“Borrowing Base” means:

 

(i) 85% (except as may be required by clauses (e) or (i) of the definition of “Eligible Receivables”) of the Value of Eligible Receivables of the Loan Parties, plus

 

(ii) 90% of the Net Orderly Liquidation Value of Eligible Inventory of the Loan Parties, plus

 

(iii) 90% of the face amount of Eligible Credit Card Receivables of the Loan Parties, plus

 

(iv) at the option of the Borrower, 100% of Qualified Cash, minus

 

(v) without duplication, the amount of all Reserves as the Administrative Agent may at any time and from time to time in the exercise of its Permitted Discretion establish or modify in accordance with the provisions of Section 2.26;

 

provided that in no event shall the aggregate amounts set forth in clauses (i) through (iii) of this definition attributable to Inventory or Receivables acquired pursuant to the purchase or other acquisition of property and assets or businesses of any Person or of assets constituting a business unit, a line of business or division of such Person or Equity Interests in a Person, that is not subject to a completed inventory appraisal or field examination conducted by or on behalf of the Administrative Agent exceed 10% of the Borrowing Base; provided further that in connection with any such purchase or other acquisition, the Borrower may request that the Administrative Agent undertake an inventory appraisal or field examination in respect of such acquired Inventory or Receivables and, upon such request, the Administrative Agent shall use commercially reasonable efforts to engage a third party reasonably acceptable to the Borrower to commence such inventory appraisal or field examination within 30 days.

 

The Borrowing Base at any time shall be determined by reference to the most recent Borrowing Base Certificate delivered to the Administrative Agent pursuant to the definition of “Qualified Accounts”, Section 4.02(f), Section 5.01(i), Section 5.14, the final paragraph of Section 6.05 or the first proviso of Section 9.15 and adjusted by the Administrative Agent in the exercise of its Permitted Discretion and in accordance with Section 2.26 based upon additional information, if any, received after the date of delivery of any such Borrowing Base Certificate; provided that until the earlier of (i) delivery of an initial inventory appraisal and an initial field examination conducted by or on behalf of the Administrative Agent and a Borrowing Base Certificate in respect thereof along with customary supporting documentation and (ii) the date that is 90 days following the Effective Date (or such later date as the Administrative Agent reasonably agrees), the Borrowing Base shall be deemed to be $200,000,000 (or such greater amount set forth in the initial inventory appraisal conducted by or on behalf of the Administrative Agent); provided, further, that, in the event the Borrower does not deliver an initial inventory appraisal and an initial field examination conducted by or on behalf of the Administrative Agent by the date that is 90 days following the Effective Date (or such later date as the Administrative Agent reasonably agrees), on the date that is 90 days following the Effective Date (or such applicable later date) the Borrowing Base shall be reduced to zero and shall not be increased until such date as the Borrower has delivered to the Administrative Agent such inventory appraisal and field examination and a Borrowing Base Certificate in respect thereof along with customary supporting documentation.

 

“Borrowing Base Certificate” means a certificate, signed and certified as accurate and complete by a Financial Officer of the Borrower Agent, in substantially the form of Exhibit F or another form which is acceptable to the Administrative Agent in its reasonable discretion.

 

“Borrowing Request” means a request by a Borrower for a Borrowing in accordance with Section 2.03, via electronic notice via the Portal or otherwise in substantially the form of Exhibit B or another form which is acceptable to the Administrative Agent in its reasonable discretion.

 

“Capital Expenditures” means, for any period, the additions to property, plant and equipment and other capital expenditures of the Borrower and the Restricted Subsidiaries that are (or should be) set forth in a consolidated statement of cash flows of the Borrower for such period prepared in accordance with GAAP.

 

“Capital Lease Obligation” means an obligation that is a Capitalized Lease; and the amount of Indebtedness represented thereby at any time shall be the amount of the liability in respect thereof that would at that time be required to be capitalized on a balance sheet in accordance with GAAP as applied by the Borrower in the Audited Financial Statements.

 

“Capitalized Leases” means all leases that have been or should be, in accordance with GAAP as applied by the Borrower in the Audited Financial Statements, recorded as capitalized leases.

 

“Capitalized Software Expenditures” means, for any period, the aggregate of all expenditures (whether paid in cash or accrued as liabilities) by the Borrower and the Restricted Subsidiaries during such period in respect of purchased software or internally developed software and software enhancements that, in conformity with GAAP, are or are required to be reflected as capitalized costs on the consolidated balance sheet of the Borrower and the Restricted Subsidiaries.

 

 

“Cash Management Services” has the meaning provided in the definition of Secured Cash Management Obligations.

 

“Casualty Event” means any event that gives rise to the receipt by the Borrower, a Loan Party or any Restricted Subsidiary of any insurance proceeds or condemnation awards in respect of any equipment, fixed assets or real property (including any improvements thereon) to replace or repair such equipment, fixed assets or real property.

 

“CF Debt Priority Collateral” has the meaning assigned to such term in the form of ABL Intercreditor Agreement attached as Exhibit E hereto.

 

“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group, other than the Permitted Holders (directly or indirectly, including through one or more holding companies), of Equity Interests representing 40% or more of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests in the Borrower and the percentage of the aggregate ordinary voting power so held is greater than the percentage of the aggregate ordinary voting power represented by the Equity Interests in the Borrower held by the Permitted Holders, unless the Permitted Holders (directly or indirectly, including through one of more holding companies) otherwise have the right (pursuant to contract, proxy or otherwise), directly or indirectly, to designate, nominate or appoint (and do so designate, nominate or appoint) a majority of the Board of Directors of the Borrower or (b) the occurrence of a “Change of Control” (or similar event, however denominated), as defined in the documentation governing any Material Indebtedness that is Subordinated Indebtedness. For purposes of this definition, (i) “beneficial ownership,” shall be as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act, (ii) the phrase Person or “group” is within the meaning of Section 13(d) or 14(d) of the Exchange Act, but excluding any employee benefit plan of such Person or “group” and its subsidiaries and any Person acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan, and (iii) if any Person or “group” includes one or more Permitted Holders, the issued and outstanding Equity Interests of the Borrower directly or indirectly owned by the Permitted Holders that are part of such Person or “group” shall not be treated as being owned by such Person or “group” for purposes of determining whether this definition is triggered).

 

“Change in Law” means (a) the adoption of any rule, regulation, treaty or other law after the date of this Agreement, (b) any change in any rule, regulation, treaty or other law or in the administration, interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement; provided that, notwithstanding anything herein to the contrary, (i) any requests, rules, guidelines or directives under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 or issued in connection therewith and (ii) any requests, rules, guidelines or directives promulgated by the Bank of International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States regulatory authorities, in each case pursuant to Basel III, shall in each case shall be deemed to be a “Change in Law,” regardless of when enacted, adopted, promulgated or issued.

 

“Chattel Paper” means any “chattel paper,” as such term is defined in the UCC, including electronic chattel paper, now owned or hereafter acquired by any Loan Party, wherever located.

 

“Class” when used in reference to (a) any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Loans under the Facility (including a FILO Tranche), (b) any Commitment, refers to whether such Commitment is a Revolving Commitment or an Incremental Commitment under the Facility and (c) any Lender, refers to whether such Lender has a Loan or Commitment with respect to a particular Class of Loans or Commitments under the Facility. Loans made under Incremental Commitments that have different terms and conditions shall be construed to be in different Classes.

 

 

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

 

“Collateral” means any and all assets, whether real or personal, tangible or intangible, on which Liens are purported to be granted pursuant to the Security Documents by any Loan Party to secure the Secured Obligations of the Loan Parties.

 

“Collateral Access Agreement” means a collateral access agreement (including a landlord lien waiver) in the form of Exhibit J-1 or J-2 hereto, as applicable, or otherwise reasonably satisfactory to the Administrative Agent.

 

“Collateral Agreement” means the Collateral Agreement among the Borrower, each other Loan Party and the Administrative Agent, substantially in the form of Exhibit D.

 

“Collateral and Guarantee Requirement” means, at any time, the requirement that:

 

 

 

 

 

Notwithstanding the foregoing provisions of this definition or anything in this Agreement or any other Loan Document to the contrary, (a) the foregoing provisions of this definition shall not require the creation or perfection of pledges of or security interests in, or the obtaining of title insurance, legal opinions or other deliverables with respect to, particular assets of the Loan Parties, or the provision of Guarantees by any Subsidiary, if, and for so long as and to the extent that the Administrative Agent and the Borrower reasonably agree in writing that the cost of creating or perfecting such pledges or security interests in such assets, or obtaining such title insurance, legal opinions or other deliverables in respect of such assets, or providing such Guarantees (taking into account any material adverse Tax consequences to the Borrower and its Subsidiaries (including the imposition of withholding or other material Taxes)), shall be excessive in view of the benefits to be obtained by the Lenders therefrom, (b) Liens required to be granted from time to time pursuant to the term “Collateral and Guarantee Requirement” shall be subject to exceptions and limitations set forth in the Security Documents as in effect on the Effective Date, (c) except as otherwise expressly set forth herein, in no event shall control agreements or other control or similar arrangements be required with respect to deposit accounts, securities accounts, commodities accounts or other assets specifically requiring perfection by control agreements, (d) no perfection actions shall be required with respect to Vehicles and other assets subject to certificates of title, (e) no perfection actions shall be required with respect to commercial tort claims with a value less than $5,000,000 and no perfection shall be required with respect to promissory notes evidencing debt for borrowed money in a principal amount of less than $5,000,000 (except to the extent such perfection may be achieved solely by filing a UCC financing statement), (f) no actions in any non-U.S. jurisdiction or required by the laws of any non-U.S. jurisdiction shall be required, except as expressly provided in this Agreement, to be taken to create any security interests in assets located or titled outside of the United States (including any Equity Interests of Foreign Subsidiaries and any Intellectual Property or real property owned by Foreign Subsidiaries) or to perfect or make enforceable any security interests in any such assets, (g) no actions shall be required to perfect a security interest in letter of credit rights (other than the filing of UCC filings), (h) in no event shall the Collateral include any Excluded Assets and (i) no delivery of share certificates evidencing Equity Interests in Immaterial Subsidiaries shall be required. The Administrative Agent may grant extensions of time for the creation and perfection of security interests in or the obtaining of title insurance, legal opinions or other deliverables with respect to particular assets or the provision of any Guarantee by any Subsidiary (including extensions beyond the Effective Date or in connection with assets acquired, or Subsidiaries formed or acquired, after the Effective Date) where it determines that such action cannot be accomplished without undue effort or expense by the time or times at which it would otherwise be required to be accomplished by this Agreement or the Security Documents.

 

“Commercial Letter of Credit” means any Letter of Credit issued for the purpose of providing the primary payment mechanism in connection with the purchase of any materials, goods or services by the Borrower or its Subsidiaries in the ordinary course of business.

 

“Commitment” means with respect to any Lender, its Revolving Commitment, Incremental Commitment or any combination thereof (as the context requires).

 

“Commitment Fee Rate” means a rate per annum equal to 0.25%.

 

“Commitment Schedule” means Schedule 2.01.

 

“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.

 

“Company Materials” has the meaning specified in Section 5.01.

 

“Compliance Certificate” means a Compliance Certificate in the form of Exhibit I required to be delivered pursuant to Section 5.01(c).

 

 

“Consolidated EBITDA” means, for any period, the Consolidated Net Income for such period, plus:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in each case, as determined on a consolidated basis for the Borrower and the Restricted Subsidiaries in accordance with GAAP; provided that,

 

(I)          there shall be included in determining Consolidated EBITDA for any period, without duplication, the Acquired EBITDA of any Person, property, business or asset acquired by the Borrower or any Restricted Subsidiary during such period (other than any Unrestricted Subsidiary) whether such acquisition occurred before or after the Effective Date to the extent not subsequently sold, transferred or otherwise disposed of (but not including the Acquired EBITDA of any related Person, property, business or assets to the extent not so acquired) (each such Person, property, business or asset acquired, including pursuant to the Transactions or pursuant to a transaction consummated prior to the Effective Date, and not subsequently so disposed of, an “Acquired Entity or Business”), and the Acquired EBITDA of any Unrestricted Subsidiary that is converted into a Restricted Subsidiary during such period (each, a “Converted Restricted Subsidiary”), in each case based on the Acquired EBITDA of such Pro Forma Entity for such period (including the portion thereof occurring prior to such acquisition or conversion) determined on a historical Pro Forma Basis, and

 

(II)         there shall be (A) excluded in determining Consolidated EBITDA for any period the Disposed EBITDA of any Person, property, business or asset (other than any Unrestricted Subsidiary) sold, transferred or otherwise disposed of, closed or classified as discontinued operations by the Borrower or any Restricted Subsidiary during such period (but if such operations are classified as discontinued due to the fact that they are subject to an agreement to dispose of such operations, only when and to the extent such operations are actually disposed of) (each such Person, property, business or asset so sold, transferred or otherwise disposed of, closed or classified, a “Sold Entity or Business”), and the Disposed EBITDA of any Restricted Subsidiary that is converted into an Unrestricted Subsidiary during such period (each, a “Converted Unrestricted Subsidiary”), in each case based on the Disposed EBITDA of such Sold Entity or Business or Converted Unrestricted Subsidiary for such period (including the portion thereof occurring prior to such sale, transfer, disposition, closure, classification or conversion) determined on a historical Pro Forma Basis and (B) included in determining Consolidated EBITDA for any period in which a Sold Entity or Business is disposed, an adjustment equal to the Pro Forma Disposal Adjustment with respect to such Sold Entity or Business (including the portion thereof occurring prior to such disposal) as specified in the Pro Forma Disposal Adjustment certificate delivered to the Administrative Agent (for further delivery to the Lenders).

 

Notwithstanding the foregoing, for all purposes of this Agreement, Consolidated EBITDA shall be deemed to equal (a) ($51,509,000) for the fiscal quarter ended March 31, 2018, (b) ($53,410,000) for the fiscal quarter ended June 30, 2018, (c) ($68,633,000) for the fiscal quarter ended September 30, 2018 and (d) ($55,355,000) for the fiscal quarter ended December 31, 2018, in each case and, without duplication, adjusted to reflect any Pro Forma Adjustment with respect to any relevant Specified Transaction or any restructuring, cost saving initiative or other initiative, in each case, occurring or identified after the Effective Date and not otherwise included in the calculation of the foregoing amounts.

 

“Consolidated First Lien Debt” means Consolidated Total Debt that is not Subordinated Indebtedness and is secured by Liens on the Collateral on an equal or senior priority basis (but without regard to the control of remedies) with Liens securing the Secured Obligations. For the avoidance of doubt, (a) any Indebtedness under the Facility shall constitute First Lien Debt and (b) Consolidated First Lien Debt shall be reduced, without duplication, by the amount of cash and Permitted Investments reducing Consolidated Total Debt as of the relevant date of determination.

