Exhibit 10.2

SECOND AMENDMENT TO SECOND AMENDED AND RESTATED

$250,000,000 ASSET-BASED LOAN CREDIT AGREEMENT

This Second Amendment to Second Amended and Restated $250,000,000 Asset-Based Loan Credit Agreement (this “Amendment”) is made as of this 13th day of January, 2021, by and among:

EXPRESS HOLDING, LLC, a Delaware limited liability company (the “Parent”),

EXPRESS, LLC, a Delaware limited liability company (the “Borrower”),

EXPRESS, INC., a Delaware corporation (“Holdings”),

EXPRESS TOPCO LLC, a Delaware limited liability company (“Intermediate Holdings”, and together with Holdings, individually, a “New Guarantor” and collectively, the “New Guarantors”),

the Subsidiary Guarantors,

the Lenders, the Issuing Bank, and the Swing Line Bank,

WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association (“WFB”), as administrative agent for the Lender Parties (in such capacity, the “Administrative Agent”), and

WFB, as collateral agent for the Secured Parties (in such capacity, the “Collateral Agent”, and together with the Administrative Agent, collectively, the “Agents”),

in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

W I T N E S S E T H :

WHEREAS, the Parent, the Borrower, the Lenders party thereto, and the Agents, among others, have entered into a Second Amended and Restated $250,000,000 Asset-Based Loan Credit Agreement dated as of May 20, 2015 (as amended, restated, supplemented or otherwise modified and in effect from time to time, the “Credit Agreement”);

WHEREAS, the Loan Parties desire to enter into a term loan agreement and related documents, instruments and agreements (as further defined in the Credit Agreement (as amended hereby), the “Term Documents”) with, among others, Wells Fargo Bank, National Association, pursuant to which, among other things, the Loan Parties desire to incur Debt and to secure such Debt by granting a Lien on substantially all of the Loan Parties’ assets (which Lien shall have the priority set forth in the ABL Intercreditor Agreement (as defined in the Credit Agreement (as amended hereby));

WHEREAS, the New Guarantors are part of a consolidated corporate enterprise with the Parent, the Borrower and the Subsidiary Guarantors and derive direct and indirect benefits from the Facilities provided to the Borrower pursuant to the Loan Documents;

WHEREAS, it is a condition of the effectiveness of this Amendment that the New Guarantors join the Credit Agreement and the other Loan Documents as Guarantors thereunder, and the New Guarantors desire to effect such joinder; and

WHEREAS, in connection with the foregoing, the Loan Parties, the Agents and the Lenders have agreed to amend certain other terms and conditions of the Credit Agreement as set forth herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

 

1.	Definitions. All capitalized terms used in this Amendment and not otherwise defined shall have the same meanings herein as in the Credit Agreement.

 

2.	Joinder and Assumption of Obligations. Effective as of the Second Amendment Effective Date, each New Guarantor hereby acknowledges that it has received and reviewed copies of the Credit Agreement and the other Loan Documents, and acknowledges and agrees to, and does hereby:

 

(a)

join in the execution of, and become a party to, the Credit Agreement and each other Loan Document as a Guarantor thereunder;

 

(b)

agree to be bound by all representations, warranties, covenants, agreements, liabilities, and acknowledgments of the Guarantors in the Credit Agreement, in each case, with the same force and effect as if such New Guarantor was a signatory to the Credit Agreement and was expressly named as a Guarantor therein; and

 

(c)

without limiting the generality of the foregoing:

 

(i)

absolutely, unconditionally and irrevocably guarantee the punctual payment when due, whether at scheduled maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all Obligations of each other Loan Party now or hereafter existing under or in respect of the Loan Documents, any Secured Hedge Agreement, any Secured Bank Product Agreement, or any Secured Cash Management Agreement (including, without limitation, any extensions, modifications, substitutions, amendments or renewals of any or all of the foregoing Obligations), whether direct or indirect, absolute or contingent, and whether for principal, interest, premium, fees, indemnities, contract causes of action, costs, expenses or otherwise (such Obligations being the “Guaranteed Obligations”; provided that the Guaranteed Obligations shall not include any Excluded Swap Obligations), and agrees to pay any and all expenses (including, without limitation, fees and expenses of counsel) incurred by the Administrative Agent, any other Lender Party, any Hedge Bank, any provider of Bank Products, or any Cash Management Bank in enforcing any rights under, as applicable, this Guaranty, any other Loan Document, any Secured Hedge Agreement, Secured Bank Product Agreement, or any Secured Cash Management Agreement. Without limiting the generality of the foregoing, the liability of such New Guarantor shall extend to all amounts that constitute part of the Guaranteed Obligations and would be owed by any other Loan Party to any Lender Party or any Hedge Bank or any Cash Management Bank under or in respect of, as applicable, the Loan Documents or any Secured Hedge Agreement, Secured Bank Product Agreement, or any Secured Cash Management Agreement but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving such other Loan Party;

 

(ii)

unconditionally and irrevocably agree that in the event any payment shall be required to be made to any Lender Party under the Credit Agreement or any other

 

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guaranty, such New Guarantor will contribute, to the maximum extent permitted by applicable law, such amounts to each other Guarantor and each other guarantor so as to maximize the aggregate amount paid to the Lender Parties or Hedge Banks or any Cash Management Bank under or in respect of, as applicable, the Loan Documents or any Secured Hedge Agreement, Secured Bank Product Agreement, or any Secured Cash Management Agreement; and

 

(iii)

agree to be bound as a Guarantor by all of the terms and conditions of the Guaranty, as set forth in the Credit Agreement, to the same extent as each of the other Guarantors thereunder. Each New Guarantor further agrees, as of the date first above written, that each reference in the Credit Agreement to an “Additional Guarantor” or a “Guarantor” shall also mean and be a reference to the undersigned, and each reference in any other Loan Document to a “Guarantor” or a “Loan Party”, as applicable, shall also mean and be a reference to Holdings and Intermediate Holdings.

 

3.	Amendments to Credit Agreement. The Credit Agreement is hereby amended as follows:

 

(a)

Composite Credit Agreement. By deleting the stricken text (indicated textually in the same manner as the following example: stricken text) and by adding the double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as reflected in the modifications identified in the document annexed hereto as Annex A attached to this Amendment.

 

(b)

Amendments to Exhibits. By amending and restating Exhibit F (Form of Borrowing Base Certificate) to the Credit Agreement in its entirety to read as set forth in the Exhibit F annexed hereto as Annex B attached to this Amendment.

 

(c)

Amendments to Schedules.

 

(i)

By deleting each of Schedules 4.01(e) (Governmental Authorizations), 4.01(g) (Litigation), 4.01(t) (Intellectual Property), 5.02(h) (Limited Liability Company Agreements), and 5.02(l) (Negative Pledge) therefrom in its entirety.

 

(ii)

By amending and restating each other Schedule to the Credit Agreement (other than Schedule III (Existing Letters of Credit) thereto) in its entirety to read as set forth in the corresponding Schedule annexed hereto as Annex C attached to this Amendment.

 

4.

Ratification of Loan Documents. Except as otherwise expressly provided herein, all terms and conditions of the Credit Agreement and the other Loan Documents remain in full force and effect, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles (regardless of whether enforcement is sought in law or equity). The Loan Parties hereby ratify, confirm, and reaffirm (i) all Loan Documents as amended hereby, and (ii) that all representations and warranties of the Loan Parties contained in the Credit Agreement or any other Loan Document are true and correct in all material respects (except in the case of any representation or warranty qualified or modified by materiality, which are true and correct in all respects as so qualified or modified) on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (or in all respects, as applicable) as of such earlier date. Without limiting the foregoing, each of the Loan Parties hereby acknowledges, confirms and agrees that any and all Collateral previously pledged to the

 

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Collateral Agent, for the benefit of the Secured Parties, pursuant thereto, shall continue to secure all Obligations of the Loan Parties at any time and from time to time outstanding under the Credit Agreement and the other Loan Documents, as such Obligations have been, and may hereafter be, amended, restated, supplemented, increased or otherwise modified from time to time. The Loan Parties hereby represent and warrant that giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

 

5.

Conditions to Effectiveness. This Amendment shall not be effective until each of the following conditions precedent has been fulfilled (or concurrently fulfilled with the effectiveness of this Amendment or waived by the Administrative Agent) to the reasonable satisfaction of the Administrative Agent:

 

(a)

The Administrative Agent shall have received on or before the Second Amendment Effective Date the following, each dated such day (unless otherwise specified), in form and substance reasonably satisfactory to the Administrative Agent (unless otherwise specified):

 

(i)

executed counterparts of this Amendment sufficient in number for distribution to the Agents, each Lender and the Borrower;

 

(ii)

that certain Fee Letter, duly executed on the Second Amendment Effective Date by the Loan Parties, the Lead Arranger and the Agents;

 

(iii)

(A) the Security Agreement (as such term is defined in the Credit Agreement as amended hereby), duly executed by the parties thereto, and (B) the Intellectual Property Security Agreements (as defined in such Security Agreement), duly executed by the parties thereto;

 

(iv)

Lien search results and other documentation reflecting that proper financing statements under the Uniform Commercial Code and all other documents and instruments (including Intellectual Property Security Agreements) have been filed in all jurisdictions that the Administrative Agent may deem necessary in the reasonable opinion of the Administrative Agent, in order to perfect and protect the liens and security interests created under the Collateral Documents (having the priority contemplated by the ABL Intercreditor Agreement) and that no Liens other than Permitted Liens exist on any Collateral;

 

(v)

Evidence of the insurance required by the terms of the Loan Documents;

 

(vi)

Certified copies of the resolutions of the board of directors, board of managers or members, as applicable, of each Loan Party approving each Loan Document to which it is or is to be a party;

 

(vii)

A copy of a certificate or certificate(s) of the Secretary of State of the jurisdiction of incorporation or formation of each Loan Party, dated reasonably near the Second Amendment Effective Date certifying (A) as to a true and correct copy of the charter of such Loan Party and each amendment thereto on file in such Secretary’s office and (B) that (1) such amendments are the only amendments to such Loan Party’s charter, articles of organization, or certificate of formation, as applicable, on file in such Secretary’s office, (2) (to the extent customary for such jurisdiction’s Secretary of State’s certificate) such Loan Party has paid all franchise taxes to the date of such certificate and (3) such Loan Party is duly

 

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incorporated and in good standing or presently subsisting under the laws of the State of the jurisdiction of its incorporation or formation;

 

(viii)

A certificate of the Secretary or other Responsible Officer of each Loan Party certifying as to (A) the absence of any amendments to the charter, articles of organization, or certificate of formation, as applicable, of such Loan Party since the date of the Secretary of State’s certificate referred to in clause (vii) above, (B) a true and correct copy of the bylaws, limited liability company agreement or operating agreement, as applicable, of such Loan Party as in effect on the date on which the resolutions referred to in clause (vi) above were adopted and on the Second Amendment Effective Date, (C) the due incorporation or formation, as applicable, and good standing or valid existence of such Loan Party as a corporation or limited liability company organized under the laws of the jurisdiction of its incorporation or formation and (D) the names and true signatures of the officers of such Loan Party authorized to sign each Loan Document to which it is or is to be a party and the other documents to be delivered hereunder and thereunder;

 

(ix)

A certificate, in form and substance reasonably satisfactory to the Agents, attesting to the Solvency of the Loan Parties, taken as a whole, before and after giving effect to the transactions contemplated to occur on the Second Amendment Effective Date (including, without limitation, the funding of the portion of the Term Loans to occur on such date); and

 

(x)

A favorable opinion of Kirkland & Ellis LLP, counsel for the Loan Parties, in form and substance reasonably satisfactory to the Collateral Agent and of Vorys, Sater, Seymour and Pease LLP, special local counsel for Express GC, LLC, in form and substance reasonably satisfactory to the Collateral Agent.

 

(b)

The Administrative Agent shall have received (i) a Borrowing Base Certificate, and (ii) a Term Loan Borrowing Base Certificate, each dated as of the Second Amendment Effective Date, relating to the week ended on January 9, 2021 and in form and substance satisfactory to the Administrative Agent.

 

(c)

There shall have been no event or circumstance since the date of the Audited Financial Statements that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect (other than resulting from any event, development or circumstance related to the COVID-19 pandemic occurring prior to the Second Amendment Effective Date that was disclosed to the Agents and the Lenders in writing on or prior to the Second Amendment Effective Date).

 

(d)

(i) The Term Credit Agreement shall have been entered into and shall be in form and substance satisfactory to the Administrative Agent, and contemporaneously herewith, the Borrower shall have received at least $90,000,000 of gross proceeds from the portion of the Term Loans made on the Second Amendment Effective Date pursuant to the Term Credit Agreement, and upon such receipt, the Borrower shall have remitted net proceeds thereof to the Administrative Agent for application to the Obligations, (ii) a Responsible Officer of the Borrower shall have delivered a certificate to the Administrative Agent, in form and substance satisfactory to the Administrative Agent, which certificate shall attach the Term Credit Agreement and all other material Term Documents and certify that such documents are true, correct and complete copies of all such Term Documents, and (iii) the Term Documents shall be in full force and effect and no default or event of

 

5

default shall exist under the Term Documents, or would result from the consummation of the transactions contemplated hereby (including the incurrence of such portion of the Term Loans).

 

(e)

Each Intercreditor Agreement shall (i) have been duly executed by all parties thereto and delivered to the Administrative Agent, and (ii) shall be in form and substance reasonably satisfactory to the Administrative Agent and the Required Lenders.

 

(f)

All representations and warranties of the Loan Parties contained in the Credit Agreement or any other Loan Document shall be true and correct in all material respects (except in the case of any representation or warranty qualified or modified by materiality, which shall be true and correct in all respects as so qualified or modified) on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (or in all respects, as applicable) as of such earlier date.

 

(g)

After giving effect to this Amendment and the transactions contemplated hereby (including the incurrence of the portion of the Term Loans to be funded on the Second Amendment Effective Date), no Default or Event of Default shall have occurred and be continuing.

 

(h)

The Administrative Agent shall have received all documentation and other information required by bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation the Patriot Act.

 

(i)

Substantially concurrently with the effectiveness of this Amendment, the Borrower shall have paid or made arrangements to pay all fees of the Agents, the Lead Arranger and the Lender Parties required under the Second Amendment Fee Letter.

 

(j)

The Agents shall have been reimbursed by the Loan Parties for all reasonable and documented costs and expenses of the Agents (including, without limitation, reasonable attorneys’ fees) in connection with the preparation, negotiation, execution, and delivery of this Amendment and related documents. The Loan Parties hereby acknowledge and agree that the Administrative Agent may charge the Loan Account to pay such costs and expenses.

 

(k)

The Administrative Agent shall have received (i) a tax diligence report in respect of the 2020 Tax Refund Claim prepared by Nardella & Taylor, LLP, and (ii) all calculations prepared by KPMG US LLP and reporting to management, as well as supporting analysis as may be requested by the Administrative Agent, in respect of the 2020 Tax Refund Claim, in each case in form and substance reasonably satisfactory to the Administrative Agent.

 

(l)

The Agents shall have received such other documents, instruments and agreements as the Agents have reasonably requested in writing to the Loan Parties prior to the date hereof.

 

6.

No Additional Revolving Credit Commitments. Notwithstanding anything in the Credit Agreement (including, without limitation, Section 2.18 thereof) to the contrary, the parties hereto acknowledge and agree that from and after the Second Amendment Effective Date, (i) the Borrower shall not be entitled to request that, and the Borrower agrees that it shall not request, any Additional Revolving Credit Commitments be provided or any other increase in Commitments under the Credit Agreement, whether by any existing Lenders or any other Person,

 

6

in excess of amounts permitted pursuant to the ABL Intercreditor Agreement, and (ii) no Additional Revolving Credit Commitment Amendment or other increase in Commitments under the Credit Agreement purported to be entered into after the Second Amendment Effective Date shall be effective except to the extent permitted under the ABL Intercreditor Agreement.

 

7.	Miscellaneous.

 

(a)

This Amendment may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered shall be an original, and all of which together shall constitute one instrument. Delivery of an executed counterpart of a signature page to this Amendment by telecopy or other electronic transmission shall be effective as delivery of a manually executed counterpart of this Amendment.

 

(b)

This Amendment expresses the entire understanding of the parties with respect to the transactions contemplated hereby. No prior negotiations or discussions shall limit, modify, or otherwise affect the provisions hereof.

 

(c)

Any determination that any provision of this Amendment or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not affect the validity, legality, or enforceability of such provision in any other instance, or the validity, legality, or enforceability of any other provisions of this Amendment.

 

(d)

THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the parties have hereunto caused this Amendment to be executed and their seals to be hereto affixed as of the date first above written.

 

Signature Page to Second Amendment to Second Amended and Restated

$250,000,000 Asset-Based Loan Credit Agreement

Signature Page to Second Amendment to Second Amended and Restated

$250,000,000 Asset-Based Loan Credit Agreement

Signature Page to Second Amendment to Second Amended and Restated

$250,000,000 Asset-Based Loan Credit Agreement

Signature Page to Second Amendment to Second Amended and Restated

$250,000,000 Asset-Based Loan Credit Agreement

Signature Page to Second Amendment to Second Amended and Restated

$250,000,000 Asset-Based Loan Credit Agreement

Signature Page to Second Amendment to Second Amended and Restated

$250,000,000 Asset-Based Loan Credit Agreement

Annex A

Composite Credit Agreement

ANNEX A TO SECOND AMENDMENT TO SECOND AMENDED AND RESTATED

$250,000,000 ASSET-BASED LOAN CREDIT AGREEMENT

– COMPOSITE CREDIT AGREEMENT

SECOND AMENDED AND RESTATED $250,000,000

ASSET-BASED LOAN CREDIT AGREEMENT

Dated as of

May 20, 2015,

as amended May 24, 2019 and January 21, 2021

among

EXPRESS, INC.,

as Holdings

EXPRESS TOPCO LLC,

as Intermediate Holdings

EXPRESS HOLDING, LLC,

as Parent

and

EXPRESS, LLC,

as Borrower

THE OTHER LOAN PARTIES PARTY HERETO

and

THE INITIAL LENDERS, INITIAL ISSUING BANK AND

SWING LINE BANK NAMED HEREIN,

as Initial Lenders, Initial Issuing Bank and Swing Line Bank

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Administrative Agent and Collateral Agent

BANK OF AMERICA, N.A.,

as Documentation Agent

and

U.S. BANK NATIONAL ASSOCIATION,

as Syndication Agent

and

WELLS FARGO BANK, NATIONAL ASSOCIATION

BANK OF AMERICA, N.A.

as SoleJoint Lead ArrangerArrangers and Sole BookrunnerJoint Bookrunners

T A B L E O F C O N T E N T S

 

 

Section				Page
SECTION				PAGE
ARTICLE					I
-DEFINITIONS AND ACCOUNTING TERMS					1
SECTION 1.01.		Certain Defined Terms			1
SECTION 1.02.		Computation of Time Periods; Other Definitional Provisions			4456
SECTION 1.03.		Accounting Terms			4456
SECTION 1.04.		Foreign Subsidiaries [Reserved]			4557
SECTION 1.05.		Letter of Credit Amounts			4557
SECTION 1.06.		Divisions			4557
SECTION 1.07.		Limited Condition Transactions [Reserved]			4558
ARTICLE					II
-AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF CREDIT					58
SECTION 2.01.		The Advances			4658
SECTION 2.02.		Making the Advances			4860
SECTION 2.03.		Letters of Credit			5163
SECTION 2.04.		Repayment of Advances			5971
SECTION 2.05.		Termination or Reduction of the Commitments			5971
SECTION 2.06.		Prepayments			6072
SECTION 2.07.		Interest			6073
SECTION 2.08.		Fees			6174
SECTION 2.09.		Conversion of Advances			6276
SECTION 2.10.		Increased Costs, Etc.			6376
SECTION 2.11.		Payments and Computations			6579
SECTION 2.12.		Taxes			6883
SECTION 2.13.		Sharing of Payments, Etc.			7185
SECTION 2.14.		Use of Proceeds			7186
SECTION 2.15.		Defaulting Lenders			7286
SECTION 2.16.		Evidence of Debt			7489
SECTION 2.17.		Reserves 75; Eligibility Criteria			89
SECTION 2.18.		Increase in Commitments			7590
ARTICLE					III
-CONDITIONS TO EFFECTIVENESS AND OF LENDING					91
SECTION 3.01.		Conditions Precedent to Amendment and Restatement of the Existing Credit Agreement			7792
SECTION 3.02.		Conditions Precedent to Each Borrowing and Issuance			7893
SECTION 3.03.		Determinations Under Section 3.01			7994
ARTICLE					IV
-REPRESENTATIONS AND WARRANTIES					94
SECTION 4.01.		Representations and Warranties			7994

 

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ARTICLE					V
-COVENANTS OF THE LOAN PARTIES					101
SECTION 5.01.		Affirmative Covenants			85101
SECTION 5.02.		Negative Covenants			91109
SECTION 5.03.		Reporting Requirements			101122
SECTION 5.04.		Holding Company Status of Parent			106129
SECTION 5.05.		Financial Covenant			106129
ARTICLE					VI
-EVENTS OF DEFAULT					130
SECTION 6.01.		Events of Default			107130
SECTION 6.02.		Actions in Respect of the Letters of Credit upon Default			110133
ARTICLE					VII
-THE AGENTS					134
SECTION 7.01.		Authorization and Action			110134
SECTION 7.02.		Agents’ Reliance, Etc.			111135
SECTION 7.03.		WFB and Affiliates			113136
SECTION 7.04.		Lender Party Credit Decision			113137
SECTION 7.05.		Indemnification			113137
SECTION 7.06.		Successor Agents			114138
SECTION 7.07.		Reserved			115138
SECTION 7.08.		Collateral and Guaranty Matters			115138
SECTION 7.09.		Notice of Transfer			115139
SECTION 7.10.		Reports and Financial Statements			116139
SECTION 7.11.		Agency for Perfection			116140
SECTION 7.12.		Providers			117140
ARTICLE					VIII
-GUARANTY					141
SECTION 8.01.		Guaranty; Limitation of Liability			117141
SECTION 8.02.		Guaranty Absolute			118142
SECTION 8.03.		Waivers and Acknowledgments			119143
SECTION 8.04.		Subrogation			120144
SECTION 8.05.		Guaranty Supplements			121145
SECTION 8.06.		Subordination			121145
SECTION 8.07.		Continuing Guaranty; Assignments			122146
ARTICLE					IX
-MISCELLANEOUS					146
SECTION 9.01.		Amendments, Etc.			122146
SECTION 9.02.		Notices, Etc.			123148
SECTION 9.03.		No Waiver; Remedies			125149
SECTION 9.04.		Costs and Expenses			125149
SECTION 9.05.		Right of Set-off			127151
SECTION 9.06.		Binding Effect			127151

 

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`SECTION 9.07.		Assignments and Participations			127152
SECTION 9.08.		Execution in Counterparts 131; Integration			155
SECTION 9.09.		No Liability of the Issuing Bank			131156
SECTION 9.10.		Confidentiality			131156
SECTION 9.11.		Release of Collateral			132157
SECTION 9.12.		Replacement of Holdout Lender			132157
SECTION 9.13.		Patriot Act Notice, Etc.			133158
SECTION 9.14.		Jurisdiction, Etc.			133158
SECTION 9.15.		Governing Law			134158
SECTION 9.16.		Waiver of Jury Trial			134158
SECTION 9.17.		Release			134159
SECTION 9.18.		Keepwell			134159
SECTION 9.19.		No Novation			135159
SECTION 9.20.		Acknowledgment and Consent to Bail-In of EEAAffected Financial Institutions			135160
SECTION 9.21.		Acknowledgment Regarding Any Supported QFCs			160
SECTION 9.22.		Severability			161
SECTION 9.23.		Intercreditor Agreements			161

 

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SCHEDULES TO THE CREDIT AGREEMENT

 

Schedule I		-		Commitments and Applicable Lending Offices
Schedule II		-		Subsidiary Guarantors
Schedule III		-		Existing Letters of Credit
Schedule IV		-		Fiscal Months; Fiscal Quarters
Schedule 4.01(b)		-		Loan Parties
Schedule 4.01(c)		-		Subsidiaries and Other Equity Investments
Schedule 4.01(e)		-		Governmental Authorizations
Schedule 4.01(g)		-		Litigation
Schedule 4.01(q)		-		Certain Employee Benefits Plans
Schedule 4.01(s)		-		Tax Returns
Schedule 4.01(tu)		-		Intellectual Property Disclosures
Schedule 5.02(a)		-		Existing Liens
Schedule 5.02(b)		-		Existing Debt
Schedule 5.02(f)		-		Investments
Schedule 5.02(h)		-		Limited Liability Company Agreements
Schedule 5.02(l)		-		Negative Pledge
Schedule 5.03(m)		-		Collateral Reporting

EXHIBITS

 

Exhibit A		-		Form of Revolving Credit Note
Exhibit B		-		Form of Notice of Borrowing
Exhibit C		-		Form of Assignment and Assumption
Exhibit D		-		Form of Guaranty Supplement
Exhibit E		-		Form of Solvency Certificate
Exhibit F		-		Form of Borrowing Base Certificate

 

iv

SECOND AMENDED AND RESTATED ASSET-BASED LOAN CREDIT AGREEMENT

SECOND AMENDED AND RESTATED ASSET-BASED LOAN CREDIT AGREEMENT dated as of May 20, 2015, as amended on May 24, 2019 (and January 13, 2021 (as amended, amended and restated, restated, supplemented, modified or otherwise in effect from time to time, this “Agreement”), among EXPRESS, INC., a Delaware corporation (“Holdings”), EXPRESS TOPCO LLC, a Delaware limited liability company (“Intermediate Holdings”), EXPRESS HOLDING, LLC, a Delaware limited liability company (the “Parent”), EXPRESS, LLC, a Delaware limited liability company (the “Borrower”), the Subsidiary Guarantorsother Loan Parties (as hereinafter defined), the Lenders (as hereinafter defined), the Issuing Bank (as hereinafter defined), the Swing Line Bank (as hereinafter defined), WELLS FARGO BANK, NATIONAL ASSOCIATION, as collateral agent (together with any successor collateral agent appointed pursuant to Article VII, the “Collateral Agent”) for the Secured Parties (as hereinafter defined) and as administrative agent (together with any successor administrative agent appointed pursuant to Article VII, the “Administrative Agent” and, together with the Collateral Agent, the “Agents”) for the Lender Parties (as hereinafter defined), Bank of America, N.A., as documentation agent (the “Documentation Agent”), and U.S. Bank National Association, as syndication agent (the “Syndication Agent”).

