issuing Bank
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
[Consented to:](3)
    	
 
    
	
 
    	
 
    
	
REGENERON PHARMACEUTICALS, INC.
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    

 

(3)  To be added only if the consent of the Company is required by the terms of the Credit Agreement.

 

3

 

ANNEX I

 

STANDARD TERMS AND CONDITIONS FOR

 

ASSIGNMENT AND ASSUMPTION

 

1.                                      Representations and Warranties.

 

1.1                               Assignor.  The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Company, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Company, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

 

1.2.                            Assignee.  The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and (v) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

 

2.                                      Payments.  From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

 

3.                                      General Provisions.  This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument.  Acceptance and adoption of the terms of this Assignment and Assumption by the Assignee and the Assignor by Electronic Signature or delivery of an executed counterpart of a signature page of this Assignment and Assumption by any Electronic System shall be effective as

 

 

delivery of a manually executed counterpart of this Assignment and Assumption.  This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.

 

2

 

EXHIBIT B

 

[INTENTIONALLY OMITTED]

 

 

EXHIBIT C

 

FORM OF INCREASING LENDER SUPPLEMENT

 

INCREASING LENDER SUPPLEMENT, dated                     , 20       (this “Supplement”), by and among each of the signatories hereto, to the Credit Agreement, dated as of March 19, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto, the Lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).

 

W I T N E S S E T H

 

WHEREAS, pursuant to Section 2.20 of the Credit Agreement, the Company has the right, subject to the terms and conditions thereof, to effectuate from time to time an increase in the Aggregate Commitment and/or one or more tranches of Incremental Term Loans under the Credit Agreement by requesting one or more Lenders to increase the amount of its Commitment and/or to participate in such a tranche;

 

WHEREAS, the Company has given notice to the Administrative Agent of its intention to [increase the Aggregate Commitment] [and] [enter into a tranche of Incremental Term Loans] pursuant to such Section 2.20; and

 

WHEREAS, pursuant to Section 2.20 of the Credit Agreement, the undersigned Increasing Lender now desires to [increase the amount of its Commitment] [and] [participate in a tranche of Incremental Term Loans] under the Credit Agreement by executing and delivering to the Company and the Administrative Agent this Supplement;

 

NOW, THEREFORE, each of the parties hereto hereby agrees as follows:

 

1.                                      The undersigned Increasing Lender agrees, subject to the terms and conditions of the Credit Agreement, that on the date of this Supplement it shall [have its Commitment increased by $[                    ], thereby making the aggregate amount of its total Commitments equal to $[                    ]] [and] [participate in a tranche of Incremental Term Loans with a commitment amount equal to $[                    ] with respect thereto].

 

2.                                      The Company hereby represents and warrants that no Default or Event of Default has occurred and is continuing on and as of the date hereof.

 

3.                                      Terms defined in the Credit Agreement shall have their defined meanings when used herein.

 

4.                                      This Supplement shall be governed by, and construed in accordance with, the laws of the State of New York.

 

5.                                      This Supplement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same document.

 

 

IN WITNESS WHEREOF, each of the undersigned has caused this Supplement to be executed and delivered by a duly authorized officer on the date first above written.

 

	
 
    	
 
    	
[INSERT   NAME OF INCREASING LENDER]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Accepted   and agreed to as of the date first written above:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
REGENERON   PHARMACEUTICALS, INC.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Acknowledged as of the date first written above:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
JPMORGAN CHASE BANK, N.A.
    	
 
    	
 
    
	
as Administrative Agent
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    
						

 

2

 

EXHIBIT D

 

FORM OF AUGMENTING LENDER SUPPLEMENT

 

AUGMENTING LENDER SUPPLEMENT, dated                     , 20       (this “Supplement”), by and among each of the signatories hereto, to the Credit Agreement, dated as of March 19, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto, the Lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).

 

W I T N E S S E T H

 

WHEREAS, the Credit Agreement provides in Section 2.20 thereof that any bank, financial institution or other entity may [extend Commitments] [and] [participate in tranches of Incremental Term Loans] under the Credit Agreement subject to the approval of the Company and the Administrative Agent, by executing and delivering to the Company and the Administrative Agent a supplement to the Credit Agreement in substantially the form of this Supplement; and

 

WHEREAS, the undersigned Augmenting Lender was not an original party to the Credit Agreement but now desires to become a party thereto;

 

NOW, THEREFORE, each of the parties hereto hereby agrees as follows:

 

1.  The undersigned Augmenting Lender agrees to be bound by the provisions of the Credit Agreement and agrees that it shall, on the date of this Supplement, become a Lender for all purposes of the Credit Agreement to the same extent as if originally a party thereto, with a [Commitment with respect to Revolving Loans of $[                    ]] [and] [a commitment with respect to Incremental Term Loans of $[                    ]].

 

2.  The undersigned Augmenting Lender (a) represents and warrants that it is legally authorized to enter into this Supplement; (b) confirms that it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and has reviewed such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Supplement; (c) agrees that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement or any other instrument or document furnished pursuant hereto or thereto; (d) appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Credit Agreement or any other instrument or document furnished pursuant hereto or thereto as are delegated to the Administrative Agent by the terms thereof, together with such powers as are incidental thereto; and (e) agrees that it will be bound by the provisions of the Credit Agreement and will perform in accordance with its terms all the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender.

 

3.  The undersigned’s address for notices for the purposes of the Credit Agreement is as follows:

 

[                      ]

 

 

4.  The Company hereby represents and warrants that no Default or Event of Default has occurred and is continuing on and as of the date hereof.

 

5.  Terms defined in the Credit Agreement shall have their defined meanings when used herein.

 

6.  This Supplement shall be governed by, and construed in accordance with, the laws of the State of New York.

 

7.  This Supplement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same document.

 

[remainder of this page intentionally left blank]

 

2

 

IN WITNESS WHEREOF, each of the undersigned has caused this Supplement to be executed and delivered by a duly authorized officer on the date first above written.

 

	
 
    	
 
    	
[INSERT   NAME OF AUGMENTING LENDER]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Accepted   and agreed to as of the date first written above:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
REGENERON   PHARMACEUTICALS, INC.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Acknowledged as of the date first written above:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
JPMORGAN CHASE BANK, N.A.
    	
 
    	
 
    
	
as Administrative Agent
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    

 

3

 

EXHIBIT E

 

LIST OF CLOSING DOCUMENTS

 

REGENERON PHARMACEUTICALS, INC
 CERTAIN SUBSIDIARY BORROWERS

 

CREDIT FACILITIES

 

March 19, 2015

 

LIST OF CLOSING DOCUMENTS(1)

 

A.                                    LOAN DOCUMENTS

 

1.                                      Credit Agreement (the “Credit Agreement”) by and among Regeneron Pharmaceuticals, Inc., a New York corporation (the “Company”), the Subsidiary Borrowers from time to time parties thereto (collectively with the Company, the “Borrowers”), the institutions from time to time parties thereto as Lenders (the “Lenders”) and JPMorgan Chase Bank, N.A., in its capacity as Administrative Agent for itself and the other Lenders (the “Administrative Agent”), evidencing a revolving credit facility to the Borrowers from the Lenders in an initial aggregate principal amount of $750,000,000.

 

SCHEDULES

 

	
Schedule 2.01
    	
—
    	
Commitments
    
	
Schedule 3.01
    	
—
    	
Subsidiaries
    
	
Schedule 6.01
    	
—
    	
Existing Indebtedness
    
	
Schedule 6.02
    	
—
    	
Existing Liens
    

 

EXHIBITS

 

	
Exhibit A
    	
—
    	
Form of Assignment and Assumption
    
	
Exhibit B
    	
—
    	
[Intentionally Omitted]
    
	
Exhibit C
    	
—
    	
Form of Increasing Lender Supplement
    
	
Exhibit D
    	
—
    	
Form of Augmenting Lender Supplement
    
	
Exhibit E
    	
—
    	
List of Closing Documents
    
	
Exhibit F-1
    	
—
    	
Form of Borrowing Subsidiary Agreement
    
	
Exhibit F-2
    	
—
    	
Form of Borrowing Subsidiary   Termination
    
	
Exhibit G
    	
—
    	
Form of Subsidiary Guaranty
    
	
Exhibit H-1
    	
—
    	
Form of U.S. Tax Certificate (Foreign   Lenders That Are Not Partnerships)
    
	
Exhibit H-2
    	
—
    	
Form of U.S. Tax Certificate (Foreign   Participants That Are Not Partnerships)
    
	
Exhibit H-3
    	
—
    	
Form of U.S. Tax Certificate (Foreign   Participants That Are Partnerships)
    
	
Exhibit H-4
    	
—
    	
Form of U.S. Tax Certificate (Foreign   Lenders That Are Partnerships)
    

 

(1) Each capitalized term used herein and not defined herein shall have the meaning assigned to such term in the above-defined Credit Agreement.  Items appearing in bold and italics shall be prepared and/or provided by the Company and/or Company’s counsel.