 

“Consolidated Interest Expense” means the sum of (a) cash interest expense (including that attributable to Capitalized Leases), net of cash interest income of the Borrower and the Restricted Subsidiaries with respect to all outstanding Indebtedness of the Borrower and the Restricted Subsidiaries, including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and net costs under hedging agreements plus (b) non-cash interest expense resulting solely from the amortization of original issue discount from the issuance of Indebtedness of the Borrower and the Restricted Subsidiaries (excluding Indebtedness borrowed hereunder in connection with the Transactions) at less than par, plus (c) pay-in-kind interest expense of the Borrower and the Restricted Subsidiaries, but excluding, for the avoidance of doubt, (i) amortization of deferred financing costs, debt issuance costs, commissions, fees and expenses and any other amounts of non-cash interest other than referred to in clause (b) above (including as a result of the effects of acquisition method accounting or pushdown accounting), (ii) non-cash interest expense attributable to the movement of the mark-to-market valuation of obligations under hedging agreements or other derivative instruments pursuant to FASB Accounting Standards Codification No. 815-Derivatives and Hedging, (iii) any one-time cash costs associated with breakage in respect of hedging agreements for interest rates, (iv) commissions, discounts, yield, make whole premium and other fees and charges (including any interest expense) incurred in connection with any Permitted Receivables Financing, (v) any “additional interest” owing pursuant to a registration rights agreement with respect to any securities, (vi) any payments with respect to make-whole premiums or other breakage costs of any Indebtedness, including, without limitation, any Indebtedness issued in connection with the Transactions, (vii) penalties and interest relating to taxes, (viii) accretion or accrual of discounted liabilities not constituting Indebtedness, (ix) interest expense attributable to a direct or indirect parent entity resulting from push-down accounting, (x) any expense resulting from the discounting of Indebtedness in connection with the application of recapitalization or purchase accounting and (xi) any interest expense attributable to the exercise of appraisal rights and the settlement of any claims or actions (whether actual, contingent or potential) with respect thereto and with respect to any Permitted Acquisition or similar Investment permitted hereunder, all as calculated on a consolidated basis in accordance with GAAP.

 

For purposes of this definition, interest on a Capitalized Lease shall be deemed to accrue at an interest rate reasonably determined by the Borrower to be the rate of interest implicit in such Capitalized Lease in accordance with GAAP.

 

“Consolidated Net Income” means, for any period, the net income (loss) of the Borrower and the Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP, excluding (and excluding the effect of), without duplication:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

There shall be excluded from Consolidated Net Income for any period the effects from applying acquisition method accounting, including applying acquisition method accounting to inventory, property and equipment, loans and leases, software and other intangible assets and deferred revenue (including deferred costs related thereto and deferred rent) required or permitted by GAAP and related authoritative pronouncements (including the effects of such adjustments pushed down to the Borrower and the Restricted Subsidiaries), as a result of the Transactions, any acquisition consummated prior to the Effective Date and any Permitted Acquisitions or other Investment or the amortization or write-off of any amounts thereof.

 

In addition, to the extent not already included in Consolidated Net Income, Consolidated Net Income shall include the amount of proceeds received or, so long as such Person has made a determination that there exists reasonable evidence that such amount will in fact be reimbursed by the insurer or indemnifying party and only to the extent that such amount is in fact reimbursed within 365 days of the date of the insurable or indemnifiable event (net of any amount so added back in any prior period to the extent not so reimbursed within the applicable 365-day period), due from business interruption insurance or reimbursement of expenses and charges that are covered by indemnification and other reimbursement provisions in connection with any acquisition or other Investment or any disposition of any asset permitted hereunder.

 

“Consolidated Secured Debt” means Consolidated Total Debt that is not Subordinated Indebtedness and is secured by a Lien on the Collateral. For the avoidance of doubt, Consolidated Secured Debt shall be reduced, without duplication, by the amount of cash and Permitted Investments reducing Consolidated Total Debt as of the relevant date of determination.

 

“Consolidated Total Assets” means, as at any date of determination, the amount that would be set forth opposite the caption “total assets” (or any like caption) on the most recent consolidated balance sheet of the Borrower and the Restricted Subsidiaries in accordance with GAAP.

 

“Consolidated Total Debt” means, as of any date of determination (i) the outstanding principal amount of all third party Indebtedness for borrowed money (including purchase money Indebtedness), unreimbursed drawings under letters of credit, Capital Lease Obligations, third party Indebtedness obligations evidenced by notes or similar instruments and, without duplication, Receivables Guarantees, in each case of the Borrower and the Restricted Subsidiaries on such date, on a consolidated basis and determined in accordance with GAAP (excluding, in any event, the effects of any discounting of Indebtedness resulting from the application of acquisition method accounting in connection with the Transactions or any Permitted Acquisition or other Investment) minus (ii) the aggregate amount of cash and Permitted Investments on the consolidated balance sheet of the Borrower and the Restricted Subsidiaries on such date to the extent the use thereof for the application to the payment of Indebtedness is not prohibited by law or any contract to which the Borrower and any Restricted Subsidiary is a party (which, for the avoidance of doubt, shall include all Qualified Cash so long as no Cash Dominion Event is continuing). It is understood that (x) the foregoing clause (ii) shall not apply in respect of any calculation hereunder of the Fixed Charge Coverage Ratio and (y), to the extent the Borrower or any Restricted Subsidiary incurs any Indebtedness and receives the proceeds of such Indebtedness, for purposes of determining any incurrence test under this Agreement and whether the Borrower is in Pro Forma Compliance with any such test, the proceeds of such incurrence may be considered cash or Permitted Investments for purposes of any “netting” pursuant to clause (ii) of this definition to the extent not promptly applied to the transaction financed in connection with such incurrence.

 

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

 

“Control Agreement” has the meaning assigned to such term in Section 5.17(a).

 

“Controlled Accounts” has the meaning assigned to such term in Section 5.17(a).

 

“Converted Restricted Subsidiary” has the meaning given such term in the definition of “Consolidated EBITDA.”

 

“Converted Unrestricted Subsidiary” has the meaning given such term in the definition of “Consolidated EBITDA.”

 

“Corresponding Tenor” with respect to any Available Tenor means, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as such Available Tenor.

 

“Cost” means the cost of purchase of Inventory determined according to the accounting policies used in the preparation of the Borrower’s audited financial statements.

 

“Covered Party” has the meaning specified in Section 9.21(a).

 

“Cure Amount” has the meaning assigned to such term in Section 7.03(a).

 

“Cure Expiration Date” has the meaning assigned to such term in Section 7.03(a).

 

“Cure Right” has the meaning assigned to such term in Section 7.03(a).

 

“Customs Broker/Carrier Agreement” means an agreement in form and substance reasonably satisfactory to the Administrative Agent among the Borrower, a customs broker, freight forwarder, consolidator or carrier, and the Administrative Agent, in which the customs broker, freight forwarder, consolidator or carrier acknowledges that it has control over and holds the documents evidencing ownership of the subject inventory for the benefit of the Administrative Agent and agrees, upon notice from the Administrative Agent, to hold and dispose of the subject inventory solely as directed by the Administrative Agent.

 

“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which may include a lookback) being established by the Administrative Agent in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for business loans; provided that, if the Administrative Agent decides that any such convention is not administratively feasible for the Administrative Agent, then the Administrative Agent may establish another convention in its reasonable discretion that is substantially consistent with both (x) market practice and (y) other syndicated credit facilities for similarly situated sponsors.

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

 

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

 

“Defaulting Lender” means any Lender that has (a) failed to fund any portion of its Loans or participations in Letters of Credit or Swingline Loans within two Business Days of the date on which such funding is required hereunder, (b) notified the Borrower, the Administrative Agent, any Issuing Bank, any Swingline Lender or any Lender in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement or provided any written notification to any Person to the effect that it does not intend to comply with its funding obligations under this Agreement, (c) failed, within three Business Days after request by the Administrative Agent (whether acting on its own behalf or at the reasonable request of the Borrower (it being understood that the Administrative Agent shall comply with any such reasonable request)), to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans and participations in then outstanding Letters of Credit and Swingline Loans, (d) otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within two Business Days of the date when due, in each case unless the subject of a good faith dispute or subsequently cured, (e)(i) become or is insolvent or has a parent company that has become or is insolvent or (ii) become the subject of a bankruptcy or insolvency proceeding or any action or proceeding of the type described in Section 7.01(h) or (i), or has had a receiver, interim receiver, monitor, conservator, trustee, administrator, assignee for the benefit of creditors, examiner, liquidator or similar Person charged with reorganization or liquidation of its business or custodian, appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, interim receiver, monitor, conservator, trustee, administrator, assignee for the benefit of creditors, examiner, liquidator or similar Person charged with reorganization or liquidation of its business or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or (f) or has a direct or indirect parent company that has become the subject of a Bail-In Action.

 

“Deposit Account” has the meaning assigned to such term in the Uniform Commercial Code in the state of New York.

 

“Designated Disbursement Account” has the meaning assigned to such term in Section 5.17(d).

 

“Designated Non-Cash Consideration” means the Fair Market Value of non-cash consideration received by the Borrower or a Subsidiary in connection with a Disposition pursuant to Section 6.05(k) that is designated as Designated Non-Cash Consideration pursuant to a certificate of a Responsible Officer of the Borrower, setting forth the basis of such valuation (which amount will be reduced by the Fair Market Value of the portion of the non-cash consideration converted to cash within 180 days following the consummation of the applicable Disposition).

 

“Determination Date” means, (a) with respect to any Letter of Credit denominated in a currency other than Dollars, (i) each date of issuance of such Letter of Credit and (ii) each date of any amendment of such Letter of Credit that would have the effect of increasing the face amount thereof; and (b) such additional dates as the Administrative Agent or the respective Issuing Bank determine in its reasonable discretion.

 

“Dilution Percentage” means the percent equal to (a) bad debt write-downs or write-offs, discounts, returns, promotions, credits, credit memos, charge backs and other dilutive items with respect to Eligible Credit Card Receivables or Eligible Receivables, as the case may be, divided by (b) gross sales, determined based on information contained in the most recent field examination (or, in the Permitted Discretion of the Administrative Agent, based on updated information provided to the Administrative Agent by the Borrower).

 

“Dilution Reserve” means an amount equal to the amount of Eligible Credit Card Receivables or Eligible Receivables under the Facility, multiplied by the percentage by which the Dilution Percentage exceeds 5%.

 

“Disposed EBITDA” means, with respect to any Sold Entity or Business or Converted Unrestricted Subsidiary for any period, the amount for such period of Consolidated EBITDA of such Sold Entity or Business or Converted Unrestricted Subsidiary (determined as if references to the Borrower and the Restricted Subsidiaries in the definition of the term “Consolidated EBITDA” (and in the component financial definitions used therein) were references to such Sold Entity or Business and its subsidiaries or to such Converted Unrestricted Subsidiary and its subsidiaries), all as determined on a consolidated basis for such Sold Entity or Business or Converted Unrestricted Subsidiary.

 

“Disposition” has the meaning assigned to such term in Section 6.05.

 

“Disqualified Equity Interest” means, with respect to any Person, any Equity Interest in such Person that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable, either mandatorily or at the option of the holder thereof), or upon the happening of any event or condition:

 

 

 

 

in each case, on or prior to the date 91 days after the Latest Maturity Date; provided, however, that (i) an Equity Interest in any Person that would not constitute a Disqualified Equity Interest but for terms thereof giving holders thereof the right to require such Person to redeem or purchase such Equity Interest upon the occurrence of an “asset sale,” a “change of control” or similar event shall not constitute a Disqualified Equity Interest if any such requirement becomes operative only after repayment in full of all the Loans and all other Loan Document Obligations that are accrued and payable and the termination of the Commitments and the termination of all outstanding Letters of Credit (other than Letters of Credit that have been cash collateralized on terms set forth in Section 2.24(i) or back-stopped following the termination of the Commitments in a manner reasonably satisfactory to the applicable Issuing Banks) and (ii) if an Equity Interest in any Person is issued pursuant to any plan for the benefit of employees of the Borrower (or any direct or indirect parent thereof) or any of the Subsidiaries or by any such plan to such employees, such Equity Interest shall not constitute a Disqualified Equity Interest solely because it may be required to be repurchased by the Borrower (or any direct or indirect parent company thereof) or any of the Subsidiaries in order to satisfy applicable statutory or regulatory obligations of such Person.

 

“Disqualified Lenders” means (a) those Persons identified by a Sponsor or the Borrower to the Joint Bookrunners in writing prior to June 18, 2019 (or, if identified in writing after such date but prior to the date hereof, with the consent of Joint Bookrunners holding at least a majority of the financing commitments as of June 18, 2019), (b) those Persons who are competitors of the Borrower and its Subsidiaries identified by a Sponsor or the Borrower to the Administrative Agent from time to time in writing (including by email) and (c) in the case of each Persons identified pursuant to clauses (a) and (b) above, any of their Affiliates that are either (i) identified in writing by the Borrower or a Sponsor from time to time or (ii) known or reasonably identifiable as Affiliates (other than, in the case of this clause (ii), Affiliates that are bona fide debt funds); provided, that no designation of any Person as a Disqualified Lender shall retroactively disqualify any assignments or participations made to, or information provided to, such Person before it was designated as a Disqualified Lender, and such Person shall not be deemed to be a Disqualified Lender in respect of any assignments or participations made to such Person prior to the date of such designation.

 

“Document” has the meaning assigned to such term in the Collateral Agreement.

 

“Dollar Equivalent” means, at any time, (a) with respect to any amount denominated in Dollars, such amount in Dollars, and (b) with respect to any amount denominated in any other currency, the equivalent amount thereof in Dollars as determined by the Administrative Agent at such time in accordance with Section 1.06 hereof.

 

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

 

“Domestic Subsidiary” means any Subsidiary that is incorporated or organized under the laws of a State within the United States of America or the District of Columbia.

 

“Drawing Document” means any Letter of Credit or other document presented for purposes of drawing under any Letter of Credit, including by electronic transmission such as SWIFT, electronic mail, facsimile or computer generated communication.

 

“Early Opt-in Election” means, with respect to Dollars, the occurrence of:

(2) the joint election by the Administrative Agent and the Borrower to declare that an Early Opt-in Election for Dollars has occurred and the provision, as applicable, by the Administrative Agent of written notice of such election to the Borrower and the Lenders.

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

 

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

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

 

“Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund and (d) any other Person other than, in each case, (i) a natural person, (ii) a Defaulting Lender, (iii) a Disqualified Lender or (iv) any Sponsor, the Borrower or any of their respective Affiliates.

 

“Eligible Credit Card Receivables” means, as of any date of determination, Receivables and Payment Intangibles due to a Loan Party from major credit card processors (including, without limitation, VISA, Mastercard, American Express, Diners Club, Carte Blanche and DiscoverCard) as arise in the ordinary course of business and which have been earned by performance, that, unless otherwise approved by the Administrative Agent in its Permitted Discretion, meet all of the following requirements:

 

 

 

 

 

 

“Eligible In-Transit Inventory” means Inventory (other than Eligible Letter of Credit Inventory) owned by a Loan Party that would be Eligible Inventory under clause (2) of such definition if it were not in transit from a foreign location to a location of such Loan Party within the United States. Without limiting the foregoing, no Inventory shall be Eligible In-Transit Inventory unless it (a) has cleared customs into the United States; (b) is insured in accordance with the provisions of this Agreement and the other Loan Documents; (c) has been identified to the applicable sales contract and title has passed to the applicable Loan Party; (d) is not sold by a vendor that has a right to reclaim, divert shipment of, repossess, stop delivery, claim any reservation of title or otherwise assert Lien rights against the Inventory, or with respect to whom any Loan Party is in default of any obligations; (e) is subject to customary purchase orders and other sale documentation consistent with such Loan Party’s ordinary course of dealing; (f) is shipped by a common carrier that is not affiliated with the vendor; and (g) is subject to documents of title evidencing ownership thereof over which the Administrative Agent has control (such as, if requested by the Administrative Agent, by the delivery of a Customs Broker/Carrier Agreement).