PRELIMINARY STATEMENTS:

(1) The Parent, the Borrower, the lenders party thereto (the “Existing Lenders”), and the Agents are parties to the Amended and Restated Credit Agreement, dated as of July 29, 2011 (as heretofore amended or otherwise modified, the “Existing Credit Agreement”), pursuant to which the Existing Lenders extended credit to the Borrower consisting of a revolving credit facility, with subfacilities for the issuance of letters of credit and swing line loans; and

(2) The Borrower has requested that the Agents, the Lenders and the Lender Parties (as hereinafter defined) amend and restate the Existing Agreement in accordance with the terms of this Agreement.

(3) The proceeds of the Revolving Credit Facility (as hereinafter defined) are to be used from time to time to pay fees and expenses pursuant to this Agreement and the other Loan Documents (as hereinafter defined), for working capital, and for other general corporate purposes (including Capital Expenditures and Permitted Acquisitions) of the Parent and its Subsidiaries.

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements contained herein, the parties hereto hereby agree to amend and restate the Existing Credit Agreement as follows:

ARTICLE I—Article I

DEFINITIONS AND ACCOUNTING TERMS

SECTION  1.01. SECTION 1.01. Certain Defined Terms. As used in this Agreement (including in the preamble and the preliminary statements hereto), the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):

“2020 Tax Refund Claim” means the “2020 Tax Refund Claim” as such term is defined in the Term Credit Agreement.

 

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“2020 Tax Refund Proceeds” means the cash proceeds actually received by the Loan Parties in respect of the 2020 Tax Refund Claim.

“ABL Intercreditor Agreement” means (a) that certain Intercreditor Agreement dated as of the Second Amendment Effective Date by and among the Agents and the Term Agents, and acknowledged and agreed to by the Loan Parties, as amended, modified, restated or replaced from time to time in accordance with the terms thereof, or (b) any other intercreditor agreement reasonably acceptable to the Agents among the Agents and any administrative agent and collateral agent or trustee with respect to the Term Credit Agreement or any Permitted Refinancing Debt thereof, as it may be amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms hereof and thereof.

“ABL Priority Collateral” shall have the meaning provided to such term in the ABL Intercreditor Agreement.

“Account(s)” means “accounts” as defined in the UCC and also means a right to payment of a monetary obligation, whether or not earned by performance, (a) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, or (b) for services rendered or to be rendered. The term “Account” does not include (a) rights to payment evidenced by chattel paper or an instrument, (b) commercial tort claims, (c) deposit accounts, (d) investment property, or (e) letter-of-credit rights or letters of credit.

“Account Debtor” means the Person obligated on an Account.

“Additional Revolving Credit Commitments Effective Date” has the meaning specified in Section 2.18(b).

“Additional Guarantor” has the meaning specified in Section 8.05.

“Additional Revolving Credit Advances” means any loans made in respect of any Additional Revolving Credit Commitments that shall have been added pursuant to Section 2.18.

“Additional Revolving Credit Commitment Amendment” has the meaning specified in Section 2.18(b).

“Additional Revolving Credit Commitments” means the commitments of the Additional Revolving Credit Lenders to make Additional Revolving Credit Advances pursuant to Section 2.18.

“Additional Revolving Credit Lenders” means the lenders providing the Additional Revolving Credit Advances.

“Adjusted Payment Conditions” means, at the time of determination with respect to any transaction or payment to which the Adjusted Payment Conditions apply, that:

(a) the date of consummation of such transaction or payment is after the End Date,

(b) no Event of Default shall have occurred and be continuing at such time or would immediately result therefrom,

 

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(c) Excess Availability shall be, on the date of such transaction or payment, and for the one (1) month period immediately preceding such transaction or payment, not less than twenty percent (20%) of the Borrowing Base (calculated without giving effect to the Term Pushdown Reserve) (in each case calculated on a pro forma basis after giving effect to such transaction or payment), and

(d) at least five (5) days prior to the consummation of such transaction or the making of such payment, the Borrower shall have provided to the Administrative Agent a certificate signed by a Responsible Officer of the Borrower, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to and attaching evidence (including, without limitation, financial statements for the applicable period to the extent necessary to demonstrate calculation of the Adjusted Payment Conditions, whether or not otherwise required to be delivered pursuant to Section 5.03; provided, however, that in the event such certificate is being delivered concurrently with the financial statements most recently required to be delivered pursuant to Section 5.03 and such financial statements cover the applicable period for which Adjusted Payment Conditions are required to be satisfied, the delivery of such financial statements pursuant to Section 5.03 shall satisfy the requirement to deliver financial statements pursuant to this clause (d)) of satisfaction of the conditions contained in clauses (b) and (c) above on a basis (including, without limitation, giving due consideration to results for prior periods) reasonably satisfactory to the Administrative Agent.

“Adjustment Date” means the first day of each Fiscal Quarter, commencing February 1, 2021.

“Administrative Agent” has the meaning specified in the recital of partiespreamble to this Agreement.

“Administrative Agent’s Account” means the account of the Administrative Agent specified by the Administrative Agent in writing to the Lender Parties from time to time.

“Advance” means a Revolving Credit Advance, a Swing Line Advance, a Letter of Credit Advance, a Protective Advance or an Additional Revolving Credit Advance.

“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.

“Affiliate” means, as to any Person, any other Person that, directly or indirectly, controls, is controlled by or is under common control with such Person. For purposes of this definition, the term “control” (including the terms “controlling,” “controlled by” and “under common control with”) of a Person means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person by contract or other agreement.

“Agents” has the meaning specified in the recital of partiespreamble to this Agreement.

“Aggregate Commitments” means the Commitments of all of the Lenders.

“Agreement” has the meaning specified in the preamble hereto.

“Agreement Value” means, for each Hedge Agreement, on any date of determination, after taking into account the effect of any legally enforceable netting agreement relating to such Hedge Agreement, (a) for any date on or after the date such Hedge Agreement has been closed out and termination value determined in accordance therewith, such termination value, and (b) for any date prior to the date

 

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referenced in clause (a), the amount determined as the mark-to-market value for such Hedge Agreement, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreement (which may include a Lender or any Affiliate of a Lender).

“Anti-Corruption Laws” means the FCPA, the U.K. Bribery Act of 2010, as amended, and all other applicable laws and regulations or ordinances concerning or relating to bribery or corruption in any jurisdiction in which any Loan Party or any of its Subsidiaries or Affiliates is located or is doing business.

“Anti-Money Laundering Laws” means the applicable laws or regulations in any jurisdiction in which any Loan Party or any of its Subsidiaries or Affiliates is located or is doing business that relates to money laundering, any predicate crime to money laundering, or any financial record keeping and reporting requirements related thereto.

“Applicable Lending Office” means, with respect to each Lender Party, such Lender Party’s Domestic Lending Office in the case of a Base Rate Advance and such Lender Party’s Eurodollar Lending Office in the case of a Eurodollar Rate Advance.

“Applicable Margin” means :

( a percentage per annum determined by reference to the amount of Excess Availability as set forth below:) From and after the Second Amendment Effective Date until the first Adjustment Date, the percentages set forth in Level II of the pricing grid below; and

 

ExcessAverage Daily Availability		Base Rate Advances				Eurodollar Rate Advances
Level I Greater than or equal to 50% of the Borrowing Base			0.25%				1.25%1.00	%			2.00	%
Level II Less than 50% of the Borrowing Base			0.50%				1.50%1.25	%			2.25	%

The

(b) From and after the first Adjustment Date and on each Adjustment Date thereafter, the Applicable Margin for each Base Rate Advance shall be determined by reference tofrom the average monthly amount of Excessforegoing pricing grid based upon Average Daily Availability calculated by reference tofor the most recent Borrowing Base Certificate delivered toFiscal Quarter ended immediately preceding such Adjustment Date; provided, however, that notwithstanding anything to the contrary set forth herein, upon the occurrence of an Event of Default, the Administrative Agent may, and at the direction of the Required Lenders shall, immediately increase the Applicable Margin to that set forth in Level II (even if the Average Daily Availability requirements for a different Level have been met) and interest shall accrue at

 

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the Default Rate (it being understood and agreed that if interest is accruing at the Default Rate pursuant to Section 5.032.07(mb) and, then the Applicable Margin for each Eurodollar Rate Advance shall be determined by reference to the average monthly amount of Excess Availability calculated by reference to the most recent Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 5.03(m) prior to the first day of each Interest Period for such Advance; provided, however, that so increased and interest shall so accrue pursuant to this proviso without further action required by any Person); provided further that (i) if any Borrowing Base Certificates or Term Loan Borrowing Base Certificates are at any time restated or otherwise revised (including as a result of an audit) or if the information set forth in any Borrowing Base Certificates or Term Loan Borrowing Base Certificates otherwise proves to be false or incorrect such that the Applicable Margin would have been higher than was otherwise in effect during any period, without constituting a waiver of any Default arising as a result thereof, interest due under this Agreement shall be immediately recalculated at such higher rate for any applicable periods and shall be due and payable on demand, and (ii) the Applicable Margin shall be at Level II for so long as the Borrower has not submitted to the Administrative Agent the Borrowing Base CertificateCertificates and Term Loan Borrowing Base Certificates at the times required to be delivered hereunder, without constituting a waiver of any Default arising as a result thereof.

“Appraised Value” means “Appraised Value” as such term is defined in the Term Credit Agreement.

“Appropriate Lender” means, at any time, with respect to (a) the Revolving Credit Facility, a Lender that has a Commitment at such time, (b) the Letter of Credit Facility, (i) the Issuing Bank and (ii) if the other Revolving Credit Lenders have made Letter of Credit Advances pursuant to Section 2.03(d) that are outstanding at such time, each such other Revolving Credit Lender and (c) the Swing Line Facility, (i) the Swing Line Bank and (ii) if the other Revolving Credit Lenders have made Swing Line Advances pursuant to Section 2.02(b) that are outstanding at such time, each such other Revolving Credit Lender.

“Approved Fund” means any Fund that is administered or managed by (i) a Lender Party, (ii) an Affiliate of a Lender Party or (iii) an entity or an Affiliate of an entity that administers or manages a Lender Party.

“ArrangerArrangers” means, collectively, WFB, and Bank of America, N.A., each in its capacity as solea joint lead arranger and sole book managera joint bookrunner.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender Party and an Eligible Assignee (with the consent of any party whose consent is required by Section 9.07 or by the definition of “Eligible Assignee”), and accepted by the Administrative Agent, in accordance with Section 9.07 and in substantially the form of Exhibit C hereto or any other form approved by the Administrative Agent and the Borrower.

“Audited Financial Statements” means the audited Consolidated balance sheet of Parent and its Subsidiaries for the Fiscal Year ended February 1, 2020, and the related Consolidated statements of income or operations and cash flows for such Fiscal Year of the Parent and its Subsidiaries, including the notes thereto.

“Auto-Extension Letter of Credit” shall have the meaning specified in Section 2.03(b)(iii).

“Available Amount” of any Letter of Credit means, at any time, the maximum amount for which such Letter of Credit may be honored (assuming compliance at such time with all conditions to drawing).

 

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“Average Daily Availability” means, for any Fiscal Quarter, an amount equal to the sum of Excess Availability for each day of such Fiscal Quarter divided by the actual number of days in such Fiscal Quarter, as determined by the Administrative Agent, which determination shall be conclusive absent manifest error.

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEAAffected Financial Institution.

“Bail-In Legislation” means, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation, rule or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).

“Bank Products” means any services or facilities provided to any Loan Party by any Lender or any of its Affiliates (but excluding Cash Management Services) including, without limitation, on account of (a) Swap ContractsHedge Agreements, (b) merchant services constituting a line of credit, (c) leasing, (d) Factored Receivables, and (e) supply chain finance services including, without limitation, trade payable services and supplier accounts receivable purchases.

“Bank Product Reserves” means such reserves as the Agents from time to time determines in their Permitted Discretion as being appropriate to reflect the liabilities and obligations of the Loan Parties with respect to Bank Products then provided or outstanding.

“Bankruptcy Law” means, collectively, Title 11, U.S. Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or any similar foreign, federal or state law for thedebtor relief laws of debtorsthe United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

“Base Rate” means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to the highest of:

(a) (a) the rate of interest in effect for such day as publicly announced from time to time by WFB as its “prime rate”, with the understanding that the “prime rate” is a rate set by WFB based upon various factors including WFB’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate (if any such announced rate is below zero, then the rate determined pursuant to this clause (a) shall be deemed to be zero). Any change in such rate announced by WFB shall take effect at the opening of business on the day specified in the public announcement of such change;

(b) (b) ¹⁄₂ of 1% per annum above the Federal Funds Rate; and

(c) (c) 1% above the Eurodollar Rate (based on an interest period of one month).

“Base Rate Advance” means an Advance that bears interest as provided in Section 2.07(a)(i).

 

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“Basel III” means the set of reform measures designed to improve the regulation, supervision and risk management within the banking sector, as developed by the Basel Committee on Banking Supervision.

“Benchmark Replacement” means the sum of: (a) the alternate benchmark rate (which may include Term SOFR) that has been selected by the Administrative Agent and the Borrower giving due consideration to (i) any selection or recommendation of a replacement rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a rate of interest as a replacement to the LIBO Rate for Dollar-denominated syndicated credit facilities and (b) the Benchmark Replacement Adjustment; provided that, if the Benchmark Replacement as so determined would be less than 0.50%, the Benchmark Replacement shall be deemed to be 0.50% for purposes of this Agreement.

“Benchmark Replacement Adjustment” means, with respect to any replacement of the LIBO Rate with an Unadjusted Benchmark Replacement for each applicable Interest Period, the spread adjustment, or method for calculating or determining such spread adjustment (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Borrower giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the LIBO Rate with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the LIBO Rate with the applicable Unadjusted Benchmark Replacement for Dollar-denominated, syndicated credit facilities at such time.

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Base Rate”, the definition of “Interest Period”, timing and frequency of determining rates and making payments of interest and other administrative matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if Administrative Agent determines that no market practice for the administration of the Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement).

“Benchmark Replacement Date” means the earlier to occur of the following events with respect to the LIBO Rate:

(a) in the case of clause (a) or (b) of the definition of “Benchmark Transition Event,” the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of the LIBO Rate permanently or indefinitely ceases to provide the LIBO Rate; or

(b) in the case of clause (c) of the definition of “Benchmark Transition Event,” the date of the public statement or publication of information referenced therein.

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the LIBO Rate:

 

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(a) a public statement or publication of information by or on behalf of the administrator of the LIBO Rate announcing that such administrator has ceased or will cease to provide the LIBO Rate, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the LIBO Rate;

(b) a public statement or publication of information by the regulatory supervisor for the administrator of the LIBO Rate, the Federal Reserve System of the United States (or any successor), an insolvency official with jurisdiction over the administrator for the LIBO Rate, a resolution authority with jurisdiction over the administrator for the LIBO Rate or a court or an entity with similar insolvency or resolution authority over the administrator for the LIBO Rate, which states that the administrator of the LIBO Rate has ceased or will cease to provide the LIBO Rate permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the LIBO Rate; or

(c) a public statement or publication of information by the regulatory supervisor for the administrator of the LIBO Rate announcing that the LIBO Rate is no longer representative.

“Benchmark Transition Start Date” means (a) in the case of a Benchmark Transition Event, the earlier of (i) the applicable Benchmark Replacement Date and (ii) if such Benchmark Transition Event is a public statement or publication of information of a prospective event, the ninetieth (90^th) day prior to the expected date of such event as of such public statement or publication of information (or if the expected date of such prospective event is fewer than ninety (90) days after such statement or publication, the date of such statement or publication) and (b) in the case of an Early Opt-in Election, the date specified by the Administrative Agent or the Required Lenders, as applicable, by notice to Borrower, the Administrative Agent (in the case of such notice by the Required Lenders) and the Lenders.

“Benchmark Unavailability Period” means, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to the LIBO Rate and solely to the extent that the LIBO Rate has not been replaced with a Benchmark Replacement, the period (x) beginning at the time that such Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the LIBO Rate for all purposes hereunder in accordance with Section 2.10(g) and (y) ending at the time that a Benchmark Replacement has replaced the LIBO Rate for all purposes hereunder pursuant to Section 2.10(g).

“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“BHC Act Affiliate” of a Person means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such Person.

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

“Borrower” has the meaning specified in the recital of partiespreamble to this Agreement.

“Borrower’s Account” means the account of the Borrower specified by the Borrower in writing to the Administrative Agent from time to time.

“Borrowing” means a Revolving Credit Borrowing or a Swing Line Borrowing.

 

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“Borrowing Base” means, at any time, the sum of

(a) the product of the Inventory Advance Rate at such time and the Net Orderly Liquidation Value of the Eligible Inventory of the Loan Parties at such time, plus

(b) the product of the Credit Card Advance Rate at such time and the face amount of Eligible Credit Card Receivables of the Loan Parties at such time, plus

(c) 100% of Borrowing Base Eligible Cash Collateral, minus

(d) the sum of (x) the Term Pushdown Reserve, and (y) the aggregate amount of all Reserves at such time.

“Borrowing Base Certificate” means a certificate of the Borrower on behalf of the Loan Parties, signed by a Responsible Officer of the Borrower, in the form of Exhibit F (or another form which is mutually acceptable to the Collateral Agent and the Borrower).

“Borrowing Base Eligible Cash Collateral” means Eligible Cash Collateral that is maintained in an account at WFB or its affiliates in an amount at any time not in excess of 30% of the Borrowing Base.

“Borrowing Base Eligible Cash Collateral” means only such unrestricted cash and Cash Equivalents (a) that are maintained in a deposit or investment account with WFB or an affiliate thereof specifically and solely used for purposes of holding such cash or Cash Equivalents, which account is subject to a first priority perfected security interest in favor of the Collateral Agent, for the benefit of the Secured Parties (subject to Permitted Liens that do not have priority over the Lien of the Collateral Agent (other than inchoate or other Liens arising by operation of law and Liens described in clause (x) of the definition of “Permitted Liens”)), and (b) for which the Collateral Agent shall have received evidence, in form and substance reasonably satisfactory to Collateral Agent, of the amount of such cash or Cash Equivalents held in such deposit or investment account as of the applicable date of the calculation of Availability by the Collateral Agent; provided that unless the Collateral Agent and the Supermajority Lenders otherwise agree in writing, the amount available for inclusion in the Borrowing Base based on Borrowing Base Eligible Cash Collateral shall be $0.

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the laws of, or are in fact closed in, the state where the Administrative Agent’s Officeoffice is located and, if such day relates to any Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank market.

“Capital Expenditures” means, for any Person for any period, without duplication, all expenditures made, directly or indirectly, by such Person or any of its Subsidiaries (or in the case of the Borrower or any Loan Party, solely its Restricted Subsidiaries) during such period for equipment, fixed assets, real property or improvements, or for replacements or substitutions therefor or additions thereto, that have been or should be, in accordance with GAAP, reflected as additions to property, plant or equipment on a Consolidated balance sheet of such Person. For purposes of this definition, “Capital Expenditures” shall not include expenditures (i) made to restore, replace, rebuild, develop, maintain, improve or upgrade property, to the extent such expenditure is made with, or subsequently reimbursed out of, insurance proceeds, indemnity payments, condemnation awards (or payments in lieu thereof) or damage recovery proceeds or other settlements relating to any damage, loss, destruction or condemnation of such property, (ii) constituting reinvestment of the net proceeds of any Transfer, to the extent permitted

 

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hereunder, (iii) made by the Parent or any of its Restricted Subsidiaries as payment of the consideration for Permitted Acquisitions or any other Permitted Investment, (iv) made by Parent or any of its Restricted Subsidiaries to effect leasehold improvements to any property leased by Parent or any of its Restricted Subsidiaries as lessee, to the extent that such expenses have been reimbursed in cash by the landlord, (v) actually paid for by a third party (excluding any Loan Party or any of its Restricted Subsidiaries) and for which no Loan Party or any of its Restricted Subsidiaries has provided or is required to provide or incur, directly or indirectly, any consideration or monetary obligation to such third party or any other person (whether before, during or after such period), or (vi) made with the cash proceeds from the sale or issuance of Qualified Capital Stock of Parent (or any direct or indirect holding company of Parent).

“Capitalized Leases” means all leases that have been or should be, in accordance with GAAP, recorded as capitalized leases.

“Cash Collateralize” has the meaning specified in Section 2.03(k).

“Cash Collateralize” means (i) with respect to L/C Obligations, to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Issuing Bank and the Lenders, as collateral for the L/C Obligations, cash or deposit account balances in an amount equal to 103% of the Outstanding Amount of all L/C Obligations (other than L/C Obligations with respect to Letters of Credit denominated in a currency other than Dollars, which L/C Obligations shall be Cash Collateralized in an amount equal to 107% of the Outstanding Amount of such L/C Obligations), pursuant to documentation in form and substance satisfactory to the Administrative Agent in its Permitted Discretion and the Issuing Bank (which documents are hereby Consented to by the Lenders), and (ii) with respect to Obligations on account of Bank Products, to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the applicable Providers, as collateral for such Obligations, cash or deposit account balances in an amount determined by the Administrative Agent as sufficient to satisfy the reasonably estimated credit exposure, operational risk or processing risk with respect to such Obligations then existing, pursuant to documentation in form and substance satisfactory to the Administrative Agent in its Permitted Discretion (which documents are hereby Consented to by the Lenders). The term “Cash Collateral” shall have a correlative meaning.

“Cash Equivalents” means any of the following, to the extent owned by the Parent or any of its Restricted Subsidiaries free and clear of all Liens other than Permitted Liens and Liens created under the Collateral Documents and, in each case, having a maturity of not greater than one year from the date of issuance thereof: (a) readily marketable direct obligations of the Government of the United States or any agency or instrumentality thereof or obligations unconditionally guaranteed by the full faith and credit of the Government of the United States, (b) readily marketable direct obligations of any member of the European Economic Area, Switzerland or Japan, or any agency or instrumentality thereof or obligations unconditionally guaranteed by the full faith and credit of such country, and, at the time of acquisition thereof having a credit rating of at least AA- (or the equivalent grade) by Moody’s or Aa3 by S&P, (c) marketable general obligations issued by any state of the United States or any political subdivision thereof or any or any instrumentality thereof that is guaranteed by the full faith and credit of such state and, at the time of acquisition thereof having a credit rating of at least AA- (or the equivalent grade) by Moody’s or Aa3 by S&P, (d) insured certificates of deposit, time deposits, eurodollar time deposits or overnight time deposits with any commercial bank that is organized under the laws of the United States or any State thereof, any member of the European Economic Area, Switzerland or Japan and has combined capital and surplus of at least $500 million, (e) commercial paper issued by any Lender or any corporation organized under the laws of any State of the United States and rated at least “Prime-1” (or the then equivalent grade) by Moody’s or “A-1” (or the then equivalent grade) by S&P, (f) repurchase agreements and reverse repurchase agreements with a duration of not more than 30 days for underlying securities of the types set forth in clauses (a) through (e) entered into with any financial institution meeting the specifications in

 

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clause (d) above, (g) auction rate securities or (h) Investments in money market funds, of which at least 95% of the portfolios are limited solely to Investments of the character, quality and maturity described in clauses (a) through (f) of this definition. With respect to any Foreign Subsidiary, “Cash Equivalents” shall also include any Investment substantially comparable to the foregoing but in the currency of the jurisdiction of organization of such Subsidiary, Euros or U.S. Dollars.

“Cash Management Bank” means any Person that is a Lender or an Affiliate of a Lender and that enters into a Secured Cash Management Agreement.

“Cash Management Reserves” means the amount of reserves as the Administrative Agent determines in its Permitted Discretion as being appropriate to reflect the reasonably anticipated credit exposure of the Loan Parties with respect to Cash Management Services then provided or outstanding; provided that, in order to qualify as Cash Management Reserves, the method of calculation of such reserves must be established on or substantially contemporaneously on the date that any Lender or any of its respective Affiliates provides the applicable Cash Management Service or promptly after any amendment to the terms and conditions of such Cash Management Service.

“Cash Management Services” means any cash management services or facilities, if any, provided to the Borrower and its Restricted Subsidiaries by any Lender or any of its respective Affiliates, including, without limitation: (a) ACH transactions, (b) controlled disbursement services, treasury, depository, overdraft, and electronic funds transfer services, (c) credit or debit cards, (d) credit card processing services, and (e) purchase cards.

“CERCLA” means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended from time to time.

“CERCLIS” means the Comprehensive Environmental Response, Compensation and Liability Information System maintained by the U.S. Environmental Protection Agency.

“CFC” shall mean (i) a Subsidiary that is a controlled foreign corporation within the meaning of Section 957 of the Internal Revenue Code or (ii) a Subsidiary that has no material assets other than the Equity Interests or debt of one or more Subsidiaries that are CFCs.

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

“Change of Control” means the occurrence of any of the following: (a) any Person or two or more Persons acting in concert shall have acquired beneficial ownership (within the meaning of Rule 13(d)-3 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended), directly or indirectly, of Voting Interests (or other securities convertible into such Voting Interests) representing 50% or more of the combined voting power of all Voting Interests of the Parent; or (b) during any period of up to 12 consecutive months, Continuing Directors shall cease for any reason to

 

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constitute a majority of the board of directors of the Parent; (c) any “change of control” or similar event as defined in the Term Credit Agreement; (d) the Parent fails at any time to own 100% of the Equity Interests of the Borrower free and clear of all Liens (other than the Liens in favor of the Collateral Agent and Liens in favor of the Term Collateral Agent permitted pursuant to clause (z) of the definition of “Permitted Liens”); or (e) the Parent fails at any time to own, directly or indirectly, 100% of the Equity Interests of each other Loan Party (other than the Borrower) free and clear of all Liens (other than the Liens in favor of the Collateral Agent and Liens in favor of the Term Collateral Agent permitted pursuant to clause (z) of the definition of “Permitted Liens”), except where such failure is as a result of a transaction permitted by the Loan Documents. As used in this definition of “Change of Control”, Parent shall be deemed to be a reference to Parent, or any direct or indirect holding company of Parent.