 

 

	
Exhibit I-1
    	
—
    	
Form of Borrowing Request
    
	
Exhibit I-2
    	
—
    	
Form of Interest Election Request
    
	
Exhibit L
    	
—
    	
Form of Note
    

 

2.                                      Notes executed by the initial Borrowers in favor of each of the Lenders, if any, which has requested a note pursuant to Section 2.10(e) of the Credit Agreement.

 

B.                                    CORPORATE DOCUMENTS

 

3.                                      Certificate of the Secretary or an Assistant Secretary of each Borrower, or in the case of the Initial Dutch Borrower, a director’s certificate, certifying (i) that there have been no changes in the Certificate of Incorporation or other charter document of such Loan Party, as attached thereto and as certified as of a recent date by the Secretary of State (or analogous governmental entity) of the jurisdiction of its organization, since the date of the certification thereof by such governmental entity, (ii) the By-Laws or other applicable organizational document, as attached thereto, of such Borrower as in effect on the date of such certification, (iii) resolutions of the Board of Directors or other governing body of such Borrower authorizing the execution, delivery and performance of each Loan Document to which it is a party, (iv) the names and true signatures of the incumbent officers of each Borrower authorized to sign the Loan Documents to which it is a party, and authorized to request a Borrowing or the issuance of a Letter of Credit  under the Credit Agreement and (v) in the case of the Initial Irish Borrowers, that entry into and performance of the Loan Documents will not constitute a breach of Section 31 of the Companies Act 1990 of Ireland or a breach of Section 60 of the Companies Act 1963 of Ireland.

 

4.                                      Good Standing Certificate (or analogous documentation if applicable) for each Borrower from the Secretary of State (or analogous governmental entity) of the jurisdiction of its organization, to the extent generally available in such jurisdiction.

 

C.                                    OPINIONS

 

5.                                      Opinion of Skadden, Arps, Slate, Meagher & Flom LLP, special New York counsel for the Loan Parties.

 

6.                                      Opinion of Arthur Cox, Irish counsel for the Initial Irish Borrowers.

 

7.                                      Opinion of Baker & McKenzie Amsterdam N.V., Dutch counsel for the Initial Dutch Borrower.

 

D.                                    CLOSING CERTIFICATES AND MISCELLANEOUS

 

8.                                     A Certificate signed by a Responsible Officer of the Company certifying on behalf of the Company the following:  (i) that the representations and warranties contained in Article III of the Credit Agreement are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of the Effective Date except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of such earlier date and (ii) that no Default or Event of Default has occurred and is then continuing.

 

2

 

EXHIBIT F-1

 

[FORM OF]

 

BORROWING SUBSIDIARY AGREEMENT

 

BORROWING SUBSIDIARY AGREEMENT dated as of [          ], among Regeneron Pharmaceuticals, Inc., a New York corporation (the “Company”), [Name of Subsidiary Borrower], a [                    ] (the “New Borrowing Subsidiary”), and JPMorgan Chase Bank, N.A. as Administrative Agent (the “Administrative Agent”).

 

Reference is hereby made to the Credit Agreement dated as of March 19, 2015 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Company, the Subsidiary Borrowers from time to time party thereto, the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A. as Administrative Agent.  Capitalized terms used herein but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement.  Under the Credit Agreement, the Lenders have agreed, upon the terms and subject to the conditions therein set forth, to make Loans to certain Subsidiary Borrowers (collectively with the Company, the “Borrowers”), and the Company and the New Borrowing Subsidiary desire that the New Borrowing Subsidiary become a Subsidiary Borrower.  In addition, the New Borrowing Subsidiary hereby authorizes the Company to act on its behalf as and to the extent provided for in Article II of the Credit Agreement.  Notwithstanding the preceding sentence, the New Borrowing Subsidiary hereby designates the following officers or other authorized signatories as being authorized to, among other things, request Borrowings under the Credit Agreement on behalf of the New Subsidiary Borrower and sign this Borrowing Subsidiary Agreement and the other Loan Documents to which the New Borrowing Subsidiary is, or may from time to time become, a party:  [                            ].

 

Each of the Company and the New Borrowing Subsidiary represents and warrants that the representations and warranties of the Company in the Credit Agreement relating to the New Borrowing Subsidiary and this Agreement are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of the date hereof except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of such earlier date.  [The Company and the New Borrowing Subsidiary further represent and warrant that the execution, delivery and performance by the New Borrowing Subsidiary of the transactions contemplated under this Agreement and the use of any of the proceeds raised in connection with this Agreement will not contravene or conflict with, or otherwise constitute unlawful financial assistance under, Sections 677 to 683 (inclusive) of the United Kingdom Companies Act 2006 of England and Wales (as amended).](1) [INSERT OTHER PROVISIONS REASONABLY REQUESTED BY ADMINISTRATIVE AGENT OR ITS COUNSELS]  The Company agrees that the Guarantee of the Company contained in the Credit Agreement will apply to the Obligations of the New Borrowing Subsidiary.  Upon execution of this Agreement by each of the Company, the New Borrowing Subsidiary and the Administrative Agent, the New Borrowing Subsidiary shall be a party to the Credit Agreement and shall constitute a “Subsidiary Borrower” for all purposes thereof, and the New Borrowing Subsidiary hereby agrees to be bound by all provisions of the Credit Agreement.

 

(1) To be included only if a New Borrowing Subsidiary will be a Borrower organized under the laws of England and Wales.

 

 

[If a Dutch Subsidiary Borrower is represented by an attorney in connection with the signing and/or execution of the Credit Agreement and/or any other Loan Document it is hereby expressly acknowledged and accepted by the parties to the Credit Agreement and/or any other Loan Document that the existence and extent of the attorney’s authority and the effects of the attorney’s exercise or purported exercise of his or her authority shall be governed by the laws of The Netherlands.]

 

This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

 

[Signature Page Follows]

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their authorized officers or other authorized signatories as of the date first appearing above.

 

	
 
    	
REGENERON   PHARMACEUTICALS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
[NAME   OF NEW BORROWING SUBSIDIARY]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
JPMORGAN   CHASE BANK, N.A., as Administrative Agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

 

EXHIBIT F-2

 

[FORM OF]

 

BORROWING SUBSIDIARY TERMINATION

 

JPMorgan Chase Bank, N.A.
 as Administrative Agent
 for the Lenders referred to below
 10 South Dearborn Street
 Chicago, Illinois 60603
 Attention:  [                    ]

 

[Date]

 

Ladies and Gentlemen:

 

The undersigned, Regeneron Pharmaceuticals, Inc. (the “Company”), refers to the Credit Agreement dated as of March 19, 2015 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Company, the Subsidiary Borrowers from time to time party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.  Capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement.

 

The Company hereby terminates the status of [                            ] (the “Terminated Borrowing Subsidiary”) as a Subsidiary Borrower under the Credit Agreement.  [The Company represents and warrants that no Loans made to the Terminated Borrowing Subsidiary are outstanding as of the date hereof and that all amounts payable by the Terminated Borrowing Subsidiary in respect of interest and/or fees (and, to the extent notified by the Administrative Agent or any Lender, any other amounts payable under the Credit Agreement) pursuant to the Credit Agreement have been paid in full on or prior to the date hereof.] [The Company acknowledges that the Terminated Borrowing Subsidiary shall continue to be a Borrower until such time as all Loans made to the Terminated Borrowing Subsidiary shall have been prepaid and all amounts payable by the Terminated Borrowing Subsidiary in respect of interest and/or fees (and, to the extent notified by the Administrative Agent or any Lender, any other amounts payable under the Credit Agreement) pursuant to the Credit Agreement shall have been paid in full, provided that the Terminated Borrowing Subsidiary shall not have the right to make further Borrowings under the Credit Agreement.]