 

“Eligible Inventory” means (1) Eligible Letter of Credit Inventory and Eligible In-Transit Inventory and (2) items of Inventory of the Loan Parties subject to the Lien in favor of the Administrative Agent held for sale in the ordinary course of the business of the Loan Parties (but not including packaging or shipping materials or maintenance supplies) that, unless otherwise approved by the Administrative Agent in its Permitted Discretion, meet all of the following requirements:

 

 

 

 

 

 

 

 

 

 

With respect to any Inventory that was acquired or originated by any Person acquired after the Effective Date, the Administrative Agent shall use commercially reasonable efforts, at the expense of the Loan Parties, to complete diligence in respect of such Person and such Inventory, within a reasonable time following request of the Borrower.

 

“Eligible Letter of Credit Inventory” means as of the date of determination thereof, without duplication of other Eligible Inventory, Inventory, (a) the purchase of which is supported by a Commercial Letter of Credit having an expiry within one hundred twenty (120) days of such date of determination, which Commercial Letter of Credit provides for documentary requirements to include a document of title showing the applicable Loan Party as consignee (except as otherwise reasonably agreed by the Administrative Agent) and, beginning with the 181st day after the Effective Date, as to which the Administrative Agent has control over the documents of title, to the extent applicable, which evidence ownership of the subject Inventory, and (b) which otherwise would constitute Eligible Inventory under clause (2) thereof.

 

“Eligible Receivable” means the unpaid portion of a Receivable payable in a Permitted Currency to a Loan Party subject to the Lien in favor of the Administrative Agent, which Receivable, unless otherwise approved by the Administrative Agent in its Permitted Discretion, meets all of the following requirements:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

With respect to any Receivables that were acquired or originated by any Person acquired by the Borrower after the Effective Date, the Administrative Agent shall use commercially reasonable efforts, at the expense of the Loan Parties, to complete diligence in respect of such Person and such Receivables, within a reasonable time following request of the Borrower. Notwithstanding anything in this Agreement to the contrary, warehouse acceptance deferrals, re-bills, unapplied cash and customer deposits, in each case, of any Loan Party will be calculated and reflected in the Borrowing Base as of the end the last fiscal month of each fiscal quarter of the Borrower and, with respect to each fiscal month thereafter until the next such quarterly calculation, the Borrowing Base shall be updated to reflect an equivalent percentage of the aggregate Value of Receivables for each such item for such fiscal month based on the aggregate Value of Receivables reflected in the calculation for such prior fiscal quarter end.

 

“EMU Legislation” means the legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified European currency.

 

“Environmental Laws” means applicable common law, codes, ordinances and judgments and other applicable Requirements of Law, and all applicable injunctions or binding agreements issued, promulgated or entered into by or with any Governmental Authority, in each instance relating to the protection of the environment, including with respect to the preservation or reclamation of natural resources or the Release or threatened Release of any Hazardous Material, or to the extent relating to exposure to Hazardous Materials, the protection of human health or safety.

 

“Environmental Liability” means any liability, obligation, loss, claim, action, order or cost, contingent or otherwise (including any liability for damages, costs of medical monitoring, costs of environmental remediation or restoration, administrative oversight costs, consultants’ fees, fines, penalties and indemnities), of or relating to the Borrower or any Subsidiary directly or  indirectly resulting from or based upon (a) any actual or alleged violation of any Environmental Law or permit, license or approval issued thereunder, (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 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 a Person.

 

“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 any Loan Party, is treated as a single employer under Section 414(b) or 414(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) any failure by any Plan to satisfy the minimum funding standards (within the meaning of Section 412 or Section 430 of the Code or Section 302 of ERISA) applicable to such Plan, whether or not waived; (c) the filing pursuant to Section 412 of the Code or Section 302 of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) a determination that any Plan is, or is expected to be, in “at-risk” status (as defined in Section 303(i)(4) of ERISA or Section 430(i)(4) of the Code); (e) the incurrence by a Loan Party or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (f) the receipt by a Loan Party 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; (g) the incurrence by a Loan Party or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan (including any liability under Section 4062(e) of ERISA) or Multiemployer Plan; or (h) the receipt by a Loan Party or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from a Loan Party or any ERISA Affiliate of any notice, concerning the imposition 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 or in endangered or critical status, within the meaning of Section 305 of ERISA.

 

“Erroneous Payment” has the meaning assigned to it in Section 8.02.

 

“Erroneous Payment Impacted Class” has the meaning assigned to it in Section 8.02.

 

“Erroneous Payment Return Deficiency” has the meaning assigned to it in Section 8.02.

 

“Erroneous Payment Deficiency Assignment” has the meaning assigned to it in Section 8.02.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

 

“Euro” means the single currency of the European Union as constituted by the Treaty on European Union and as referred to in the EMU Legislation.

“Eurocurrency” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the LIBO Rate.

 

“Event of Default” has the meaning assigned to such term in Section 7.01.

 

“Excess Availability” means, at any time, an amount equal to (a) the Maximum Borrowing Amount of the Facility at such time, minus (b) the aggregate Revolving Exposures under the Facility (including the LC Exposure) of all Revolving Lenders under the Facility at such time.

 

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended from time to time.

 

“Excess Liquidity” means, at any time, the remainder of (x) the sum, without duplication, of (i) the Total Maximum Borrowing Amount plus (ii) without duplication, Qualified Cash at such time which is not included in the Maximum Borrowing Amount, minus (y) the total Revolving Exposure under all Facilities (including the LC Exposure) of all Lenders at such time.

 

“Exchange Rate” means for a currency means the rate determined by the Administrative Agent to be the rate quoted by the Person acting in such capacity as the spot rate for the purchase by such Person of such currency with another currency through its principal foreign exchange trading office at approximately 11:00 a.m. on the date two Business Days prior to the date of such determination; provided that the Administrative Agent may obtain such spot rate from another financial institution designated by the Administrative Agent if the Person acting in such capacity does not have as of the date of determination a spot buying rate for any such currency.

 

“Excluded Account” has the meaning given such term in Section 5.17(d).

 

“Excluded Assets” means (a) any fee-owned real property, (b) all leasehold interests in real property, (c) any governmental licenses or state or local franchises, charters or authorizations, to the extent a security interest in any such license, franchise, charter or authorization would be prohibited or restricted thereby (including any legally effective prohibition or restriction, but excluding any prohibition or restriction that is ineffective under the Uniform Commercial Code or similar applicable law of any applicable jurisdiction), (d) any asset if, to the extent that and for so long as the grant of a Lien thereon to secure the Secured Obligations is prohibited by any Requirements of Law (other than to the extent that any such prohibition would be rendered ineffective pursuant to any other applicable Requirements of Law) or would require consent or approval of any Governmental Authority, (e) margin stock and, to the extent prohibited by, or creating an enforceable right of termination in favor of any other party thereto under (other than any Loan Party) the terms of any applicable Organizational Documents, joint venture agreement or shareholders’ agreement, Equity Interests in any Person other than wholly-owned Restricted Subsidiaries, (f) assets to the extent a security interest in such assets would result in material adverse tax consequences to the Borrower or one of its subsidiaries as reasonably determined by the Borrower in consultation with the Administrative Agent, (g) any intent-to-use trademark application prior to the filing of a “Statement of Use” or “Amendment to Allege Use” with respect thereto, (h) any lease, license or other agreement or any property subject thereto (including pursuant to a purchase money security interest or similar arrangement) to the extent that a grant of a security interest therein would violate or invalidate such lease, license or agreement or purchase money arrangement or create a breach, default or right of termination in favor of any other party thereto (other than any Loan Party) after giving effect to the applicable anti-assignment provisions of the Uniform Commercial Code or similar applicable law of any applicable jurisdiction, other than proceeds and receivables thereof, the assignment of which is expressly deemed effective under the Uniform Commercial Code or similar applicable law of any applicable jurisdiction notwithstanding such prohibition, (i) solely with respect to Security Documents, in excess of 65% of the voting Equity Interests of (A) any Foreign Subsidiary or (B) any FSHCO, (j) receivables, and related assets (or interests therein) (A) sold to any Receivables Subsidiary or (B) otherwise pledged, factored, transferred or sold in connection with any Permitted Receivables Financing, (k) commercial tort claims and letter-of-credit rights, in each case with a value of less than $5,000,000 (except to the extent a security interest therein can be perfected by a UCC or similar filing in the applicable jurisdiction), (l) Vehicles and other assets subject to certificates of title, (m) any aircraft, airframes, aircraft engines or helicopters, or any Equipment or other assets constituting a part thereof and (n) any and all assets and personal property owned by any Subsidiary that is not a Loan Party.

 

“Excluded Subsidiary” means (a) any Subsidiary that is not a wholly-owned subsidiary of the Borrower, (b) each Subsidiary listed on Schedule 1.01(a), (c) each Unrestricted Subsidiary, (d) each Immaterial Subsidiary, (e) any Subsidiary that is prohibited by (i) applicable Requirements of Law or (ii) any contractual obligation existing on the Effective Date or on the date any such Subsidiary is acquired (so long in respect of any such contractual prohibition such prohibition is not incurred in contemplation of such acquisition), in each case from guaranteeing the Secured Obligations (but only for so long as such restriction is continuing) or which would require governmental (including regulatory) consent, approval, license or authorization to provide a Guarantee under the Guarantee Agreement, or for which the provision of a Guarantee under the Guarantee Agreement would result in a material adverse tax consequence (including as a result of the operation of Section 956 of the Code or any similar law or regulation in any applicable jurisdiction) to the Borrower or one of its subsidiaries (as reasonably determined by the Borrower in consultation with the Administrative Agent), (f) any Foreign Subsidiary, (g) any direct or indirect Domestic Subsidiary of a direct or indirect Foreign Subsidiary of the Borrower that is a “controlled foreign corporation” within the meaning of Section 957 of the Code, (h) any FSHCO, (i) any other Subsidiary excused from becoming a Loan Party pursuant to clause (a) of the last paragraph of the definition of the term “Collateral and Guarantee Requirement,” (j) each Receivables Subsidiary and (k) any not-for-profit Subsidiaries, captive insurance companies or other special purpose subsidiaries designated by the Borrower from time to time.

 

“Excluded Swap Obligation” means, with respect to any Guarantor, (a) 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, as applicable, 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 (determined after giving effect to any applicable keep well, support, or other agreement for the benefit of such Guarantor and any and all Guarantees of such Guarantor’s Swap Obligations by other Loan Parties) at the time the Guarantee of such Guarantor, or a grant by such Guarantor of a security interest, becomes effective with respect to such Swap Obligation or (b) any other Swap Obligation designated as an “Excluded Swap Obligation” of such Guarantor as specified in any agreement between the relevant Loan Parties and counterparty applicable to such Swap Obligations. 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 excluded in accordance with the first sentence of this definition.

 

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender or any other recipient of any payment to be made by or on account of any obligation of any Loan Party hereunder or under any other Loan Document, (a) Taxes imposed on (or measured by) its net income or profits (however denominated), branch profits Taxes and franchise Taxes, in each case imposed by (i) a jurisdiction as a result of such recipient being organized or having its principal office located in that jurisdiction or, in the case of any Lender, having its applicable lending office located in the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) any jurisdiction as a result of a present or former connection between such recipient and the jurisdiction imposing such Tax (other than a connection arising solely from such recipient having executed, delivered, or become a party to, performed its obligations or received payments under, received or perfected a security interest under, sold or assigned of an interest in, engaged in any other transaction pursuant to, or enforced, any Loan Documents), (b) any withholding Tax that is attributable to a Lender’s failure to comply with Section 2.15(e) or Agent’s failure to comply with Section 2.15(f), (c) except in the case of an assignee pursuant to a request by the Borrower under Section 2.17, any U.S. federal withholding Taxes imposed due to a Requirement of Law in effect at the time a Lender becomes a party hereto (or designates a new lending office), except to the extent that such Lender (or its assignor, if any) was entitled, immediately prior to the time of designation of a new lending office (or assignment), to receive additional amounts with respect to such withholding Tax under Section 2.15(a)and (d) any U.S. federal withholding Tax imposed pursuant to FATCA.

 

“Existing Letter of Credit” means any letter of credit or bank guarantee previously issued for the account of the Borrower or any other Loan Party or Subsidiary by a Lender or an Affiliate or branch of a Lender that is (a) outstanding on the Effective Date and (b) listed on Schedule 1.01(b).

 

“Facility” means, collectively, the Commitment and the extensions of credit made thereunder.

 

“Fair Market Value” means with respect to any asset or group of assets on any date of determination, the value of the consideration obtainable in a sale of such asset at such date of determination assuming a sale by a willing seller to a willing purchaser dealing at arm’s length and arranged in an orderly manner over a reasonable period of time having regard to the nature and characteristics of such asset. Except as otherwise expressly set forth herein, such value shall be determined in good faith by the Borrower.

 

“Fair Value” means the amount at which the assets (both tangible and intangible), in their entirety, of the Borrower and its Subsidiaries taken as a whole would change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each having reasonable knowledge of the relevant facts, with neither being under any compulsion to act.

 

“FATCA” means Sections 1471 through 1474 of the Code as in effect on the date hereof (or any amended or successor version that is substantively comparable), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to current Section 1471(b)(1) of the Code and any law, regulation, rule, promulgation or official agreement implementing an official governmental agreement or intergovernmental agreement with respect to the foregoing.

 

“FCA” has the meaning specified in Section 1.06(c).

 

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.

 

“Federal Funds Effective Rate” means, for any period, a fluctuating interest rate per annum equal to, for each day during such period, the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, 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 which is a Business Day, the average of the quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it (and, if any such rate is below zero, then the rate determined pursuant to this definition shall be deemed to be zero).

 

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

 

“FILO Tranche” has the meaning assigned to such term in Section 2.18(d).

 

“Financed Capital Expenditures” means, with respect to any Person and for any period, Capital Expenditures made by such Person during such period that are financed with the proceeds of Indebtedness (other than Revolving Loans) or Net Proceeds of any Disposition of assets, any Casualty Event, any incurrence or issuance of Indebtedness or any issuance of Equity Interests.

 

“Financial Officer” means the chief financial officer, principal accounting officer, treasurer or controller of the Borrower.

 

“First Lien Leverage Ratio” means, on any date, the ratio of (a) Consolidated First Lien Debt as of such date to (b) Consolidated EBITDA for the Test Period as of such date.

 

“Fixed Amounts” has the meaning specified in Section 1.08(f).

 

“Fixed Charge Coverage Ratio” means the ratio of (a) (1) Consolidated EBITDA minus (2) taxes based on income, profits or capital, including federal, foreign, state, franchise, excise and similar taxes (including in respect of repatriated funds), net of cash refunds received, of the Borrower and its Restricted Subsidiaries paid in cash during such Test Period minus (3) Capital Expenditures paid in cash during the applicable Test Period (other than Financed Capital Expenditures) to (b) (1) Consolidated Interest Expense plus (2) the aggregate amount of scheduled principal payments in respect of long term Consolidated Total Debt of the Borrower and its Restricted Subsidiaries made during such period (other than payments made by the Borrower or any Restricted Subsidiary to the Borrower or a Restricted Subsidiary), all calculated for such period for the Borrower and its Restricted Subsidiaries on a consolidated basis plus (3) the amount of distributions made pursuant to Section 6.08(a)(xiv) paid in cash during the applicable Test Period.