“Collateral” means all “Collateral” referred to in the Collateral Documents and all other property that is or is intended to be subject to any Lien in favor of the Collateral Agent for the benefit of the Secured Parties.

“Collateral Access Agreement” means an agreement reasonably satisfactory in form and substance to the AdministrativeCollateral Agent executed by (a) a bailee or other Person in possession of Collateral, and/or (b) any landlord of real property leased by any Loan Party, pursuant to which such Person (i) acknowledges the Collateral Agent’s Lien on the Collateral, (ii) releases or subordinates such Person’s Liens in the Collateral held by such Person or located on such real property, (iii) provides the Collateral Agent with access to the Collateral held by such bailee or other Person or located in or on such real property, (iv) as to any landlord, provides the Collateral Agent with a reasonable time to sell and dispose of the Collateral from such real property, and (v) makes such other agreements with the Collateral Agent as the Collateral Agent may reasonably require.

“Collateral Account” has the meaning specified in the Security Agreement.

“Collateral Agent” has the meaning specified in the recital of partiespreamble to this Agreement.

“Collateral Documents” means the Security Agreement, each Intellectual Property Security Agreement, each of the collateral documents, instruments and agreements delivered pursuant to Section 5.01(j) under this Agreement and Section 5.01(j) of the Existing Credit Agreement, and each other agreement that creates or purports to create a Lien in favor of the Collateral Agent for the benefit of the Secured Parties.

“Combined Total Outstandings” means, as of any date of determination, the sum of (a) the Used Commitments, plus (b) the Facilities under and as defined in the Term Credit Agreement.

“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 a Loan Party in the ordinary course of business of such Loan Party.

“Commercial Letter of Credit Agreement” means the Commercial Letter of Credit Agreement relating to the issuance of a Commercial Letter of Credit in the form from time to time in use by the Issuing Bank.

“Commitment” means, with respect to any Revolving Credit Lender at any time, the commitment of such Revolving Credit Lender to make Advances to the BorrowersBorrower in the amount set forth opposite such Lender’s name on Schedule I hereto under the caption “Commitment” or, if such Lender has entered into one or more Assignment and Assumptions, set forth for such Lender in the Register maintained by the Administrative Agent pursuant to Section 9.07(d) as such Lender’s “Commitment,” as

 

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such amount may be reduced at or prior to such time pursuant to Section 2.05 or increased at or prior to such time pursuant to Section 2.18.

“Commitment Fee Percentage” means the percentages determined from the following grid based upon the Average Daily Availability for the Fiscal Quarter most recently ended:

(a) From and after the Second Amendment Effective Date until the first Adjustment Date, the percentages set forth in Level I of the pricing grid below; and

 

Average Daily Availability		Commitment Fee Percentage
Level I Greater than or equal to 50% of the Borrowing Base			0.375	%
Level II Less than 50% of the Borrowing Base			0.20	%

(b) From and after the first Adjustment Date and on each Adjustment Date thereafter, the Commitment Fee Percentage shall be determined from the foregoing pricing grid based upon Average Daily Availability for the most recent Fiscal Quarter ended immediately preceding such Adjustment Date; provided, however, that notwithstanding anything to the contrary set forth herein, upon the occurrence of an Event of Default, the Administrative Agent may, and at the direction of the Required Lenders shall, immediately increase the Commitment Fee Percentage to that set forth in Level I (even if the Average Daily Availability requirements for a different Level have been met) and the commitment fees shall accrue at the Default Rate (it being understood and agreed that if interest is accruing at the Default Rate pursuant to Section 2.07(b), then the Commitment Fee Percentage shall be so increased and the commitment fees shall so accrue pursuant to this proviso without further action required by any Person); provided further that (i) if any Borrowing Base Certificates or Term Loan Borrowing Base Certificates are at any time restated or otherwise revised (including as a result of an audit) or if the information set forth in any Borrowing Base Certificates or Term Loan Borrowing Base Certificates otherwise proves to be false or incorrect such that the Commitment Fee Percentage would have been higher than was otherwise in effect during any period, without constituting a waiver of any Default arising as a result thereof, interest due under this Agreement shall be immediately recalculated at such higher rate for any applicable periods and shall be due and payable on demand, and (ii) the Commitment Fee Percentage shall be at Level I for so long as the Borrower has not submitted to the Administrative Agent the Borrowing Base Certificates and Term Loan Borrowing Base Certificates at the times required to be delivered hereunder, without constituting a waiver of any Default arising as a result thereof.

“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.

 

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“Confidential Information” means information that any Loan Party or its Subsidiaries furnishes to any Agent or any Lender Party, but does not include any such information that is or becomes generally available to the public other than as a result of a breach by such Agent or any Lender Party of its obligations hereunder or that is or becomes available to such Agent or such Lender Party from a source other than the Loan Parties who is not subject to any legally binding obligation to any Loan Party or its Subsidiaries to keep such information confidential.

“Consolidated” refers to the consolidation of the accounts, financial condition or operating results of a Person and its Subsidiaries in accordance with GAAP; provided that for purposes of this Agreement and the other Loan Documents, when used with respect to the Loan Parties, the term “Consolidated” shall not include the accounts, financial condition or operating results of any Foreign Subsidiaries or Unrestricted Subsidiaries.

“Continuing Directors” means in the case of the Parent and, with respect to any period, the directors of the Parent on the first day of such period and each other director if, in each case, such other director’s nomination for election to the board of directors of the Parent is recommended by at least a majority of the then Continuing Directors.

“Conversion,” “Convert” and “Converted” each refer to a conversion of Advances of one Type into Advances of the other Type pursuant to Section 2.09 or 2.10.

“Covered Entity” means any of the following:

(a) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);

(b) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or

(c) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

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

“Credit Card Advance Rate” means 90%.

“Credit Card Issuer” shall mean any person (other than a Borrower or other Loan Party) who issues or whose members issue credit cards, including, without limitation, MasterCard or VISA bank credit or debit cards or other bank credit or debit cards issued through MasterCard International, Inc., Visa, U.S.A., Inc. or Visa International and American Express, Discover, Diners Club, Carte Blanche and other non-bank credit or debit cards, including, without limitation, private label cards, credit or debit cards issued by or through American Express Travel Related Services Company, Inc., Novus Services, Inc. and other issuers approved by the Agent in its Permitted Discretion.

“Credit Card Processor” shall mean any servicing or processing agent or any factor or financial intermediary who facilitates, services, processes or manages the credit authorization, billing transfer and/or payment procedures with respect to any Borrower’s sales transactions involving credit card or debit card purchases by customers using credit cards or debit cards issued by any Credit Card Issuer.

“Credit Card Receivables” means each “payment intangible” (as defined in the UCC) together with all income, payments and proceeds thereof, owed by a Credit Card Issuer or Credit Card Processor to

 

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a Loan Party resulting from charges by a customer of a Loan Party on credit or debit cards issued by such Credit Card Issuer in connection with the sale of goods by a Loan Party, or services performed by a Loan Party, in each case in the ordinary course of its business.

“Customer Credit Liabilities” means, at any time, the aggregate remaining balance reflected on the books and records of the Loan Parties at such time of (a) outstanding gift certificates and gift cards of the Loan Parties entitling the holder thereof to use all or a portion of the gift certificate or gift card to pay all or a portion of the purchase price for any Inventory, and (b) outstanding merchandise credits and customer deposits of the Loan Parties.

“Customs Broker/Carrier Agreement” means an agreement in form and substance satisfactory to the Collateral Agent among a Loan Party, a third party logistics provider, customs broker, freight forwarder, consolidator or carrier, and the Collateral Agent, in which the third party logistics provider, 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 Collateral Agent and agrees, upon notice from the Collateral Agent, to hold and dispose of the subject Inventory solely as directed by the Collateral Agent.

“Debt” of any Person means, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all Obligations of such Person for the deferred purchase price of property or services (other than trade payables, deferred compensation and straight line rent and landlord allowance in each case incurred and then outstanding in the ordinary course of such Person’s business), (c) all Obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all Obligations of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person, (e) all Obligations of such Person as lessee under Capitalized Leases, (f) the maximum amount of all Obligations of such Person under acceptance, letter of credit or similar facilities, (g) all Obligations of such Person with respect to Disqualified Stock and Prohibited Preferred Stock, (h) net Obligations of such Person in respect of Hedge Agreements, valued at the Agreement Value thereof, (i) all Guaranteed Debt and Synthetic Debt of such Person and (j) all indebtedness and other payment Obligations referred to in clauses (a) through (i) above of another Person secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Lien on property (including, without limitation, accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such indebtedness or other payment Obligations; but limited in amount to the lesser of (i) the fair market value of such property or (ii) the amount of such indebtedness or other payment obligations.

Notwithstanding anything to the contrary contained herein, Debt shall not include (i) any amounts relating to preferred equity (other than Disqualified Stock and Prohibited Preferred Stock), employee consulting arrangements, accrued expenses, deferred rent (other than Capitalized Leases), deferred taxes, obligations under employment agreements, unredeemed gift card deferred revenue and deferred compensation, (ii) in connection with the existing letters of credit or any Permitted Acquisition or other acquisition otherwise permitted hereunder or consented to by the Lenders in writing or consummated prior to the First Amendment Effective Date, (A) reimbursement obligations in respect of such existing letters of credit or any letter of credit assumed in such Permitted Acquisition or other acquisition the payment of which is either fully (x) backed by a letter of credit or (y) cash collateralized, or (B) post-closing purchase price adjustments, earn-outs or similar obligations that are dependent upon the performance of the acquisition target after such closing to which the seller in such Permitted Acquisition or acquisition may become entitled, (iii) contingent obligations incurred in the ordinary course of business, (iv) non-recourse obligations under or in respect of securitization transactions, (v) customary payables with respect to money orders or wire transfers, and (vi) the obligations of any Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal

 

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property, or a combination thereof, which obligations would be required to be classified and accounted for as an operating lease under GAAP as existing on the Effective DateDecember 31, 2018 (whether or not such lease existsexisted on the Effective Date or hereafter arises) and (vii) Excluded LeasesDecember 31, 2018 or thereafter arose). Notwithstanding anything to the contrary, the financial ratios and related definitions set forth in the Loan Documents shall be computed (a) to exclude (i) the application of ASC 815 (Derivatives and Hedging), ASC 480 (Distinguishing Liabilities from Equity) or ASC 718 (Stock Compensation) (to the extent that the pronouncements in ASC 718 result in recording an equity award as a liability on the Consolidated balance sheet of the Parent and its Subsidiaries in the circumstance where, but for the application of the pronouncements, such award would have been classified as equity), (ii) any mark-to-market adjustments to any derivatives (including embedded derivatives contained in other debt or equity instruments under ASC 815), (iii) any non-cash compensation charges resulting from the application of ASC 718, and (iv) any change to lease accounting rules from those in effect pursuant to ASC 840842 (Leases) and other related lease accounting guidance as in effect on the First Amendment Effective Date, and (b) by disregarding the effects of FASB ASC 825 (Financial Instruments) and ASC 470-20 (Debt with Conversion and Other Options) on financial liabilities.

“Debt for Borrowed Money” of any Person means, at any date of determination, the sum of (a) the outstanding principal amount of all Debt of the type referred to in clauses (a), (c) and (e) of the definition of “Debt”, (b) all reimbursement Obligations at such date of such Person under acceptance, letter of credit or similar facilities at such date for amounts that have been drawn under such facilities and (c) all Synthetic Debt of such Person at such date; provided, however, for purposes of calculating Debt for Borrowed Money, the amount of the Revolving Credit Advances included therein shall be equal to the average daily outstanding balance of such Revolving Credit Advances during the twelve (12) month period ended on such date.

“Debtor Relief Laws” means any Bankruptcy Law, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, arrangement, receivership, insolvency, reorganization, 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 of Default or any event that would constitute an Event of Default but for the passage of time or the requirement that notice be given or both.

“Default Interest” has the meaning specified in Section 2.07(b)Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Margin, if any, applicable to Base Rate Advances, as applicable, plus (iii) 2% per annum; provided, however, that with respect to a Eurodollar Rate Advance, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Margin) otherwise applicable to such Eurodollar Rate Advance plus 2% per annum, and (b) when used with respect to Letter of Credit Fees with respect to any Letter of Credit, a rate equal to the rate otherwise then applicable for such Letter of Credit pursuant to Section 2.08(b), plus 2% per annum.

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

“Defaulting Lender” means, at any time, any Lender Party that (a) has failed to fund any amounts required to be funded by it under this Agreement within one (1) Business Day of the date that it is required to do so under this Agreement (including the failure to make available to the Administrative Agent amounts required pursuant to a settlement or to make a required payment in connection with a Letter of Credit Advance), (b) has notified the Borrower, the Administrative Agent, or any Lender Party in writing that it does not intend to comply with all or any portion of its funding obligations under this

 

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Agreement, (c) has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or under other agreements generally (as reasonably determined by the Administrative Agent) under which it has committed to extend credit, (d) has failed, within one (1) Business Day after written request by the Administrative Agent, to confirm that it will comply with the terms of the Agreement relating to its obligations to fund any amounts required to be funded by it under the Agreement, (e) otherwise failed to pay over to the Administrative Agent or any other Lender Party any other amount required to be paid by it under the Agreement within one (1) Business Day of the date that it is required to do so under the Agreement, or (f) has, or has a direct or indirect parent company that has, (i) taken any action or been the subject of any action or proceeding of a type described in Section 6.01(f), or (ii) become the subject of a Bail-in Action; provided, that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (f) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender upon delivery of written notice of such determination to the Borrower, the Issuing Bank, and each Lender.

“Defaulting Lender Rate” means (a) for the first three (3) days from and after the date the relevant payment is due, the Base Rate, and (b) thereafter, the interest rate then applicable to Committed Loans that are Base Rate Loans (inclusive of the Applicable Margin applicable thereto).

“Delayed Draw Term Loan” means the “Delayed Draw Term Loan” as such term is defined in the Term Credit Agreement.

“Discharge of Term Obligations” has the meaning set forth for such term in the ABL Intercreditor Agreement.

“Disqualified Stock” means any Equity Interest that, by its terms (or by the terms of any Equity Interests into which it is convertible, or for which it is exchangeable, in each case at the option of the holder thereof), matures or is Redeemable, in whole or in part, provides for scheduled payments, dividends or distributions in cash or is or becomes convertible into or exchangeable or exercisable for Debt or any other Equity Interests that would constitute Disqualified Stock, in each case on or prior to the date that is 91 days after the TerminationMaturity Date. The amount of Disqualified Stock deemed to be outstanding at any time for purposes of this Agreement shall be the maximum amount that the Loan Parties may become obligated to pay upon such maturity of, or pursuant to such Redeemable provisions in respect of, such Disqualified Stock.

“Dollars” and “$” mean lawful money of the United States of America.

“Domestic Lending Office” means, with respect to any Lender Party, the office of such Lender Party specified as its “Domestic Lending Office” opposite its name on Schedule I hereto or in the Assignment and Assumption pursuant to which it became a Lender Party, as the case may be, or such other office of such Lender Party as such Lender Party may from time to time specify to the Borrower and the Administrative Agent.

“Drawing Document” means any Letter of Credit or other document presented for purposes of drawing under any Letter of Credit.

 

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“Early Opt-in Election” means the occurrence of:

(a) (i) a determination by the Administrative Agent or (ii) a notification by the Required Lenders to the Administrative Agent (with a copy to the Borrower) that the Required Lenders have determined that Dollar-denominated syndicated credit facilities being executed at such time, or that include language similar to that contained in Section 2.10(g) are being executed or amended, as applicable, to incorporate or adopt a new benchmark interest rate to replace the LIBO Rate, and

(b) (i) the election by the Administrative Agent or (ii) the election by the Required Lenders to declare that an Early Opt-in Election has occurred and the provision, as applicable, by the Administrative Agent of written notice of such election to the Borrower and the Lenders or by the Required Lenders of written notice of such election to the Administrative Agent.

“Early Termination Fee” has the meaning set forth in the Second Amendment Fee Letter.

“EBITDA” means, for any period and with respect to Parent and its Restricted Subsidiaries, Consolidated Net Income of such Person for such period, plus

(a) without duplication and to the extent deducted in determining such Consolidated Net Income (except with respect to itemsitem (xiv) and (xxi), the sum of

(i) Consolidated interest expense, amortization or writeoff of debt discount and debt issuance costs and commissions, discounts and other fees and charges associated with Debt (including the Advances hereunder, the Term Loans, and any other Debt permitted under Section 5.02(b) hereof) of such Person for such period,

(ii) Consolidated income tax (and franchise tax in the nature of income tax) (including federal, state, local, franchise, excise and foreign income tax) expense and foreign withholding tax expense, in each case for such period, and any state single business unitary or similar tax of such Person for such period, including any penalties and interest relating to any tax examinations for such period, determined on a consolidated basis in accordance with GAAP,

(iii) depreciation and amortization expense (including amortization or impairment of intangibles (including goodwill) and organization costs) for such period (excluding amortization expense attributable to a prepaid cash item (except for deferred finance charges) that was paid in a prior period) of such Person for such period,

(iv) any other non-cash deductions, losses, charges or expenses made in determining Consolidated Net Income (but excluding any such non-cash charge in respect of an item that increased Consolidated Net Income in a prior period (to the extent of such increase)) of such Person for such period (including, without limitation, purchase accounting adjustments to revenue or expenses under ASC 805 or similar acquisition accounting under GAAP or similar provisions under GAAP); provided that if any Loan Party or any Restricted Subsidiary makes any cash payment in respect of any such non-cash deduction, loss, charge or expense, such cash payment shall be deducted from EBITDA in the period in which such payment is made,

(v) any extraordinary losses (determined on a Consolidated basis in accordance withas reconciled to GAAP) and unusual or non-recurring expenses or

 

18

charges, incurred in such period; provided that the aggregate amount of add-backs permitted pursuant to this clause (a)(v) and clause (a)(xvi) below shall not exceed at any time 15.0% of EBITDA,

(vi) any Transaction Expenses paid in such period,

(vii) fees, costs, charges and expenses incurred in connection with any consummated, anticipated, unsuccessful or attempted equity offering, issuance or repurchase, other equity issuance, Investment, acquisitions permitted under Section 5.02(f), Excluded Issuances, recapitalizations, Transfers or incurrence of Debt permitted under Article V hereunder or debt issuance (including a refinancing or replacing thereof, whether or not successful), Restricted Payment (including (y) cash stay bonuses paid to employees, severance and reorganization costs and expenses in connection with any Permitted Investment and other acquisitions or investments permitted hereunder and (z) fees, costs and expenses incurred in connection with the de-listing of a company as a public filer or public targets and compliance with public company requirements in connection with any Permitted Investment and other acquisitions or investments permitted hereunder), other disposition, consolidation, repayment of Indebtedness or recapitalization or the breakage of any hedging arrangement permitted hereunder or the incurrence of Debt permitted to be incurred hereunder (including a refinancing thereof) (in each case, whether or not successful), including such fees, expenses, costs or charges related to (i) the offering, syndication, assignment and administration of the loans under the Loan Documents and any other credit facilities (including, and together with, fees, expenses, costs or charges of any ratings agency) and (ii) any refinancing, extension, waiver, forbearance, amendment or other modification of the the Loan Documents and any other credit facilities or any other definitive documentation for any equity otherwise permitted hereunder (in each case, whether consummated, anticipated, unsuccessful, attempted or otherwise) (for the purposes of this definition, each a “Permitted Item”), [intentionally omitted],

(viii) [intentionally omitted],

(ix) foreign exchange losses recorded in “other income” and net non-cash exchange, translation or performance losses relating to foreign currency transactions and currency fluctuations,

(x) expenses in connection with earn-out obligations,

(xi) any one-time payments made related to any Permitted Item, including, without limitation, one-time compensation charges, stay bonuses paid to existing management and severance cost [intentionally omitted],

(xii) expenses incurred to the extent reimbursable by third parties pursuant to indemnification, reimbursement, guaranty or purchase price adjustment provisions and either so collected or reasonably expected to be so collected within ninety (90) days of such incurrence,

(xiii) all losses (determined on a Consolidated basis in accordance with GAAP) during such period resulting from the sale or disposition of any asset of Parent or any Restricted Subsidiary outside the ordinary course of business [intentionally omitted],

 

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(xiv) proceeds received from business interruption insurance, in each case, with respect to such measurement period,

(xv) non-cash expenses resulting from the grant or periodic remeasurement of stock options or other equity-related incentives (and, for the avoidance of doubt, including any non-cash expenses related to any stock option or other equity-related incentives resulting from the acceleration of vesting in the event of a change in control) to any director, officer, employee, former employee or consultant of Parent or any Restricted Subsidiary pursuant to a written plan or agreement approved by the board of directors of Parent,

(xvi) (aA) salary, benefit and other direct savings resulting from workforce reductions actually implemented or reasonably expected to be implemented within the following eighteen (18) months and severance related thereto and (bB) restructuring charges, business optimization costs and expenses, integration costs, retention, recruiting, relocation and signing bonuses and expenses, accruals or reserves (including restructuring costs related to any acquisition or Investment, adjustments to existing reserves, any one time expense relating to enhanced accounting function and the closure and/or consolidation of facilities and existing lines of business); provided that the aggregate amount of add-backs permitted pursuant to clause (a)(v) above and this clause (a)(xvi) shall not exceed at any time 15.0% of EBITDA,

(xvii) losses in respect of post-retirement benefits, as a result of the application of FASB 106 (or any successor provision thereof),

(xviii) losses during such period in connection with the extinguishment, retirement or write-off of Debt, and

(xix) directors’ fees and expenses paid or accrued,

(xx) (a) the amount of any loss from stores which have been closed or identified to be closed, and (b) costs and expenses related to new store, distribution center and other facility openings in an aggregate amount not to exceed $5,000,000 in any twelve (12) Fiscal Month period, and

(xxi) solely for purposes of Section 5.05, any Specified Equity Contribution, minus

(b) without duplication and to the extent included in determining such Consolidated Net Income of such Person, any non-cash gains included in Consolidated Net Income of such Person for such period (other than any gains which represent the reversal of an accrual or reserve for a potential cash item that reduced EBITDA in any prior period), minus (c) without duplication and to the extent included in determining such Consolidated Net Income of such Person, any extraordinary gains and unusual or non-recurring gains for such period, all determined on a Consolidated basis in accordance with GAAP, minus (d) without duplication and to the extent included in determining such Consolidated Net Income of such Person, foreign exchange gains recorded in “other income”, minus (e) without duplication and to the extent included in determining such Consolidated Net Income of such Person, all gains during such period resulting from the sale or disposition of any asset of Parent or any Restricted Subsidiary outside the ordinary course of business, minus (f) without duplication and to the extent included in

 

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determining such Consolidated Net Income of such Person, the amount of any gain in respect of post-retirement benefits as a result of the application of FASB 106 (or any successor provision thereof).

For purposes of calculating any financial ratio or test, EBITDA shall be calculated, without duplication, giving effect to the trailing twelve (12) month pro forma results for acquisitions and investments permitted hereunder (including the commencement of activities constituting such business) and material dispositions permitted hereunder (including the termination or discontinuance of activities constituting such business) of business entities or properties or assets, constituting a division or line of business of any business entity, division or line of business that is the subject of any such acquisition or disposition, and operational changes permitted hereunder, and any financial ratio or test shall, without duplication, give effect to the trailing twelve (12) month results for any retirement, extinguishment or repayment of Debt and any Debt incurred or assumed by Parent or any of its Restricted Subsidiaries in connection with such pro forma transaction (and all Debt so incurred or assumed shall be deemed to have borne interest (x) in the case of fixed rate Debt, at the rate applicable thereto or (y) in the case of floating rate Debt, at the rates which were or would have been applicable thereto during the period when such Debt was or was deemed to be outstanding), in each case, as if any such transaction occurred at the beginning of the applicable period.

In addition, EBITDA for any Measurement Period will be determined after giving effect to any identifiable pro forma “run rate” cost savings or demonstrable synergies resulting from any acquisition consummated during such Measurement Period or related to operational changes or adjustments (including restructurings, buy outs of leases of real property, headcount reductions, severance associated with headcount reductions, transition and integration of operations, reorganizations, operating expense reductions, operating improvements and similar restructuring initiatives), as if such cost savings, synergies, changes or adjustments had occurred at the beginning of the Measurement Period, (i) that are recommended by a due diligence quality of earnings report made available to the Administrative Agent prepared by (A) a nationally recognized accounting firm or (B) any other accounting firm that shall be reasonably acceptable to the Administrative Agent (it being understood and agreed that the “Big Four” accounting firms are acceptable to the Administrative Agreement), (ii) determined on a basis consistent with Article 11 of Regulation S-X promulgated under the Exchange Act, or (iii) reasonably expected to be realized within eighteen (18) months following the closing thereof or following such event or action on a pro forma basis and, with respect to this subclause (iii), (x) certified by a Responsible Officer of the Borrower to Administrative Agent to have been determined in good faith and reasonably anticipated by the Borrower to be realizable within eighteen (18) months thereafter or (y) solely with respect to operational changes that are not associated with any such transaction, such operational changes shall be limited to those for which reasonable steps have been taken or have begun to be taken for realizing such savings and are factually supportable and reasonably identifiable. Notwithstanding anything to the contrary, the aggregate amount added back to EBITDA for all adjustments pursuant to clause (iii) of this paragraph during any Measurement Period shall not exceed twenty five percent (25%) of EBITDA for such period (calculated after giving effect to any increase pursuant to this paragraph).

“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.

 

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“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” has the meaning specified in Section 3.01.

“Eligible Assignee” means (a) a Lender Party; (b) an Affiliate of a Lender Party; (c) an Approved Fund; and (d) any other Person (other than an individual) approved by (w) the Administrative Agent, (x) the Issuing Bank, (y) the Swing Line Bank and (z) unless an Event of Default under Section 6.01(a) or (f) has occurred and is continuing, the Borrower (each such approval not to be unreasonably withheld or delayed); provided, however, that neither any Loan Party nor any Affiliate of a Loan Party shall qualify as an Eligible Assignee under this definition.