 

[Signature Page Follows]

 

 

This instrument shall be construed in accordance with and governed by the laws of the State of New York.

 

	
 
    	
Very   truly yours,
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
REGENERON   PHARMACEUTICALS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

Copy to:                        JPMorgan Chase Bank, N.A.
 10 South Dearborn Street
 Chicago, Illinois 60603

 

2

 

EXHIBIT G

 

[FORM OF]

 

SUBSIDIARY GUARANTY

 

GUARANTY

 

THIS GUARANTY (as amended, restated, supplemented or otherwise modified from time to time, this “Guaranty”) is made as of March 19, 2015, by and among each of the undersigned (the “Initial Guarantors” and along with any additional Subsidiaries of the Company which become parties to this Guaranty by executing a supplement hereto in the form attached as Annex I, the “Guarantors”) in favor of the Administrative Agent, for the ratable benefit of the Holders of Guaranteed Obligations (as defined below), under the Credit Agreement referred to below.

 

WITNESSETH

 

WHEREAS, Regeneron Pharmaceuticals, Inc., a New York corporation (the “Company”), the Subsidiary Borrowers parties thereto (the “Subsidiary Borrowers” and, together with the Company, the “Borrowers”), the institutions from time to time parties thereto as lenders (the “Lenders”), and JPMorgan Chase Bank, N.A., as administrative agent (the “Administrative Agent”) have entered into a certain Credit Agreement dated as of March 19, 2015 (as the same may be amended, modified, supplemented and/or restated, and as in effect from time to time, the “Credit Agreement”), providing, subject to the terms and conditions thereof, for extensions of credit and other financial accommodations to be made by the Lenders to the Borrowers;

 

WHEREAS, it is a condition precedent to the extensions of credit by the Lenders under the Credit Agreement that each of the Guarantors (constituting all of the Subsidiaries of the Company required to execute this Guaranty pursuant to Section 5.09 of the Credit Agreement) execute and deliver this Guaranty, whereby each of the Guarantors shall guarantee the payment when due of all Obligations; and

 

WHEREAS, in consideration of the direct and indirect financial and other support that the Borrowers have provided, and such direct and indirect financial and other support as the Borrowers may in the future provide, to the Guarantors, and in order to induce the Lenders and the Administrative Agent to enter into the Credit Agreement, each of the Guarantors is willing to guarantee the Obligations of the Borrowers;

 

NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

SECTION 1.                            Definitions.  Terms defined in the Credit Agreement and not otherwise defined herein have, as used herein, the respective meanings provided for therein.

 

SECTION 2.                            Representations, Warranties and Covenants.  Each of the Guarantors represents and warrants (which representations and warranties shall be deemed to have been renewed at the time of the making, conversion or continuation of any Loan or issuance, amendment, renewal or extension of any Letter of Credit) that:

 

 

(A)                               It is a corporation, partnership or limited liability company duly and properly incorporated or organized, as the case may be, validly existing and (to the extent such concept applies to such entity) in good standing under the laws of its jurisdiction of incorporation, organization or formation and has all requisite authority to conduct its business in each jurisdiction in which its business is conducted, except to the extent that the failure to have such authority could not reasonably be expected to have a Material Adverse Effect.

 

(B)                               It (to the extent applicable) has the requisite power and authority and legal right to execute and deliver this Guaranty and to perform its obligations hereunder.  The execution and delivery by each Guarantor of this Guaranty and the performance by each of its obligations hereunder have been duly authorized by proper proceedings, and this Guaranty constitutes a legal, valid and binding obligation of such Guarantor, respectively, enforceable against such Guarantor, respectively, in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally.

 

(C)                               Neither the execution and delivery by it of this Guaranty, nor the consummation by it of the transactions herein contemplated, nor compliance by it with the provisions hereof will (i) violate in any material respect any applicable material law, rule, regulation, order, writ, judgment, injunction, decree or award binding on it or its articles or certificate of incorporation (or equivalent charter documents), limited liability company or partnership agreement, certificate of partnership, articles or certificate of organization, by-laws, or operating agreement or other management agreement, as the case may be, to which any of the Borrowers or any of its Subsidiaries is a party or is subject, or by which it, or its property, is bound, (ii) violated, conflict with, or constitute a default under the provisions of any indenture, instrument or agreement to which any of the Borrowers or any of its Subsidiaries is a party or is subject, or by which it, or its property, is bound, except, in the case of this clause (ii), for any such violations, defaults or rights that could not reasonably be expected to result in a Material Adverse Effect, or (iii) result in, or require, the creation or imposition of any Lien in, of or on its property pursuant to the terms of, any such indenture, instrument or agreement (other than any Loan Document).  No order, consent, adjudication, approval, license, authorization, or validation of, or filing, recording or registration with, or exemption by, or other action in respect of any governmental or public body or authority, or any subdivision thereof, which has not been obtained by it, is required to be obtained by it in connection with the execution, delivery and performance by it of, or the legality, validity, binding effect or enforceability against it of, this Guaranty.

 

In addition to the foregoing, each of the Guarantors covenants that, so long as any Lender has any Commitment outstanding under the Credit Agreement or any amount payable under the Credit Agreement or any other Guaranteed Obligations shall remain unpaid, it will, and, if necessary, will enable each of the Borrowers to, fully comply with those covenants and agreements of such Borrower applicable to such Guarantor set forth in the Credit Agreement.

 

SECTION 3.                            The Guaranty.  Each of the Guarantors hereby unconditionally guarantees, jointly with the other Guarantors and severally, the full and punctual payment and performance when due (whether at stated maturity, upon acceleration or otherwise) of the Obligations, including, without limitation, (i) the principal of and interest on each Loan made to any Borrower pursuant to the Credit Agreement, (ii) any obligations of any Borrower to reimburse LC Disbursements (“Reimbursement Obligations”), (iii) all obligations of any Borrower owing to any Lender or any affiliate of any Lender under any Swap Agreement or Banking Services Agreement, (iv) all other amounts payable by any Borrower or any of its Subsidiaries under the Credit Agreement, any Swap Agreement, any Banking Services Agreement and the other Loan Documents and (v) the punctual and faithful performance, keeping, observance, and fulfillment by any Borrower of all of the agreements, conditions,

 

2

 

covenants, and obligations of such Borrower contained in the Loan Documents (all of the foregoing being referred to collectively as the “Guaranteed Obligations” (provided, however, that the definition of “Guaranteed Obligations” shall not create or include any guarantee by any Guarantor of any Excluded Swap Obligations of such Guarantor for purposes of determining any obligations of any Guarantor) and the holders from time to time of the Guaranteed Obligations being referred to collectively as the “Holders of Guaranteed Obligations”).  Upon (x) the failure by any Borrower or any of its Affiliates, as applicable, to pay punctually any such amount or perform such obligation, and (y) such failure continuing beyond any applicable grace or notice and cure period, each of the Guarantors agrees that it shall forthwith on demand pay such amount or perform such obligation at the place and in the manner specified in the Credit Agreement, any Swap Agreement, any Banking Services Agreement or the relevant Loan Document, as the case may be.  Each of the Guarantors hereby agrees that this Guaranty is an absolute, irrevocable and unconditional guaranty of payment and is not a guaranty of collection.

 

Each of the Guarantors hereby irrevocably and unconditionally agrees, jointly and severally with the other Guarantors, that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent  and primary obligation, indemnify the Holders of Guaranteed Obligations immediately on demand against any cost, loss or liability they incur as a result of the Company or any of its Affiliates not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by such Guarantor under this Guaranty on the date when it would have been due (but so that the amount payable by each Guarantor under this indemnity will not exceed the amount which it would have had to pay under this Guaranty if the amount claimed had been recoverable on the basis of a guaranty).