 

“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the modification, amendment or renewal of this Agreement or otherwise) with respect to LIBOAdjusted Term SOFR Rate.

 

“Foreign Subsidiary” means any Subsidiary that is not incorporated or organized under the laws of a State within the United States of America or the District of Columbia.

 

“FSHCO” means any direct or indirect Domestic Subsidiary of the Borrower that has no material assets other than Equity Interests in one or more direct or indirect Foreign Subsidiaries that are “controlled foreign corporations” within the meaning of Section 957 of the Code.

 

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

 

“GAAP” means generally accepted accounting principles in the United States of America, as in effect from time to time; provided, however, that if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Effective Date in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower 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, (a) 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 any election under FASB Accounting Standards Codification 825-Financial Instruments, or any successor thereto (including pursuant to the FASB Accounting Standards Codification), to value any Indebtedness of the Borrower or any subsidiary at “fair value,” as defined therein and (b) the amount of any Indebtedness under GAAP with respect to Capital Lease Obligations shall be determined in accordance with the definition of Capital Lease Obligations.

 

“Governmental Authority” means the government of the United States of America and any other nation or any political subdivision thereof, whether state, provincial, territorial, municipal or local, and any agency, authority, 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 (including any supra-national bodies such as the European Union or the European Central Bank).

 

“Granting Lender” has the meaning assigned to such term in Section 9.04(e).

 

“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 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 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 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 (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness; provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business or customary and reasonable indemnity obligations in effect on the Effective Date or entered into in connection with any acquisition or disposition of assets permitted under this Agreement (other than such obligations with respect to Indebtedness). The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined in good faith by a Financial Officer. The term “Guarantee” as a verb has a corresponding meaning.

 

“Guarantee Agreement” means that certain Guarantee Agreement, entered into by each Loan Party, substantially in the form of Exhibit C hereto.

 

“Guarantors” means (i) each Loan Party other than the Borrower and (ii) with respect to the Secured Obligations of any Loan Party (other than the Borrower), the Borrower.

 

“Hazardous Materials” means all explosive, radioactive, hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum by-products or distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated as hazardous or toxic, or any other term of similar import, pursuant to any Environmental Law.

 

“Hedge Termination Value” means, in respect of any one or more Secured Swap Obligations, after taking into account the effect of any legally enforceable netting agreement relating to such Secured Swap Obligations, (a) for any date on or after the date such Secured Swap Obligations have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) or maximum peak exposure value for such Secured Swap Obligations, as determined based upon customary industry practices.

 

“IBA” has the meaning given to such term in Section 1.06(c).

 

“IFRS” means international accounting standards as promulgated by the International Accounting Standards Board.

 

“Immaterial Subsidiary” means any Subsidiary that is not a Material Subsidiary.

 

“Immediate Family Members” means with respect to any individual, such individual’s child, stepchild, grandchild or more remote descendant, parent, stepparent, grandparent, spouse, former spouse, qualified domestic partner, sibling, mother-in-law, father-in-law, son-in-law and daughter-in-law (including adoptive relationships) and any trust, partnership or other bona fide estate-planning vehicle the only beneficiaries of which are any of the foregoing individuals or any private foundation or fund that is controlled by any of the foregoing individuals or any donor-advised fund of which any such individual is the donor.

 

 

“Implementation Date” means the earlier to occur of (a) the first date on which each of the policies and procedures designed to promote compliance by the Borrower and its Restricted Subsidiaries and their respective directors, officers, employees, agents and Affiliates with all Sanctions, Anti-Corruption Laws and AML Legislation referenced in Section 3.18(e) have been implemented (as determined by the Borrower in its reasonable discretion) and (b) the date that is 120 days following the Closing Date (or such later date as the Administrative Agent reasonably agrees to in writing).

 

“Incremental Commitment” has the meaning assigned to such term in Section 2.18(a).

 

“Incremental Facility Amendment” has the meaning assigned to such term in Section 2.18(b)(ii).

 

“Incurrence-Based Amounts” has the meaning specified in Section 1.08(f)

 

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (d) all obligations of such Person in respect of the deferred and unpaid purchase price of property or services (excluding trade accounts payable in the ordinary course of business and any earn-out obligation until such obligation becomes a liability on the balance sheet of such Person in accordance with GAAP and if not paid within 60 days after being due and payable), (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, (f) all Guarantees by such Person of Indebtedness of others (other than by endorsement of negotiable instruments for collection in the ordinary course of business), (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 and (i) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances; provided that the term “Indebtedness” shall not include (i) deferred or prepaid revenue, (ii) purchase price holdbacks in respect of a portion of the purchase price of an asset to satisfy warranty or other unperformed obligations of the seller, (iii) any obligations attributable to the exercise of appraisal rights and the settlement of any claims or actions (whether actual, contingent or potential) with respect thereto, (iv) Indebtedness of any Parent Entity appearing on the balance sheet of the Borrower solely by reason of push down accounting under GAAP, (v) accrued expenses and royalties and (vi) asset retirement obligations and obligations in respect of reclamation and workers’ compensation (including pensions and retiree medical care) that are not overdue by more than 60 days. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. The amount of Indebtedness of any Person for purposes of clause (e) above shall (unless such Indebtedness has been assumed by such Person) be deemed to be equal to the lesser of (A) the aggregate unpaid amount of such Indebtedness and (B) the Fair Market Value of the property encumbered thereby as determined by such Person in good faith. For all purposes hereof, the Indebtedness of the Borrower and the Restricted Subsidiaries shall exclude intercompany liabilities arising from their cash management, tax, and accounting operations and intercompany loans, advances or Indebtedness having a term not exceeding 364 days (inclusive of any rollover or extensions of terms) and made in the ordinary course of business.

 

“Indemnified Taxes” means all 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.

 

“Indemnitee” has the meaning assigned to such term in Section 9.03(b).

 

“Individual LC Sublimit” has the meaning assigned to such term in the definition of “LC Sublimit”.

 

“Information” has the meaning assigned to such term in Section 9.12(a).

 

“Information Certificate” means an information certificate in a form reasonably satisfactory to the Administrative Agent delivered to the Administrative Agent on or prior to the Effective Date.

 

“Insignificant Subsidiary” means any subsidiary of the Borrower other than any such subsidiary that is a “significant subsidiary” of the Borrower within the meaning of Rule 405 of the Securities Act of 1933, as amended, in each case determined as of the date of the most recent financial statements of the Borrower delivered pursuant to Section 4.01(h).

 

“Intellectual Property” has the meaning assigned to such term in the applicable Security Documents.

 

“Interest Coverage Ratio” means, as of any date, the ratio of (a) Consolidated EBITDA to (b) Consolidated Interest Expense, in each case for the Test Period as of such date.

 

“Interest Election Request” means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.05.

 

“Interest Payment Date” means, subject to Section 2.10(c), (a) with respect to any ABR Loan, the first day of each calendar month of January, April, July and October and the Maturity Date and (b) with respect to any EurocurrencyTerm SOFR Loan, the last day of the Interest Period applicable to the Term SOFR Borrowing of which such Loan is a part and the Maturity Date and, in the case of a EurocurrencyTerm SOFR Borrowing with an Interest Period of more than three calendar months’ duration, each day immediately following the last day of such Interest Period that occurs at intervals of three calendar months’ duration after the first day of such Interest Period.

 

  “Interest Period” means, with respect to any EurocurrencyTerm SOFR Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, three or six calendar months thereafter (or, in the case of Eurocurrency Borrowings only, if agreed to by each Lender participating therein, twelve calendar months or such other period of less than one month as the Borrower may elect; provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period and (c) that in the event the Borrower elects an Interest Period of less than one month the interest rate in respect of the applicable Eurocurrency Borrowing shall be determined through the use of straight-line interpolation by reference to two such rates, one of which shall be determined as if the length of the period of such deposits were the period of time for which the rate for such deposits are available is the period next shorter than the length of such Interest Period and the other of which shall be determined as if the period of time for which the rate for such deposits are available is the period next longer than the length of such Interest Period.no tenor that has been removed from this definition pursuant to Section 2.12(e) shall be available for specification in a Borrowing Request or Interest Election Request. 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.

 

“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of Equity Interests or Indebtedness or other securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of Indebtedness of, or purchase or other acquisition of any other Indebtedness or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person (excluding, in the case of the Borrower and the Restricted Subsidiaries, intercompany loans, advances, or Indebtedness having a term not exceeding 364 days (inclusive of any rollover or extensions of terms and made in the ordinary course of business) or (c) the purchase or other acquisition (in one transaction or a series of transactions) of all or substantially all of the property and assets or business of another Person or assets constituting a business unit, line of business or division of such Person. The amount, as of any date of determination, of (i) any Investment in the form of a loan or an advance shall be the principal amount thereof outstanding on such date, minus any cash payments actually received by the applicable investor representing interest in respect of such Investment (to the extent any such payment to be deducted does not exceed the remaining principal amount of such Investment and without duplication of amounts increasing the Available Equity Amount), but without any adjustment for write-downs or write-offs (including as a result of forgiveness of any portion thereof) with respect to such loan or advance after the date thereof, (ii) any Investment in the form of a Guarantee shall be equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof, as determined in good faith by a Financial Officer, (iii) any Investment in the form of a transfer of Equity Interests or other non-cash property by the investor to the investee, including any such transfer in the form of a capital contribution, shall be the Fair Market Value of such Equity Interests or other property as of the time of the transfer, minus any payments actually received by the applicable investor representing a return of capital of, or dividends or other distributions in respect of, such Investment (to the extent such payments do not exceed, in the aggregate, the original amount of such Investment and without duplication of amounts increasing the Available Equity Amount), but without any other adjustment for increases or decreases in value of, or write-ups, write-downs or write-offs with respect to, such Investment after the date of such Investment, and (iv) any Investment (other than any Investment referred to in clause (i), (ii) or (iii) above) by the specified Person in the form of a purchase or other acquisition for value of any Equity Interests, evidences of Indebtedness or other securities of any other Person shall be the original cost of such Investment (including any Indebtedness assumed in connection therewith), plus (A) the cost of all additions thereto and minus (B) the amount of any portion of such Investment that has been repaid to the investor in cash as a repayment of principal or a return of capital, and of any cash payments actually received by such investor representing interest, dividends or other distributions in respect of such Investment (to the extent the amounts referred to in clause (B) do not, in the aggregate, exceed the original cost of such Investment plus the costs of additions thereto and without duplication of amounts increasing the Available Equity Amount), but without any other adjustment for increases or decreases in value of, or write-ups, write-downs or write-offs with respect to, such Investment after the date of such Investment. For purposes of Section 6.04, if an Investment involves the acquisition of more than one Person, the amount of such Investment shall be allocated among the acquired Persons in accordance with GAAP; provided that pending the final determination of the amounts to be so allocated in accordance with GAAP, such allocation shall be as reasonably determined by a Financial Officer.

 

“Investor” means a holder of Equity Interests in the Borrower (or any direct or indirect parent thereof) on the Effective Date.

 

“IPO” means the initial underwritten public offering (other than a public offering pursuant to a registration statement on Form S-8) of common Equity Interests in the Borrower.

 

“IPO Separation Agreements” means (a) that certain master procurement agreement, dated as of May 31, 2019, among the Borrower and the China Joint Business Arrangement between PetSmart International Holdings I LLC and PetSmart International Holdings II LLC, (b) that certain master transaction agreement, dated as of June 1, 2019, among the Borrower and PetSmart, Inc., (c) that certain tax matters agreement, dated as of June 13, 2019, among the Borrower, PetSmart, Inc. and Argos Intermediate Holdco I Inc., (d) that certain master purchase agreement, dated as of February 7, 2019 (as amended by that certain amendment to master purchase agreement, effective as of May 15, 2019) among the Borrower and PetSmart Home Office, Inc., (e) that certain intercompany services agreement, dated as of July 2, 2018, among the Borrower and Chewy Pharmacy KY, LLC, (f) that certain investor rights agreement, dated as of June 13, 2019,  among Chewy, Inc. and the other signatories thereto, (g) that certain stockholders agreement of Chewy Inc., dated as of April 17, 2019.

 

“ISDA Definitions” means the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time by the International Swaps and Derivatives Association, Inc. or such successor thereto.

 

“ISP” means, with respect to any Letter of Credit, the International Standby Practices 1998 (International Chamber of Commerce Publication No. 590) and any version or revision thereof accepted by any Issuing Bank for use.

 

“Issuer Document” means, with respect to any Letter of Credit, a letter of credit application, a letter of credit agreement, or any other document, agreement or instrument entered into (or to be entered into) by a Borrower in favor of Issuing Bank and relating to such Letter of Credit.

 

“Issuing Bank” means each of Wells Fargo, JPMorgan Chase Bank, N.A., Citibank, N.A. and any other Revolving Lender which after notice to the Administrative Agent agrees to become an Issuing Bank and, solely with respect to any Existing Letter of Credit (and any amendment, renewal or extension thereof in accordance with this Agreement), the Lender or Affiliate of a Lender that issued such Existing Letter of Credit. 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.

 

“Joint Bookrunners” means Wells Fargo Bank, National Association and JPMorgan Chase Bank, N.A. and, as the context may require, each other Amendment No. 2 Joint Bookrunner.

 

“Judgment Currency” has the meaning assigned to such term in Section 9.14(b).

 

“Junior Financing” means any Indebtedness (other than any permitted intercompany Indebtedness owing to the Borrower or any Restricted Subsidiary) that is Subordinated Indebtedness.

 

“Latest Maturity Date” means, at any date of determination, the latest maturity or expiration date applicable to any Loan or Commitment hereunder at such time, in each case as extended in accordance with this Agreement from time to time.

 

“LC Collateral Account” has the meaning assigned to such term in Section 2.24(i).

 

“LC Disbursement” means a payment made by an Issuing Bank pursuant to a drawing on a Letter of Credit.

 

“LC Exposure” means, at any time of determination, the sum (without duplication) of the Dollar Equivalent of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower or any other Loan Party at such time, less (c) the amount then on deposit in the LC Collateral Account. The LC Exposure of any Revolving Lender at any time shall be its Pro Rata Share of the total LC Exposure at such time.

 

 

“LCA Election” has the meaning assigned to such term in Section 1.08.

 

“LCA Test Date” has the meaning assigned to such term in Section 1.08.

 

“Lenders” means, individually and collectively as the context may require, the Revolving Lenders. Unless the context otherwise requires, the term “Lenders” includes the Swingline Lenders and the Issuing Banks.

 

“Letter of Credit” means any letter of credit or bank guarantee issued pursuant to this Agreement other than any such letter of credit or bank guarantee that shall have ceased to be a “Letter of Credit” outstanding hereunder pursuant to Section 9.05. Letters of Credit under the Facility may be issued in any Permitted Currency under the Facility.

 

“Liabilities” means the recorded liabilities (including contingent liabilities that would be recorded in accordance with GAAP) of the Borrower and its Subsidiaries taken as a whole, as of the Effective Date after giving effect to the consummation of the Transactions, determined in accordance with GAAP consistently applied.