“Eligible Cash Collateral” means only such unrestricted cash and Cash Equivalents (a) that are maintained in a deposit or investment account specifically and solely used for purposes of holding such cash or Cash Equivalents, which account is subject to a first priority perfected security interest in favor of the Collateral Agent, for the benefit of the Secured Parties (subject to Permitted Liens that do not have priority over the Lien of the Collateral Agent (other than inchoate or other Liens arising by operation of law and Liens described in clause (x) of the definition of “Permitted Liens”)), and (b) for which the Collateral Agent shall have received evidence, in form and substance reasonably satisfactory to Collateral Agent, of the amount of such cash or Cash Equivalents held in such deposit or investment account as of the applicable date of the calculation of Availability by the Collateral Agent.

“Eligible Credit Card Receivables” means at the time of any determination thereof, each Credit Card Receivable that satisfies the following criteria at the time of creation and continues to meet the same at the time of such determination, as determined by the Administrative Agent in its Permitted Discretion in accordance with Section 2.17: such Credit Card Receivable (ix) has been earned by performance and represents the bona fide amounts due to a Loan Party from a Credit Card Issuer or Credit Card Processor, and in each case originated in the ordinary course of business of such Loan Party, and (iiy ) in each case is not ineligible for inclusion in the calculation of the Borrowing Base pursuant to any of clauses (ai) through (lxi ) below. Without limiting the foregoing, to qualify as an Eligible Credit Card Receivable, such Credit Card Receivable shall indicate no Person other than a Loan Party as payee or remittance party. In determining the amount to be so included, the face amount of a Credit Card Receivable shall be reduced by, without duplication, to the extent not reflected in such face amount, (ix) the amount of all accrued and actual discounts, claims, credits or credits pending, promotional program allowances, price adjustments, finance charges or other allowances (including any amount that a Loan Party may be obligated to rebate to a customer, a Credit Card Issuer or Credit Card Processor pursuant to the terms of any agreement or understanding (written or oral)) and (iiy) the aggregate amount of all cash received in respect of such Credit Card Receivable but not yet applied by the Loan Parties to reduce the amount of such Credit Card Receivable. Any Credit Card Receivable meeting the foregoing criteria shall be deemed to be an Eligible Credit Card ReceivablesReceivable , but only as long as such Credit Card Receivables areReceivable is not included within any of the following categories as determined by Administrative Agent in its Permitted Discretion in accordance with Section 2.17, in which case such Credit Card ReceivablesReceivable shall not constitute an Eligible Credit Card Receivable:

(i) (a) Credit Card Receivables which do not constitute a “payment intangible” (as defined in the UCC);

 

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(ii) (b) Credit Card Receivables that have been outstanding for more than five (5) Business Days from the date of sale, or for such longer period(s) as may be approved by the Administrative Agent in its Permitted Discretion;

(iii) (c) Credit Card Receivables with respect to which a Loan Party does not have good, valid and marketable title thereto, free and clear of any Lien (other than (i) Liens granted to the Collateral Agent for its own benefit and the benefit of the other Secured Parties pursuant to the Collateral Documents, and (ii) Permitted Liens (other than any Liens under clauses (i)  orand (j) of the definition of “Permitted Liens”));

(iv) (d) Credit Card Receivables that are not subject to a first priority (except as permitted in clausesclause (cv) or (e) inof this definition) security interest in favor of the Collateral Agent for its own benefit and the benefit of the other Secured Parties (the foregoing not being intended to limit the Permitted Discretion of the Administrative Agent to change, establish or eliminate any Reserves on account of any such Liens to the extent permitted hereunder);

(v) (e) Credit Card Receivables which are disputed, or with respect to which a claim, counterclaim, offset or chargeback (other than chargebacks in the ordinary course by the Credit Card Issuer or Credit Card Processor) has been asserted, by the related credit card processor (but only to the extent of such dispute, counterclaim, offset or chargeback);

(vi) (f) Except as otherwise approved by the Administrative Agent in its Permitted Discretion, Credit Card Receivables as to which the Credit Card Issuer or Credit Card Processor has the right under certain circumstances to require a Loan Party to repurchase the Credit Card Receivables from such Credit Card Issuer or Credit Card Processor;

(vii) (g) Except as otherwise approved by the Administrative Agent in its Permitted Discretion in an aggregate amount not to exceed $10,000,000 (such approval not to be unreasonably withheld), Credit Card Receivables arising from any private label credit card program of the Loan Parties;

(viii) (h) Credit Card Receivables due from a Credit Card Issuer or Credit Card Processor which is the subject of any bankruptcy or insolvency proceedings;

(ix) (i) Credit Card Receivables which are not a valid, legally enforceable obligation of the applicable Credit Card Issuer or Credit Card Processor with respect thereto;

(x) (j) [reserved]; and

(xi) (k) Credit Card Receivables which the Agent determines in its Permitted Discretion to be uncertain of collection; and

(xii) (l) [reserved].

“Eligible Intellectual Property” means “Eligible Intellectual Property” as such term is defined in the Term Credit Agreement.

“Eligible In-Transit Inventory” means, as of any date of determination thereof, without duplication of other Eligible Inventory, In-Transit Inventory:

 

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(a) Which has been shipped from a foreign location for receipt by a Loan Party, but which has not yet been delivered to such Loan Party, which In-Transit Inventory has been in transit for sixty (60) days or less from the date of shipment of such Inventory;

(b) For which the purchase order is in the name of a Loan Party and title and risk of loss has passed to such Loan Party;

(c) For which an acceptable bill of lading or other document of title reasonably acceptable to the Administrative Agent has been issued, and in each case as to which the Administrative Agent has control (as defined in the UCC) over the documents of title which evidence ownership of the subject Inventory (such as, if requested by the Administrative Agent, by the delivery of a Customs Broker/Carrier Agreement);

(d) Which is insured to the reasonable satisfaction of the Administrative Agent in its Permitted Discretion (including, without limitation, marine cargo insurance);

(e) For which payment of the purchase price has been made by such Loan Party or the purchase price is supported by a Commercial Letter of Credit; and

(f) Which otherwise would constitute Eligible Inventory;

provided that the Administrative Agent may, in its Permitted Discretion in accordance with Section 2.17, exclude any particular Inventory from the definition of “Eligible In-Transit Inventory” in the event the Administrative Agent determines that such Inventory is subject to any Person’s right of reclamation, repudiation, stoppage in transit or any event has occurred or is reasonably anticipated by the Administrative Agent to arise which may otherwise adversely impact the ability of the Administrative Agent to realize upon such Inventory.

“Eligible Inventory” means, as of any date of determination, without duplication, (ax) Eligible In-Transit Inventory, and (by) other items of Inventory of a Loan Party in each case that are not excluded as ineligible by virtue of one or more of the criteria set forth below (without duplication of any Reserves established by the Administrative Agent) and that are reflected in the most recent Borrowing Base Certificate delivered to the Administrative Agent. Except as otherwise agreed by the Administrative Agent, in its Permitted Discretion in accordance with Section 2.17 after completion of an updated field examination and appraisal, none of the following shall be deemed to be Eligible Inventory:

(a) (a) Inventory with respect to which a Loan Party does not have good, valid and marketable title thereto, free and clear of any Lien (other than (i) Liens granted to the Collateral Agent for its own benefit and the benefit of the other Secured Parties pursuant to the Collateral Documents and (ii) other Permitted Liens (other than any Liens under clauses (i) or (j) of the definition of “Permitted Liens”)), or is leased by or is on consignment to a Loan Party, or that is not solely owned by a Loan Party;

(b) (b) Inventory that (i) is not located in the United States of America (excluding territories or possessions of the United States) (other than Eligible In-Transit Inventory) or (ii) is stored at a leased or rented location (other than a retail store location) where the aggregate value of Inventory exceeds $250,000, unless the Administrative Agent has given its prior consent thereto or unless either (x) a Collateral Access Agreement in respect of such location has been delivered to the Administrative Agent or (y) Reserves reasonably satisfactory to the Administrative Agent have been established with respect thereto (provided that the Loan Parties shall use commercially reasonable efforts to ensure that the aggregate value of all Inventory

 

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stored at such leased or rented location and not deemed “Eligible Inventory” shall not exceed $5,000,000 at any one time outstanding), (iii) is stored with a bailee or warehouseman where the aggregate value of Inventory exceeds $250,000, unless either (x) an acknowledged bailee waiver letterCollateral Access Agreement which is in form and substance reasonably satisfactory to the Administrative Agent and the Collateral Agent has been received by the Administrative Agent or (y) Reserves reasonably satisfactory to the Administrative Agent in its Permitted Discretion have been established with respect thereto (provided that the Loan Parties shall use commercially reasonable efforts to ensure that the aggregate value of all Inventory stored with a bailee or warehouseman and not deemed “Eligible Inventory” shall not exceed $5,000,000 at any one time outstanding),

(c) (c) Inventory that represents goods which (i) are damaged, defective, “seconds”, or otherwise unmerchantable, (ii) are to be returned to the vendor and which is no longer reflected in the Loan Parties’ stock ledger, (iii) are obsolete or slow moving, or special-order items, work in process, raw materials, or that constitute spare parts, shipping materials or supplies used or consumed in a Borrower’s business, or (iv) are bill and hold goods;

(d) (d) Except as otherwise agreed by the Administrative Agent in its Permitted Discretion, Inventory that represents goods that do not conform in all material respects to the representations and warranties contained in this Agreement or any of the CollateralLoan Documents;

(e) (e) Inventory that is not subject to a perfected first priority security interest in favor of the Collateral Agent for its own benefit and the benefit of the other Secured Parties (subject only to (i) Permitted Liens having priority by operation of applicable law or (ii) with respect to which Permitted Liens the Administrative Agent may establish Reserves in the exercise of its Permitted Discretion pursuant to Section 2.17);

(f) (f) Inventory that is not insured in compliance with the provisions of Section 5.01(d) hereof;

(g) (g) Inventory which consists of samples, labels, bags (other than handbags), packaging materials, and other similar non-merchandise categories;

(h) (h) Inventory which contains or bears any Intellectual Property rights licensed to such Loan Party unless the Collateral Agent is satisfied that it may sell or otherwise dispose of such Inventory without (i) infringing the rights of such licensor, (ii) violating any contract with such licensor, or (iii) incurring any liability with respect to payment of royalties other than royalties incurred pursuant to sale of such Inventory under the current licensing agreement;

(i) (i) Inventory which has been sold but not yet delivered or Inventory to the extent that any Loan Party has accepted a deposit therefor; and

(j) (j) Inventory acquired pursuant to Section 5.02(f), unless the Administrative Agent shall have received or conducted (A) appraisals, from appraisers reasonably satisfactory to the Administrative Agent, of such Inventory to be acquired in such Investment and has established an Inventory Advance Rate and Inventory Reserves (if applicable) therefor and (B) such other due diligence as the Administrative Agent may reasonably require, all of the results of the foregoing to be reasonably satisfactory to the Administrative Agent in its Permitted Discretion. As long as the Administrative Agent has received reasonable prior notice of such acquisitions under Section 5.02(f) and the Loan Parties reasonably cooperate (and cause the Person being acquired to

 

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reasonably cooperate) with the Administrative Agent, the Administrative Agent shall use reasonable best efforts to complete such due diligence and a related appraisal on or prior to the closing date of such acquisition under Section 5.02(f).

“End Date” means the “End Date” as such term is defined in the Term Credit Agreement.

“Environmental Action” means any action, suit, demand, demand letter, claim, notice of non-compliance or violation, notice of liability or potential liability, investigation, proceeding, consent order or consent agreement relating in any way to any violation of, or liability under, any Environmental Law, or an Environmental Permit or arising from an alleged injury or threat to the environment, or to health and safety with regard to exposure to Hazardous Materials, including, without limitation, and to the extent arising from the foregoing, by any governmental or regulatory authority or third party for enforcement, cleanup, removal, response, remedial or other actions, damages, contribution, indemnification, cost recovery, compensation or injunctive relief.

“Environmental Law” means any Federal, state, local or foreign statute, law, ordinance, rule, regulation, code, order, writ, judgment, injunction or decree relating to pollution or protection of the environment, natural resources or exposure of any individual to Hazardous Material, including, without limitation, those relating to the use, handling, transportation, treatment, storage, disposal, release or discharge of Hazardous Materials.

“Environmental Permit” means any permit, approval, identification number, license or other authorization required under any Environmental Law.

“Equity Interests” means, with respect to any Person, shares of capital stock of (or other ownership or profit interests in) such Person, warrants, options or other rights for the purchase or other acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or other acquisition from such Person of such shares (or such other interests), and other ownership or profit interests in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are authorized on any date of determination.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

“ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a member of the controlled group of any Loan Party, or under common control with any Loan Party, within the meaning of Section 4001(a)(14) of ERISA.

“ERISA Event” means (a)(i) the occurrence of a reportable event, within the meaning of Section 4043 of ERISA, with respect to any Plan unless the 30 day notice requirement with respect to such event has been waived by the PBGC or (ii) the requirements of Section 4043(b) of ERISA apply with respect to a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan, and an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect to such Plan within the following 30 days; (b) the application for a minimum funding waiver with respect to a Plan; (c) the provision by the administrator of any Plan of a notice of intent to terminate such Plan, pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation of operations at a facility of any Loan Party or any ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e) the

 

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withdrawal by any Loan Party or any ERISA Affiliate from a Multiple Employer Plan during a plan year for which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a lien under Section 302(f) of ERISA shall have been met with respect to any Plan; (g) the adoption of an amendment to a Plan requiring the provision of security to such Plan pursuant to Section 307 of ERISA; or (h) the institution by the PBGC of proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the occurrence of any event or condition described in Section 4042 of ERISA that constitutes grounds for the termination of, or the appointment of a trustee to administer, such Plan.

“Escrow Bank” has the meaning specified in Section 2.15(c).

“Eurodollar Lending Office” means, with respect to any Lender Party, the office of such Lender Party specified as its “Eurodollar Lending Office” opposite its name on Schedule I hereto or in the Assignment and Assumption pursuant to which it became a Lender Party (or, if no such office is specified, its Domestic Lending Office), or such other office of such Lender Party as such Lender Party may from time to time specify to the Borrower and the Administrative Agent.

“Eurodollar Rate” means:

(a) for any Interest Period with respect to any Eurodollar Rate Advance, an interest rate per annum equal to the LIBO Rate for such Interest Period; and

(b) for any interest rate calculation with respect to any Base Rate Advance, an interest rate per annum equal to the LIBO Rate for an Interest Period commencing on the date of such calculation and ending on the date that is thirty (30) days thereafter.

“Eurodollar Rate Advance” means an Advance that bears interest as provided in Section 2.07(a)(ii).

“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.

“Events of Default” has the meaning specified in Section 6.01.

“Excess Availability” means, at any time, the amount, if any, by which (a) the Loan Cap exceeds (b) the aggregate amount of Used Commitments at such time.

“Excess Cash” means, at any time, the amount by which the aggregate amount of cash and Cash Equivalents, marketable securities, treasury bonds and bills, certificates of deposit, investments in money market funds, and commercial paper, in each case, held or owned by a Loan Party in a deposit account (including, without limitation, operating accounts and disbursement accounts) or a securities account exceeds (a) so long as no Triggering Event has then occurred and is continuing, $40,000,000 (other than (i) ordinary course retail store operating cash and (ii) cash of the Loan Parties not to exceed amounts estimated in good faith to be necessary to fund expenditures in the ordinary course of their business as and when due and without acceleration thereof within the three (3) Business Days of any date of determination), or (b) if a Triggering Event has occurred and is continuing, $0.

“Excluded Issuance” shall mean (i) an issuance and sale of Qualified Capital Stock of the Parent (or any direct or indirect holding company of the Parent) or Subordinated Debt to the shareholders (or any other stockholder exercising preemptive rights triggered by such issuance), to the extent such Qualified Capital Stock or Subordinated Debt is used, or the net cash proceeds thereof shall be, within 90 days of the consummation of such issuance and sale, used or committed to be used (and so used within 180 days

 

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of consummation), without duplication, to finance Capital Expenditures or one or more permitted Investments permitted under Section 5.02(f) and (ii) an issuance and sale of Qualified Capital Stock of the Parent (or any direct or indirect holding company of the Parent) to satisfy legal requirements regarding the issuance of a de minimis amount of shares.

“Excluded Leases” means (i) that certain Lease dated as of May 18, 2012 by and between 1552 Broadway Retail Owner LLC and Express, LLC relating to the property located at 1552 Broadway and 1560 Broadway, New York, New York 10036 and (ii) that certain Retail Lease dated as of November 15, 2011 by and between Handerly Hotels, Inc. and Express, LLC relating to the property located at 301 Geary Street, San Francisco, California 94108, in each case, as amended, restated, modified or supplemented from time to time.

“Excluded Subsidiary” means (i) any CFC, (ii) any Subsidiary of a CFC, (iii) any Subsidiary of the Parent that is organized under the laws of a jurisdiction located inside the United States that is not a Material Subsidiary; provided that all Excluded Subsidiaries covered by this clause (iii) shall not represent, in the aggregate, more than 5% of EBITDA or 5% of Consolidated tangible assets of the Parent and its Subsidiaries and the Parent shall be obligated to designate one or more Subsidiaries that would otherwise qualify as Excluded Subsidiaries covered by this clause (iii) as Material Subsidiaries in order to comply with the terms of this proviso, (iv) Subsidiaries prohibited by applicable requirements of laws or by any contractual obligation existing on the FirstSecond Amendment Effective Date (or the date of acquisition of such Subsidiary, as applicable) from guaranteeing the Obligations or which would require governmental or regulatory consent, approval, license or authorization to provide a guarantee of the Obligations unless the same shall have been received, (v) Subsidiaries the provision of a guarantee of the Obligations by which would reasonably be expected to result in a Material Adverse Effect[reserved], (vi) any entity where the cost and/or burden (other than the documentation thereof) of granting a guarantee of the Obligations outweighs the benefit to the Lenders, as determined in the reasonable discretion of Administrative Agent and Borrower, (vii) special-purpose entities (including receivables entities and securitization Subsidiaries), (viii) not-for-profit Subsidiaries, (ix) captive insurance companies or (x) Unrestricted Subsidiaries.

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal or unlawful under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guarantee of such Guarantor or the grant of such security interest would otherwise have become effective with respect to such Swap Obligation but for such Guarantor’s failure to constitute an “eligible contract participant” at such time.

“Excluded Taxes” means, with respect to any Payee, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case, of any Lender, in which its Applicable Lending Office is located, (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which any Loan Party is located, (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Lead Borrower under Section 9.12), any withholding tax that is imposed on amounts payable hereunder at the time such Payee becomes a party hereto (or designates a new Applicable Lending Office) or is attributable to such Payee’s failure or inability (other than as a result of a changeChange in lawLaw ) to comply with Section 2.12, except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Applicable

 

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Lending Office (or assignment), to receive additional amounts from the Loan Parties with respect to such withholding tax pursuant to Section 2.12(a), (d) any U.S. federal, state or local backup withholding tax, and (e) any U.S. federal withholding tax imposed under FATCA.

“Existing Advances Indebtedness” has the meaning specified in Section 2.01.

“Existing Credit Agreement” has the meaning specified in the recitals to this Agreement.

“Existing Debt” means such Debt set forth on Schedule 5.02(b).

“Existing Lender” has the meaning specified in the recitals to this Agreement.

“Existing Letters of Credit” means the Letters of Credit issued under the Existing Credit Agreement and set forth on Schedule III.

“Extraordinary Receipt” means any cash amount actually received by any Loan Party (net of all out of pocket fees, costs, legal fees, court costs, taxes and other expenses incurred by any Loan Party in connection with the collection, litigation, adjudication, arbitration, receipt or recovery of any such Extraordinary Receipt, in each case to the extent such amounts are not deducted in calculating Consolidated Net Income) that is not received in the ordinary course of business and which is received as a result of proceeds of casualty insurance and condemnation awards (and payments in lieu thereof); provided, however, that an Extraordinary Receipt shall not include cash receipts received from proceeds of insurance or condemnation awards (or payments in lieu thereof) to the extent that such proceeds or awards are received by any Person in respect of any third party claim against such Person and applied to pay (or to reimburse such Person for its prior payment of) such claim and the costs and expenses of such Person with respect thereto.

“Facility” means the Revolving Credit Facility, the Swing Line Facility or the Letter of Credit Facility, as the context may require.

“Factored Receivables” means any Accounts originally owed or owing by a Loan Party to another Person which have been purchased by or factored with WFB or any of its Affiliates pursuant to a factoring arrangement or otherwise with the Person that sold the goods or rendered the services to the Loan Party which gave rise to such Account.

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

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

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if such rate is not so published for any day which is a Business Day, the Federal Funds Rate for such day shall be the average of the quotations for such day

 

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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 Bank of New York’s Website” means the website of the Federal Reserve Bank of New York at http://www.newyorkfed.org, or any successor source.

“Fee Letter” means, collectively, (i) the fee letter dated as of April 24, 2015 among the Loan Parties, the Lead Arranger, and the Agents, as amended and restated pursuant to that certain amended and restated fee letter dated as of the First Amendment Effective Date among the Loan Parties, the Lead Arranger, and the Agents, and (ii) the Second Amendment Fee Letter.

“First Amendment” means that certain First Amendment to Second Amended and Restated $250,000,000 Asset-Based Loan Credit Agreement and First Amendment to Amended and Restated Security Agreement, dated as of the First Amendment Effective Date, among the Borrower, the Guarantors, the Agents and the Lenders party thereto.

“First Amendment Effective Date” means the date on which the conditions specified in Section 5 of the First Amendment are satisfied.

“Fiscal Month” means any fiscal month of the Parent and its Consolidated Subsidiaries ending on the dates set forth on Schedule IV hereto, as such schedule may be updated from time to time by delivery of a new Schedule IV hereto to the Administrative Agent.

“Fiscal Quarter” means any fiscal quarter of the Parent and its Consolidated Subsidiaries ending on the dates set forth on Schedule IV hereto, as such schedule may be updated from time to time by delivery of a new Schedule IV hereto to the Administrative Agent.

“Fiscal Year” means a fiscal year of the Parent and its Consolidated Subsidiaries ending on the Saturday closest to January 31 in any calendar year.

“Fixed Charges” means, with reference to any period, without duplication, cash Interest Expense, plus scheduled principal paymentpayments on Debt for Borrowed Money, plus expense for income taxes paid in cash (net of any cash refund in respect of income taxes actually received during such period (including the 2020 Tax Refund Proceeds in excess of the amounts required to be paid by the Borrower in accordance with Section 2.06(b) of this Agreement and Section 2.06(b) of the Term Credit Agreement, if any)), plus all Restricted Payments made in reliance on Sections 5.02(g)(vii)(B), 5.02(g)(viii), 5.02(g)(ix) or 5.02(g)(x) (whether in cash or other property, other than common Equity Interests), all calculated for the Parent and its Restricted Subsidiaries on a Consolidated basis.

“Fixed Charge Coverage Ratio” means the ratio, determined as of the end of a Fiscal Month for the most recently completed Measurement Period, of (i) EBITDA minus the unfinanced portion of Capital Expenditures (including Capital Expenditures financed with Advances or any other short-term Debt) to (ii) Fixed Charges, all calculated for the Parent and its Restricted Subsidiaries on a Consolidated basis.

“Foreign Lender” means a Payee that is not a United States person within the meaning of Internal Revenue Code Section 7701(a)(30).

“Foreign Subsidiary” means a Subsidiary of the Parent that is organized under the laws of a jurisdiction located outside of the United States.

 

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

“GAAP” has the meaning specified in Section 1.03.

“Global Borrowing Base” means the sum of the Borrowing Base and the Term Loan Borrowing Base.

“Governmental Authority” means any nation or government, any state, province, city, municipal entity or other political subdivision thereof, and any governmental, executive, legislative, judicial, administrative or regulatory agency, department, authority, instrumentality, commission, board, bureau or similar body, whether federal, state, provincial, territorial, local or foreign 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).

“Governmental Authorization” means any authorization, approval, consent, franchise, license, covenant, order, ruling, permit, certification, exemption, notice, declaration or similar right, undertaking or other action of, to or by, or any filing, qualification or registration with, any Governmental Authority.

“Guaranteed Debt” means, with respect to any Person, any Obligation or arrangement of such Person to guarantee or intended to guarantee any Debt (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, (a) the direct or indirect guarantee, endorsement (other than for collection or deposit in the ordinary course of business), co making, discounting with recourse or sale with recourse by such Person of the Obligation of a primary obligor, (b) the Obligation to make take-or-pay or similar payments, if required, regardless of nonperformance by any other party or parties to an agreement, (c) the grant of any Lien on any assets of such Person securing any Debt or other obligation of any other Person, whether or not such Debt or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Debt to obtain any such Lien) or (d) any Obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (A) for the purchase or payment of any such primary obligation or (B) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, assets, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof; provided, however, that the term “Guaranteed Debt” shall not include any product warranties or other ordinary course contingent obligations incurred in the ordinary course of business, including indemnities. The amount of any Guaranteed Debt shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guaranteed Debt is made (or, if less, the maximum amount of such primary obligation for which such Person may be liable pursuant to the terms of the instrument evidencing such Guaranteed Debt) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder), as determined by such Person in good faith.

“Guaranteed Obligations” has the meaning specified in Section 8.01.

“Guaranties” means, collectively, the Parent Guaranty, the Holdings Guaranty, the Intermediate Holdings and the Subsidiary Guaranty.

 

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“Guarantors” means, collectively, the Parent and, the Holdings Entities, the Subsidiary Guarantors, and any other Person that guarantees the Obligations.

“Guaranty Supplement” has the meaning specified in Section 8.05.

“Hazardous Materials” means (a) petroleum or petroleum products, by-products or breakdown products, radioactive materials, asbestos-containing materials, polychlorinated biphenyls, radon gas and toxic mold and (b) any other chemicals, materials or substances designated, classified or regulated as hazardous or toxic or explosive or radioactive substances or as a pollutant or contaminant under any Environmental Law.

“Hedge Agreements” 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.

“Hedge Bank” means any Lender Party or an Affiliate of a Lender Party in its capacity as a party to a Secured Hedge Agreement.

“Holdings ” has the meaning specified in the preamble to this Agreement.

“Holdings Entities” means, collectively, Holdings and Intermediate Holdings. “Holdings Entity” means any one of such Persons.

“Holdings Guaranty” means the guaranty of Holdings set forth in Article VIII.

“Indemnified Party” has the meaning specified in Section 9.04(b).

“Indemnified Taxes” means Taxes imposed with respect to any Loan Document or any payment thereunder other than Excluded Taxes.