 

SECTION 4.                            Guaranty Unconditional.  The obligations of each of the Guarantors hereunder shall be unconditional and absolute and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by:

 

(A)                               any extension, renewal, settlement, indulgence, compromise, waiver or release of or with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations, whether (in any such case) by operation of law or otherwise, or any failure or omission to enforce any right, power or remedy with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations;

 

(B)                               any modification or amendment of or supplement to the Credit Agreement, any Swap Agreement, any Banking Services Agreement or any other Loan Document, including, without limitation, any such amendment which may increase the amount of, or the interest rates applicable to, any of the Obligations guaranteed hereby;

 

(C)                               any release, surrender, compromise, settlement, waiver, subordination or modification, with or without consideration, of any collateral securing the Guaranteed Obligations or any part thereof, any other guaranties with respect to the Guaranteed Obligations or any part thereof, or any other obligation of any person or entity with respect to the Guaranteed Obligations or any part thereof, or any nonperfection or invalidity of any direct or indirect security for the Guaranteed Obligations;

 

(D)                               any change in the corporate, partnership or other existence, structure or ownership of any Borrower or any other guarantor of any of the Guaranteed Obligations, or any insolvency, bankruptcy, examinership, reorganization or other similar proceeding affecting such Borrower or any other guarantor of the Guaranteed Obligations, or any of their respective assets

 

3

 

or any resulting release or discharge of any obligation of such Borrower or any other guarantor of any of the Guaranteed Obligations;

 

(E)                                the existence of any claim, setoff or other rights which the Guarantors may have at any time against any Borrower, any other guarantor of any of the Guaranteed Obligations, the Administrative Agent, any Holder of Guaranteed Obligations or any other Person, whether in connection herewith or in connection with any unrelated transactions; provided that nothing herein shall prevent the assertion of any such claim by separate suit or compulsory counterclaim;

 

(F)                                 the enforceability or validity of the Guaranteed Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto or with respect to any collateral securing the Guaranteed Obligations or any part thereof, or any other invalidity or unenforceability relating to or against any Borrower or any other guarantor of any of the Guaranteed Obligations, for any reason related to the Credit Agreement, any Swap Agreement, any Banking Services Agreement, any other Loan Document, or any provision of applicable law decree, order or regulation of any jurisdiction purporting to prohibit the payment by such Borrower or any other guarantor of the Guaranteed Obligations, of any of the Guaranteed Obligations or otherwise affecting any term of any of the Guaranteed Obligations;

 

(G)                               the failure of the Administrative Agent to take any steps to perfect and maintain any security interest in, or to preserve any rights to, any security or collateral for the Guaranteed Obligations, if any;

 

(H)                              the election by, or on behalf of, any one or more of the Holders of Guaranteed Obligations, in any proceeding instituted under Chapter 11 of Title 11 of the United States Code (11 U.S.C. 101 et seq.) (the “Bankruptcy Code”), of the application of Section 1111(b)(2) of the Bankruptcy Code;

 

(I)                                   any borrowing or grant of a security interest by any Borrower, as debtor-in-possession, under Section 364 of the Bankruptcy Code;

 

(J)                                   the disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of the claims of the Holders of Guaranteed Obligations or the Administrative Agent for repayment of all or any part of the Guaranteed Obligations;

 

(K)                              the failure of any other guarantor to sign or become party to this Guaranty or any amendment, change, or reaffirmation hereof; or

 

(L)                                any other act or omission to act or delay of any kind by any Borrower, any other guarantor of the Guaranteed Obligations, the Administrative Agent, any Holder of Guaranteed Obligations or any other Person or any other circumstance whatsoever which might, but for the provisions of this Section 4, constitute a legal or equitable discharge of any Guarantor’s obligations hereunder except as provided in Section 5.

 

SECTION 5.                            Continuing Guarantee; Discharge Only Upon Payment In Full;  Reinstatement In Certain Circumstances.  Each of the Guarantors’ obligations hereunder shall constitute a continuing and irrevocable guarantee of all Guaranteed Obligations now or hereafter existing and shall remain in full force and effect until all Guaranteed Obligations shall have been paid in full in cash and the Commitments and all Letters of Credit issued under the Credit Agreement shall have terminated or expired, or satisfaction otherwise of the Final Release Conditions.  If at any time any payment of the principal of or interest on any Loan, any Reimbursement Obligation or any other amount payable by any

 

4

 

Borrower or any other party under the Credit Agreement, any Swap Agreement, any Banking Services Agreement or any other Loan Document (including a payment effected through exercise of a right of setoff) is rescinded, or is or must be otherwise restored or returned upon the insolvency, bankruptcy, examinership or reorganization of any Borrower or otherwise (including pursuant to any settlement entered into by a Holder of Guaranteed Obligations in its discretion), each of the Guarantors’ obligations hereunder with respect to such payment shall be reinstated as though such payment had been due but not made at such time.  The parties hereto acknowledge and agree that each of the Guaranteed Obligations shall be due and payable in the same currency as such Guaranteed Obligation is denominated but if currency control or exchange regulations are imposed in the country which issues such currency with the result that such currency (the “Original Currency”) no longer exists or the relevant Guarantor is not able to make payment in such Original Currency, then all payments to be made by such Guarantor hereunder in such currency shall instead be made when due in Dollars in an amount equal to the Dollar Amount (as of the date of payment) of such payment due, it being the intention of the parties hereto that each Guarantor takes all risks of the imposition of any such currency control or exchange regulations.

 

SECTION 6.                            General Waivers; Additional Waivers.

 

(A)                               General Waivers.  Each of the Guarantors irrevocably waives acceptance hereof, presentment, demand or action on delinquency, protest, the benefit of any statutes of limitations and, to the fullest extent permitted by law, any notice not provided for herein, as well as any requirement that at any time any action be taken by any Person against any Borrower, any other guarantor of the Guaranteed Obligations, or any other Person.

 

(B)                               Additional Waivers.  Notwithstanding anything herein to the contrary, each of the Guarantors hereby absolutely, unconditionally, knowingly, and expressly waives:

 

(i)                                     any right it may have to revoke this Guaranty as to future indebtedness or notice of acceptance hereof;

 

(ii)                                  (a) notice of acceptance hereof; (b) notice of any loans or other financial accommodations made or extended under the Loan Documents or the creation or existence of any Guaranteed Obligations; (c) notice of the amount of the Guaranteed Obligations, subject, however, to each Guarantor’s right to make inquiry of Administrative Agent and Holders of Guaranteed Obligations to ascertain the amount of the Guaranteed Obligations at any reasonable time; (d) notice of any adverse change in the financial condition of any Borrower or of any other fact that might increase such Guarantor’s risk hereunder; (e) notice of presentment for payment, demand, protest, and notice thereof as to any instruments among the Loan Documents; (f) notice of any Default or Event of Default; and (g) all other notices (except if such notice is specifically required to be given to such Guarantor hereunder or under the Loan Documents) and demands to which each Guarantor might otherwise be entitled;

 

(iii)                               its right, if any, to require the Administrative Agent and the other Holders of Guaranteed Obligations to institute suit against, or to exhaust any rights and remedies which the Administrative Agent and the other Holders of Guaranteed Obligations has or may have against, the other Guarantors or any third party; and each Guarantor further waives any defense arising by reason of any disability or other defense (other than the defense that the Guaranteed Obligations shall have been fully and finally performed and indefeasibly paid) of the other Guarantors or by reason of the cessation from any cause whatsoever of the liability of the other Guarantors in respect thereof;

 

5

 

(iv)                              (a) any rights to assert against the Administrative Agent and the other Holders of Guaranteed Obligations any defense (legal or equitable), set-off, counterclaim, or claim which such Guarantor may now or at any time hereafter have against the other Guarantors or any other party liable to the Administrative Agent and the other Holders of Guaranteed Obligations; (b) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of perfection, sufficiency, validity, or enforceability of the Guaranteed Obligations or any security therefor; (c) any defense such Guarantor has to performance hereunder, and any right such Guarantor has to be exonerated, arising by reason of:  the impairment or suspension of the Administrative Agent’s and the other Holders of Guaranteed Obligations’ rights or remedies against the other Guarantors; the alteration by the Administrative Agent and the other Holders of Guaranteed Obligations of the Guaranteed Obligations; any discharge of the other Guarantors’ obligations to the Administrative Agent and the other Holders of Guaranteed Obligations by operation of law as a result of the Administrative Agent’s and the other Holders of Guaranteed Obligations’ intervention or omission; or the acceptance by the Administrative Agent and the other Holders of Guaranteed Obligations of anything in partial satisfaction of the Guaranteed Obligations; and (d) the benefit of any statute of limitations affecting such Guarantor’s liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation of any statute of limitations applicable to the Guaranteed Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to such Guarantor’s liability hereunder; and

 

(v)                                 any defense arising by reason of or deriving from (a) any claim or defense based upon an election of remedies by the Administrative Agent and the other Holders of Guaranteed Obligations; or (b) any election by the Administrative Agent and the other Holders of Guaranteed Obligations under Section 1111(b) of Title 11 of the United States Code entitled “Bankruptcy”, as now and hereafter in effect (or any successor statute), to limit the amount of, or any collateral securing, its claim against the Guarantors.