 

Notwithstanding any provision to the contrary in this Agreement, if at any time the rate determined pursuant to this definition is less than zero, then such rate shall be deemed to be zero.  Each determination of the LIBO Rate shall be made by the Administrative Agent and shall be presumed to be correct in the absence of objective evidence to the contrary.

“LIBOR” 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 or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset.

 

“Limited Condition Acquisition” shall mean any Acquisition Transaction the consummation of which is not conditioned on the availability of, or on obtaining, third party financing.

 

“Loan Document Obligations” means (a) the due and punctual payment by the Borrower of (i) the principal of and interest at the applicable rate or rates provided in this Agreement (including interest accruing during the pendency of any bankruptcy, insolvency, receivership, examination or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise and (ii) all other monetary obligations of the Borrower under or pursuant to this Agreement and each of the other Loan Documents, including obligations to pay LC Disbursements, fees, expense reimbursement obligations and indemnification obligations, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership, arrangement, administration, examination or other similar proceeding, regardless of whether allowed or allowable in such proceeding), (b) the due and punctual payment and performance of all other obligations of the Borrower under or pursuant to each of the Loan Documents and (c) the due and punctual payment and performance of all the obligations of each other Loan Party under or pursuant to this Agreement and each of the other Loan Documents (including interest and monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership, arrangement, administration, examination or other similar proceeding, regardless of whether allowed or allowable in such proceeding).

 

“Loan Documents” means this Agreement, any Incremental Facility Amendment, any Loan Modification Agreement, the Guarantee Agreement the Security Documents, the ABL Intercreditor Agreement (if executed) and, except for purposes of Section 9.02, any promissory notes delivered pursuant to Section 2.07(g).

 

“Loan Modification Agreement” means a Loan Modification Agreement, in form reasonably satisfactory to the Administrative Agent, among the Borrower, the Administrative Agent and one or more Accepting Lenders, effecting one or more Permitted Amendments and such other amendments hereto and to the other Loan Documents as are contemplated by Section 2.22.

 

“Loan Modification Offer” has the meaning specified in Section 2.22(a).

 

“Loan Parties” means the Borrower and the Subsidiary Loan Parties.

 

“Loans” means the loans and advances made by the Lenders to the Borrower pursuant to this Agreement, including Revolving Loans, Swingline Loans and Protective Advances.

 

“Local Time” means local time in New York, New York, with respect to the times for the receipt and sending of notices by and to, and the disbursement by or payment to, the Administrative Agent, any Lender or any Issuing Bank, (b) local time in London, England, with respect to the times for the determination of “LIBO Rate”; (c) local time at the place of determination, if such local time as of such place for determination is specified herein; and (dc) in all other circumstances, New York, New York time.

 

“Management Investors” means the directors and officers and employees of the Borrower and/or any of its subsidiaries who are (directly or indirectly through one or more investment vehicles) Investors.

 

“Master Agreement” has the meaning assigned to such term in the definition of “Swap Agreement.”

 

“Material Adverse Effect” means any event, circumstance or condition that has had, or could reasonably be expected to have, a materially adverse effect on (a) the business or financial condition of the Borrower and the Restricted Subsidiaries, taken as a whole, (b) the ability of the Borrower and the Guarantors, taken as a whole, to perform their payment obligations under the Loan Documents or (c) the rights and remedies of the Administrative Agent and the Lenders under the Loan Documents.

 

“Material Indebtedness” means Indebtedness (other than the Loan Document Obligations), or obligations in respect of one or more Swap Agreements, of any one or more of the Borrower and the Restricted Subsidiaries in an aggregate principal amount exceeding $3375,000,000; provided that in no event shall any Permitted Receivables Financing be considered Material Indebtedness for any purpose. For purposes of determining Material Indebtedness, the “principal amount” of the obligations in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Restricted Subsidiary would be required to pay if such Swap Agreement were terminated at such time.

 

“Material Subsidiary” means (a) each wholly-owned Restricted Subsidiary that, as of the last day of the fiscal quarter of the Borrower most recently ended for which financial statements are available, had revenues or total assets for such quarter in excess of 2.5% of the consolidated revenues or total assets, as applicable, of the Borrower for such quarter or that is designated by the Borrower as a Material Subsidiary and (b) any group comprising wholly-owned Restricted Subsidiaries that each would not have been a Material Subsidiary under clause (a) but that, taken together, as of the last day of the fiscal quarter of the Borrower most recently ended for which financial statements are available, had revenues or total assets for such quarter in excess of 10.0% of the consolidated revenues or total assets, as applicable, of the Borrower for such quarter; provided that solely for purposes of Section 7.01(h) and 7.01(i) each such Restricted Subsidiary forming part of such group is subject to an Event of Default under one or more of such Sections.

 

“Maturity Date” means (a) with respect to the initial Commitments hereunder, the date that is five years after the Amendment No. 1 Effective Date and (b) with respect to any Incremental Commitments, the final maturity date as specified in the applicable Incremental Facility Amendment; provided, in each case, that if such day is not a Business Day, the applicable Maturity Date shall be the Business Day immediately preceding such day.

 

“Maximum Borrowing Amount” means the lesser of (a) the aggregate Revolving Commitments at such time and (b) the Borrowing Base, in each case as determined for the Facility at any time.

 

“Monthly Borrowing Base Certificate” means a certificate, signed and certified as accurate and complete by a Financial Officer of the Borrower, in substantially the form of Exhibit F or another form which is acceptable to the Administrative Agent in its reasonable discretion.

 

“Monthly Reporting Period” means any period beginning on the date that (x) there are any Revolving Loans outstanding or (y) the face amount of all Letters of Credit issued and outstanding is greater than or equal to $75120,000,000, until such time as (x) there have not been any Revolving Loans outstanding and (y) the face amount of all Letters of Credit issued and outstanding has been less than $75120,000,000, in each case, for at least twenty (20) consecutive calendar days. 

 

“Moody’s” means Moody’s Investors Service, Inc. and any successor to its rating agency business.

 

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

 

“Net Orderly Liquidation Value” means, with respect to Inventory of any Loan Party, the orderly liquidation value thereof, net of all costs of liquidation thereof, as based upon the most recent Inventory appraisal conducted in accordance with this Agreement and expressed as a percentage of Cost of such Inventory.

 

“Net Proceeds” means, with respect to any event, (a) the proceeds received in respect of such event in cash or Permitted Investments, including (i) any cash or Permitted Investments received in respect of any non-cash proceeds, including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment or earn-out (but excluding any interest payments), but only as and when received, (ii) in the case of a casualty, insurance proceeds that are actually received, and (iii) in the case of a condemnation or similar event, condemnation awards and similar payments that are actually received, minus (b) the sum of (i) all fees and out-of-pocket expenses paid by the Borrower and the Restricted Subsidiaries in connection with such event (including attorney’s fees, investment banking fees, survey costs, title insurance premiums, and related search and recording charges, transfer taxes, deed or mortgage recording taxes, underwriting discounts and commissions, other customary expenses and brokerage, consultant, accountant and other customary fees), (ii) in the case of a Disposition of an asset (including pursuant to a Sale Leaseback or Casualty Event or similar proceeding), (x) the amount of all payments that are permitted hereunder and are made by the Borrower and the Restricted Subsidiaries as a result of such event to repay Indebtedness (other than the Loans) secured by such asset or otherwise subject to mandatory prepayment as a result of such event, (y) the pro rata portion of net cash proceeds thereof (calculated without regard to this clause (y)) attributable to minority interests and not available for distribution to or for the account of the Borrower and the Restricted Subsidiaries as a result thereof and (z) the amount of any liabilities directly associated with such asset and retained by the Borrower or the Restricted Subsidiaries and (iii) the amount of all Taxes paid (or reasonably estimated to be payable), and the amount of any reserves established by the Borrower and the Restricted Subsidiaries to fund contingent liabilities reasonably estimated to be payable, that are directly attributable to such event, provided that any reduction at any time in the amount of any such reserves (other than as a result of payments made in respect thereof) shall be deemed to constitute the receipt by the Borrower at such time of Net Proceeds in the amount of such reduction.

 

“New Project” shall mean (a) each facility or store which is either a new facility, store, branch or office or an expansion, relocation, remodeling or substantial modernization of an existing facility, store, branch or office owned by the Borrower or its Subsidiaries which in fact commences operations and (b) each creation (in one or a series of related transactions) of a business unit to the extent such business unit commences operations or each expansion (in one or a series of related transactions) of business into a new market.

 

“Non-Accepting Lender” has the meaning assigned to such term in Section 2.22(c).

 

“Non-Cash Compensation Expense” means any non-cash expenses and costs that result from the issuance of stock-based awards, partnership interest-based awards and similar incentive based compensation awards or arrangements.

 

“Non-Consenting Lender” has the meaning assigned to such term in Section 9.02(c).

 

“Not Otherwise Applied” means the Available Equity Amount that was not previously applied pursuant to Section 6.04(o) or 6.08(b)(iv).

 

“Noticed Cash Management Obligations” means any Secured Cash Management Obligations with respect to which the Borrower and the Secured Party with respect thereto have notified the Administrative Agent of the intent to include such Secured Cash Management Obligations as Noticed Cash Management Obligations hereunder (so long as such designation, and the resulting Secured Cash Management Reserves at the time of designation, would not result in an Overadvance) and with respect to which a Secured Cash Management Reserve has subsequently been established in the amount set forth in such notice; provided that such designation shall be made within ten (10) Business Days of (i) the Effective Date if such Cash Management Services are in place on the Effective Date or (ii) the date such Cash Management Services are commenced if not in place on the Effective Date.

 

“Noticed Hedge” means any Secured Swap Obligations arising under a Swap Agreement with respect to which the Borrower and the Secured Party thereof have notified the Administrative Agent of the intent to include such Secured Swap Obligations as a Noticed Hedge hereunder (so long as such designation, and the resulting Secured Hedge Reserves at the time of designation, would not result in an Overadvance) and with respect to which a Secured Hedge Reserve has subsequently been established in the amount set forth in such notice; provided that such designation shall be made within ten (10) Business Days of (i) the Effective Date if such Swap Agreement is in place on the Effective Date or (ii) the date such Swap Agreement is entered into if such Swap Agreement is not in place on the Effective Date.

 

“NYFRB” means the Federal Reserve Bank of New York.

 

“OFAC” has the meaning assigned to such term in Section 3.18.

 

“Organizational Documents” means (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); and (c) with respect to any unlimited liability company, partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation, organization or incorporation and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation, organization or incorporation (as applicable) with the applicable Governmental Authority in the jurisdiction of its formation, organization or incorporation (as applicable) and, if applicable, any certificate or articles of formation or organization of such entity.

 

“Other Taxes” means all present or future recording, stamp, court or documentary, intangible, filing or similar Taxes arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document, except any such Taxes imposed with respect to an assignment.

 

“Overadvance” means at any time the amount by which the aggregate outstanding Revolving Exposure exceeds the Borrowing Base.

 

“Overadvance Condition” means and is deemed to exist any time the aggregate outstanding Revolving Exposure exceeds the Borrowing Base.

 

“Overadvance Loan” means an Alternate Base Rate Revolving Loan made at a time an Overadvance Condition exists or which results in an Overadvance Condition.

 

“Parent Entity” means any Person that is a direct or indirect parent of the Borrower.

 

“Participant” has the meaning assigned to such term in Section 9.04(c)(i).

 

“Participant Register” has the meaning assigned to such term in Section 9.04(c)(iii).

 

“Payment Account” has the meaning assigned to such term in Section 5.17(c).

 

“Payment Conditions” means, at any time of determination, with respect to any Specified Covenant Event, the following: (a) each of (i) Excess Liquidity (after giving Pro Forma Effect to such Specified Covenant Event as of such date) and (ii) average daily Excess Liquidity during the twenty (20) consecutive day period immediately preceding the making of such Specified Covenant Event shall be not less than (I) in the case of a Specified Investment, Specified Restricted Debt Payment, Specified Lien or Specified Debt Incurrence, the greater of (x) 10% of the Maximum Borrowing Amount and (y) $4572,000,000, or (II) in the case of a Specified Dividend, the greater of (x) 12.50% of the Maximum Borrowing Amount and (y) $56,25090,000,000, in each case, as of such date, and (b) the Fixed Charge Coverage Ratio as of the end of the most recently ended Test Period prior to the making of such Specified Covenant Event, calculated on a Pro Forma Basis, shall be equal to or greater than 1.00:1.00; provided that, the Fixed Charge Coverage Ratio test described in this clause (b) shall not apply unless each of (i) Excess Liquidity (calculated in order to give Pro Forma Effect to such Specified Covenant Event as of such date) and (ii) average daily Excess Liquidity during the twenty (20) consecutive day period immediately preceding the making of such Specified Covenant Event is less than (I) in the case of a Specified Investment, Specified Restricted Debt Payment, Specified Lien or Specified Debt Incurrence, the greater of (x) 15% of the Maximum Borrowing Amount and (y) $67,500108,000,000 or (II) in the case of a Specified Dividend, the greater of (x) 17.50% of the Maximum Borrowing Amount and (y) $78,750126,000,000, in each case, as of such date.

 

“Payment Intangible” has the meaning assigned to such term in the UCC.

 

“Payment Notice” has the meaning assigned to it in Section 8.02.

 

“Payment Recipient” has the meaning assigned to it in Section 8.02.

 

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

 

“Permitted Acquisition” means an Acquisition Transaction; provided that (a) in the case of any purchase or other acquisition of Equity Interests in a Person, (i) such Person, upon the consummation of such purchase or acquisition, will be a Subsidiary (including as a result of a merger, amalgamation or consolidation between any Subsidiary and such Person), or (ii) such Person is merged into or consolidated or, amalgamated with a Subsidiary and such Subsidiary is the surviving or continuing entity of such merger, amalgamation or consolidation, (b) the business of such Person, or such assets, as the case may be, constitute a business permitted by Section 5.15, (c) with respect to each such purchase or other acquisition, all actions required to be taken with respect to any such newly created or acquired Subsidiary (including each subsidiary thereof) or assets in order to satisfy the requirements set forth in clauses (a), (b), (c) and (d) of the definition of the term “Collateral and Guarantee Requirement” to the extent applicable shall have been taken (or arrangements for the taking of such actions after the consummation of the Permitted Acquisition shall have been made that are reasonably satisfactory to the Administrative Agent) (unless such newly created or acquired Subsidiary is designated as an Unrestricted Subsidiary pursuant to Section 5.14 or is otherwise an Excluded Subsidiary) and (d) after giving effect to any such purchase or other acquisition, (i) no Event of Default under clause (a), (b), (h) or (i) of Section 7.01 shall have occurred and be continuing and (ii) if such Person is an Unrestricted Subsidiary or such assets are owned by an Unrestricted Subsidiary, the applicable Payment Conditions are satisfied.