“Independent Consultant” means a financial advisor or other Person engaged by the Loan Parties for the purposes set forth in Section 5.01(m), which shall be acceptable to Administrative Agent in its sole discretion.

“Independent Consultant Termination Conditions” means, for any time of determination, that:

(a) as of such time of determination, (i) the Borrower has received the 2020 Tax Refund Proceeds, such 2020 Tax Refund Proceeds have been applied to repay the amounts required to be paid by the Borrower in accordance with Section 2.06(b) of this Agreement and Section 2.06(b) of the Term Credit Agreement, and (iii) the Delayed Draw Term Loan has been paid in full in cash;

 

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(b) no Default or Event of Default shall have occurred and be continuing at such time or would immediately result therefrom;

(c) Excess Availability shall be, as of such time of determination, and for the 90 day period immediately following such time of determination, not less than, thirty-five percent (35%) of the Borrowing Base (calculated without giving effect to the Term Pushdown Reserve); and

(d) EBITDA for the most recent Measurement Period for which monthly financial statements and the corresponding Responsible Officer certificate have been delivered (or are required to have been delivered) pursuant to Section 5.03(g), as of such time of determination, is at least equal to $50,000,000.

“Initial Issuing Bank” means the bank listed on the signature pages hereof as the Initial Issuing Bank.

“Initial Lender Parties” means the Initial Issuing Bank, the Initial Lenders and the Initial Swing Line Bank.

“Initial Lenders” means the banks, financial institutions and other institutional lenders listed on the signature pages hereof as the Initial Lenders.

“Initial Swing Line Bank” means the bank listed on the signature pages hereof as the Initial Swing Line Bank.

“Insufficiency” means, with respect to any Plan, the amount, if any, of a Plan’s accumulated benefit obligation (determined in accordance with GAAP) in excess of the Plan’s fair value of assets.

“Intellectual Property” means all “Intellectual Property Collateral” as defined in the Security Agreement; provided that Intellectual Property shall not exclude any “Excluded Assets” as defined in the Security Agreement.

“Intellectual Property Security Agreements” means each short-form intellectual property security agreement dated as of the Second Amendment Effective Date among the Loan Parties and the Collateral Agent, granting a Lien in the Intellectual Property of the Loan Parties, as the same now exists or may hereafter be amended, modified, supplemented, renewed, restated or replaced.

“Intercreditor Agreements” means, collectively, the ABL Intercreditor Agreement and the MGF Intercreditor Agreement.

“Intercreditor Provisions” has the meaning specified in Section 6.01(p).

“Interest Expense” means, for any Measurement Period, the sum of (a) all interest, premium payments, debt discount, fees, charges and related expenses in connection with Debt for Borrowed Money or in connection with the deferred purchase price of assets, in each case to the extent treated as interest in accordance with GAAP, including, without limitation, all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and net costs under Hedge Agreements, but excluding any interest paid-in-kind or capitalized interest, or non-cash or deferred interest financing costs and to the extent directly related to the Transaction, debt issuance costs, debt discount or premium and other financing fees and expenses, (b) all interest paid or payable with respect to discontinued operations and (c) the portion of rent expense with respect to such period under Capitalized Leases that is treated as interest in accordance with GAAP minus (d) the sum of (i) Consolidated net gains

 

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of such Person and its Restricted Subsidiaries under Hedge Agreements (but excluding any unrealized gains) and (ii) interest income during such period (excluding any portion of interest income representing accruals of amounts received in a previous period), in each case of or by the Parent and its Restricted Subsidiaries for the most recently completed Measurement Period, all as determined on a Consolidated basis in accordance with GAAP.

“Interest Period” means, for each Eurodollar Rate Advance comprising part of the same Borrowing, the period commencing on the date of such Eurodollar Rate Advance or the date of the Conversion of any Base Rate Advance into such Eurodollar Rate Advance, and ending on the last day of the period selected by the Borrower pursuant to the provisions below and, thereafter, each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the last day of the period selected by the Borrower pursuant to the provisions below. The duration of each such Interest Period shall be one, two, three or six months, as the Borrower may, upon notice received by the Administrative Agent not later than 11:00 A.M. (New York City time) on the third Business Day prior to the first day of such Interest Period, select; provided, however, that:

(a) (a) the Borrower may not select any Interest Period with respect to any Eurodollar Rate Advance under a Facility that ends after any principal repayment installment date for such Facility or the Termination Date unless, after giving effect to such selection, the aggregate principal amount of Base Rate Advances and of Eurodollar Rate Advances having Interest Periods that end on or prior to such principal repayment installment date or Termination Date for such Facility shall be at least equal to the aggregate principal amount of Advances under such Facility due and payable on or prior to such date;

(b) (b) Interest Periods commencing on the same date for Eurodollar Rate Advances comprising part of the same Borrowing shall be of the same duration;

(c) (c) whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day, provided, however, that, if such extension would cause the last day of such Interest Period to occur in the next following calendar month, the last day of such Interest Period shall occur on the next preceding Business Day; and

(d) (d) whenever the first day of any Interest Period occurs on a day of an initial calendar month for which there is no numerically corresponding day in the calendar month that succeeds such initial calendar month by the number of months equal to the number of months in such Interest Period, such Interest Period shall end on the last Business Day of such succeeding calendar month.

“Intermediate Holdings” has the meaning specified in the preamble to this Agreement.

“Intermediate Holdings Guaranty” means the guaranty of Intermediate Holdings set forth in Article VIII.

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

“In-Transit Inventory” means Inventory of a Loan Party which is in the possession of a common carrier and is in transit from a foreign vendor of a Loan Party from a location outside of the continental United States to a location of a Loan Party that is within the continental United States.

 

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“Inventory” has the meaning given that term in the UCC.

“Inventory Advance Rate” means 90%.

“Inventory Reserves” means such reserves as may be established from time to time by the Administrative Agent acting in its Permitted Discretion in accordance with Section 2.17, with respect to changes in the determination of the saleability, at retail, of the Eligible Inventory or which reflect such other factors as negatively affect the market value of the Eligible Inventory or otherwise.

“Investment” in any Person means any loan or advance to such Person (other than (a) third-party trade receivables or (b) intercompany trade receivables, in each case incurred in the ordinary course of such Person’s business), any purchase or other acquisition of any Equity Interests or Debt or the assets comprising a division or business unit or a substantial part or all of the business of such Person, any capital contribution to such Person or any other direct or indirect investment in such Person, including, without limitation, any acquisition by way of a merger or consolidation (or similar transaction) and any arrangement pursuant to which the investor incurs Debt of the types referred to in clause (i) or (j) of the definition of “Debt” in respect of such Person. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

“ISP” means, with respect to any Letter of Credit, the International Standby Practices 1998 (International Chamber of Commerce Publication No. 590) and any subsequent revision thereof adopted by the International Chamber of Commerce on the date such Letter of Credit is issued.

“Issuer Documents” means with respect to any Letter of Credit, the Letter Credit Application, the Standby Letter of Credit Agreement or Commercial Letter of Credit Agreement, as applicable, and any other document, agreement and instrument entered into by the Issuing Bank and the Borrower (or any Subsidiary) or in favor of the Issuing Bank and relating to any such Letter of Credit.

“Issuing Bank” means (a) WFB in its capacity as issuer of Letters of Credit hereunder and with respect to the Existing Letters of Credit, or any successor issuer of Letters of Credit hereunder (which successor may only be (x) an Eligible Assignee or (y) a Lender selected by the Administrative Agent in its discretion pursuant to Section 9.07 and, so long as no Event of Default has occurred and is continuing, approved by the Borrower), and (b) any other Lender selected by the Administrative Agent in its discretion agreed to by such Lender and, so long as no Event of Default has occurred and is continuing, approved by the Borrower. The Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of the Issuing Bank and/or for such Affiliate to act as an advising, transferring, confirming and/or nominated bank in connection with the issuance or administration of any such Letter of Credit, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate.

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof, or the renewal thereof.

“L/C Obligations” means, as at any date of determination, the aggregate undrawn amount available to be drawn under all outstanding Letters of Credit. For purposes of computing the amounts available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.05. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of any Rule under the ISP or any article of UCP 600, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

 

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“LCT Election” has the meaning specified in Section 1.07.

“LCT Test Date” has the meaning specified in Section 1.07.

“Lead Arranger” Wells Fargo Bank, National Association, in its capacity as sole lead arranger and solelead bookrunner.

“Lender Party” means any Lender, the Issuing Bank or the Swing Line Bank.

“Lenders” means the Initial Lenders and each Person that shall become a Lender hereunder pursuant to Section 9.07 for so long as such Initial Lender or Person, as the case may be, shall be a party to this Agreement.

“Letter of Credit” means each Standby Letter of Credit and each Commercial Letter of Credit issued hereunder and shall include the Existing Letters of Credit.

“Letter of Credit Advance” means an advance made by the Issuing Bank or any Revolving Credit Lender pursuant to Section 2.03(d).

“Letter of Credit Application” means an application for the issuance or amendment of a Letter of Credit in the form from time to time in use by the Issuing Bank.

“Letter of Credit Expiration Date” means the day that is seven days prior to the Termination Date then in effect (or, if such day is not a Business Day, the next preceding Business Day).

“Letter of Credit Facility” means the subfacility for the issuance of Letters of Credit pursuant Section 2.03 of this Agreement.

“Letter of Credit Fee” has the meaning specified in Section 2.08(b)(i).

“Letter of Credit Indemnified Costs” has the meaning specified in Section 2.03(f).

“Letter of Credit Related Person” has the meaning specified in Section 2.03(f).

“Letter of Credit Sublimit” means an amount equal to $45,000,000. The Letter of Credit Sublimit is part of, and not in addition to, the Aggregate Commitments. A permanent reduction of the Aggregate Commitments shall not require a corresponding pro rata reduction in the Letter of Credit Sublimit; provided, however, that if the Aggregate Commitments are reduced to an amount less than the Letter of Credit Sublimit, then the Letter of Credit Sublimit shall be reduced to an amount equal to (or, at the Borrower’s option, less than) the Aggregate Commitments.

“Leverage Ratio” means, at any date of determination, the ratio of Consolidated Debt for Borrowed Money (net of (x) unrestricted cash and Cash Equivalents and (y) cash and Cash Equivalents (i) to the extent deemed restricted solely as a result of Permitted Liens in favor of the Agents, the Term Agents or MGF, or (ii) subject to Liens permitted pursuant to clause (x) of the definition of “Permitted Liens”) at such date to EBITDA, in each case of the Parent and its Restricted Subsidiaries for the most recently completed Measurement Period.

“LIBO Rate” means for any Interest Period with respect to a Eurodollar Rate Advance,the greater of (a) 0.50% per annum, and (b) the rate per annum as published by ICE Benchmark Administration Limited (or any successor page or other commercially available source as the Administrative Agent may

 

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designate from time to time) as of 11:00 a.m., London time, two Business Days prior to the commencement of the requested Interest Period, for a term, and in an amount, comparable to the Interest Period and the amount of the Eurodollar Rate Advance requested (whether as an initial Eurodollar Rate Advance or as a continuation of a Eurodollar Rate Advance or as a conversion of a Base Rate Advance to a Eurodollar Rate Advance) by the Borrower in accordance with this Agreement (and, if any such published rate is below zero, then the rate determined pursuant to this clause (b) shall be deemed to be zero). Each determination of the LIBO Rate shall be made by the Administrative Agent and shall be conclusive in the absence of manifest error.

“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale, Capitalized Leases, Synthetic Debt, or other title retention agreement, any easement, right of way or other encumbrance on title to real property).

“Limited Condition Transaction” means any Permitted Acquisition or other similar Investment permitted hereunder whose consummation is not conditioned on the availability of, or on obtaining, third party financing.

“Loan Account” has the meaning specified in Section 2.16.

“Loan Cap” means, at any time of determination, the lesser of (a) the Aggregate Commitments or (b) the Borrowing Base.

“Loan Documents” means (i) this Agreement, (ii) the Notes, (iii) the Collateral Documents, (iv) the Fee Letter, the (v) the Borrowing Base Certificates and the Term Loan Borrowing Base Certificates, (vi) the ABL Intercreditor Agreement, (vii) the MGF Intercreditor Agreement, (viii) the Reaffirmation Agreement, (ix) the Post-Closing Letter, and (vix) any other instrument or agreement now or hereafter executed and delivered in connection herewith, or in connection with any transaction arising out of any Cash Management Services and Bank Products provided by any Lender or any of its Affiliates, each as amended and in effect from time to time.

“Loan Parties” means, collectively, the Borrower and the Guarantors.

“London Business Day” means a day on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in London, England.

“Mandatory Term Loan Prepayments” means, prior to the Discharge of Term Obligations, mandatory payments of the Term Obligations with proceeds of any Term Priority Collateral to the extent required to be made pursuant to the Term Credit Agreement as in effect as of the Second Amendment Effective Date.

“Margin Stock” has the meaning specified in Regulation U.

“Material Adverse Effect” means a material adverse effect on (a) the business, financial condition, operations, performance or properties of the Parent and its Subsidiaries, taken as a whole, (b) the rights and remedies of any Agent or any Lender Party under any Loan Document or, (c) the Collateral, or the Collateral Agent’s Liens (on behalf of itself and the other Secured Parties) on the Collateral or the priority of such Liens, or (d) the ability of any Loan Party to perform its Obligations under any Loan Document to which it is a party.

 

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“Material Intellectual Property” means Intellectual Property that is material to the conduct of business of any of the Loan Parties; provided that any Intellectual Property that is Eligible Intellectual Property shall be deemed to be Material Intellectual Property.

“Material Subsidiary” means, at any time, (i) any Subsidiary of the Parent that represents more than 5% of the total revenues of the Companies on a consolidated basis and more than 5% of Consolidated tangible assets of the Parent and its Subsidiaries, determined at the end of the most recently completed financial quarterFiscal Quarter of the Parent based on the financial statements of the Parent delivered pursuant to Section 5.03(b) or (c) or (ii) any Subsidiary of the Parent designated by notice in writing given by the Parent to the Administrative Agent to be a “Material Subsidiary; provided that, any such Subsidiary so designated as a Material Subsidiary shall at all times thereafter remain a Material Subsidiary for the purposes of this Agreement unless, in the case of a Subsidiary which became a Material Subsidiary pursuant to the terms of subclause (i) of this definition, such Subsidiary no longer continues to meet the thresholds set forth in such subclause (i) or, in the case of a Subsidiary designated by the Parent as a Material Subsidiary pursuant to the terms of subclause (ii) of this definition, the Parent or Borrower subsequently un-designates such Subsidiary as a Material Subsidiary so long as such Subsidiary does not meet the thresholds set forth in subclause (i) of this definition.

“Maturity Date” means the earlier of (a) May 24, 2024 and (b) the “Termination Date” under and as defined in the Term Credit Agreement, as the same may be extended from time to time.

“Measurement Period” means each period of twelve (12) consecutive Fiscal Months of the Parent.

“MGF ” means MGF Sourcing US, LLC, a Delaware limited liability company.

“MGF Intercreditor Agreement” means that certain Subordination and Intercreditor Agreement dated as of the Second Amendment Effective Date by and among the Agents, the Term Agents, MGF and the Loan Parties, as amended, modified, restated or replaced from time to time in accordance with the terms thereof.

“Moody’s” means Moody’s Investors Services, Inc.

“Multiemployer Plan” means a multiemployer plan, as defined in Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is making or accruing an obligation to make contributions, or with respect to which any Loan Party has any liability.

“Multiple Employer Plan” means a single employer plan, as defined in Section 4001(a)(15) of ERISA and subject to Title IV of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA Affiliate and at least one Person other than the Loan Parties and the ERISA Affiliates or (b) was so maintained and in respect of which any Loan Party or any ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA in the event such plan has been or were to be terminated.

“Net Income” means, for any period, the net income or loss of the Parent and the Restricted Subsidiaries for such period determined on a Consolidated basis in accordance with GAAP; provided that there shall be excluded (a) unrealized gains and losses with respect to Hedge Agreements during such period and (b) the impact of purchase accounting or similar adjustments required or permitted by GAAP in connection with any Permitted Acquisition (including the reduction of revenue from any write down of deferred revenue).

 

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“Net Orderly Liquidation Value” means, with respect to Inventory of any Person, the appraised orderly liquidation value thereof, net of costs and expenses to be incurred in connection with any such liquidation, as set forth in the most recently delivered or conducted appraisal (as required or permitted hereby) by an appraiser reasonably acceptable to the Administrative Agent.

“Net Proceeds” means, with respect to any event, (a) the cash proceeds received in respect of such event including (i) any cash 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 receivable or otherwise, but excluding any interest payments), but only as and when received, (ii) in the case of a casualty, insurance proceeds and (iii) in the case of a condemnation or similar event, condemnation awards and similar payments, minus (b) the sum of (i) all reasonable fees and out-of-pocket expenses paid to third parties (other than Affiliates) in connection with such event, (ii) in the case of a Transfer of an asset (including pursuant to a sale and leaseback transaction or a casualty or a condemnation or similar proceeding), the amount of all payments required to be made as a result of such event to repay Debt (other than the Obligations or the Term Loans) secured by such asset or otherwise subject to mandatory prepayment as a result of such event and (iii) the amount of all taxes paid (or reasonably estimated to be payable) and the amount of any reserves established to fund contingent liabilities reasonably estimated to be payable, in each case during the year that such event occurred or the next succeeding year and that are directly attributable to such event (as determined reasonably and in good faith by a financial officer of the Borrower).

“Non-Defaulting Lender” means each Lender other than a Defaulting Lender.

“Non-Extension Notice Date” has the meaning specified in Section 2.03(b)(iii).

“Note” means a Revolving Credit Note.

“Notice of Borrowing” has the meaning specified in Section 2.02(a).

“Notice of Swing Line Borrowing” has the meaning specified in Section 2.02(b).

“NPL” means the National Priorities List under CERCLA.

“Obligation” means, with respect to any Person, any payment, performance or other obligation of such Person of any kind, including, without limitation, any liability of such Person on any claim, whether or not the right of any creditor to payment in respect of such claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, disputed, undisputed, legal, equitable, secured or unsecured, and whether or not such claim is discharged, stayed or otherwise affected by any proceeding referred to in Section 6.01(f). Without limiting the generality of the foregoing, the Obligations of any Loan Party under the Loan Documents include (a) all advances to, and debts (including principal, interest, fees (including any fees payable pursuant to the Fee Letter), costs, and expenses), liabilities, obligations, covenants, indemnities, and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Advance or Letter of Credit (including payments in respect of reimbursement of disbursements, interest thereon and obligations to provide cash collateral therefor), whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest, fees (including any fees payable pursuant to the Fee Letter), costs, expenses and indemnities that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest, fees, costs, expenses and indemnities are allowed claims in such proceeding, and (b) any Other Liabilities. Notwithstanding the foregoing, the Obligations shall not include any Excluded Swap Obligations.

 

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“OFAC” means The Office of Foreign Assets Control of the U.S. Department of the Treasury.

“Other Liabilities” means (a) any obligation on account of (i) any Cash Management Services furnished to any of the Loan Parties or any of their Restricted Subsidiaries and/or (ii) any transaction with any Lender or any of its Affiliates, which arises out of any Bank Product entered into with any Loan Party and any such Person, as each may be amended from time to time.

“Other Taxes” has the meaning specified in Section 2.12(b).

“Outstanding Amount” means with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date.

“Overadvance” means an Advance to the extent that, immediately after its having been made, Excess Availability is less than zero.

“Parent” has the meaning specified in the recital of partiespreamble to this Agreement.

“Parent Guaranty” means the guaranty of the Parent set forth in Article VIII.

“Participant Register” has the meaning specified in Section 9.07(g).

“Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. 107-56, signed into law October 26, 2001.

“Payee” shall mean any Agent, Lender or any other recipient of any payment to be made by or on account of any obligation of any Loan Party under any Loan Document, including any participant.

“Payment Conditions” means, at the time of determination with respect to any transaction or payment to which the Payment Conditions appliesapply , that:

(a) the date of consummation of such transaction or payment is after the End Date,

(b) no Event of Default under Section 6.01(a) or 6.01(f) shall have occurred and be continuing at such time or would immediately result therefrom,

(b) either:

(c) (i)  (A)until Discharge of the Term Obligations, Excess Availability plus Eligible Cash Collateral (without duplication of Borrowing Base Eligible Cash Collateral)shall be, on the date of such transaction or payment, and for the three (3) month period immediately preceding such transaction or payment, not less than thirty-five percent (35%) of the Global Borrowing Base (calculated without giving effect to the Term Pushdown Reserve) (in each case calculated on a pro forma basis after giving effect to such transaction or payment), or (ii) from and after Discharge of the Term Obligations, Excess Availability shall be, on the date of such transaction or payment, and for the three (3) month period immediately preceding such transaction or payment, not less than twelve and one-halffifteen percent (12.515%) of the Borrowing Base (in each case calculated on a pro forma basis after giving effect to such transaction or payment), and;

 

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(Bd) the Fixed Charge Coverage Ratio as of the end of the most recently ended Measurement Period for which financial statements have been or are required to have been delivered pursuant to Section 5.03(b), (c) or (g) shall be greater than or equal to 1.00 to 1.00 (calculated on a pro forma basis after giving effect to such transaction or payment as if such transaction or payment had been made as of the first day of such Measurement Period) (provided that the condition set forth in this clause (B) shall not be a condition to the Transfer of assets pursuant to Section 5.02(e)(xv) or to the prepayment of Subordinated Debt pursuant to Section 5.02(j)(i)), or(ii) Excess Availability plus Eligible Cash Collateral (without duplication of Borrowing Base Eligible Cash Collateral) shall be, on the date of such transaction or payment, and projected to be for the 3 month period immediately following such transaction or payment, not less than twenty percent (20%) of the Borrowing Base (in each case calculated on a pro forma basis after giving effect to such transaction or payment) (provided that the condition set forth in this clause (ii) shall not as if such transaction or payment had been made as of the first day of such Measurement Period), and the Borrower would be a conditionable to the prepaymentincur at least $1 of Subordinated Debt pursuant to Section  5.02(jb )(ixi )), (without taking into account the requirement therein to satisfy the Payment Conditions) on the date of such transaction or payment; and

(ce) at least five (5) days prior to the consummation of such transaction or the making of such payment, the Borrower shall have provided to the Administrative Agent a certificate signed by a Responsible Officer of the Borrower, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to and attaching evidence (including, without limitation, financial statements for the applicable period limited to the extent necessary to demonstrate calculation of the Payment Conditions, whether or not otherwise required to be delivered pursuant to Section 5.03; provided, however, that in the event such certificate is being delivered concurrently with the financial statements most recently required to be delivered pursuant to Section 5.03 and such financial statements cover the applicable period for which Payment Conditions are required to be satisfied, the delivery of such financial statements pursuant to Section 5.03 shall satisfy the requirement to deliver financial statements pursuant to this clause (ce)) of satisfaction of the conditions contained in clauses (ab), (c) and (bd) above on a basis (including, without limitation, giving due consideration to results for prior periods) reasonably satisfactory to the Administrative Agent.

“PBGC” means the Pension Benefit Guaranty Corporation (or any successor).

“Permitted Acquisition” has the meaning specified in Section 5.02(f)(vii).

“Permitted Discretion” means a determination made in good faith and in the exercise of its commercially reasonable (from the perspective of, and with customary business practices for, a secured asset-based lender in the retail industry) business judgment, based upon its consideration of any factor that it reasonably believes (i) could materially adversely affect the quantity, quality, mix or value of Collateral (including any applicable laws that may inhibit collection of a receivable), the enforceability or priority of an Agent’s liens thereon, or the amount that the Administrative Agent, the Lenders or the Issuing Bank could receive in liquidation of any Collateral; (ii) that any collateral report or financial information delivered by a Borrower or any Guarantor is incomplete, inaccurate or misleading in any material respect; or (iii) creates or could result in an event of default. In exercising such judgment, the Administrative Agent may consider any factors that could materially increase the credit risk of lending to the BorrowersBorrower on the security of the Collateral. Any Reserve or eligibility criteria 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 or eligibility criteria, as reasonably determined, without duplication, by the Administrative Agent in good faith; provided that circumstances,

 

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conditions, events or contingencies existing or arising prior to the First Amendment Effective Date and, in each case, disclosed in writing by Parent or any Restricted Subsidiary in connection with this Agreement or otherwise known to the Administrative Agent, in either case, prior to the First Amendment Effective Date and for which no Reserves or eligibility criteria have been established as of the First Amendment Effective Date, shall not be the basis for any establishment of any Reserves or eligibility criteria after the First Amendment Effective Date, unless such circumstances, conditions, events or contingencies shall have changed in a material respect since the First Amendment Effective Date.

“Permitted Distributions” shall mean (i) [intentionally omitted], (ii) payments by the Borrower or its Subsidiaries to or on behalf of Parent for franchise taxes and other fees required to maintain the legal existence of Parent or to pay the out-of-pocket legal, accounting and other fees and expenses in the nature of overhead in the ordinary course of business of Parent, including without limitation payment of fees and reimbursement of expenses of the board of directors and payments by the Parent to its direct or indirect parent company for such taxes, fees and expenses applicable to such parent company, and (iii) any payments to Parent (and payments by Parent to its direct or indirect parent company) in order for Parent (or such direct or indirect parent company) to pay for any taxable period for which Parent, the Borrower and any of its Subsidiaries are members of a consolidated, combined or similar income tax group for federal and/or applicable state or local income tax purposes or are entities treated as disregarded from any such member for U.S. federal income tax purposes (a “Tax Group”) of which Parent (or any direct or indirect parent company of Parent) is the common parent, any consolidated, combined or similar income taxes of such Tax Group that are due and payable by Parent (or any such direct or indirect parent company of Parent) for such taxable period; provided that the amount of such payment shall not exceed the amount that the Borrower would be required to pay in respect of federal, state, local or non-US taxes were the Borrower a corporation filing a consolidated return with each of its domestic Subsidiaries.

“Permitted Investment” has the meaning specified in Section 5.02(f).