 

SECTION 7.                            Subordination of Subrogation; Subordination of Intercompany Indebtedness.

 

(A)                               Subordination of Subrogation.  Until the Guaranteed Obligations have been fully and finally performed and indefeasibly paid in full in cash, or satisfaction otherwise of the Final Release Conditions, the Guarantors (i) shall have no right of subrogation with respect to such Guaranteed Obligations, (ii) waive any right to enforce any remedy which the Holders of Guaranteed Obligations, the Issuing Banks or the Administrative Agent now have or may hereafter have against any Borrower, any endorser or any guarantor of all or any part of the Guaranteed Obligations or any other Person, and (iii) waive any benefit of, and any right to participate in, any security or collateral given to the Holders of Guaranteed Obligations, the Issuing Banks and the Administrative Agent to secure the payment or performance of all or any part of the Guaranteed Obligations or any other liability of any Borrower to the Holders of Guaranteed Obligations or the Issuing Banks.  Should any Guarantor have the right, notwithstanding the foregoing, to exercise its subrogation rights, each Guarantor hereby expressly and irrevocably (A) subordinates any and all rights at law or in equity to subrogation, reimbursement, exoneration, contribution, indemnification or set off that such Guarantor may have to the indefeasible payment in full in cash of the Guaranteed Obligations and (B) waives any and all defenses available to a surety, guarantor or accommodation co-obligor until the Guaranteed Obligations are indefeasibly paid in full in cash.  Each Guarantor acknowledges and agrees that this subordination is intended to benefit the Administrative Agent and the other Holders of Guaranteed Obligations and shall not limit or otherwise affect such Guarantor’s liability hereunder or the enforceability of this Guaranty, and that the Administrative Agent, the

 

6

 

other Holders of Guaranteed Obligations and their respective successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this Section 7(A).

 

(B)                               Subordination of Intercompany Indebtedness.  Each Guarantor agrees that any and all claims of such Guarantor against any Borrower or any other Guarantor hereunder (each an “Obligor”) with respect to any “Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Guaranteed Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Guaranteed Obligations; provided that, as long as no Event of Default has occurred and is continuing, such Guarantor may receive payments of principal and interest from any Obligor with respect to Intercompany Indebtedness.  Notwithstanding any right of any Guarantor to ask, demand, sue for, take or receive any payment from any Obligor, all rights, liens and security interests of such Guarantor, whether now or hereafter arising and howsoever existing, in any assets of any other Obligor shall be and are subordinated to the rights of the Holders of Guaranteed Obligations and the Administrative Agent in those assets.  No Guarantor shall have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Guaranteed Obligations shall have been fully paid and satisfied (in cash) and all financing arrangements pursuant to any Loan Document, any Swap Agreement or any Banking Services Agreement have been terminated.  If all or any part of the assets of any Obligor, or the proceeds thereof, are subject to any distribution, division or application to the creditors of such Obligor, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of any such Obligor is dissolved or if substantially all of the assets of any such Obligor are sold, then, and in any such event (such events being herein referred to as an “Insolvency Event”), any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness of any Obligor to any Guarantor (“Intercompany Indebtedness”) shall be paid or delivered directly to the Administrative Agent for application on any of the Guaranteed Obligations, due or to become due, until such Guaranteed Obligations shall have first been fully paid and satisfied (in cash).  Should any payment, distribution, security or instrument or proceeds thereof be received by the applicable Guarantor upon or with respect to the Intercompany Indebtedness after any Insolvency Event and prior to the satisfaction of all of the Guaranteed Obligations and the termination of all financing arrangements pursuant to any Loan Document among any Borrower and the Holders of Guaranteed Obligations, such Guarantor shall receive and hold the same in trust, as trustee, for the benefit of the Holders of Guaranteed Obligations and shall forthwith deliver the same to the Administrative Agent, for the benefit of the Holders of Guaranteed Obligations, in precisely the form received (except for the endorsement or assignment of the Guarantor where necessary), for application to any of the Guaranteed Obligations, due or not due, and, until so delivered, the same shall be held in trust by the Guarantor as the property of the Holders of Guaranteed Obligations.  If any such Guarantor fails to make any such endorsement or assignment to the Administrative Agent, the Administrative Agent or any of its officers or employees is irrevocably authorized to make the same.  Each Guarantor agrees that until the Guaranteed Obligations (other than the contingent indemnity obligations) have been paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan Document among any Borrower and the Holders of Guaranteed Obligations have been terminated or satisfaction otherwise of the Final Release Conditions, no Guarantor will assign or transfer to any Person (other than the Administrative Agent) any claim any such Guarantor has or may have against any Obligor.

 

7

 

SECTION 8.                            Contribution with Respect to Guaranteed Obligations.

 

(A)                               To the extent that any Guarantor shall make a payment under this Guaranty (a “Guarantor Payment”) which, taking into account all other Guarantor Payments then previously or concurrently made by any other Guarantor, exceeds the amount which otherwise would have been paid by or attributable to such Guarantor if each Guarantor had paid the aggregate Guaranteed Obligations satisfied by such Guarantor Payment in the same proportion as such Guarantor’s “Allocable Amount” (as defined below) (as determined immediately prior to such Guarantor Payment) bore to the aggregate Allocable Amounts of each of the Guarantors as determined immediately prior to the making of such Guarantor Payment, then, following indefeasible payment in full in cash of the Guaranteed Obligations and termination of the Credit Agreement, the Swap Agreements and the Banking Services Agreements, such Guarantor shall be entitled to receive contribution and indemnification payments from, and be reimbursed by, each other Guarantor for the amount of such excess, pro rata based upon their respective Allocable Amounts in effect immediately prior to such Guarantor Payment.

 

(B)                               As of any date of determination, the “Allocable Amount” of any Guarantor shall be equal to the excess of the fair saleable value of the property of such Guarantor over the total liabilities of such Guarantor (including the maximum amount reasonably expected to become due in respect of contingent liabilities, calculated, without duplication, assuming each other Guarantor that is also liable for such contingent liability pays its ratable share thereof), giving effect to all payments made by other Guarantors as of such date in a manner to maximize the amount of such contributions.

 

(C)                               This Section 8 is intended only to define the relative rights of the Guarantors, and nothing set forth in this Section 8 is intended to or shall impair the obligations of the Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Guaranty.

 

(D)                               The parties hereto acknowledge that the rights of contribution and indemnification hereunder shall constitute assets of the Guarantor or Guarantors to which such contribution and indemnification is owing.

 

(E)                                The rights of the indemnifying Guarantors against other Guarantors under this Section 8 shall be exercisable upon the full and indefeasible payment of the Guaranteed Obligations in cash and the termination of the Credit Agreement or satisfaction otherwise of the Final Release Conditions.

 

SECTION 9.                            Limitation of Guaranty.  Notwithstanding any other provision of this Guaranty, the amount guaranteed by each Guarantor hereunder shall be limited to the extent, if any, required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law.  In determining the limitations, if any, on the amount of any Guarantor’s obligations hereunder pursuant to the preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification or contribution which such Guarantor may have under this Guaranty, any other agreement or applicable law shall be taken into account.

 

SECTION 10.                     Stay of Acceleration.  If acceleration of the time for payment of any amount payable by any Borrower under the Credit Agreement, any Swap Agreement, any Banking Services Agreement or any other Loan Document is stayed upon the insolvency, bankruptcy or reorganization of such Borrower, all such amounts otherwise subject to acceleration under the terms of the Credit Agreement, any Swap Agreement, any Banking Services Agreement or any other Loan

 

8

 

Document shall nonetheless be payable by each of the Guarantors hereunder forthwith on demand by the Administrative Agent.