 

“Permitted Amendment” means an amendment to this Agreement and, if applicable the other Loan Documents, effected in connection with a Loan Modification Offer pursuant to Section 2.22, providing for an extension of a maturity date applicable to all or any portion of the Loans and/or Commitments of the Accepting Lenders and, in connection therewith, (a) a change in the Applicable Rate with respect to the Loans and/or Commitments of the Accepting Lenders and/or (b) a change in the fees payable to, or the inclusion of new fees to be payable to, the Accepting Lenders and/or (c) additional covenants or other provisions applicable only to periods after the Latest Maturity Date at the time of such Loan Modification Offer (it being understood that to the extent that any additional financial maintenance covenant is added for the benefit of any such Loans and/or Commitments, no consent shall be required by the Administrative Agent or any of the Lenders if such additional financial maintenance covenant is either (i) also added for the benefit of any corresponding Loans remaining outstanding after the issuance or incurrence of such Loans and/or Commitments or (ii) only applicable after the Latest Maturity Date at the time of such Loan Modification Offer); provided that (A) the borrowing and repayment (other than in connection with a permanent repayment and termination of commitments) of the Loans made pursuant to the amended Commitments shall be made on a pro rata basis with any borrowings and repayments of any Loans and Commitments of the Class that is being amended and that remain outstanding after such amendment and (B) assignments and participations of the amended Commitments shall be governed by the assignment and participation provisions set forth in Section 9.04.

 

“Permitted Cure Securities” means any Equity Interest of the Borrower other than any Disqualified Equity Interests; provided that any such Equity Interests issued for purposes of exercising a Cure Right pursuant to Section 7.03 that are not common Equity Interests shall be on terms and conditions reasonably acceptable to the Administrative Agent.

 

“Permitted Currency” means each currency in which a Borrowing may be made under the Facility as well as Euros, Sterling, Swiss Francs, Canadian Dollars, Japanese Yen and Chinese Yuan.

 

“Permitted Discretion” means a determination made in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment. Any Reserve established or modified by the Administrative Agent shall have a reasonable relationship to circumstances, conditions, events or contingencies which are the basis for such reserve, as reasonably determined, without duplication, by the Administrative Agent in good faith; provided that circumstances, conditions, events or contingencies known to the Administrative Agent as of the Effective Date shall not be the basis for any such establishment or modification after the Effective Date; provided, further, that notwithstanding the foregoing, solely with respect to Bank Product Reserves, “Permitted Discretion” as used herein shall mean the sole discretion of the Administrative Agent.

 

“Permitted Encumbrances” means:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

“Permitted Holder” means (a) any one or more of the Sponsors; (b) Argos Holdings L.P. and its Affiliates (including, without limitation, Buddy Holdings Corp, PetSmart, Inc., PetSmart Buddy Holdings Corp. and Buddy Chester Sub Corp.); (c) the Management Investors and their Immediate Family Members and (d) any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act as in effect on the date hereof) of which the Persons described in clauses (a), (b) and/or (c) are members; provided that the Persons described in clause (a), (b) and/or (c) beneficially own a majority of the Equity Interests beneficially owned by such group.

 

“Permitted Inventory Locations” means each location listed on Schedules 6(a), 6(b) and 6(c) of the Information Certificate delivered to the Administrative Agent prior to the Effective Date, and from time to time each other location within the United States which the Borrower has notified the Administrative Agent is a location at which Inventory of a Loan Party is maintained.

 

“Permitted Investments” means any of the following, to the extent owned by the Borrower or any Restricted Subsidiary:

 

 

 

 

 

 

 

 

 

 

 

 

 

“Permitted Receivables Financing” means, collectively, any, receivables securitizations or other receivables financings (including any factoring programs in an aggregate amount not to exceed the greater of $50,000,000 and 32% of Consolidated EBITDA for the last Test Period (measured at each time any such financing is entered into) and that are non-recourse to the Borrower and the Restricted Subsidiaries (except for (x) any customary limited recourse or recourse limited Subsidiaries that are not Loan Parties, (y) any performance undertaking or Guarantee and (z) an unsecured parent Guarantee (a “Receivables Guarantee”) by the Borrower or a Restricted Subsidiary and a parent company of a Restricted Subsidiary of obligations of Restricted Subsidiaries, and, in each case, reasonable extensions thereof); provided that with respect to Permitted Receivables Financings incurred in the form of a factoring program, the outstanding amount of such Permitted Receivables Financing for the purposes of this definition shall be deemed to be equal to the Permitted Receivables Net Investment for the last Test Period.

 

“Permitted Receivables Net Investment” means the aggregate cash amount paid by the purchasers under any Permitted Receivables Financing in the form of a factoring program in connection with their purchase of accounts receivable and customary related assets or interests therein, as the same may be reduced from time to time by collections with respect to such accounts receivable and related assets or otherwise in accordance with the terms of such Permitted Receivables Financing (but excluding any such collections used to make payments of commissions, discounts, yield and other fees and charges incurred in connection with any Permitted Receivables Financing in the form of a factoring program which are payable to any Person other than the Borrower or a Restricted Subsidiary).

 

“Permitted Refinancing” means, with respect to any Person, any modification, refinancing, refunding, renewal or extension of any Indebtedness of such Person; provided that (a) the principal amount (or accreted value, if applicable) thereof does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so modified, refinanced, refunded, renewed or extended except by an amount equal to unpaid accrued interest and premium thereon plus other amounts paid, and fees and expenses incurred, in connection with such modification, refinancing, refunding, renewal or extension and by an amount equal to any existing revolving commitments unutilized thereunder to the extent that the portion of any existing and unutilized revolving commitment being refinanced was permitted to be drawn under Sections 6.01 and 6.02 of this Agreement immediately prior to such refinancing (other than by reference to a Permitted Refinancing) and such drawing shall be deemed to have been made, (b) other than with respect to a Permitted Refinancing in respect of Indebtedness permitted pursuant to Section 6.01(a)(v), Indebtedness resulting from such modification, refinancing, refunding, renewal or extension has a final maturity date equal to or later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being modified, refinanced, refunded, renewed or extended, (c) if the Indebtedness being modified, refinanced, refunded, renewed or extended is subordinated in right of payment to the Loan Document Obligations, Indebtedness resulting from such modification, refinancing, refunding, renewal or extension is subordinated in right of payment to the Loan Document Obligations on terms at least as favorable to the Lenders as those contained in the documentation governing the Indebtedness being modified, refinanced, refunded, renewed or extended, (d) immediately after giving effect thereto, no Event of Default shall have occurred and be continuing, (e) if the Indebtedness being modified, refinanced, refunded, renewed or extended is permitted pursuant to Section 6.01(a)(ii) or Section (a)(xxiii), the primary obligor in respect of, and/or the Persons (if any) that Guarantee, the Indebtedness resulting from such modification, refinancing, refunding, renewal or extension are the primary obligor in respect of, and/or Persons (if any) that Guaranteed the Indebtedness being modified, refinanced, refunded, renewed or extended and (f) the other terms and conditions of such Indebtedness shall be as agreed between the Borrower and the parties providing any such Indebtedness. For the avoidance of doubt, it is understood that a Permitted Refinancing may constitute a portion of an issuance of Indebtedness in excess of the amount of such Permitted Refinancing; provided that such excess amount is otherwise permitted to be incurred under Section 6.01. For the avoidance of doubt, it is understood and agreed that a Permitted Refinancing includes successive Permitted Refinancings of the same Indebtedness.

 

“Person” means any natural person, corporation, limited liability company, unlimited 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 a Loan Party 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” has the meaning specified in Section 5.01.

 

“Portal” has the meaning specified in Section 2.03.

 

“Post-Transaction Period” means, with respect to any Specified Transaction, the period beginning on the date on which such Specified Transaction is consummated and ending on the last day of the eighth full consecutive fiscal quarter of the Borrower immediately following the date on which such Specified Transaction is consummated.

 

“Present Fair Saleable Value” means the amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of the Borrower and its Subsidiaries taken as a whole are sold with reasonable promptness in an arm’s-length transaction under present conditions for the sale of comparable business enterprises insofar as such conditions can be reasonably evaluated.

 

“Pro Forma Adjustment” means, for any Test Period, any adjustment to Consolidated EBITDA made in accordance with clause (b) of the definition of that term.

 

“Pro Forma Basis,” “Pro Forma Compliance” and “Pro Forma Effect” means, with respect to compliance with any test, financial ratio or covenant hereunder required by the terms of this Agreement to be made on a Pro Forma Basis, that (a) to the extent applicable, the Pro Forma Adjustment shall have been made and (b) all Specified Transactions and the following transactions in connection therewith that have been made during the applicable period of measurement or subsequent to such period and prior to or simultaneously with the event for which the calculation is made shall be deemed to have occurred as of the first day of the applicable period of measurement in such test, financial ratio or covenant: (i) income statement items (whether positive or negative) attributable to the property or Person subject to such Specified Transaction, (A) in the case of a Disposition of all or substantially all Equity Interests in any subsidiary of the Borrower or any division, product line, or facility used for operations of the Borrower or any of the Restricted Subsidiaries, shall be excluded, and (B) in the case of a Permitted Acquisition or Investment described in the definition of “Specified Transaction,” shall be included, (ii) any retirement of Indebtedness, and (iii) any Indebtedness incurred or assumed by the Borrower or any of the Restricted Subsidiaries in connection therewith and if such Indebtedness has a floating or formula rate, shall have an implied rate of interest for the applicable period for purposes of this definition determined by utilizing the rate that is or would be in effect with respect to such Indebtedness as at the relevant date of determination; provided that, without limiting the application of the Pro Forma Adjustment pursuant to clause (a) above, the foregoing pro forma adjustments may be applied to any such test, financial ratio or covenant solely to the extent that such adjustments are consistent with the definition of “Consolidated EBITDA” (and subject to the limitations set forth in clause (b) thereof) and give effect to events (including cost savings, operating expense reductions and synergies) that are (i) (x) directly attributable to such transaction, (y) expected to have a continuing impact on the Borrower and any of the Restricted Subsidiaries and (z) factually supportable or (ii) otherwise consistent with the definition of “Pro Forma Adjustment.”

 

“Pro Forma Disposal Adjustment” means, for any four-fiscal quarter period that includes all or a portion of a fiscal quarter included in any Post-Transaction Period with respect to any Sold Entity or Business, the pro forma increase or decrease in Consolidated EBITDA projected by the Borrower in good faith as a result of contractual arrangements between the Borrower or any Restricted Subsidiary entered into with such Sold Entity or Business at the time of its disposal or within the Post-Transaction Period and which represent an increase or decrease in Consolidated EBITDA which is incremental to the Disposed EBITDA of such Sold Entity or Business for the most recent four-fiscal quarter period prior to its disposal.

 

“Pro Forma Entity” means any Acquired Entity or Business or any Converted Restricted Subsidiary.

 

“Pro Rata Share” means, with respect to each Lender at any time a fraction (expressed as a percentage, carried out to the ninth decimal place), the numerator of which is the amount of the Commitments and, if applicable and without duplication, Loans, of such Lender at such time and the denominator of which is the amount of the Aggregate Commitments and, if applicable and without duplication, Loans at such time (if the applicable Commitments have terminated or expired, the Pro Rata Share shall be determined based upon such Lender’s share of the aggregate Revolving Exposure at that time).

 

“Proposed Change” has the meaning assigned to such term in Section 9.02(c).

 

“Protective Advance” has the meaning assigned to such term in Section 2.08(a).

 

“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.

 

“Public Lenders” has the meaning specified in Section 5.01.

 

“QFC Credit Support” has the meaning specified in Section 9.21.

 

“Qualified Accounts” means all Bank Accounts of Loan Parties that are either (i) in the name of the Administrative Agent or (ii) subject to an account Control Agreement in favor of the Administrative Agent; provided that the applicable depositary (if not the Administrative Agent) shall provide daily reports to the Administrative Agent setting forth the balances in such accounts (which reports may relate to the previous Business Day); provided further that, in each case, such Qualified Account is not subject to any other Lien other than Liens permitted by Section 6.02, and such Liens do not have priority over, and are junior to, the Lien of the Administrative Agent (other than (i) inchoate or other Liens (including tax Liens) arising by operation of law or (ii) Permitted Encumbrances under clause (h)(i) of the definition thereof). To the extent any cash or cash equivalents have been withdrawn from any Qualified Account, then, prior to or concurrently with either (A) a Borrowing hereunder or (B) the consummation of a transaction hereunder which requires satisfaction of the Payment Conditions, in each case subsequent to such withdrawal, then either (1) the Borrower shall deliver an updated Borrowing Base Certificate (which updated Borrowing Base Certificate shall be updated only for the withdrawal of such cash or cash equivalents and which shall supersede any previously delivered Borrowing Base Certificate for the applicable period) within one (1) Business Day or (2) the Borrower may notify the Administrative Agent of such withdrawal and in lieu of delivering the updated Borrowing Base Certificate referred to in the foregoing clause (1), the Administrative Agent shall take a Reserve in the amount of such withdrawal under the Borrowing Base; provided that such Reserve shall no longer be in effect upon the delivery of an updated Borrowing Base Certificate reflecting such withdrawal.

“Qualified Cash” means, at any time, the amount of unrestricted cash and Permitted Investments of the relevant Loan Parties held in Qualified Accounts as such time.

 

“Qualified Equity Interests” means Equity Interests in the Borrower or any parent of the Borrower other than Disqualified Equity Interests.

 

“Receivables” means (i) Accounts and (ii) Payment Intangibles evidencing rights to payment for goods sold or leased, or for services rendered.

 

“Receivables Guarantee” has the meaning assigned to such term in the definition of “Permitted Receivables Financing”.

 

“Receivables Subsidiary” means any Special Purpose Entity established in connection with a Permitted Receivables Financing.

 

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

 

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the partners, directors, officers, employees, trustees, agents, controlling persons, advisors and other representatives of such Person and of each of such Person’s Affiliates and permitted successors.

 

“Release” means any release, spill, emission, leaking, dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching or migration into the environment (including ambient air, surface water, groundwater, land surface or subsurface strata) and including the environment within any building or other structure.

 

“Relevant Governmental Body” means the Federal Reserve Board and/or the NYFRB, or a committee officially endorsed or convened by the Federal Reserve Board and/or the NYFRB or, in each case, any successor thereto.

 

“Removal Effective Date” has the meaning assigned to such term in Article VIII.

 

“Rent Reserve” means an amount equal to no more than three calendar months of the aggregate rent payable by the Loan Parties on all leased properties in respect of which Collateral Access Agreements are not in effect. Notwithstanding anything in this Agreement to the contrary, Rent Reserves will be calculated by the Administrative Agent on a semi-annual basis.

 

“Replacement Lender” has the meaning assigned to such term in Section 2.22(c).

 

“Required Additional Debt Terms” means with respect to any Indebtedness, (a) such Indebtedness does not mature earlier than the Latest Maturity Date (except in the case of customary bridge loans, which subject to customary conditions (including no payment or bankruptcy event of default), would either automatically be converted into or required to be exchanged for permanent refinancing which does not mature earlier than the Latest Maturity Date), (b) such Indebtedness does not have mandatory redemption features (other than customary asset sale, insurance and condemnation proceeds events, change of control offers or events of default or, if term loans, excess cash flow prepayments applicable to periods before the Latest Maturity Date) that could result in redemptions of such Indebtedness prior to the Latest Maturity Date, (c) such Indebtedness is not guaranteed by any entity that is not a Loan Party, (d) such Indebtedness that is secured (i) is not secured by any assets not securing the Secured Obligations, (ii) is subject to the ABL Intercreditor Agreement or another intercreditor agreement reasonably acceptable to the Administrative Agent and (iii) is subject to security agreements relating to such Indebtedness that are substantially the same as the Security Documents (with such differences as are reasonably satisfactory to the Administrative Agent) and (e) the other terms and conditions of such Indebtedness shall be as agreed between the Borrower and the parties providing any such Indebtedness.