“Permitted Liens” means:

(a) Liens for taxes, assessments and governmental charges or levies to the extent not yet due or not required to be paid under Section 5.01(b) and Liens for taxes, assessments or governmental charges or levies, which are being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP;

(b) Liens imposed by contract or law, such as materialmen’s, mechanics’, carriers’, workmen’s and repairmen’s Liens and other similar Liens arising in the ordinary course of business securing obligations that (i) in the aggregate do not materially adversely affect the use of the property to which they relate and (ii) are being contested in good faith and for which adequate reserves have been established in accordance with GAAP;

(c) Liens in the ordinary course of business to secure obligations under workers’ compensation laws, unemployment insurance, social security or similar legislation or to secure public or statutory obligations;

(d) deposits to secure the performance of bids, trade contracts and leases (other than Debt), contracts for the purchase of property otherwise permitted by this Agreement, statutory obligations, surety bonds (other than bonds related to judgments or litigation), performance bonds and other obligations of a like nature incurred in the ordinary course of business;

 

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(e) Liens securing judgments, decrees, attachments or awards (or the payment of money) not constituting an Event of Default under Section 6.01(g) or securing appeal or other surety bonds related to such judgments;

(f) easements, rights of way, restrictions, zoning, building codes and other land use laws and other encumbrances on imperfections of title to real property that do not materially adversely affect the use of such property for its present purposes;

(g) statutory, or common law or contractual Liens of landlords, creditor depository institutions or institutions holding securities accounts (including rights of set-off or similar rights and remedies);

(h) any interest or title of a lessor or sublessor under any lease of real estate or non-exclusive licensor or sublicensor of Intellectual Property not prohibited hereby;

(i) Liens on the property of a Person existing at the time such Person becomes a Subsidiary of the Borrower securing Debt permitted by Section 5.02(b)(ix); provided that, any such Lien may not extend to any other Propertyproperty of the Borrower or any other Subsidiary that is not a direct Subsidiary of such Person; and provided further that, any such Lien was not created in anticipation of or in connection with the transaction or series of transactions pursuant to which such Person became a Subsidiary of the Borrower;

(j) Liens on property at the time the Borrower or any Subsidiary acquired such property, including any acquisition by means of a merger, amalgamation or consolidation with or into the Borrower or any of its Subsidiaries; provided that, such Lien may not extend to any other property of the Borrower or any of its Subsidiaries; provided further that, such Liens shall not have been created in anticipation of or in connection with the transaction or series of transactions pursuant to which such property was acquired by the Borrower or any Subsidiary;

(k) Liens on specific items of inventory or other goods and the proceeds thereof (in favor of MGF securing obligations (consisting solely of trade receivables and each ofnot, for the following relating thereto: documents, instruments, accounts, chattel paper, letter of credit rights, general intangibles, supporting obligations, and claims under insurance policies) securing such Person’s obligations in respect of bankers’ acceptances or letters of credit issued or credited for the account of such Person to facilitate the purchase, shipment or storage of such inventory or goodsavoidance of doubt, any Debt for borrowed money) owing to MGF by the Borrower or any Subsidiary, to the extent such Liens are subject to the MGF Intercreditor Agreement; provided that any such Liens are junior to the Liens on the Collateral securing the Obligations;

(l) Liens arising under conditional sale, title retention, consignment or similar arrangements for the sale of goods in the ordinary course of business;

(m) Liens on insurance proceeds securing the payment of financed insurance premiums;

(n) leases or subleases and licenses or sublicenses granted to others in the ordinary course of business and otherwise permitted by Section 5.02(e);

(o) customary Liens granted in favor of a trustee to secure fees and other amounts owing to such trustee under an indenture or other agreement pursuant to which Debt permitted by Section 5.02(b) is issued         [reserved];

 

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(p) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of custom duties in connection with the importation of goods;

(q) the filing of precautionary financing statements in connection with operating leases, consignment, Transfers permitted under Section 5.02(e) and similar matters;

(r) Liens (i) on proceeds of sales of assets held in escrow pending resolution of indemnity or purchase price reduction claims and (ii) on cash advances in favor of the seller of any property to be acquired in any Permitted Investment to be applied against the purchase price for such Investment so long as such Investment would have been permitted on the date of the creation of such Lien;

(s) other Liens on assets (other than Intellectual Property unless the same would otherwise be permitted by Section 5.02(e)), securing Debt or other obligations not prohibited hereunder (but not, for the avoidance of doubt, any Debt for borrowed money) in an aggregate amount not to exceed $25,000,0001,000,000 at any time outstanding;

 

(t)	Liens granted pursuant to the Collateral Documents;

(u) (i) Liens securing Debt permitted pursuant to Section 5.02(b)(viii) and (ii) any Lien in existence on the FirstSecond Amendment Effective Date and set forth on Schedule 5.02(a) or securing Debt permitted pursuant to Section 5.02(b)(iii);

(v) replacement, extension and renewal of any Lien permitted hereby (provided, however, that (1) no such Lien shall extend to or cover any property not theretofore subject to the Lien being extended, renewed or replaced and (2) the aggregate amount secured shall not exceed the amount permitted to be secured prior to such extension, renewal, replacement, refinancing, refunding or defeasance (plus the amount of any premium paid in respect thereof in connection with any such extension, refunding, refinancing, renewing, replacing or defeasing and plus the amount of reasonable expenses incurred in connection therewith));

(w) Liens securing purchase money Debt incurred pursuant to Section 5.02(b)(ii), provided that any such Liens attach only to the property being financed pursuant to such IndebtednessDebt and do not encumber any other property of any Loan Party;

(x) bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more accounts maintained by any Loan Party, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with respect to cash management and operating account arrangements, including those involving pooled accounts and netting arrangements, provided that, unless such Liens are non-consensual and arise by operation of law, in no case shall any such Liens secure (either directly or indirectly) the repayment of any Debt;

(y) purchase money Liens upon or in real property or equipment acquired or held by the Borrower or any of its Subsidiaries in the ordinary course of business to secure the purchase price of such property or equipment or to secure Debt incurred solely for the purpose of financing the acquisition of any such property or equipment to be subject to such Liens, or Liens existing on any such property or equipment at the time of acquisition (other than any such Liens created in contemplation of such acquisition that do not secure the purchase price), or extensions, renewals or replacements of any of the foregoing for the same or a lesser amount; provided, however, that

 

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no such Lien shall extend to or cover any property other than the property or equipment being acquired; (z) [Intentionally Omitted]; (aa) Liens securing Debt incurred pursuant to Section 5.02(b)(xii); and (bb) Liens on cash collateral securing Debt permitted pursuant to Section 5.02(b)(xv). y) [reserved]; and

(z) Liens in favor of the Term Collateral Agent securing Term Obligations to the extent permitted under Section 5.02(b)(viii), to the extent such Liens are subject to the ABL Intercreditor Agreement; provided that any such Liens on any ABL Priority Collateral are junior to the Liens on the ABL Priority Collateral securing the Obligations.

“Permitted Preferred Stock” means and refers to any Preferred Stock issued by the Parent (or its direct or indirect parent) that is not Prohibited Preferred Stock.

“Permitted Refinancing Debt” means, with respect to any Person, any refinancing, replacing, refunding, renewing, defeasance or extension of any Debt of such Person (or any successor of such Person); provided that (A) the amount of such refinancing, replacing, refunding, renewing, defeasing or extending Debt does not result in an increase in the aggregate principal or facility amount thereof (plus the amount of any premium paid in respect of such Debt in connection with any such refinancing, replacing, refunding, renewing, defeasance or extension and plus the amount of reasonable expenses incurred by Parent and its Restricted Subsidiaries in connection therewith), provided that in the case of Permitted Refinancing Debt incurred in respect of the Term Loans, the aggregate principal amount thereof shall not exceed the amount permitted to be incurred pursuant to Section 5.02(b)(viii), (B) such Debt (if it is term debt) does not have a weighted average life to maturity that is less than the weighted average life to maturity of the Debt being extended, refunded, refinanced, renewed, replaced or defeased, (C) such Debt (if it is term debt) does not have a final maturity earlier than the final maturity of the Debt being extended, refunded, refinanced, renewed, replaced or defeased, (D) the direct and contingent obligors therefor shall not be changed (unless any contingent obligor is released), as a result of or in connection with such refinancing, replacing, refunding, renewing, defeasance or extension, (E) if the Debt being refinanced, replaced, refunded, renewed, defeased or extended, is subordinate or junior to the Obligations and any Guaranty thereof, then the Debt incurred to extend, refund or refinance such Debt shall be subordinate to the Obligations and any Guaranty, as the case may be, at least to the same extent and in the same manner as the Debt being refinanced, replaced, refunded, renewed, defeased or extended, (F) the terms of any agreement entered into and of any instrument issued in connection with such Debt are no less favorable in any material respect to the Loan Parties or the Lenders than the terms of any agreement or instrument governing the Debt being refinanced, replaced, refunded, renewed, defeased or extended and the interest rate applicable to any such refinancing, refunding, renewing or extending Debt does not exceed the then applicable market interest rate, (G) if such Debt is Subordinated Debt, such Permitted Refinancing Debt shall be subject to a subordination agreement in form and substance satisfactory to the Administrative Agent, and (H) in the case of Permitted Refinancing Debt incurred in respect of the Term Loans, if such Permitted Refinancing Debt is secured, such Permitted Refinancing Debt and the Liens securing such Permitted Refinancing Debt shall be permitted by, and subject to the terms of, the ABL Intercreditor Agreement.

“Person” means an individual, partnership, corporation (including a business trust), limited liability company, joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.

“Plan” means a Single Employer Plan or a Multiple Employer Plan.

“Post -Closing Letter” means the letter agreement, dated as of the Second Amendment Effective Date, by and among the Administrative Agent and the Loan Parties.

 

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“Post- Petition Interest” has the meaning specified in Section 8.06.

“Preferred Stock” means, as applied to the Equity Interests of any Person, the Equity Interests of any class or classes (however designated) that is preferred with respect to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Equity Interests of any other class of such Person.

“Priority Payable Reserves” means reserves established in the Permitted Discretion of the Administrative Agent for amounts secured by any Liens, choate or inchoate, which rank or are capable of ranking in priority to the Agents’ and/or Lenders’ Liens and/or for amounts which may represent costs relating to the enforcement of the Agent’s Liens including, without limitation, in the Permitted Discretion of the Administrative Agent, any such amounts due and not paid for vacation pay, amounts due and not paid under any legislation relating to workers’ compensation or to employment insurance.

“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 of such Lender under the applicable Facility or Facilities at such time and the denominator of which is the amount of the Aggregate Commitments under the applicable Facility or Facilities at such time; provided that if such Commitments have been terminated, then the Pro Rata Share of each Lender shall be determined based on the Pro Rata Share of such Lender immediately prior to such termination and after giving effect to any subsequent assignments made pursuant to the terms hereof.

“Prohibited Preferred Stock” means any Preferred Stock that by its terms is mandatorily redeemable or subject to any other payment obligation (including any obligation to pay dividends, other than dividends of shares of Preferred Stock of the same class and series payable in kind or dividends of shares of common stock) on or before a date that is less than 1 year after the TerminationMaturity Date, or, on or before the date that is less than 1 year after the TerminationMaturity Date, is redeemable at the option of the holder thereof for cash or assets or securities (other than distributions in kind of shares of Preferred Stock of the same class and series or of shares of common stock).

“Protective Advance” has the meaning specified in Section 2.01(d).

“Provider” has the meaning specified in Section 7.12.

“PTO ” means the United States Patent and Trademark Office (or any equivalent office).

“QFC ” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. § 5390(c)(8)(D).

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

“Qualified Capital Stock” of any person shall mean any Equity Interests of such person that are not Disqualified Stock.

“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant guaranty or grant of the relevant security interest becomes effective with respect to such Swap Obligation or such other person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

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“Reaffirmation Agreement” means that certain Confirmation, Ratification and Amendment of Ancillary Loan Documents, dated as of the Effective Date, executed and delivered by the Loan Parties and the Administrative Agent.

“Redeemable” means, with respect to any Equity Interest, any such Equity Interest that (a) the issuer has undertaken to redeem at a fixed or determinable date or dates, whether by operation of a sinking fund or otherwise, or upon the occurrence of a condition not solely within the control of the issuer or (b) is redeemable at the option of the holder.

“Register” has the meaning specified in Section 9.07(d).

“Regulation U” means Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time.

“Relevant Governmental Body” means the Board and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board and/or the Federal Reserve Bank of New York or any successor thereto.

“Required Lenders” means, at any time, at least two Lenders that are not Affiliates (unless there shall, at any date of determination, be fewer than two Lenders that are not Affiliates) owed or holding at least a majority in interest of the sum of (a) the aggregate principal amount of the Advances outstanding at such time, (b) the aggregate Available Amount of all Letters of Credit outstanding at such time and (c) the aggregate Unused Commitments at such time; provided, however, that if any Lender shall be a Defaulting Lender at such time, there shall be excluded from the determination of Required Lenders at such time (A) the aggregate principal amount of the Advances owing to such Lender (in its capacity as a Lender) and outstanding at such time, (B) such Lender’s Pro Rata Share of the aggregate Available Amount of all Letters of Credit outstanding at such time and (C) the Unused Commitment of such Lender at such time. For purposes of this definition, the aggregate principal amount of Swing Line Advances owing to the Swing Line Bank and of Letter of Credit Advances owing to the Issuing Bank and the Available Amount of each Letter of Credit shall be considered to be owed to the Revolving Credit Lenders ratably in accordance with their respective Commitments.

“Reserves” means any and all reserves which the Administrative Agent deems necessary, in its Permitted Discretion, to maintain against the Borrowing Base: (a) to reflect anythe impediments to the Agents’ ability to realize upon the Collateral, (b) to reflect claims and liabilities that the Administrative Agent determines will need to be satisfied in connection with the realization onupon the Collateral included in the Borrowing Base, (c) to reflect criteria, events, conditions, contingencies or risks which adversely affect any component of the Borrowing Base, or the assets, business, financial performance or financial condition of any Loan Party, or (d) to reflect that a Default has occurred and is continuing (provided that in the case of this clause (d), the reserve shall be reasonably related to the event giving rise to such Default), which may be instituted by the Administrative Agent upon five Business Days’ prior notice to the Borrowerin accordance with Section 2.17 hereof (including, without limitation, Inventory Reserves, Priority Payable Reserves, Cash Management Reserves, Bank Product Reserves, reserves for Customer Credit Liabilities (not to exceed 50% of such liability), and reserves due to reasonably anticipated changes in the Net Orderly Liquidation Value of Eligible Inventory between appraisals); provided, however, that (i) rent Reserves for locations leased by any Loan Party (A) shall not be taken for leased retail stores or for leased locations covered by a Collateral Access Agreement and (B) for all other leased locations, shall be limited to (x) in the case of the Borrower’s corporate headquarters, one month’s rent and (y) in all other cases, three months’ rent but in any event shall not exceed the total value of Eligible Inventory at any such other location, (ii) Reserves for consignee’s, warehousemen’s and bailee’s charges (A) shall not be taken for locations covered by an acknowledged bailee waiver lettera Collateral

 

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Access Agreement and (B) for all other such locations, shall be limited to three months’ charges but in any event shall not exceed the total value of Eligible Inventory at any such other location, (iii) all Reserves (including the amount of such Reserve) shall bear a reasonable relationship to the events, conditions or circumstances that are the basis for such Reserve and (iv) the amount of any Reserve shall not be duplicative of the amount of any other Reserve imposed hereunder with respect to the same events, conditions or circumstances. In the event that the Administrative Agent determines in its Permitted Discretion that (a) the events, conditions or circumstances underlying the maintenance of any Reserve shall cease to exist or (b) the liability that is the basis for any Reserve has been reduced, then such Reserve shall be rescinded or reduced in an amount as determined in Administrative Agent’s Permitted Discretion, as applicable, at the request of the Borrower.

“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.

“Responsible Officer” means the Chief Executive Officer, Chief Financial Officer and Treasurer of the Parent or the Borrower, as applicable, or any other individual designated in writing to the Administrative Agent by an existing Responsible Officer of a Loan Party as an authorized signatory of any certificate or other document to be delivered hereunder, which other individual has been authenticated through the Administrative Agent’s electronic platform or portal in accordance with its procedures for such authentication.

“Restricted Payment” has the meaning specified in Section 5.02(g).

“Restricted Subsidiary” means a Subsidiary of the BorrowerHoldings other than an Unrestricted Subsidiary.

“Revolving Credit Advance” has the meaning specified in Section 2.01(a).

“Revolving Credit Borrowing” means a borrowing consisting of simultaneous Revolving Credit Advances of the same Type made by the Revolving Credit Lenders.

“Revolving Credit Facility” means, at any time, the aggregate amount of the Revolving Credit Lenders’ Commitments at such time.

“Revolving Credit Lender” means any Lender that has a Commitment.

“Revolving Credit Note” means a promissory note of the Borrower payable to the order of any Revolving Credit Lender, in substantially the form of Exhibit A hereto, evidencing the aggregate indebtedness of the Borrower to such Lender resulting from the Revolving Credit Advances, Letter of Credit Advances and Swing Line Advances made by such Lender, as amended.

“S&P” means Standard & Poor’sS&P Global Ratings, a division of The McGraw-Hill Companies, Inc.

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

 

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“Sanctioned Person” means, at any time (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 other Sanctions-related list maintained by any Governmental Authority, (b) a Person or legal entity that is a target of Sanctions, (c) any Person operating, organized or resident in a Sanctioned Entity that would be prohibited by applicable 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.

“Sanctions” means individually and collectively, respectively, any and all economic sanctions, trade sanctions, financial sanctions, sectoral sanctions, secondary sanctions, trade embargoes anti-terrorism laws and other sanctions laws, regulations or embargoes, including those imposed, administered or enforced from time to time by: (a) the United States of America, including those administered by OFAC, the U.S. Department of State, the U.S. Department of Commerce, or through any existing or future applicable executive order, (b) the United Nations Security Council, (c) the European Union or any European Union member state, (d) Her Majesty’s Treasury of the United Kingdom, or (d) any other Governmental Authority with jurisdiction over any Secured Party or any Loan Party or any of their respective Subsidiaries or Affiliates.

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

“Second Amendment” means that certain Second Amendment to Second Amended and Restated $250,000,000 Asset-Based Loan Credit Agreement dated as of the Second Amendment Effective Date by and among Holdings, Intermediate Holdings, the Parent, the Borrower, the Subsidiary Guarantors, the Lenders, the Issuing Bank, and the Swing Line Bank, and Wells Fargo Bank, National Association, as Administrative Agent and Collateral Agent.

“Second Amendment Effective Date” means the date on which the conditions specified in Section 5 of the Second Amendment are satisfied.

“Second Amendment Fee Letter” means the Second Amendment Fee Letter dated as of the Second Amendment Effective Date among the Loan Parties, the Lead Arranger, and the Agents.

“Secured Bank Product Agreement” means any agreement that is entered into by and between the Borrower or any of its Restricted Subsidiaries and any Agent or Lender or any of its Affiliates in connection with Bank Products provided by such Agent, Lender or Affiliate.

“Secured Cash Management Agreement” means any agreement that is entered into by and between the Borrower or any of its Restricted Subsidiaries and any Agent or Lender or any of its Affiliates in connection with Cash Management Services provided by such Agent or Lender or Affiliate.

“Secured Hedge Agreement” means any Hedge Agreement required or permitted under Article V that is entered into by and between the Borrower and any Hedge Bank.

“Secured Obligations” has the meaning specified in Section 23 of the Security Agreement.

“Secured Parties” means (a) the Agents, the Lender Parties, the Hedge Banks, the Agents, Lenders or Affiliates thereof that provide Bank Products, the Cash Management Banks, the beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document, each other Person to whom Obligations under this Agreement and other Loan Documents are owing, and the successors and assigns of each of the foregoing.

 

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“Security Agreement” means the Second Amended and Restated Security Agreement, dated as of the Second Amendment Effective Date (as amended, restated, supplemented or otherwise modified from time to time), by the Loan Parties in favor of the Collateral Agent.

“Significant Guarantor” means, at any date of determination, any (i) Subsidiary Guarantor of the Borrower that individually has or (ii) group of Subsidiary Guarantors of the Borrower, that in the aggregate has, in either case, revenues, assets or earnings in an amount equal to at least 5% of (a) the Consolidated revenues of the Parent and its Restricted Subsidiaries for the most recently completed Fiscal Quarter for which the Lenders have received financial statements of the Parent and its Restricted Subsidiaries pursuant to Section 5.03(b) or (c), (b) the Consolidated assets of the Parent and its Restricted Subsidiaries as of the last day of the most recently completed Fiscal Quarter for which the Lenders have received financial statements of the Parent and its Restricted Subsidiaries pursuant to Section 5.03(b) or (c), or (c) the Consolidated net earnings of the Parent and its Restricted Subsidiaries for the most recently completed Fiscal Quarter for which the Lenders have received financial statements of the Parent and its Restricted Subsidiaries pursuant to Section 5.03(b) or (c), in each case determined in accordance with GAAP for such period.

“Single Employer Plan” means a single employer plan, as defined in Section 4001(a)(15) of ERISA and subject to Title IV of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA Affiliate and no Person other than the Loan Parties and the ERISA Affiliates or (b) was so maintained and in respect of which any Loan Party or any ERISA Affiliate could have liability under Section 4069 of ERISA in the event such plan has been or were to be terminated.

“SOFR ” with respect to any day means the secured overnight financing rate published for such day by the Federal Reserve Bank of New York, as the administrator of the benchmark, (or a successor administrator) on the Federal Reserve Bank of New York’s Website.

“Solvent” and “Solvency” mean, with respect to any Person on a particular date, that on such date (a) the fair value of the property of such Person is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of such Person, (b) the present fair salable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay such debts and liabilities as they mature and (d) such Person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such Person’s property would constitute an unreasonably small capital. The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

“Specified Default” means any of the events described in (a) Section 6.01(a)(ii) (without giving effect to the fivethree (3) Business Day grace period specified therein), (b) Section 6.01(f) (without giving effect to the sixty (60) day period for any proceeding described therein to be undismissed or unstayed) or (c) Section 6.01(g) (without giving effect to the sixty (60) day period specified in clause (ii) thereof).

“Specified Equity Contribution” has the meaning specified in Section 5.05(b).

“Specified Representations” means the representations and warranties made by the Loan Parties in Section 4.01(d), Section 4.01(f), Section 4.01(h), Section 4.01(i), Section 4.01(l), Section 4.01(m), Section 4.01(n) (subject to customary limitations on the perfection of Liens on the Collateral in financing commitments obtained in connection with Limited Condition Transactions), Section 4.01(o), and the first sentence of Section 4.01(a).

 

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“Spot Rate” for a specified 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. (New York City time) 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.

“Standard Letter of Credit Practice” means, for the Issuing Bank, any domestic or foreign Law or letter of credit practices applicable in the city in which the 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 600, as chosen in the applicable Letter of Credit.

“Standby Letter of Credit” means any Letter of Credit that is not a Commercial Letter of Credit and that (a) is used in lieu or in support of performance guaranties or performance, surety or similar bonds (excluding appeal bonds) arising in the ordinary course of business, (b) is used in lieu or in support of stay or appeal bonds, (c) supports the payment of insurance premiums for reasonably necessary casualty insurance carried by any of the Loan Parties, or (d) supports payment or performance for identified purchases or exchanges of products or services in the ordinary course of business.

“Standby Letter of Credit Agreement” means the Standby Letter of Credit Agreement relating to the issuance of a Standby Letter of Credit in the form from time to time in use by the Issuing Bank.

“Subordinated Debt” means any Debt of any Loan Party that is secured by a Lien that is junior to Liens securing the Obligations (other than Debt under the Term Credit Agreement) or subordinated to the Obligations of such Loan Party under the Loan Documents, which Debt is on, and that otherwise contains, terms and conditions reasonably satisfactory to the Administrative Agent.

“Subordinated Obligations” has the meaning specified in Section 8.06.

“Subsidiary” of any Person means any corporation, partnership, joint venture, limited liability company, trust or estate of which (or in which) more than 50% of (a) the issued and outstanding capital stock having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether at the time capital stock of any other class or classes of such corporation shall or might have voting power upon the occurrence of any contingency), (b) the interest in the capital or profits of such partnership, joint venture or limited liability company or (c) the beneficial interest in such trust or estate is, in the case of clauses (a), (b) and (c), at the time directly or indirectly owned or controlled by such Person, by such Person and one or more of its other Subsidiaries or by one or more of such Person’s other Subsidiaries.

“Subsidiary Guarantors” means the Subsidiaries of the Parent listed on Schedule II hereto and each other Subsidiary of the Parent that shall be required to execute and deliver a guaranty pursuant to Section 5.01(j), and any other Person that guarantees the Obligations. For the avoidance of doubt, no Excluded Subsidiary shall be a Subsidiary Guarantor.

“Subsidiary Guaranty” means the guaranty of the Subsidiary Guarantors set forth in Article VIII, together with each other guaranty and guaranty supplement delivered pursuant to Section 5.01(j) of this Agreement and Section 5.01(j) of the Existing Credit Agreement, in each case, as amended, amended and restated, modified or otherwise supplemented.

 

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“Supermajority Lenders” means, at any time, at least two Lenders that are not Affiliates (unless there shall, at any date of determination, be fewer than two Lenders that are not Affiliates) owed or holding at least 66²⁄₃% of the sum of (a) the aggregate principal amount of the Advances outstanding at such time, (b) the aggregate Available Amount of all Letters of Credit outstanding at such time and (c) the aggregate Unused Commitments at such time; provided, however, that if any Lender shall be a Defaulting Lender at such time, there shall be excluded from the determination of Supermajority Lenders at such time (A) the aggregate principal amount of the Advances owing to such Lender (in its capacity as a Lender) and outstanding at such time, (B) such Lender’s Pro Rata Share of the aggregate Available Amount of all Letters of Credit outstanding at such time and (C) the Unused Commitment of such Lender at such time. For purposes of this definition, the aggregate principal amount of Swing Line Advances owing to the Swing Line Bank and of Letter of Credit Advances owing to the Issuing Bank and the Available Amount of each Letter of Credit shall be considered to be owed to the Revolving Credit Lenders ratably in accordance with their respective Commitments.

“Supplemental Collateral Agent” has the meaning specified in Section 7.01(c).

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

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

“Swing Line Advance” means an advance made by (a) the Swing Line Bank pursuant to Section 2.01(b) or (b) any Revolving Credit Lender pursuant to Section 2.02(b).

“Swing Line Bank” means the Initial Swing Line Bank and any Eligible Assignee to which the Swing Line Commitment hereunder has been assigned pursuant to Section 9.07.