 

SECTION 11.                     Notices.  All notices, requests and other communications to any party hereunder shall be given in the manner prescribed in Article IX of the Credit Agreement with respect to the Administrative Agent at its notice address therein and with respect to any Guarantor, in care of the Company at the address of the Company set forth in the Credit Agreement or such other address or telecopy number as such party may hereafter specify for such purpose by notice to the Administrative Agent in accordance with the provisions of such Article IX.

 

SECTION 12.                     No Waivers.  No failure or delay by the Administrative Agent or any other Holder of Guaranteed Obligations in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  The rights and remedies provided in this Guaranty, the Credit Agreement, any Swap Agreement, any Banking Services Agreement and the other Loan Documents shall be cumulative and not exclusive of any rights or remedies provided by law.

 

SECTION 13.                     Successors and Assigns.  This Guaranty is for the benefit of the Administrative Agent and the other Holders of Guaranteed Obligations and their respective successors and permitted assigns; provided, that no Guarantor shall have any right to assign its rights or obligations hereunder without the consent of all of the Lenders, and any such assignment in violation of this Section 13 shall be null and void; and in the event of an assignment of any amounts payable under the Credit Agreement, any Swap Agreement, any Banking Services Agreement or the other Loan Documents in accordance with the respective terms thereof, the rights hereunder, to the extent applicable to the indebtedness so assigned, may be transferred with such indebtedness.  This Guaranty shall be binding upon each of the Guarantors and their respective successors and assigns.

 

SECTION 14.                     Changes in Writing.  Other than in connection with the addition of additional Subsidiaries, which become parties hereto by executing a supplement hereto in the form attached as Annex I, neither this Guaranty nor any provision hereof may be changed, waived, discharged or terminated orally, but only in writing signed by each of the Guarantors and the Administrative Agent.

 

SECTION 15.                     GOVERNING LAW.  THIS GUARANTY SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

 

SECTION 16.                     CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL; IMMUNITY.

 

(A)                               CONSENT TO JURISDICTION.  EACH GUARANTOR HEREBY IRREVOCABLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY, BOROUGH OF MANHATTAN, AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND

 

9

 

MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS GUARANTY OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY ISSUING BANK OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(B)                               EACH GUARANTOR IRREVOCABLY DESIGNATES AND APPOINTS THE COMPANY, AS ITS AUTHORIZED AGENT, TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF, SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUIT, ACTION OR PROCEEDING OF THE NATURE REFERRED TO IN CLAUSE (A) ABOVE.  SAID DESIGNATION AND APPOINTMENT SHALL BE IRREVOCABLE BY EACH SUCH FOREIGN GUARANTOR UNTIL ALL GUARANTEED OBLIGATIONS PAYABLE BY SUCH FOREIGN GUARANTOR HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS SHALL HAVE BEEN PAID IN FULL IN ACCORDANCE WITH THE PROVISIONS HEREOF AND THEREOF.  EACH FOREIGN GUARANTOR HEREBY CONSENTS TO PROCESS BEING SERVED IN ANY SUIT, ACTION OR PROCEEDING OF THE NATURE REFERRED TO IN CLAUSE (A) ABOVE BY SERVICE OF PROCESS UPON THE COMPANY AS PROVIDED IN THIS CLAUSE (B); PROVIDED THAT, TO THE EXTENT LAWFUL AND POSSIBLE, NOTICE OF SAID SERVICE UPON SUCH AGENT SHALL BE MAILED BY REGISTERED OR CERTIFIED AIR MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, TO THE COMPANY OR TO ANY OTHER ADDRESS OF WHICH SUCH FOREIGN GUARANTOR SHALL HAVE GIVEN WRITTEN NOTICE TO THE ADMINISTRATIVE AGENT (WITH A COPY THEREOF TO THE COMPANY).  EACH FOREIGN GUARANTOR IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL CLAIM OF ERROR BY REASON OF ANY SUCH SERVICE IN SUCH MANNER AND AGREES THAT SUCH SERVICE SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON SUCH FOREIGN GUARANTOR IN ANY SUCH SUIT, ACTION OR PROCEEDING AND SHALL, TO THE FULLEST EXTENT PERMITTED BY LAW, BE TAKEN AND HELD TO BE VALID AND PERSONAL SERVICE UPON AND PERSONAL DELIVERY TO SUCH FOREIGN GUARANTOR.  NOTHING HEREIN WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

 

(C)                               WAIVER OF JURY TRIAL.  EACH GUARANTOR HEREBY WAIVES  TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER AND FURTHER WAIVES ANY RIGHT TO INTERPOSE ANY COUNTERCLAIM RELATED TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY IN SUCH ACTION.

 

(D)                               TO THE EXTENT THAT ANY GUARANTOR HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER FROM SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OF A JUDGMENT, EXECUTION OR OTHERWISE), EACH GUARANTOR HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS GUARANTY.

 

10

 

SECTION 17.                     No Strict Construction.  The parties hereto have participated jointly in the negotiation and drafting of this Guaranty.  In the event an ambiguity or question of intent or interpretation arises, this Guaranty shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Guaranty.

 

SECTION 18.                     Taxes, Expenses of Enforcement, etc.

 

(A)                               Taxes.

 

(i)                                     Each payment by any Guarantor hereunder or under any promissory note or application for a Letter of Credit shall be made without withholding for any Taxes, unless such withholding is required by any law.  If any Guarantor determines, in its sole discretion exercised in good faith, that it is so required to withhold Taxes, then such Guarantor may so withhold and shall timely pay the full amount of withheld Taxes to the relevant Governmental Authority in accordance with applicable law.  If such Taxes are Indemnified Taxes, then the amount payable by the Guarantor shall be increased as necessary so that, net of such withholding (including such withholding applicable to additional amounts payable under this Section), the applicable Recipient receives the amount it would have received had no such withholding been made.

 

(ii)                                  In addition, such Guarantor shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

 

(iii)                               As soon as practicable after any payment of Indemnified Taxes by any Guarantor to a Governmental Authority, such Guarantor shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

 

(iv)                              The Guarantors shall jointly and severally indemnify each Recipient for any Indemnified Taxes that are paid or payable by such Recipient in connection with any Loan Document (including amounts payable under this Section 18(A)) and any reasonable and documented out-of-pocket expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  The indemnity under this Section 18(A) shall be paid within ten (10) days after the Recipient delivers to any Guarantor a certificate setting forth in reasonable detail the basis and calculation of the amount of any Indemnified Taxes so payable by such Recipient.  Such certificate shall be conclusive of the amount so payable absent manifest error.  Such Recipient shall deliver a copy of such certificate to the Administrative Agent.  In the case of any Lender making a claim under this Section 18(A) on behalf of any of its beneficial owners, an indemnity payment under this Section 18(A) shall be due only to the extent that such Lender is able to establish that, with respect to the applicable Indemnified Taxes, such beneficial owners supplied to the applicable Persons such properly completed and executed documentation necessary to claim any applicable exemption from, or reduction of, such Indemnified Taxes.

 

(v)                                 By accepting the benefits hereof, each Lender agrees that it will comply with Section 2.17(f) of the Credit Agreement.

 

(B)                               Expenses of Enforcement, Etc.  The Guarantors agree to reimburse the Administrative Agent and the other Holders of Guaranteed Obligations for any reasonable and documented costs and out-of-pocket expenses (including reasonable and documented attorneys’

 

11

 

fees) paid or incurred by the Administrative Agent or any other Holder of Guaranteed Obligations in connection with the collection and enforcement of amounts due under the Loan Documents, including without limitation this Guaranty.

 

SECTION 19.                     Setoff.  At any time after all or any part of the Guaranteed Obligations have become due and payable (by acceleration or otherwise), each Holder of Guaranteed Obligations (including the Administrative Agent) and its Affiliates may, without notice to any Guarantor and regardless of the acceptance of any security or collateral for the payment hereof, appropriate and apply in accordance with the terms of the Credit Agreement toward the payment of all or any part of the Guaranteed Obligations  (i) any indebtedness due or to become due from such Holder of Guaranteed Obligations or the Administrative Agent to any Guarantor, and (ii) any moneys, credits or other property belonging to any Guarantor, at any time held by or coming into the possession of such Holder of Guaranteed Obligations (including the Administrative Agent) or any of their respective affiliates.