 

“Required Lenders” means, at any time, Lenders having Revolving Exposures and unused Commitments (other than Swingline Commitments) representing more than 50% of the aggregate Revolving Exposures and unused Commitments (other than Swingline Commitments) at such time; provided that whenever there are one or more Defaulting Lenders or Disqualified Lenders, the total outstanding Revolving Exposures of, and the unused Revolving Commitments of, each Defaulting Lender and each Disqualified Lender shall in each case be excluded for purposes of making a determination of Required Lenders.

 

“Requirements of Law” means, with respect to any Person, any statutes, laws, treaties, rules, regulations, orders, decrees, writs, injunctions or determinations of any arbitrator or court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

 

“Required Reserve Notice” means (a) so long as no Event of Default has occurred and is continuing, at least five Business Days’ advance notice to the Borrower (or such shorter period as the Borrower may agree), and (b) if an Event of Default has occurred and is continuing, one days’ advance notice to the Borrower; provided that, solely for purposes of any determination under Section 4.02(d), a Required Reserve Notice with respect to any Bank Product Reserves shall be effective immediately and shall not require any advance notice.

 

“Reserves” means all Availability Reserves, Dilution Reserves, Rent Reserves, Royalty Reserves, Bank Product Reserves, Secured Cash Management Reserves, Secured Hedge Reserves, Shrink Reserves and any and all other reserves which the Administrative Agent deems necessary in its Permitted Discretion. Notwithstanding anything in this Agreement to the contrary, Reserves in respect of employee liabilities and employee withholdings will be determined based on information contained in the most recent field examination (or, in the Permitted Discretion of the Administrative Agent, based on updated information provided to the Administrative Agent by the Borrower).

 

“Resignation Effective Date” has the meaning assigned to such term in Article VIII.

 

 

“Responsible Officer” means the chief executive officer, president, vice president, chief financial officer, treasurer or assistant treasurer, or other similar officer, manager or a director of a Loan Party (including, with respect to the Portal, any person authorized and authenticated through the Portal in accordance with the Administrative Agent’s procedures for such authentication) and with respect to certain limited liability companies or partnerships that do not have officers, any manager, sole member, managing member or general partner thereof, and as to any document delivered on the Effective Date or thereafter pursuant to paragraph (a) of the definition of the term “Collateral and Guarantee Requirement,” any secretary or assistant secretary of a Loan Party. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

 

“Restricted Debt Payments” has the meaning specified in Section 6.08(b).

 

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the Borrower or any other Restricted Subsidiary, or 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 Borrower or any Restricted Subsidiary or any option, warrant or other right to acquire any such Equity Interests.

 

“Restricted Subsidiary” means any Subsidiary other than an Unrestricted Subsidiary.

 

“Revolving Borrowing” means a request for Revolving Loans.

 

 

“Revolving Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender’s Revolving Loans and its LC Exposure and an amount equal to its Pro Rata Share of the aggregate principal amounts of Swingline Loans and Protective Advances outstanding at such time.

 

“Revolving Lender” means, as of any date of determination, a Lender with a Revolving Commitment or, if the Revolving Commitments have terminated or expired, a Lender with Revolving Exposure. Unless the context otherwise requires, the term “Revolving Lenders” includes the Swingline Lender under the Facility.

 

“Revolving Loan” means the loans and advances made by the Revolving Lenders pursuant to this Agreement, including a Loan made pursuant to Section 2.01, Swingline Loans, Protective Advances, and Overadvance Loans.

 

“Royalties” means all royalties, fees, expense reimbursement and other amounts payable by any Loan Party under a license of Intellectual Property.

 

“Royalty Reserve” means an amount equal to all accrued Royalties that are then unpaid, whether or not then due and payable by any Loan Party.

 

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and any successor to its rating agency business.

 

“Sale Leaseback” means any transaction or series of related transactions pursuant to which the Borrower or any other Restricted Subsidiary (a) sells, transfers or otherwise disposes of any property, real or personal, whether now owned or hereafter acquired, and (b) as part of such transaction, thereafter rents or leases such property or other property that it intends to use for substantially the same purpose or purposes as the property being sold, transferred or disposed of.

 

“Sanctions” means economic sanctions administered or enforced by the United States Government (including without limitation, sanctions enforced by OFAC), the United Nations Security Council, the European Union or any European Union member state, HerHis Majesty’s Treasury of the United Kingdom, or any other Governmental Authority with jurisdiction over any Loan Party, any of their respective Subsidiaries or any party hereto.

 

“Sanctioned Entity” means (a) a country or a government of a country, (b) an agency of the government of a country, (c) an organization directly or indirectly controlled by a country or its government, or (d) a Person resident in or determined to be resident in a country, in each case of clauses (a) through (d) that is a target of any comprehensive country Sanctions program administered and enforced by OFAC.

 

“Sanctioned Person” means (a) any Person named on the list of Specially Designated Nationals and Blocked Persons maintained by OFAC, OFAC’s consolidated Non-SDN list or any applicable other Sanctions-related list maintained by any applicable Governmental Authority, (b) a Person or legal entity that is the subject of Sanctions, (c) any Person operating, organized or resident in a Sanctioned Entity to the extent it would be prohibited by Sanctions, or (d) any Person directly or indirectly owned or controlled (individually or in the aggregate) by or acting on behalf of any such Person or Persons described in clauses (a) through (c) above.

 

“SEC” means the Securities and Exchange Commission or any Governmental Authority succeeding to any of its principal functions.

 

“Secured Bank Product Obligations” means the due and punctual payment and performance of all Bank Product Obligations of the Borrower and the Restricted Subsidiaries in respect of any purchase card programs provided to the Borrower or any Subsidiary (whether absolute or contingent and howsoever and whenever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor)) that are (a) owed to the Administrative Agent or any of its Affiliates or branches, (b) owed on the Effective Date to a Person that is a Lender or an Affiliate or branch of a Lender as of the Effective Date or (c) owed to a Person that is an Agent, a Lender or an Affiliate or branch of an Agent or Lender at the time such obligations are incurred.

 

“Secured Cash Management Obligations” means the due and punctual payment and performance of all obligations of the Borrower and the Restricted Subsidiaries in respect of any overdraft and related liabilities arising from treasury, depository, cash pooling arrangements and cash management services, corporate credit and purchasing cards and related programs or any automated clearing house transfers of funds or supply chain finance services including, without limitation, trade payable services and supplier accounts receivable purchases (collectively, “Cash Management Services”) provided to the Borrower or any Subsidiary (whether absolute or contingent and howsoever and whenever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor)) that are (a) owed to the Administrative Agent or any of its Affiliates or branches, (b) owed on the Effective Date to a Person that is a Lender or an Affiliate or branch of a Lender as of the Effective Date or (c) owed to a Person that is an Agent, a Lender or an Affiliate or branch of an Agent or Lender at the time such obligations are incurred.

 

“Secured Cash Management Reserves” means Secured Obligations in respect of any Secured Cash Management Obligation in the amount specified by the applicable Secured Party and the Borrower in writing to the Administrative Agent under the definition of “Noticed Cash Management Obligations”, which amount may, subject to the restrictions set forth in the definition of “Noticed Cash Management Obligations” be increased with respect to any existing Secured Cash Management Obligation at any time by further written notice from such Secured Party and the Borrower to the Administrative Agent.

 

“Secured Hedge Reserves” means Secured Obligations in respect of any Secured Swap Obligation in the amount specified by the applicable Secured Party and the Borrower in writing to the Administrative Agent under the definition of “Noticed Hedges” (but not to exceed the Hedge Termination Value), which amount may, subject to the restrictions set forth in the definition of “Noticed Hedges” and herein, be increased with respect to any existing Secured Swap Obligation at any time by further written notice from such Secured Party and the Borrower to the Administrative Agent.

 

“Secured Leverage Ratio” means, on any date, the ratio of (a) Consolidated Secured Debt as of such date to (b) Consolidated EBITDA for the Test Period as of such date.

 

“Secured Obligations” means (a) the Loan Document Obligations, (b) the Secured Cash Management Obligations, (c) the Secured Bank Product Obligations and (d) the Secured Swap Obligations (excluding with respect to any Loan Party, Excluded Swap Obligations of such Loan Party).

 

“Secured Parties” means (a) each Lender, (b) each Issuing Bank, (c) the Administrative Agent, (d) each Joint Bookrunner, (e) each Lead Arranger, (f) each Person to whom any Secured Cash Management Obligations are owed, (g) each Person to whom any Secured Bank Product Obligations are owed, (h) each counterparty to any Swap Agreement the obligations under which constitute Secured Swap Obligations, (i) the beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document and (j) the permitted successors and assigns of each of the foregoing.

 

“Secured Swap Obligations” means the due and punctual payment and performance of all obligations of the Borrower, and the Restricted Subsidiaries under each Swap Agreement that (a) is with a counterparty that is an Agent or any of its Affiliates or branches, (b) is in effect on the Effective Date with a counterparty that is a Lender or an Affiliate or branch of a Lender as of the Effective Date and (c) is entered into after the Effective Date with any counterparty that is a Lender, an Agent or an Affiliate or branch of a Lender or an Agent at the time such Swap Agreement is entered into.

 

“Security Documents” means the Collateral Agreement, the ABL Intercreditor Agreement (if executed) and each other security agreement, pledge agreement or other instrument or document executed and delivered pursuant to the Collateral and Guarantee Requirement, Section 4.01(f), 5.11 or 5.12 by a Loan Party or any Parent Entity thereof to secure any of the Secured Obligations or to govern the lien priorities of the holders of Liens on the Collateral.

 

“Settlement” has the meaning specified in Section 2.23(a)(ii).

 

“Settlement Date” has the meaning specified in Section 2.23(a)(ii).

 

“Shrink Reserve” means an amount reasonably estimated by the Administrative Agent to be equal to that amount which is required in order that the shrink reflected in current books and records of the Loan Parties would be reasonably equivalent to the shrink calculated as part of the Borrower’s most recent physical Inventory or cycle counts; provided that no Shrink Reserve established by the Administrative Agent shall be duplicative of any shrink as so reflected in the current books and records of the Loan Parties or estimated by the Borrower for purposes of computing the Borrowing Base.

 

“SOFR” means, with respect to any Business Day, a rate per annum equal to the secured overnight financing rate for such Business Day publishedas administered by the SOFR Administrator on the SOFR Administrator’s Website.. 

 

“SOFR Administrator” means the NYFRB (or a successor administrator of the secured overnight financing rate).

 

“SOFR Administrator’s Website” means the NYFRB’s website, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

 

“Sold Entity or Business” has the meaning given such term in the definition of “Consolidated EBITDA.”

 

“Solvent” means (a) the Fair Value of the assets of the Borrower and its Subsidiaries on a consolidated basis taken as a whole exceeds their Liabilities, (b) the Present Fair Saleable Value of the assets of the Borrower and its Subsidiaries on a consolidated basis taken as a whole exceeds their Liabilities, (c) the Borrower and its Subsidiaries on a consolidated basis taken as a whole after consummation of the Transactions is a going concern and has sufficient capital to reasonably ensure that it will continue to be a going concern for the period from the date hereof through the Latest Maturity Date taking into account the nature of, and the needs and anticipated needs for capital of, the particular business or businesses conducted or to be conducted by the Borrower and its Subsidiaries on a consolidated basis as reflected in the projected financial statements and in light of the anticipated credit capacity and (d) for the period from the date hereof through the Latest Maturity Date, the Borrower and its Subsidiaries on a consolidated basis taken as a whole will have sufficient assets and cash flow to pay their Liabilities as those liabilities mature or (in the case of contingent Liabilities) otherwise become payable, in light of business conducted or anticipated to be conducted by the Borrower and its Subsidiaries as reflected in the projected financial statements and in light of the anticipated credit capacity.

 

“Special Purpose Entity” means a direct or indirect subsidiary of the Borrower, whose organizational documents contain restrictions on its purpose and activities and impose requirements intended to preserve its separateness from the Borrower and/or one or more Subsidiaries of the Borrower.

 

“Special Resolution Regimes” has the meaning specified in Section 9.21.

 

“Specified Covenant Event” means any Specified Investment, Specified Dividend, Specified Restricted Debt Payment, Specified Lien and/or Specified Debt Incurrence.

 

“Specified Debt Incurrence” means any Indebtedness incurred pursuant to Section 6.01(a)(xix).

 

“Specified Default” means any Event of Default pursuant to Section 7.01(a), (b), (c) (with respect to representations in any Borrowing Base Certificate only), (d) (with respect to Section 5.17 or 6.10 only), (e) (with respect to Section 5.01(i) only), (h) or (i).

 

“Specified Dividend” means any Restricted Payment made pursuant to Section 6.08(a)(xiv).

 

“Specified Excess Availability” means the sum of (a) Excess Availability and (b) the lesser of (i) Suppressed Availability and (ii) 5.0% of the aggregate Revolving Commitments at such time.

 

“Specified Investment” means any Investment made pursuant to Section 6.04(u).

 

“Specified Lien” means any Lien incurred pursuant to Section 6.02(xxv).

 

“Specified Restricted Debt Payment” means any prepayment, redemption, purchase, defeasance or other payment in respect of Junior Financings made pursuant to Section 6.08(b)(v).

 

“Specified Transaction” means, with respect to any period, any Investment, Disposition, incurrence or repayment of Indebtedness, Restricted Payment, New Project, subsidiary designation or other event that by the terms of the Loan Documents requires “Pro Forma Compliance” with a test or covenant hereunder or requires such test or covenant to be calculated on a “Pro Forma Basis.”

 

“Specified Transaction Adjustments” has the meaning specified in Section 1.08(d).

 

“Sponsor” means each of (a) BC Partners, Inc. and its Affiliates (including the funds, partnerships or other co-investment vehicles managed, advised or controlled thereby but other than, in each case, the Borrower and its Subsidiaries or any portfolio company), (b) Caisse de dépôt et placement du Québec and its Affiliates (including the funds, partnerships or other co-investment vehicles managed, advised or controlled thereby but other than, in each case, the Borrower and its Subsidiaries or any portfolio company), (c) Government of Singapore Investment Corporation and its Affiliates (including the funds, partnerships or other co-investment vehicles managed, advised or controlled thereby but other than, in each case, the Borrower and its Subsidiaries or any portfolio company), (d) GIC Private Limited and its Affiliates (including the funds, partnerships or other co-investment vehicles managed, advised or controlled thereby but other than, in each case, the Borrower and its Subsidiaries or any portfolio company), (e) Longview Asset Management LLC and its Affiliates (including the funds, partnerships or other co-investment vehicles managed, advised or controlled thereby but other than, in each case, the Borrower and its Subsidiaries or any portfolio company) and (f) StepStone Group LP and its Affiliates (including the funds, partnerships or other co-investment vehicles managed, advised or controlled thereby but other than, in each case, the Borrower and its Subsidiaries or any portfolio company).

 

“SPV” has the meaning assigned to such term in Section 9.04(e).

 

“Standby Letter of Credit” means any Letter of Credit other than a Commercial Letter of Credit.