“Swing Line Borrowing” means a borrowing consisting of a Swing Line Advance made by the Swing Line Bank pursuant to Section 2.01(b) or the Revolving Credit Lenders pursuant to Section 2.02(b).

“Swing Line Commitment” means, with respect to the Swing Line Bank at any time, the obligation to make a Swing Line Advance up to a maximum principal amount of $30,000,000 at any one time outstanding or, if the Swing Line Bank has entered into an Assignment and Assumption, set forth for the Swing Line Bank in the Register maintained by the Administrative Agent pursuant to Section 9.07(d) as the Swing Line Bank’s “Swing Line Commitment,” as such amount may be reduced at or prior to such time pursuant to Section 2.05.

“Swing Line Facility” means, at any time, an amount equal to the Swing Line Bank’s Swing Line Commitment at such time, as such amount may be reduced at or prior to such time pursuant to Section 2.05.

“Synthetic Debt” means, with respect to any Person, without duplication of any clause within the definition of “Debt,” all (a) Obligations of such Person under any lease that is treated as an operating lease for financial accounting purposes and a financing lease for tax purposes (i.e., a “synthetic lease”) and (b) Obligations of such Person in respect of transactions entered into by such Person that are intended to function primarily as a borrowing of funds (including, without limitation, any minority interest

 

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transactions that function primarily as a borrowing) but are not otherwise included in the definition of “Debt” or as a liability on a Consolidated balance sheet of such Person and its Restricted Subsidiaries in accordance with GAAP.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Term Administrative Agent” means (a) Wells Fargo Bank, National Association, its capacity as administrative agent for the lenders under the Term Credit Agreement, (b) any successor to Wells Fargo Bank, National Association, by assignment or otherwise, in its capacity as administrative agent for the lenders under the Term Credit Agreement, and (c) any other party that may become agent or trustee under the Term Credit Agreement or Permitted Refinancing Debt in respect thereof, in each case of clauses (a) through (c) to the extent a party to the ABL Intercreditor Agreement.

“Term Agents” means, collectively, the Term Administrative Agent and the Term Collateral Agent.

“Term Borrowing Base” means the “Term Loan Borrowing Base” as such term is defined in the Term Credit Agreement.

“Term Collateral Agent” means (a) Wells Fargo Bank, National Association, its capacity as collateral agent for the lenders under the Term Credit Agreement, (b) any successor to Wells Fargo Bank, National Association, by assignment or otherwise, in its capacity as collateral agent for the lenders under the Term Credit Agreement, and (c) any other party that may become agent or trustee under the Term Credit Agreement or Permitted Refinancing Debt in respect thereof, in each case of clauses (a) through (c) to the extent a party to the ABL Intercreditor Agreement.

“Term Credit Agreement” means that certain $140,000,000 Asset-Based Term Loan Agreement dated as of the Second Amendment Effective Date, among the Loan Parties, the lenders party thereto, and the Term Agents, as amended, amended and restated, supplemented, extended or otherwise modified from time to time in accordance with the provisions hereof and of the ABL Intercreditor Agreement, and any replacement credit agreement entered into pursuant to any Permitted Refinancing Debt (subject to the ABL Intercreditor Agreement) in respect thereof.

“Term Documents” means the “Loan Documents” as such term is defined in the Term Credit Agreement.

“Term Loan Borrowing Base” means the “Term Loan Borrowing Base” as such term is defined in the Term Credit Agreement.

“Term Loan Borrowing Base Certificate” means the “Term Loan Borrowing Base Certificate” as such term is defined in the Term Credit Agreement.

“Term Loans” means the “Loans” as defined in the Term Credit Agreement.

“Term Obligations” has the meaning set forth for such term in the ABL Intercreditor Agreement.

“Term Priority Collateral” has the meaning set forth for such term in the ABL Intercreditor Agreement.

 

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“Term Pushdown Reserve” means the “Term Pushdown Reserve” as defined in the Term Credit Agreement.

“Term SOFR” means the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

“Termination Date” means the earliestearlier of (a) the date of termination in whole of the Commitments, the Letter of Credit Facility and the Swing Line Commitment, pursuant to Section 2.05 or 6.01, and (b) May 24, 2024the Maturity Date.

“Trading With the Enemy Act” has the meaning specified in Section 4.01(h)(ii).

“Transaction” means the transactions contemplated by the Loan Documents, including any amendments thereto.

“Transaction Expenses” means fees, costs and expenses incurred in connection with the Transaction, whether before or after the Effective Date.

“Transfer” has the meaning specified in Section 5.02(e).

“Triggering Event” means that either (a) an Event of Default has occurred and is continuing, or (b) Excess Availability plus Eligible Cash Collateral (without duplication of Borrowing Base Eligible Cash Collateral) is less than 1020 % of the Borrowing Base for five consecutive Business Days(calculated without giving effect to the Term Pushdown Reserve) at any time. A Triggering Event shall be deemed to be continuing until either (a) such Event of Default has been waived in accordance with the terms of this Agreement, or (b) Excess Availability plus Eligible Cash Collateral (without duplication of Borrowing Base Eligible Cash Collateral) exceeds 1020% of the Borrowing Base (calculated without giving effect to the Term Pushdown Reserve) for 30 consecutive days. Notwithstanding anything to the contrary, if a Triggering Event occurs during the period commencing on the Second Amendment Effective Date and continuing through and including the End Date, such Triggering Event shall be deemed to be continuing until the first date following the End Date on which the conditions described in the immediately preceding sentence shall have been satisfied.

“Type” refers to the distinction between Advances bearing interest at the Base Rate and Advances bearing interest at the Eurodollar Rate.

“UCC” has the meaning specified in the Security Agreement.

“UCP 600” 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 subsequent revision thereof adopted by the International Chamber of Commerce on the date such Letter of Credit is issued.

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

“Unintentional Overadvance” means an Overadvance which, to the Agents’ knowledge, did not constitute an Overadvance when made but which has become an Overadvance resulting from changed circumstances beyond the control of the Secured Parties, including, without limitation, a reduction in the value of property or assets included in the Borrowing Base, increase in Reserves, or misrepresentation by the Loan Parties.

 

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“Unmatured Surviving Obligations” means Obligations under this Agreement and the other Loan Documents that by their terms survive the termination of this Agreement or the other Loan Documents but are not, as of the date of determination, due and payable and for which no outstanding claim has been made.

“Unrestricted Subsidiary” means any Subsidiary of Parent (other than any Loan Party) designated by the Borrower as an Unrestricted Subsidiary pursuant to Section 5.01(l) subsequent to the First Amendment Effective DateEnd Date, and subject to Section 5.02(k); provided that no Subsidiary may be, or may be designated as, an Unrestricted Subsidiary unless (a) it is a CFC, or (b) it does not have any material liabilities, is not engaged in any business or commercial activities, does not own any assets with a book value of more than $3,000,000 in the aggregate, and is not obligated or liable, directly or indirectly, contingently or otherwise, in respect of any Debt in any material amount, and (b) it does not own any Intellectual Property.

“Unused Commitment” means, with respect to any Revolving Credit Lender at any time, (a) such Lender’s Commitment at such time minus (b) the sum of (i) the aggregate principal amount of all Revolving Credit Advances, Swing Line Advances and Letter of Credit Advances made by such Lender (in its capacity as a Lender) and outstanding at such time plus, without duplication, (ii) such Lender’s Pro Rata Share of (A) the aggregate Available Amount of all Letters of Credit outstanding at such time, (B) the aggregate principal amount of all Letter of Credit Advances made by the Issuing Bank pursuant to Section 2.03(d) and outstanding at such time and (C) the aggregate principal amount of all Swing Line Advances made by the Swing Line Bank pursuant to Section 2.01(b) and outstanding at such time.

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

“Used Commitment” means, with respect to any Revolving Credit Lender at any time, the sum of (a) the aggregate principal amount of all Revolving Credit Advances, Swing Line Advances and Letter of Credit Advances made by such Lender (in its capacity as a Lender) and outstanding at such time and, without duplication, (b) such Lender’s Pro Rata Share of (i) the aggregate Available Amount of all Letters of Credit outstanding at such time, (ii) the aggregate principal amount of all Letter of Credit Advances made by the Issuing Bank pursuant to Section 2.03(d) and outstanding at such time and (iii) the aggregate principal amount of all Swing Line Advances made by the Swing Line Bank pursuant to Section 2.01(b) and outstanding at such time.

“USCO ” means the United States Copyright Office (or any equivalent office).

“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.

“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.

“Voting Interests” means shares of capital stock issued by a corporation, or equivalent Equity Interests in any other Person, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even if the right so to vote has been suspended by the happening of such a contingency.

 

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“WFB” means Wells Fargo Bank, National Association and its successors.

“Withdrawal Liability” has the meaning specified in Part I of Subtitle E of Title IV of ERISA.

“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.

Notwithstanding anything to the contrary herein or in any other Loan Document, any reference to a defined term as defined in the Term Credit Agreement or any other Term Document shall refer to the definition of such term as in effect on the Second Amendment Effective Date (including with respect to any component definitions (or any sub-component definitions)), except with respect to any amendment or modification thereto (or to any component definitions (or any sub-component definitions)) permitted under this Agreement and the ABL Intercreditor Agreement or otherwise consented to by the Agents and the Required Lenders.

SECTION  1.02. SECTION 1.02. Computation of Time Periods; Other Definitional Provisions.

(a) In this Agreement and the other Loan Documents in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding.” References in the Loan Documents to any agreement or contract “as amended” shall mean and be a reference to such agreement or contract as amended, amended and restated, restated, supplemented or otherwise modified from time to time in accordance with its terms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”

(b) Any reference herein or in any other Loan Document to the satisfaction, repayment, or payment in full of the Obligations shall mean (i) the indefeasible repayment in Dollars in full in cash or immediately available funds (or, in the case of contingent reimbursement obligations with respect to Letters of Credit and Bank Products (other than Hedge Agreements) and any other Unmatured Surviving Obligation, including indemnification obligations, providing Cash Collateralization) or other collateral as may be requested by any Agent of all of the Obligations (including the payment of any termination amount then applicable (or which would or could become applicable as a result of the repayment of the other Obligations) under Hedge Agreements) other than (A) Unmatured Surviving Obligations, (B) any Obligations relating to Bank Products (other than Hedge Agreements) that, at such time, are allowed by the applicable Provider to remain outstanding without being required to be repaid or Cash Collateralized or other collateral as may be requested by any Agent, and (C) any Obligations relating to Hedge Agreements that, at such time, are allowed by the applicable Provider of such Hedge Agreements to remain outstanding without being required to be repaid, and (ii) the termination of (A) the Aggregate Commitments, (B) the obligation of the Issuing Bank to issue Letters of Credit hereunder, and (C) the Loan Documents.

SECTION  1.03. SECTION 1.03. Accounting Terms.

All accounting terms not specifically or completely defined herein shall be construed in accordance with generally accepted accounting principles as in effect from time to time in the United States (“GAAP”), applied on a consistent basis; provided,

 

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however, that if at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and the Borrower or the Administrative Agent shall so request, the Administrative Agent and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP; provided that, until so amended, such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein. Notwithstanding anything herein to the contrary or any changes in GAAP after the Effective DateDecember 31, 2018 that would require lease obligations (whether existing now or entered in the futurenot such lease existed on December 31, 2018 or thereafter arose) that would be treated as operating leases as of the Effective DateDecember 31, 2018 to be classified and accounted for as a Capitalized Lease or otherwise reflected on a Person’s consolidated balance sheet, such obligations shall continue to be excluded from the definition of Debt and shall not be treated as an obligation under a Capitalized Lease for any purposes hereunder or under any Loan Document.

SECTION 1.04. Foreign Subsidiaries. Notwithstanding anything in this Agreement or any other Loan Document to the contrary, (a) the Foreign Subsidiaries shall not be subject to any representation or warranty, any covenant, or any other provision of any Loan Document and the non-compliance by any Foreign Subsidiary with any provision of any Loan Document shall not constitute a Default or Event of Default under any Loan Document, (b) all financial ratios or requirements set forth in any Loan Document shall be calculated without regard to the Foreign Subsidiaries, and (c) all references in any definition or provision describing the calculation of such financial ratios or requirements shall disregard the Foreign Subsidiaries notwithstanding any language to the contrary in such definition that such calculation applies to any Person and its Subsidiaries, unless, in each case, Foreign Subsidiaries are expressly included in such requirement or calculation.

SECTION  1.04. [Reserved].

SECTION 1.05. SECTION 1.05. Letter of Credit Amounts. Unless otherwise specified, all references herein to the amount of a Letter of Credit at any time shall be deemed to be the Available Amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms of any Issuer Documents related thereto, provides for one or more automatic increases in the Available Amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum Available Amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum Available Amount is in effect at such time.

SECTION  1.06. SECTION 1.06. Divisions. For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Equity Interests at such time.

SECTION 1.07. Limited Condition Transactions. Notwithstanding anything to the contrary in this Agreement or any other Loan Document, in connection with any action being taken in connection with a Limited Condition Transaction, for purposes of:

(a) determining compliance with any provision of this Agreement which requires the calculation of any financial ratio or test, including, the Fixed Charge Coverage Ratio, the Leverage Ratio or satisfaction of the Payment Conditions; or

 

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(b) determining compliance with representations and warranties (other than Specified Representations) and defaults or events of default; or

(c) testing availability under baskets set forth in this Agreement (including baskets measured as a percentage of EBITDA);

in each case, at the option of the Borrower (the Borrower’s election to exercise such option in connection with any Limited Condition Transaction, an “LCT Election”), the date of determination of whether any such action is permitted hereunder shall be deemed to be the date the definitive agreement for such Limited Condition Transaction is entered into (the “LCT Test Date”) (provided that with respect to any required calculation of the Payment Conditions on the LCT Test Date, such calculation shall be effective only in the event that such Limited Condition Transaction is consummated within 180 days following the LCT Test Date), and if, after giving pro forma effect to the Limited Condition Transaction, the Parent or any of its Restricted Subsidiaries would have been permitted to take such action on the relevant LCT Test Date in compliance with such ratio, test, representations, warranties, defaults, specified defaults, events of default, or basket, such ratio, test, representations, warranties, defaults, specified defaults, events of default, or basket (including with respect to satisfaction of the Payment Conditions in connection therewith) shall be deemed to have been complied with. For the avoidance of doubt, if the Borrower has made an LCT Election and any of the ratios, tests or baskets for which compliance was determined or tested as of the LCT Test Date would have failed to have been satisfied as a result of fluctuations in any such ratio, test or basket, including due to fluctuations in EBITDA, at or prior to the consummation of the relevant transaction or action, such baskets, tests or ratios will not be deemed to have failed to have been satisfied as a result of such fluctuations. Notwithstanding anything to the contrary in this Agreement or any other Loan Document, if the Borrower has made an LCT Election for any Limited Condition Transaction, then in connection with any event or transaction occurring after the relevant LCT Test Date and prior to the earlier of the date on which such Limited Condition Transaction is consummated or the date that the definitive agreement for such Limited Condition Transaction is terminated, expires or passes, as applicable, without consummation of such Limited Condition Transaction (a “Subsequent Transaction”) in connection with which a ratio, test or basket availability calculation must be made on a pro forma basis or giving pro forma effect to such Subsequent Transaction, for purposes of determining whether such ratio, test or basket availability has been complied with under this Agreement, any such ratio, test or basket shall be required to be satisfied on a pro forma basis assuming such Limited Condition Transaction and other transactions in connection therewith (including any incurrence of Debt and the use of proceeds thereof) have been consummated until such time as the applicable Limited Condition Transaction has actually closed or the definitive agreement with respect thereto has been terminated (it being further understood and agreed, however, that for other purposes under this Agreement, neither any Consolidated Net Income or EBITDA therefrom, nor any assets of the target to be acquired pursuant to such Limited Condition Acquisition, shall be included in Consolidated Net Income or EBITDA, or in the calculation of the Borrowing Base, as applicable, in any such subsequent calculation until such Limited Condition Acquisition has actually closed). Notwithstanding the foregoing, the Limited Condition Transaction provisions set forth above shall not apply in respect of the incurrence of any Advances (including, without limitation, a Letter of Credit Extension) or other credit extension hereunder, the proceeds of which will be used to finance such Limited Condition Transaction.

SECTION 1.07. [Reserved]. Article II

AMOUNTS AND TERMS OF THE ADVANCES

AND THE LETTERS OF CREDIT

SECTION  2.01. SECTION 2.01. The Advances(a) .

(a) The Revolving Credit Advances. Subject to the terms and conditions set forth herein, (i) each Revolving Credit Lender severally agrees to make revolving credit loans denominated in Dollars to the Borrower pursuant to Section 2.02 (a “Revolving Credit Advance”) from time to time, on any Business Day until the Termination Date, in an aggregate principal amount of $1,000,000 or an integral

 

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multiple of $100,000 in excess thereof (other than a Borrowing the proceeds of which shall be used solely to repay or prepay in full outstanding Swing Line Advances or outstanding Letter of Credit Advances) and shall consist of Revolving Credit Advances made simultaneously by the Revolving Credit Lenders ratably according to their Commitments; provided, however, that the aggregate principal amount of all such Revolving Credit Advances (together with the aggregate principal amount of all Swing Line Advances then outstanding plus the aggregate Available Amount of all Letters of Credit outstanding at such time) shall not exceed the Loan Cap then in effect, subject to the Administrative Agent’s authority, in its sole discretion to make Protective Advances pursuant to the terms of Section 2.01(d). Within the limits of each Revolving Credit Lender’s Unused Commitment in effect from time to time, the Borrower may borrow under this Section 2.01(a), prepay pursuant to Section 2.06(a) and reborrow under this Section 2.01(a). Notwithstanding anything to the contrary contained in this Section 2.01, the parties hereby acknowledge, confirm, and agree that (i) the aggregate outstanding principal amount of the Revolving Credit Advances under and as defined in the Existing Credit Agreement immediately prior to the Effective Date (such IndebtednessDebt being hereinafter referred to as the “Existing Advances Indebtedness”) is outstanding and payable to Lenders under the Existing Credit Agreement without set-off, counterclaim, deduction, offset, or defense, and the L/C Obligations with respect to Existing Letters of Credit are reimbursable in accordance with the terms hereof, and are secured by a first priority security interest in and lien on the Collateral (subject to Permitted Liens and other Liens created or permitted by the Loan Documents), and (ii) the Existing Advances Indebtedness shall be deemed outstanding under this Agreement and the Existing Letters of Credit shall be deemed issued under this Agreement on the Effective Date.

(b) The Swing Line Advances. The Swing Line Bank agrees on the terms and conditions hereinafter set forth, to make Swing Line Advances to the Borrower from time to time on any Business Day during the period from the Effective Date until the Termination Date (i) in an aggregate amount not to exceed at any time outstanding $30,000,000 at such time and (ii) in an amount for each such Swing Line Borrowing not to exceed the aggregate of the Unused Commitments of the Revolving Credit Lenders at such time; provided, however, that the aggregate principal amount of all such Swing Line Advances (together with the aggregate principal amount of all Revolving Credit Advances then outstanding plus the aggregate Available Amount of all Letters of Credit outstanding at such time) shall not exceed the Loan Cap then in effect, subject to the Administrative Agent’s authority, in its sole discretion to make Protective Advances pursuant to the terms of Section 2.01(d). No Swing Line Advance shall be used for the purpose of funding the payment of principal of any other Swing Line Advance. Each Swing Line Borrowing shall be in an amount of $1,000,000 or an integral multiple of $100,000 in excess thereof and shall be made as a Base Rate Advance. Within the limits of the Swing Line Facility and within the limits referred to in clause (ii) above, the Borrower may borrow under this Section 2.01(b), repay pursuant to Section 2.04(b) or prepay pursuant to Section 2.06(a) and reborrow under this Section 2.01(b). Immediately upon the making of a Swing Line Advance, each Revolving Credit Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Bank a risk participation in such Swing Line Advance in an amount equal to the product of such Lender’s Pro Rata Share times the amount of such Swing Line Advance.

(c)	[Intentionally Omitted].

(d) Protective Advances. Any provision of this Agreement to the contrary notwithstanding, (i) subject to the limitations set forth below, the Administrative Agent and the Collateral Agent are authorized by the Borrower and the Lenders, from time to time in each of their sole discretion (but shall have absolutely no obligation to), to make Advances to the Borrower, on behalf of all Lenders, which the Administrative Agent or the Collateral Agent, in such Person’s reasonable discretion, deems necessary or desirable (A) after the occurrence and during the continuance of an Event of Default or (B) at any time that any of the other applicable conditions precedent set forth in Section 3.02 are not satisfied (x) to

 

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preserve or protect the Collateral, or any portion thereof, (y) to enhance the likelihood of, or maximize the amount of, repayment of the Advances and other Obligations under the Loan Documents or (z) to pay any other amount chargeable to or required to be paid by the Borrower pursuant to the terms of this Agreement, including payments of principal, interest, Letter of Credit Advances, fees, reimbursable expenses (including costs, fees and expenses as described in Section 9.04) and other sums payable under the Loan Documents (any of such Advance are herein referred to as “Protective Advances”); provided that no Protective Advance shall cause the sum of the aggregate principal amount of all Swing Line Advances and Revolving Credit Advances then outstanding (together with the aggregate Available Amount of all Letters of Credit outstanding at such time) to exceed the Aggregate Commitments; provided, further, that the aggregate amount of Protective Advances outstanding at any time, which were made pursuant to clauses (x) and (y) above, shall not at any time exceed the lesser of (1) $25,000,000 and (2) 10% of the Borrowing Base. Protective Advances shall be secured by Liens in favor of the Administrative Agent in and to the Collateral and shall constitute Obligations hereunder. All Protective Advances shall be Base Rate Advances. The Administrative Agent’s and the Collateral Agent’s authorization to make Protective Advances may be revoked at any time by the Required Lenders. Any such revocation must be in writing and shall become effective prospectively upon the Administrative Agent’s receipt thereof. At any time that there is sufficient Excess Availability and the conditions set forth in Section 3.02 have been satisfied, the Administrative Agent or the Collateral Agent may request the Revolving Credit Lenders to make a Revolving Credit Advances to repay a Protective Advance. At any other time, the Administrative Agent or the Collateral Agent may require the Lenders to fund their risk participations as described in clause (ii). The making by any Agent of a Protective Advance shall not modify or abrogate any of the provisions of Section 2.03 regarding the Lenders’ obligations to purchase participations with respect to Letter of Credits or of Section 2.01(b) regarding the Lenders’ obligations to purchase participations with respect to Swing Line Loans. No Agent shall have any liability for, and no Loan Party or Secured Party shall have the right to, or shall, bring any claim of any kind whatsoever against any Agent with respect to Unintentional Overadvances regardless of the amount of any such Overadvance(s). (ii) Upon the making of a Protective Advance by the Administrative Agent or the Collateral Agent (whether before or after the occurrence of an Event of Default), each Lender shall be deemed, without further action by any party hereto, to have unconditionally and irrevocably purchased from the Administrative Agent or the Collateral Agent, as applicable, without recourse or warranty, an undivided interest and participation in any Protective Advance in proportion to its Pro Rata Share of all payments of principal and interest and all proceeds of Collateral received by the Administrative Agent in respect of such Protective Advance.

SECTION  2.02. SECTION 2.02. Making the Advances. (a) 

(a) Except as otherwise provided in Section 2.02(b) or 2.03, each Borrowing shall be made on notice (which may be delivered through the Administrative Agent’s electronic platform or portal), given not later than 11:00 A.M. (New York City time) on the third Business Day prior to the date of the proposed Borrowing in the case of a Borrowing consisting of Eurodollar Rate Advances, or the first Business Day prior to the date of the proposed Borrowing in the case of a Borrowing consisting of Base Rate Advances by the Borrower to the Administrative Agent, which shall give to each Appropriate Lender prompt notice thereof by telecopier or electronic communication. Each such notice of a Borrowing (a “Notice of Borrowing”) shall be by telephone, confirmed immediately in writing, or by telecopier or electronic communication, in substantially the form of Exhibit B hereto, specifying therein the requested (1) date of such Borrowing, (2) Facility under which such Borrowing is to be made, (3) Type of Advances comprising such Borrowing, (4) aggregate amount of such Borrowing and (5) in the case of a Borrowing consisting of Eurodollar Rate Advances, initial Interest Period for each such Advance. Each Appropriate Lender shall, before 11:00 A.M. (New York City time) on the date of such

 

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Borrowing, make available for the account of its Applicable Lending Office to the Administrative Agent at the Administrative Agent’s Account, in same day funds, such Lender’s ratable portion of such Borrowing in accordance with the respective Commitments under the applicable Facility of such Lender and the other Appropriate Lenders. After the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable conditions set forth in Article III, the Administrative Agent will make such funds available to the Borrower by crediting the Borrower’s Account; provided, however, that, in the case of any Revolving Credit Borrowing, the Administrative Agent shall first apply such funds to prepay ratably the aggregate principal amount of any Swing Line Advances and Letter of Credit Advances outstanding at such time, together with interest accrued and unpaid thereon to and as of such date. All Borrowing requests which are not made on-line via the Administrative Agent’s electronic platform or portal shall be subject to (and unless the Administrative Agent elects otherwise in the exercise of its sole discretion, such Borrowings shall not be made until the completion of) the Administrative Agent’s authentication process (with results satisfactory to the Administrative Agent) prior to the funding of any such requested Advance.

(b)(i) Each Swing Line Borrowing shall be made on notice, given not later than 11:00 A.M. (New York City time) on the date of the proposed Swing Line Borrowing, by the Borrower to the Swing Line Bank and the Administrative Agent. Each such notice of a Swing Line Borrowing (a “Notice of Swing Line Borrowing”) shall be by telephone, confirmed promptly in writing, or by telecopier or electronic communication, specifying therein the requested (i) date of such Borrowing (which shall be a Business Day), (ii) amount of such Borrowing and (iii) maturity of such Borrowing (which maturity shall be no later than the seventh day after the requested date of such Borrowing). The Swing Line Bank will make the amount of the requested Swing Line Advances available to the Administrative Agent at the Administrative Agent’s Account, in same day funds. After the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable conditions set forth in Article III, the Administrative Agent will make such funds available to the Borrower by crediting the Borrower’s Account.