 

SECTION 20.                     Financial Information.  Each Guarantor hereby assumes responsibility for keeping itself informed of the financial condition of each of the Borrowers and any and all endorsers and/or other Guarantors of all or any part of the Guaranteed Obligations, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations, or any part thereof, that diligent inquiry would reveal, and each Guarantor hereby agrees that none of the Holders of Guaranteed Obligations (including the Administrative Agent) shall have any duty to advise such Guarantor of information known to any of them regarding such condition or any such circumstances.  In the event any Holder of Guaranteed Obligations (including the Administrative Agent), in its sole discretion, undertakes at any time or from time to time to provide any such information to a Guarantor, such Holder of Guaranteed Obligations (including the Administrative Agent) shall be under no obligation (i) to undertake any investigation not a part of its regular business routine, (ii) to disclose any information which such Holder of Guaranteed Obligations (including the Administrative Agent), pursuant to accepted or reasonable commercial finance or banking practices, wishes to maintain confidential or (iii) to make any other or future disclosures of such information or any other information to such Guarantor.

 

SECTION 21.                     Severability.  Wherever possible, each provision of this Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Guaranty.

 

SECTION 22.                     Merger.  This Guaranty represents the final agreement of each of the Guarantors with respect to the matters contained herein and may not be contradicted by evidence of prior or contemporaneous agreements, or subsequent oral agreements, between the Guarantor and any Holder of Guaranteed Obligations (including the Administrative Agent).

 

SECTION 23.                     Headings.  Section headings in this Guaranty are for convenience of reference only and shall not govern the interpretation of any provision of this Guaranty.

 

SECTION 24.                     Judgment Currency.  If for the purposes of obtaining judgment in any court it is necessary to convert a sum due from any Guarantor hereunder in the currency expressed to be payable herein (the “specified currency”) into another currency, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures the Administrative Agent could purchase the specified currency with such other currency at the Administrative Agent’s main New York City office on the Business Day preceding that on which final, non-appealable judgment is given.  The obligations of each Guarantor in respect of any sum due hereunder shall, notwithstanding any judgment in a currency other than the

 

12

 

specified currency, be discharged only to the extent that on the Business Day following receipt by any Holder of Guaranteed Obligations (including the Administrative Agent), as the case may be, of any sum adjudged to be so due in such other currency such Holder of Guaranteed Obligations (including the Administrative Agent), as the case may be, may in accordance with normal, reasonable banking procedures purchase the specified currency with such other currency.  If the amount of the specified currency so purchased is less than the sum originally due to such Holder of Guaranteed Obligations (including the Administrative Agent), as the case may be, in the specified currency, each Guarantor agrees, to the fullest extent that it may effectively do so, as a separate obligation and notwithstanding any such judgment, to indemnify such Holder of Guaranteed Obligations (including the Administrative Agent), as the case may be, against such loss, and if the amount of the specified currency so purchased exceeds (a) the sum originally due to any Holder of Guaranteed Obligations (including the Administrative Agent), as the case may be, in the specified currency and (b) amounts shared with other Holders of Guaranteed Obligations as a result of allocations of such excess as a disproportionate payment to such other Holder of Guaranteed Obligations under Section 2.18 of the Credit Agreement, such Holder of Guaranteed Obligations (including the Administrative Agent), as the case may be, agrees, by accepting the benefits hereof, to remit such excess to such Guarantor.

 

SECTION 25.                     Keepwell.  Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Guarantor to honor all of its obligations under this Guaranty in respect of Specified Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 25 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 25 or otherwise under this Guaranty voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount).  The obligations of each Qualified ECP Guarantor under this Section 25 shall remain in full force and effect until a discharge of such Qualified ECP Guarantor’s Guaranteed Obligations in accordance with the terms hereof and the other Loan Documents.  Each Qualified ECP Guarantor intends that this Section 25 constitute, and this Section 25 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Guarantor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.  As used herein, “Qualified ECP Guarantor” means, in respect of any Specified Swap Obligation, each Guarantor that has total assets exceeding $10,000,000 at the time the relevant Guarantee or grant of the relevant security interest becomes or would become effective with respect to such Specified Swap Obligation or such other Person as constitutes an ECP and can cause another Person to qualify as an ECP at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

SECTION 26.                     Termination of Guaranty.  The obligations of any Guarantor under this Guaranty shall automatically terminate in accordance with Section 9.14 of the Credit Agreement.

 

Remainder of Page Intentionally Blank.

 

13

 

IN WITNESS WHEREOF, each of the Initial Guarantors has caused this Guaranty to be duly executed by its authorized officer as of the day and year first above written.

 

	
 
    	
[GUARANTORS]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    

 

14

 

	
Acknowledged   and Agreed
    	
 
    
	
as   of the date first written above:
    	
 
    
	
 
    	
 
    
	
JPMORGAN   CHASE BANK, N.A.,
    	
 
    
	
as   Administrative Agent
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
			

 

15

 

ANNEX I TO GUARANTY

 

Reference is hereby made to the Guaranty (the “Guaranty”) made as of [    ], by and among [GUARANTORS TO COME] (the “Initial Guarantors” and along with any additional Subsidiaries of the Company, which become parties thereto and together with the undersigned, the “Guarantors”) in favor of the Administrative Agent, for the ratable benefit of the Holders of Guaranteed Obligations, under the Credit Agreement.  Capitalized terms used herein and not defined herein shall have the meanings given to them in the Guaranty.  By its execution below, the undersigned [NAME OF NEW GUARANTOR], a [corporation] [partnership] [limited liability company] (the “New Guarantor”), agrees to become, and does hereby become, a Guarantor under the Guaranty and agrees to be bound by such Guaranty as if originally a party thereto.  By its execution below, the undersigned represents and warrants as to itself that all of the representations and warranties contained in Section 2 of the Guaranty are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of the date hereof except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, in all respects) as of such earlier date.

 

IN WITNESS WHEREOF, New Guarantor has executed and delivered this Annex I counterpart to the Guaranty as of this                      day of                   , 20      .

 

	
 
    	
[NAME   OF NEW GUARANTOR]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Its:
    

 

 

EXHIBIT H-1

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of March 19, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto (collectively with the Company, the “Borrowers”), the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of any Borrower within the meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a controlled foreign corporation related to any Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrowers with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrowers and the Administrative Agent and (2) the undersigned shall have at all times furnished the Borrowers and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME   OF LENDER]
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
	
 
    	
 
    
	
Date:                       ,   20[    ]
    	
 
    
			

 

 

EXHIBIT H-2

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of March 19, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto (collectively with the Company, the “Borrowers”), the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of any Borrower within the meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a controlled foreign corporation related to any Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME   OF PARTICIPANT]
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
			

 

Date:                      , 20[    ]

 

 

EXHIBIT H-3

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of March 19, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto (collectively with the Company, the “Borrowers”), the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect such participation, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of any Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to any Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME   OF PARTICIPANT]
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
			

 

Date:                      , 20[    ]

 

 

EXHIBIT H-4

 

[FORM OF]

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of March 19, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto (collectively with the Company, the “Borrowers”), the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to the Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of any Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to any Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrowers with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrowers and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrowers and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME   OF LENDER]
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
			

 

Date:                      , 20[    ]

 

 

EXHIBIT I-1

 

FORM OF BORROWING REQUEST

 

JPMorgan Chase Bank, N.A.,

as Administrative Agent

for the Lenders referred to below

 

[10 South Dearborn
 Chicago, Illinois 60603

Attention: [                    ]
 Facsimile: [                    ]](9)

 

With a copy to:

 

Two Corporate Drive, Suite 730
 Shelton, Connecticut 06484
 Attention: Scott Farquhar
 Facsimile: (203) 944-8495

 

Re:  Regeneron Pharmaceuticals, Inc.