 

“Standard Letter of Credit Practice” means, for any Issuing Bank, any domestic or foreign law or letter of credit practices applicable in the city in which such Issuing Bank issued the applicable Letter of Credit or, for its branch or correspondent, such laws and practices applicable in the city in which it has advised, confirmed or negotiated such Letter of Credit, as the case may be, in each case, (a) which letter of credit practices are of banks that regularly issue letters of credit in the particular city, and (b) which laws or letter of credit practices are required or permitted under ISP or UCP, as chosen in the applicable Letter of Credit.

 

“Sterling” means the lawful currency of the United Kingdom.

 

“Subordinated Indebtedness” means any Material Indebtedness that is subordinated in right of payment to the Loan Document Obligations.

 

“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 well as any other corporation, limited liability company, partnership, association or other entity (a) 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, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

 

“Subsidiary” means any subsidiary of the Borrower.

 

“Subsidiary Loan Party” means each Subsidiary that is party to the Guarantee Agreement.

 

“Successor Borrower” has the meaning assigned to such term in Section 6.03(a)(iv).

 

“Super Majority Lenders” means, at any time, Lenders having Revolving Exposures and unused Commitments (other than Swingline Commitments) representing more than 66.7% of the aggregate Revolving Exposures and unused Commitments (other than Swingline Commitments) at such time; provided that whenever there are one or more Defaulting Lenders, the total outstanding Revolving Exposures of, and the unused Revolving Commitments of, each Defaulting Lender shall in each case be excluded for purposes of making a determination of Super Majority Lenders.

 

“Supported QFC” has the meaning specified in Section 9.21.

 

“Suppressed Availability” means, at any time, the amount (if any, but in no event less than zero) by which the Borrowing Base exceeds the aggregate Revolving Commitments at such time.

 

“Swap” means any agreement, contract, or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act or other applicable law.

 

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

 

“Swap Obligation” means, with respect to any Person, any obligation to pay or perform under any Swap.

 

“Swingline Borrowing” means a request for Swingline Loans.

 

“Swingline Exposure” means, with respect to any Revolving Lender, at any time, such Revolving Lender’s Pro Rata Share of the Swingline Loans outstanding at such time.

 

“Swingline Lender” means Wells Fargo Bank, National Association, in its capacity as lender of Swingline Loans hereunder, and its successors and assigns in such capacity.

 

“Swingline Loan” means a Swingline Loan made by the Swingline Lender to the Borrower under Section 2.23(a).

 

“Swingline Sublimit” means an amount equal to the lesser of (a) $30,000,000 and (b) the Total Revolving Commitments. The Swingline Sublimit is part of, and not in addition to, the Revolving Commitments.

 

“Syndication Agent” means JPMorgan Chase Bank, N.A., in its capacity as syndication agent hereunder.

 

“Tax Group” has the meaning specified in Section 6.08(a)(vii)(A)

 

“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings (including backup withholding) imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

“Term SOFR” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted Term SOFR Rate.

 

 

 

“Term SOFR Transition Event” means the determination by the Administrative Agent that (a) Term SOFR has been recommended for use by the Relevant Governmental Body, (b) the administration of Term SOFR is administratively feasible for the Administrative Agent and (c) a Benchmark Transition Event or an Early Opt-in Election, as applicable, has previously occurred resulting in a Benchmark Replacement in accordance with Section 2.12 that is not Term SOFR.

“Test Period” means, at any date of determination, the most recently completed four consecutive fiscal quarters of the Borrower ending on or prior to such date for which financial statements have been (or were required to have been) delivered pursuant to Section 5.01(a) or Section 5.01(b); provided that prior to the first date financial statements have been delivered pursuant to Section 5.01(a) or Section 5.01(b), the Test Period in effect shall be the period of four consecutive fiscal quarters of the Borrower ended February 3, 2019.

 

“Total Leverage Ratio” means, on any date, the ratio of (a) Consolidated Total Debt as of such date to (b) Consolidated EBITDA for the Test Period as of such date.

 

“Total Maximum Borrowing Amount” means the Maximum Borrowing Amount under the Facility at such time.

 

“Total Revolving Commitments” means the aggregate outstanding amount of Revolving Commitments for the Facility of all Revolving Lenders under the Facility.

 

“Transactions” means, collectively, (a) the effectiveness of this Agreement, (b) the effectiveness of the IPO Separation Agreements, (c) the consummation of any other transactions in connection with the foregoing and (d) the payment of the fees and expenses incurred in connection with any of the foregoing (including the Transaction Costs).

 

“Transaction Costs” means any fees or expenses incurred or paid by the Sponsors, a Parent Entity, the Borrower or any Subsidiary in connection with the Transactions, this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby.

 

“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 LIBOAdjusted Term SOFR Rate or the Alternate Base Rate.

 

“UCC” or “Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided, however, that, at any time, if by reason of mandatory provisions of law, any or all of the perfection or priority of the Administrative Agent’s security interest in any item or portion of the Pledged Collateral (as defined in the Collateral Agreement) is governed by the Uniform Commercial Code as in effect in a U.S. jurisdiction other than the State of New York, the term “UCC” shall mean the Uniform Commercial Code as in effect, at such time, in such other jurisdiction for purposes of the provisions hereof relating to such perfection or priority and for purposes of definitions relating to such provisions.

 

“UCP” means, with respect to any Letter of Credit, the Uniform Customs and Practice for Documentary Credits 2007 Revision, International Chamber of Commerce Publication No. 600 and any version or revision thereof accepted by any Issuing Bank for use.

 

 

 

“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

 

“Uncontrolled Cash” means all amounts from time to time on deposit in any Designated Disbursement Account.

 

“Unrestricted Subsidiary” means any Subsidiary designated by the Borrower as an Unrestricted Subsidiary pursuant to Section 5.14 subsequent to the Effective Date.

 

 

 

“USA Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, as amended from time to time.

 

“Value” means, on any date, with reference to (a) Eligible Inventory, the Net Orderly Liquidation Value thereof and (b) Eligible Receivables, the book value thereof determined in accordance with GAAP.

 

“Vehicles” means all railcars, cars, trucks, trailers, construction and earth moving equipment and other vehicles covered by a certificate of title law of any state and all tires and other appurtenances to any of the foregoing.

 

“Weekly Borrowing Base Certificate” means a certificate, signed and certified as accurate and complete by a Financial Officer of the Borrower, in substantially the form of Exhibit F or another form which is acceptable to the Administrative Agent in its reasonable discretion (it being agreed that each Weekly Borrowing Base Certificate will be based on the most recently delivered Borrowing Base Certificate delivered on a monthly basis updated to reflect changes in the aggregate Value of Receivables and Inventory of the relevant Loan Parties but with ineligibility and reserve related items reflecting those set forth in such most recent Borrowing Base Certificate).

“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing: (a) the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (ii) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by (b) the then outstanding principal amount of such Indebtedness.

 

“wholly-owned subsidiary” means, with respect to any Person at any date, a subsidiary of such Person of which securities or other ownership interests representing 100% of the Equity Interests (other than (a) directors’ qualifying shares and (b) nominal shares issued to foreign nationals to the extent required by applicable Requirements of Law) are, as of such date, owned, controlled or held 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.

 

“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.

 

“Withholding Agent” shall mean any Loan Party, the Administrative Agent and, in the case of any U.S. federal withholding tax, any other withholding agent, if applicable.

 

“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom,  any powers of the applicable Resolution Authority  under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution  or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in each case, at the option of the Borrower (the Borrower’s election to exercise such option in connection with any Limited Condition Acquisition, an “LCA Election”), the date of determination of whether any such action is permitted hereunder, shall be deemed to be the date the definitive agreements for such Limited Condition Acquisition are entered into (the “LCA Test Date”) (provided that the Borrower shall be required to make an LCA Election on or prior to the date on which the definitive agreements for such Limited Condition Acquisition have been entered into), and if, after giving Pro Forma Effect to the Limited Condition Acquisition and the other transactions to be entered into in connection therewith (including any incurrence of Indebtedness and the use of proceeds thereof) as if they had occurred at the beginning of the most recent Test Period ending prior to the LCA Test Date (after giving effect to any increases or decrease in Indebtedness of the Borrower and Restricted Subsidiaries since such date), the Borrower could have taken such action on the relevant LCA Test Date in compliance with such ratio, representation, warranty, default, Events of Default or basket, such ratio, representation, warranty, default, Event of Default or basket shall be deemed to have been complied with for purposes of such Limited Condition Acquisition. For the avoidance of doubt, if the Borrower has made an LCA Election and any of the ratios or baskets for which compliance was determined or tested as of the LCA Test Date are exceeded as a result of fluctuations in any such ratio or basket, including due to fluctuations in Consolidated EBITDA or Consolidated Total Assets of the Borrower or the Person subject to such Limited Condition Acquisition, at or prior to the consummation of the relevant transaction or action, such baskets or ratios will not be deemed to have been exceeded as a result of such fluctuations. If the Borrower has made an LCA Election for any Limited Condition Acquisition, then in connection with any subsequent calculation of any ratios, representations, warranties, defaults, Events of Default or basket availability with respect to the incurrence of Indebtedness or Liens, or the making of Restricted Payments, mergers, the conveyance, lease or other transfer of all or substantially all of the assets of the Borrower, the prepayment, redemption, purchase, defeasance or other satisfaction of Indebtedness, or the designation of an Unrestricted Subsidiary on or following the relevant LCA Test Date and prior to the earlier of the date on which such Limited Condition Acquisition is consummated or the date that the definitive agreement for such Limited Condition Acquisition is terminated or expires without consummation of such Limited Condition Acquisition, any such ratios, representations, warranties, defaults, Events of Default or baskets shall be calculated on a Pro Forma Basis assuming such Limited Condition Acquisition and other transactions in connection therewith (including any incurrence of Indebtedness and the use of proceeds thereof) have not been consummated until such time as the applicable Limited Condition Acquisition has actually closed or the definitive agreement with respect thereto has been terminated (it being further understood that any Consolidated Net Income, Consolidated EBITDA and/or Consolidated Total Assets therefrom shall not be included in the Borrower’s Consolidated Net Income, Consolidated EBITDA or Consolidated Total Assets, as applicable, in any such subsequent calculation until such Limited Condition Acquisition has actually closed or the definitive agreement with respect thereto has been terminated).

 

 

 

 

 

 

 

 

ARTICLE II

 

THE CREDITS

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

Except as provided above, the amount of any such Revolving Commitment reduction shall not be applied to the LC Sublimit or the Swingline Sublimit unless otherwise specified by the Borrower. Notwithstanding the foregoing, the Borrower may rescind or postpone any notice of termination of the Commitments if such termination would have resulted from a refinancing of all of the Facility, which refinancing is not consummated or is otherwise shall be delayed. Unless previously terminated, all Commitments of a Class shall terminate on the Maturity Date applicable to such Class.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(h)    The parties hereto agree and acknowledge that the Announcements resulted in the occurrence of a Benchmark Transition Event with respect to the London interbank offered rate pursuant to the terms of this Agreement and that any obligation of the Administrative Agent to notify any parties of such Benchmark Transition Event pursuant to clause (d) of this Section 2.12 shall be deemed satisfied.

      

 

 

 

 

 

 

 

 

 

 

and the result of any of the foregoing shall be to increase the cost to such Lender of making, maintaining, continuing or converting any EurocurrencyTerm SOFR Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or any Issuing Bank or to reduce the amount of any sum received or receivable by such Lender or Issuing Bank hereunder (whether of principal, interest or otherwise), then, from time to time upon request of such Lender or Issuing Bank, the Borrower will pay to such Lender or Issuing Bank such additional amount or amounts as will compensate such Lender or such Issuing Bank for such increased costs actually incurred or reduction actually suffered, provided that to the extent any such costs or reductions are incurred by any Lender as a result of any requests, rules, guidelines or directives enacted or promulgated under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and Basel III after the Effective Date, then such Lender or such Issuing Bank shall be compensated pursuant to this Section 2.13(a) only to the extent such Lender or such Issuing Bank is imposing such charges on similarly situated borrowers under the other syndicated credit facilities that such Lender is a lender under or such Issuing Bank is a letter of credit issuer under. Notwithstanding the foregoing, (i) the Borrower shall not be liable for such increased cost or reduction other than to the extent that it relates to the Facility under which such Person is the Borrower and (ii) this paragraph will not apply to (A) Indemnified Taxes or Other Taxes indemnifiable under Section 2.15 or (B) Excluded Taxes.

 

 

 

 

         Section 2.14    Break Funding Payments. In the event of (a) the payment of any principal of any EurocurrencyTerm SOFR Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any EurocurrencyTerm SOFR Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Loan on the date specified in any notice delivered pursuant hereto or (d) the assignment of any EurocurrencyTerm SOFR Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.17 or Section 9.02(c), then, in any such event, the Borrower shall, after receipt of a written request by any Lender affected by any such event (which request shall set forth in reasonable detail the basis for requesting such amount), compensate each Lender under the Facility for the actual loss, cost and expense attributable to such event. For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 2.14, each Lender shall be deemed to have funded each EurocurrencyTerm SOFR Loan made by it at the LIBOAdjusted Term SOFR Rate for such Loan by a matching deposit or other borrowing for a comparable amount and for a comparable period, whether or not such EurocurrencyTerm SOFR Loan was in fact so funded. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section delivered to the Borrower shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 15 days after receipt of such demand. Notwithstanding the foregoing, this Section 2.14 will not apply to losses, costs or expenses resulting from Taxes, as to which Section 2.15 shall govern.

 

 

 

 

 

 

 

Without limiting the foregoing:

 

 

 

 

 

 

 

 

 

Notwithstanding any other provisions of this clause (e), a Lender shall not be required to deliver any form or other documentation that such Lender is not legally eligible to deliver.

 

 

 

Notwithstanding anything to the contrary, this Section 2.15(g) shall not be construed to require the Administrative Agent or any Lender or Issuing Bank to make available its Tax returns (or any other information relating to Taxes which it deems confidential to any Loan Party or any other Person).

 

 

 (a)    The Borrower shall make each payment required to be made by it under any Loan Document (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts payable under Section 2.13, 2.14 or 2.15, or otherwise) prior to the time expressly required hereunder or under such other Loan Document for such payment (or, if no such time is expressly required, prior to 2:00 p.m., Local Time), on the date when due, in immediately available funds, without setoff or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to such account as may be specified by the Administrative Agent, 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 2.13, 2.14, 2.15 and 9.03 shall be made directly to the Persons entitled thereto and payments pursuant to other Loan Documents shall be made to the Persons specified therein. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment (other than payments on the EurocurrencyTerm SOFR Loans) under any Loan Document 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. If any payment on a EurocurrencyTerm SOFR Loan becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day unless the result of such extension would be to extend such payment into another calendar month, in which event such payment shall be made on the immediately preceding Business Day. In the case of any payment of principal pursuant to the preceding two sentences, interest thereon shall be payable at the then applicable rate for the period of such extension. All payments or prepayments of any Loan or with respect to a Letter of Credit shall be made in the currency in which such Loan or Letter of Credit (as applicable) is denominated, all payments of accrued interest payable on a Loan shall be made in the currency in which such Loan is denominated, and all other payments under each Loan Document shall be made in Dollars. If, for any reason, the Borrower is prohibited by Requirements of Law from making any required payment hereunder in any currency (other than Dollars), the Borrower shall make such payment in Dollars in the Dollar Equivalent of such payment amount.