 

[Date]

 

Ladies and Gentlemen:

 

Reference is hereby made to the Credit Agreement dated as of March 19, 2015 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto, the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).  Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

 

[USE THE FOLLOWING FOR A REVOLVING LOAN REQUESTED UNDER SECTION 2.03:]

 

The [undersigned Subsidiary Borrower and the] Company hereby give[s] you notice pursuant to Section 2.03 of the Credit Agreement that a Borrowing is being requested under the Credit Agreement, and in that connection the following information is being provided with respect to such Borrowing requested hereby:

 

1.                                      Name of Borrower:

 

2.                                      Aggregate principal amount of Borrowing:(10)

 

3.                                      Date of Borrowing (which shall be a Business Day):

 

(9)  If request is in respect of Revolving Loans in a Foreign Currency or a Designated Loan, please replace this address with the London address from Section 9.01(a)(ii).

(10)  Not less than applicable amounts specified in Section 2.02(c).

 

 

4.                                      Type of Borrowing (ABR(11) or Eurocurrency):

 

5.                                      Interest Period and the last day thereof (if a Eurocurrency Borrowing):(12)

 

6.                                      Agreed Currency:

 

7.                                      Location and number of the applicable Borrower’s account or any other account reasonably acceptable to the Administrative Agent to which proceeds of Borrowing are to be disbursed:

 

The undersigned hereby represents and warrants that the conditions to credit extensions specified in Section 4.02 of the Credit Agreement are satisfied as of the date hereof.

 

[USE THE FOLLOWING FOR A SWINGLINE LOAN REQUESTED UNDER SECTION 2.05:]

 

The [undersigned Subsidiary Borrower and the] Company hereby give[s] you notice pursuant to Section 2.05 of the Credit Agreement that a Swingline Loan in Dollars is being requested under the Credit Agreement, and in that connection the following information is being provided with respect to such Borrowing requested hereby:

 

1.                                      Name of Borrower:

 

2.                                      Aggregate principal amount of Borrowing:

 

3.                                      Date of Borrowing (which shall be a Business Day):

 

4.                                      Location and number of the applicable Borrower’s account or any other account reasonably acceptable to the Administrative Agent to which proceeds of Borrowing are to be disbursed:

 

The undersigned hereby represents and warrants that the conditions to credit extensions specified in Section 4.02 of the Credit Agreement are satisfied as of the date hereof.

 

[Signature Page Follows]

 

(11)  ABR should not be selected for a Designated Loan (a Revolving Loan denominated in Dollars to a Designated Foreign Subsidiary Borrower).

(12)  Which must comply with the definition of “Interest Period” and end not later than the Maturity Date.

 

2

 

IN WITNESS WHEREOF, the undersigned has caused this Borrowing Request to be duly executed by an authorized officer or other authorized signatory as of the date first appearing above.

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
[REGENERON   PHARMACEUTICALS, INC.][SUBSIDIARY BORROWER],
    
	
 
    	
as a Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
[REGENERON PHARMACEUTICALS, INC.,
    
	
 
    	
as the Company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:](1)
    

 

(1)  Additional signature of the Company to be included if Borrowing Request is made by a Subsidiary Borrower.

 

 

EXHIBIT I-2

 

FORM OF INTEREST ELECTION REQUEST

 

JPMorgan Chase Bank, N.A.,

as Administrative Agent

for the Lenders referred to below

 

[10 South Dearborn
 Chicago, Illinois 60603

Attention: [              ]
 Facsimile: ([    ]) [    ]-[          ]](1)

 

Re:  Regeneron Pharmaceuticals, Inc.

 

[Date]

 

Ladies and Gentlemen:

 

Reference is hereby made to the Credit Agreement dated as of March 19, 2015 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Regeneron Pharmaceuticals, Inc. (the “Company”), the Subsidiary Borrowers from time to time party thereto, the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”).  Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.  The undersigned Borrower hereby gives you notice pursuant to Section 2.08 of the Credit Agreement that it requests to [convert][continue] an existing Borrowing under the Credit Agreement, and in that connection the undersigned Borrower specifies the following information with respect to such [conversion][continuation] requested hereby:

 

1.                                      List Borrower, date, Type, principal amount, Agreed Currency and Interest Period (if applicable) of existing Borrowing:

 

2.                                      Aggregate principal amount of resulting Borrowing:

 

3.                                      Effective date of interest election (which shall be a Business Day):

 

4.                                      Type of Borrowing (ABR or Eurocurrency):

 

5.                                      Interest Period and the last day thereof (if a Eurocurrency Borrowing):(2)

 

6.                                      Agreed Currency:

 

[Signature Page Follows]

 

(1)  If request is in respect of Revolving Loans in a Foreign Currency or a Designated Loan, please replace this address with the London address from Section 9.01(a)(ii).

(2)  Which must comply with the definition of “Interest Period” and end not later than the Maturity Date.

 

 

	
 
    	
Very   truly yours,
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
[REGENERON PHARMACEUTICALS, INC.,
    
	
 
    	
as the Company]
    
	
 
    	
[SUBSIDIARY BORROWER,
    
	
 
    	
as   a Borrower]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    

 

 

EXHIBIT L

 

[FORM OF] NOTE

 

March 19, 2015

 

FOR VALUE RECEIVED, the undersigned, [REGENERON PHARMACEUTICALS, INC.][SUBSIDIARY BORROWER], a [                      ] (the “Borrower”), HEREBY UNCONDITIONALLY PROMISES TO PAY to [NAME OF LENDER] (the “Lender”) the aggregate unpaid Dollar Amount of all Loans made by the Lender to the Borrower pursuant to the “Credit Agreement” (as defined below) on the Maturity Date or on such earlier date as may be required by the terms of the Credit Agreement.  Capitalized terms used herein and not otherwise defined herein are as defined in the Credit Agreement.

 

The undersigned Borrower promises to pay interest on the unpaid principal amount of each Loan made to it from the date of such Loan until such principal amount is paid in full at a rate or rates per annum determined in accordance with the terms of the Credit Agreement.  Interest hereunder is due and payable at such times and on such dates as set forth in the Credit Agreement.

 

At the time of each Loan, and upon each payment or prepayment of principal of each Loan, the Lender shall make a notation either on the schedule attached hereto and made a part hereof, or in such Lender’s own books and records, in each case specifying the amount of such Loan, the respective Interest Period thereof (in the case of Eurocurrency Loans) or the amount of principal paid or prepaid with respect to such Loan, as applicable; provided that the failure of the Lender to make any such recordation or notation shall not affect the Obligations of the undersigned Borrower hereunder or under the Credit Agreement.

 

This Note is one of the notes referred to in, and is entitled to the benefits of, that certain Credit Agreement dated as of March 19, 2015 by and among the Borrower, [Company, the other][the] Subsidiary Borrowers from time to time parties thereto, the financial institutions from time to time parties thereto as Lenders and JPMorgan Chase Bank, N.A., as Administrative Agent (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”).  The Credit Agreement, among other things, (i) provides for the making of Loans by the Lender to the Borrower from time to time in an aggregate amount not to exceed at any time outstanding the Dollar Amount of such Lender’s Commitment, the indebtedness of the Borrower resulting from each such Loan to it being evidenced by this Note, and (ii) contains provisions for acceleration of the maturity hereof upon the happening of certain stated events and also for prepayments of the principal hereof prior to the maturity hereof upon the terms and conditions therein specified.

 

Demand, presentment, protest and notice of nonpayment and protest are hereby waived by the Borrower.

 

Whenever in this Note reference is made to the Administrative Agent, the Lender or the Borrower, such reference shall be deemed to include, as applicable, a reference to their respective successors and permitted assigns.  The provisions of this Note shall be binding upon and shall inure to the benefit of said successors and assigns.  The Borrower’s successors and assigns shall include, without limitation, a receiver, trustee or debtor in possession of or for the Borrower.

 

This Note shall be construed in accordance with and governed by the law of the State of New York.

 

 

*****

 

2

 

	
 
    	
[REGENERON   PHARMACEUTICALS, INC.][SUBSIDIARY BORROWER]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    

 

Note

 

 

SCHEDULE OF LOANS AND PAYMENTS OR PREPAYMENTS

 

	
Date
    	
 
    	
Amount of
   Loan
    	
 
    	
Type of
   Loan Currency
    	
 
    	
Interest
   Period/Rate
    	
 
    	
Amount of
   Principal
   Paid or
   Prepaid
    	
 
    	
Unpaid
   Principal
   Balance
    	
 
    	
Notation
   Made By

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00242-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00242-of-00352.parquet"}]]