(ii) The Swing Line Bank may, at any time in its sole and absolute discretion, request on behalf of the Borrower (and the Borrower hereby irrevocably authorizes the Swing Line Bank to so request on its behalf) that each Revolving Credit Lender make a Base Rate Advance in an amount equal to such Lender’s Pro Rata Share of the amount of Swing Line Advances then outstanding. Such request shall be deemed to be a Notice of Borrowing for purposes hereof and shall be made in accordance with the provisions of Section 2.02(a) without regard solely to the minimum amounts specified in Section 2.01(b) but subject to the satisfaction of the conditions set forth in Section 3.02. The Swing Line Bank shall furnish the Borrower with a copy of the applicable Notice of Borrowing promptly after delivering such notice to the Administrative Agent. Each Revolving Credit Lender shall make an amount equal to its Pro Rata Share of the amount specified in such Notice of Borrowing available for the account of its Applicable Lending Office to the Administrative Agent for the account of the Swing Line Bank, by deposit to the Administrative Agent’s Account, in same day funds, not later than 11:00 A.M. (New York City time) on the day specified in such Notice of Borrowing.

(iii) If for any reason any Swing Line Advance cannot be refinanced by a Revolving Credit Borrowing as contemplated by Section 2.02(b)(ii), the request for Base Rate Advances submitted by the Swing Line Bank as set forth in Section 2.02(b)(ii) shall be deemed to be a request by the Swing Line Bank that each of the Revolving Credit Lenders fund its risk participation in the relevant Swing Line Advance and each Revolving Credit Lender’s payment to the Administrative Agent for the account of the Swing Line Bank pursuant to Section 2.02(b)(ii) shall be deemed payment in respect of such participation.

 

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(iv) If and to the extent that any Revolving Credit Lender shall not have made the amount of its Pro Rata Share of such Swing Line Advance available to the Administrative Agent in accordance with the provisions of Section 2.02(b)(ii), such Revolving Credit Lender agrees to pay to the Administrative Agent forthwith on demand such amount together with interest thereon, for each day from the date of the applicable Notice of Borrowing delivered by the Swing Line Bank until the date such amount is paid to the Administrative Agent, at the Federal Funds Rate.

(v) Each Revolving Credit Lender’s obligation to make Revolving Credit Advances or to purchase and fund risk participations in Swing Line Advance pursuant to this Section 2.02(b) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against the Swing Line Bank, the Borrower or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Revolving Credit Lender’s obligation to make Revolving Credit Advances pursuant to this Section 2.02(b) is subject to satisfaction of the conditions set forth in Section 3.02. No funding of risk participations shall relieve or otherwise impair the obligation of the Borrower to repay Swing Line Advances, together with interest as provided herein.

(c) Anything in subsection (a) above to the contrary notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances for any Borrowing if the aggregate amount of such Borrowing is less than $1,000,000 or if the obligation of the Appropriate Lenders to make Eurodollar Rate Advances shall then be suspended pursuant to Section 2.09 or 2.10 and (ii) the Eurodollar Rate Advances may not be outstanding as part of more than 15 separate Borrowings.

(d) Each Notice of Borrowing and each Notice of Swing Line Borrowing shall be irrevocable and binding on the Borrower. In the case of any Borrowing that the related Notice of Borrowing specifies is to be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each Appropriate Lender against any loss, cost or expense incurred by such Lender (as set forth in a written notice delivered by such Lender or the Administrative Agent to the Borrower) as a result of any failure to fulfill on or before the date specified in such Notice of Borrowing for such Borrowing the applicable conditions set forth in Article III, including, without limitation, any loss (excluding loss of anticipated profits), cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund the Advance to be made by such Lender as part of such Borrowing when such Advance, as a result of such failure, is not made on such date.

(e) Unless the Administrative Agent shall have received notice from an Appropriate Lender prior to the date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s ratable portion of such Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent on the date of such Borrowing in accordance with subsection (a) of this Section 2.02 and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower or Swing Line Bank or Issuing Bank, as applicable, on such date a corresponding amount. If and to the extent that such Lender shall not have so made such ratable portion available to the Administrative Agent, such Lender, the Borrower or Swing Line Bank or Issuing Bank, as applicable, severally agrees to repay or pay to the Administrative Agent forthwith on demand such corresponding amount and to pay interest thereon, for each day from the date such amount is made available to the Borrower or Swing Line Bank or Issuing Bank, as applicable, until the date such amount is repaid or paid to the Administrative Agent, at (i) in the case of the Borrower, the interest rate applicable at such time under Section 2.07 to Advances comprising such Borrowing and (ii) in the case of such Lender, or Swing Line Bank or Issuing Bank, as applicable, the Federal Funds Rate. If such Lender shall

 

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pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender’s Advance as part of such Borrowing for all purposes.

(f) The failure of any Lender to make the Advance to be made by it as part of any Borrowing shall not relieve any other Lender of its obligation, if any, hereunder to make its Advance on the date of such Borrowing, but no Lender shall be responsible for the failure of any other Lender to make the Advance to be made by such other Lender on the date of any Borrowing.

(g) TheTo the extent not paid by the Borrower when due (after taking into consideration any grace period), the Administrative Agent, without the request of the Borrower, may advance any interest, fee, service charge (including direct wire fees), costs and expenses of any Secured Party in accordance with Section 9.04(a), or other payment to which any Secured Party is entitled from the Loan Parties pursuant hereto or any other Loan Document, as and when due and payable, and may charge the same to the Loan Account notwithstanding that an Overadvance may result thereby. The Administrative Agent shall advise the Borrower of any such advance or charge contemporaneously withpromptly after the making thereof. Such action on the part of the Administrative Agent shall not constitute a waiver of the Administrative Agent’s rights and the Borrower’s obligations under Section 2.06(b). Any amount which is added to the principal balance of the Loan Account as provided in this Section 2.02(g) shall bear interest at the interest rate then and thereafter applicable to Base Rate Advances.

SECTION  2.03. SECTION 2.03. Letters of Credit.

(a) Subject to the terms and conditions of this Agreement, upon the request of the Borrower made in accordance herewith, and prior to the Termination Date, the Issuing Bank agrees to issue a requested Letter of Credit for the account of the Loan Parties. By submitting a request to the Issuing Bank for the issuance of a Letter of Credit, the Borrower shall be deemed to have requested that the Issuing Bank issue the requested Letter of Credit. Each request for the issuance of a Letter of Credit, or the amendment, renewal, or extension of any outstanding Letter of Credit, shall be (i) irrevocable and shall be made in writing pursuant to a Letter of Credit Application by a Responsible Officer, (ii) delivered to the Issuing Bank and the Administrative Agent via telefacsimile or other electronic method of transmission reasonably acceptable to the Issuing Bank not later than 11:00 a.m. (New York City time) at least two Business Days (or such other date and time as the Administrative Agent and the Issuing Bank may agree in a particular instance in their sole discretion) prior to the requested date of issuance, amendment, renewal, or extension, and (iii) subject to the Issuing Bank’s authentication procedures with results satisfactory to the Issuing Bank. Each such request shall be in form and substance reasonably satisfactory to the Issuing Bank and (i) shall specify (A) the amount of such Letter of Credit, (B) the date of issuance, amendment, renewal, or extension of such Letter of Credit, (C) the proposed expiration date of such Letter of Credit, (D) the name and address of the beneficiary of the Letter of Credit, and (E) such other information (including, the conditions to drawing, and, in the case of an amendment, renewal, or extension, identification of the Letter of Credit to be so amended, renewed, or extended) as shall be necessary to prepare, amend, renew, or extend such Letter of Credit, and (ii) shall be accompanied by such Issuer Documents as the Administrative Agent or the Issuing Bank may request or require, to the extent that such requests or requirements are consistent with the Issuer Documents that the Issuing Bank generally requests for Letters of Credit in similar circumstances. The Administrative Agent’s records of the content of any such request will be conclusive. Anything contained herein to the contrary notwithstanding, Issuing Bank may, but shall not be obligated to, issue a Letter of Credit that supports the obligations of a Loan Party in respect of (x) a lease of real property to the extent that the face amount of such Letter of Credit exceeds the highest rent (including all rent-like charges) payable under such lease for a period of one year, or (y) an employment contract to the extent that the face amount of such Letter of Credit exceeds the highest compensation payable under such contract for a period of one year.

 

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(b) The Issuing Bank shall have no obligation to issue a Letter of Credit if, after giving effect to the requested issuance, (i) the aggregate principal amount of all Used Commitments shall exceed the Loan Cap, (ii) the Used Commitments of any Lender Party would exceed such Lender’s Commitment, or (iii) the Outstanding Amount of the L/C Obligations would exceed the Letter of Credit Sublimit;

(c) In the event there is a Defaulting Lender as of the date of any request for the issuance of a Letter of Credit, the Issuing Bank shall not be required to issue or arrange for such Letter of Credit to the extent (i) the Defaulting Lender’s participation with respect to such Letter of Credit may not be reallocated pursuant to Section 2.15(b), or (ii) the Issuing Bank has not otherwise entered into arrangements reasonably satisfactory to it and the Borrower to eliminate the Issuing Bank’s risk with respect to the participation in such Letter of Credit of the Defaulting Lender, which arrangements may include the Borrower cash collateralizing such Defaulting Lender’s participation with respect to such Letter of Credit in accordance with Section 2.15(b). Additionally, the Issuing Bank shall have no obligation to issue a Letter of Credit if (A) any order, judgment, or decree of any Governmental Authority or arbitrator shall, by its terms, purport to enjoin or restrain the Issuing Bank from issuing such Letter of Credit, or any law applicable to the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the Issuing Bank shall prohibit or request that the Issuing Bank refrain from the issuance of letters of credit generally or such Letter of Credit in particular, or (B) the issuance of such Letter of Credit would violate one or more policies of the Issuing Bank applicable to letters of credit generally, or (C) the expiry date of such requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless either such Letter of Credit is Cash Collateralized on or prior to the date of issuance of such Letter of Credit (or such later date as to which the Administrative Agent may agree) or all the Lenders have approved such expiry date.

(d) Any Issuing Bank (other than WFB or any of its Affiliates) shall notify the Administrative Agent in writing no later than the Business Day immediately following the Business Day on which such Issuing Bank issued any Letter of Credit; provided that (i) until the Administrative Agent advises any such Issuing Bank that the provisions of Section 3.02 are not satisfied, or (ii) unless the aggregate amount of the Letters of Credit issued in any such week exceeds such amount as shall be agreed by the Administrative Agent and such Issuing Bank, such Issuing Bank shall be required to so notify the Administrative Agent in writing only once each week of the Letters of Credit issued by such Issuing Bank during the immediately preceding week as well as the daily amounts outstanding for the prior week, such notice to be furnished on such day of the week as the Administrative Agent and such Issuing Bank may agree. The Borrower and the Secured Parties hereby acknowledge and agree that all Existing Letters of Credit shall constitute Letters of Credit under this Agreement on and after the Effective Date with the same effect as if such Existing Letters of Credit were issued by Issuing Bank at the request of the Borrower on the Effective Date. Each Letter of Credit shall be in form and substance reasonably acceptable to the Issuing Bank, including the requirement that the amounts payable thereunder must be payable in Dollars; provided that if the Issuing Bank, in its discretion, issues a Letter of Credit denominated in a currency other than Dollars, all reimbursements by the Borrower of the honoring of any drawing under such Letter of Credit shall be paid in Dollars based on the Spot Rate. If the Issuing Bank makes a payment under a Letter of Credit, the Borrower shall pay to Administrative Agent an amount equal to the applicable Letter of Credit Advance on the Business Day such Letter of Credit Advance is made and, in the absence of such payment, the amount of the Letter of Credit Advance immediately and automatically shall be deemed to be a Revolving Credit Advance hereunder (notwithstanding any failure to satisfy any condition precedent set forth in Section 3.02 hereof) and, initially, shall bear interest at the rate then applicable to Base Rate Advances. If a Letter of Credit Advance is deemed to be a Revolving Credit Advance hereunder, the Borrower’ obligation to pay the amount of such Letter of Credit Advance to the Issuing Bank shall be automatically converted into an obligation to pay the resulting Revolving Credit Advance. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the

 

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Issuing Bank or, to the extent that the Lenders have made payments pursuant to Section 2.03(e) to reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as their interests may appear.

(e) Promptly following receipt of a notice of a Letter of Credit Advance pursuant to Section 2.03(d), each Lender agrees to fund its Pro Rata Share of any Revolving Credit Advance deemed made pursuant to Section 2.03(d) on the same terms and conditions as if the Borrower had requested the amount thereof as a Revolving Credit Advance and the Administrative Agent shall promptly pay to the Issuing Bank the amounts so received by it from the Lenders. By the issuance of a Letter of Credit (or an amendment, renewal, or extension of a Letter of Credit) and without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank shall be deemed to have granted to each Lender, and each Lender shall be deemed to have purchased, a participation in each Letter of Credit issued by the Issuing Bank, in an amount equal to its Pro Rata Share of such Letter of Credit, and each such Lender agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Lender’s Pro Rata Share of any Letter of Credit Advance made by the Issuing Bank under the applicable Letter of Credit. In consideration and in furtherance of the foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Lender’s Pro Rata Share of each Letter of Credit Advance made by the Issuing Bank and not reimbursed by Borrower on the date due as provided in Section 2.03(d), or of any reimbursement payment that is required to be refunded (or that the Administrative Agent or the Issuing Bank elects, based upon the advice of counsel, to refund) to the Borrower for any reason. Each Lender acknowledges and agrees that its obligation to deliver to the Administrative Agent, for the account of the Issuing Bank, an amount equal to its respective Pro Rata Share of each Letter of Credit Advance pursuant to this Section 2.03(e) shall be absolute and unconditional and such remittance shall be made notwithstanding the occurrence or continuation of a Default or Event of Default or the failure to satisfy any condition set forth in Section 3.02 hereof. If any such Lender fails to make available to the Administrative Agent the amount of such Lender’s Pro Rata Share of a Letter of Credit Advance as provided in this Section, such Lender shall be deemed to be a Defaulting Lender and the Administrative Agent (for the account of the Issuing Bank) shall be entitled to recover such amount on demand from such Lender together with interest thereon at the Defaulting Lender Rate until paid in full.

(f) The Borrower agrees to indemnify, defend and hold harmless each Secured Party (including the Issuing Bank and its branches, Affiliates, and correspondents) and each such Person’s respective directors, officers, employees, attorneys and agents (each, including the Issuing Bank, a “Letter of Credit Related Person”) (to the fullest extent permitted by law) from and against any and all claims, demands, suits, actions, investigations, proceedings, liabilities, fines, costs, penalties, and damages, and all reasonable documented fees and disbursements of attorneys, experts, or consultants and all other costs and expenses actually incurred in connection therewith or in connection with the enforcement of this indemnification (as and when they are incurred and irrespective of whether suit is brought), which may be incurred by or awarded against any such Letter of Credit Related Person (other than Taxes, which shall be governed by Section 2.12) (the “Letter of Credit Indemnified Costs”), and which arise out of or in connection with, or as a result of:

(i) any Letter of Credit or any pre-advice of its issuance;

(ii) any transfer, sale, delivery, surrender or endorsement of any Drawing Document at any time(s) held by any such Letter of Credit Related Person in connection with any Letter of Credit;

(iii) any action or proceeding arising out of, or in connection with, any Letter of Credit (whether administrative, judicial or in connection with arbitration), including any action or

 

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proceeding to compel or restrain any presentation or payment under any Letter of Credit, or for the wrongful dishonor of, or honoring a presentation under, any Letter of Credit;

(iv) any independent undertakings issued by the beneficiary of any Letter of Credit;

(v) any unauthorized instruction or request made to the Issuing Bank in connection with any Letter of Credit or requested Letter of Credit or error in computer or electronic transmission;

(vi) an adviser, confirmer or other nominated person seeking to be reimbursed, indemnified or compensated in connection with any Letter of Credit;

(vii) any third party seeking to enforce the rights of an applicant, beneficiary, nominated person, transferee, assignee of Letter of Credit proceeds or holder of an instrument or document;

(viii) the fraud, forgery or illegal action of parties in connection with any Letter of Credit other than the Letter of Credit Related Person;

(ix) any prohibition on payment or delay in payment of any amount payable by Issuing Bank to a beneficiary or transferee beneficiary of a Letter of Credit arising out of Anti-Corruption Laws, Anti-Money Laundering Laws, or Sanctions;

(x) the Issuing Bank’s performance of the obligations of a confirming institution or entity that wrongfully dishonors a confirmation in connection with a Letter of Credit;

(xi) any foreign language translation provided to Issuing Bank in connection with any Letter of Credit;

(xii) any foreign law or usage as it relates to Issuing Bank’s issuance of a Letter of Credit in support of a foreign guaranty including the expiration of such guaranty after the related Letter of Credit expiration date and any resulting drawing paid by Issuing Bank in connection therewith; or

(xiii) the acts or omissions, whether rightful or wrongful, of any present or future de jure or de facto governmental or regulatory authority or cause or event beyond the control of the Letter of Credit Related Person related to a Letter of Credit;

in each case, including that resulting from the Letter of Credit Related Person’s own negligence; provided, however, that such indemnity shall not be available to any Letter of Credit Related Person claiming indemnification under clauses (i) through (xiii) above to the extent that such Letter of Credit Indemnified Costs may be finally determined in a final, non-appealable judgment of a court of competent jurisdiction to have resulted directly from the gross negligence or willful misconduct of the Letter of Credit Related Person claiming indemnity. The Borrower hereby agrees to pay the Letter of Credit Related Person claiming indemnity on demand from time to time all amounts owing under this Section 2.03(f). If and to the extent that the obligations of the Borrower under this Section 2.03(f) are unenforceable for any reason, the Borrower agrees to make the maximum contribution to the Letter of Credit Indemnified Costs permissible under applicable Lawlaw. This indemnification provision shall survive termination of this Agreement and all Letters of Credit.

 

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(g) The liability of the Issuing Bank (or any other Letter of Credit Related Person) under, in connection with or arising out of any Letter of Credit (or pre-advice), regardless of the form or legal grounds of the action or proceeding, shall be limited to direct damages suffered by the Borrower that are caused directly by the Issuing Bank’s gross negligence, bad faith or willful misconduct in (i) honoring a presentation under a Letter of Credit that on its face does not at least substantially comply with the terms and conditions of such Letter of Credit, (ii) failing to honor a presentation under a Letter of Credit that strictly complies with the terms and conditions of such Letter of Credit or (iii) retaining Drawing Documents presented under a Letter of Credit. The Issuing Bank shall be deemed to have acted with due diligence and reasonable care if the Issuing Bank’s conduct is in accordance with Standard Letter of Credit Practice or in accordance with this Agreement. The Borrower’ aggregate remedies against the Issuing Bank and any Letter of Credit Related Person for wrongfully honoring a presentation under any Letter of Credit or wrongfully retaining honored Drawing Documents shall in no event exceed the aggregate amount paid by the Borrower to the Issuing Bank in respect of the honored presentation in connection with such Letter of Credit under Section 2.03(d), plus interest at the rate then applicable to Base Rate Loans hereunder. The Borrower shall take action to avoid and mitigate the amount of any damages claimed against the Issuing Bank or any other Letter of Credit Related Person, including by enforcing its rights against the beneficiaries of the Letters of Credit. Any claim by the Borrower under or in connection with any Letter of Credit shall be reduced by an amount equal to the sum of (x) the amount (if any) saved by the Borrower as a result of the breach or alleged wrongful conduct complained of; and (y) the amount (if any) of the loss that would have been avoided had the Borrower taken all reasonable steps to mitigate any loss, and in case of a claim of wrongful dishonor, by specifically and timely authorizing the Issuing Bank to effect a cure.

(h) The Borrower shall be responsible for the final text of the Letter of Credit as issued by the Issuing Bank, irrespective of any assistance the Issuing Bank may provide such as drafting or recommending text or by the Issuing Bank’s use or refusal to use text submitted by the Borrower. The Borrower understands that the final form of any Letter of Credit may be subject to such revisions and changes as are deemed necessary or appropriate by Issuing Bank, and the Borrower hereby consents to such revisions and changes not materially different from the application executed in connection therewith. The Borrower is solely responsible for the suitability of the Letter of Credit for the Borrower’s purposes. If the Borrower requests the Issuing Bank to issue a Letter of Credit for an affiliated or unaffiliated third party (an “Account Party”), (i) such Account Party shall have no rights against the Issuing Bank; (ii) Borrower shall be responsible for the application and obligations under this Agreement; and (iii) communications (including notices) related to the respective Letter of Credit shall be between the Issuing Bank and the Borrower. The Borrower will examine the copy of the Letter of Credit and any other documents sent by the Issuing Bank in connection therewith and shall promptly notify the Issuing Bank (not later than three (3) Business Days following the Borrower’s receipt of documents from the Issuing Bank) of any non-compliance with the Borrower’s instructions and of any discrepancy in any document under any presentment or other irregularity. If the Borrower so requests in any applicable Letter of Credit Application, the Issuing Bank may, in its sole and absolute discretion, agree to issue a Standby Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must permit the Issuing Bank to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Standby Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) in each such twelve-month period to be agreed upon at the time such Standby Letter of Credit is issued. Unless otherwise directed by the Administrative Agent or the Issuing Bank, Borrower shall not be required to make a specific request to the Administrative Agent or the Issuing Bank for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the Issuing Bank to permit the extension of such Standby Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date unless either such Standby Letter of Credit is Cash Collateralized on or prior to the date of issuance of such Standby Letter

 

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of Credit (or such later date as to which the Administrative Agent may agree) or all the Lenders have approved such expiry date; provided, however, that the Administrative Agent shall instruct the Issuing Bank not to permit any such extension if (A) the Issuing Bank has determined that it would not be permitted, or would have no obligation, at such time to issue such Standby Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisions of Section 2.03(a) or otherwise), or (B) the Issuing Bank has received notice (which may be by telephone or in writing) on or before the day that is five Business Days before the Non-Extension Notice Date (1) from the Administrative Agent that the Required Lenders have elected not to permit such extension or (2) from the Administrative Agent, any Lender or the Borrower that one or more of the applicable conditions specified in Section 3.02 is not then satisfied, and in each such case directing the Issuing Bank not to permit such extension.

(i) The Borrower’s reimbursement and payment obligations under this Section 2.03 are absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever, including:

(i) any lack of validity, enforceability or legal effect of any Letter of Credit or this Agreement or any term or provision therein or herein;

(ii) payment against presentation of any draft, demand or claim for payment under any Drawing Document that does not comply in whole or in part with the terms of the applicable Letter of Credit or which proves to be fraudulent, forged or invalid in any respect or any statement therein being untrue or inaccurate in any respect, or which is signed, issued or presented by a Person or a transferee of such Person purporting to be a successor or transferee of the beneficiary of such Letter of Credit;

(iii) the Issuing Bank or any of its branches or Affiliates being the beneficiary of any Letter of Credit;

(iv) the Issuing Bank or any correspondent honoring a drawing against a Drawing Document up to the amount available under any Letter of Credit even if such Drawing Document claims an amount in excess of the amount available under the Letter of Credit;

(v) the existence of any claim, set-off, defense or other right that the ParentHoldings or any of its Subsidiaries may have at any time against any beneficiary, any assignee of proceeds, the Issuing Bank or any other Person;

(vi) any other event, circumstance or conduct whatsoever, whether or not similar to any of the foregoing that might, but for this Section 2.03(i), constitute a legal or equitable defense to or discharge of, or provide a right of set-off against, any Borrower’s or any of its Subsidiaries’ reimbursement and other payment obligations and liabilities, arising under, or in connection with, any Letter of Credit, whether against the Issuing Bank, the beneficiary or any other Person; or

(vii) the fact that any Default or Event of Default shall have occurred and be continuing;

provided, however, that subject to Section 2.03(g) above, the foregoing shall not release the Issuing Bank from such liability to the Borrower as may be finally determined in a final, non-appealable judgment of a court of competent jurisdiction against the Issuing Bank following reimbursement or payment of the obligations and liabilities, including reimbursement and other payment obligations, of the Borrower to the Issuing Bank arising under, or in connection with, this Section 2.03 or any Letter of Credit.

 

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(j) Without limiting any other provision of this Agreement, the Issuing Bank and each other Letter of Credit Related Person (if applicable) shall not be responsible to the Borrower for, and the Issuing Bank’s rights and remedies against the Borrower and the obligation of the Borrower to reimburse the Issuing Bank for each drawing under each Letter of Credit shall not be impaired by:

(i) honor of a presentation under any Letter of Credit that on its face substantially complies with the terms and conditions of such Letter of Credit, even if the Letter of Credit requires strict compliance by the beneficiary;

(ii) honor of a presentation of any Drawing Document that appears on its face to have been signed, presented or issued (A) by any purported successor or transferee of any beneficiary or other Person required to sign, present or issue such Drawing Document or (B) under a new name of the beneficiary;

(iii) acceptance as a draft of any written or electronic demand or request for payment under a Letter of Credit, even if nonnegotiable or not in the form of a draft or notwithstanding any requirement that such draft, demand or request bear any or adequate reference to the Letter of Credit;

(iv) the identity or authority of any presenter or signer of any Drawing Document or the form, accuracy, genuineness or legal effect of any Drawing Document (other than the Issuing Bank’s determination that such Drawing Document appears on its face substantially to comply with the terms and conditions of the Letter of Credit);

(v) acting upon any instruction or request relative to a Letter of Credit or requested Letter of Credit that the Issuing Bank in good faith believes to have been given by a Person authorized to give such instruction or request;

(vi) any errors, omissions, interruptions or delays in transmission or delivery of any message, advice or document (regardless of how sent or transmitted) or for errors in interpretation of technical terms or in translation or any delay in giving or failing to give notice to the Borrower;

(vii) any acts, omissions or fraud by, or the insolvency of, any beneficiary, any nominated person or entity or any other Person or any breach of contract between any beneficiary and any Borrower or any of the parties to the underlying transaction to which the Letter of Credit relates;

(viii) assertion or waiver of any provision of the ISP or UCP 600 that primarily benefits an issuer of a letter of credit, including any requirement that any Drawing Document be presented to it at a particular hour or place;

(ix) payment to any paying or negotiating bank (designated or permitted by the terms of the applicable Letter of Credit) claiming that it rightfully honored or is entitled to reimbursement or indemnity under Standard Letter of Credit Practice applicable to it;

(x) acting or failing to act as required or permitted under Standard Letter of Credit Practice applicable to where the Issuing Bank has issued, confirmed, advised or negotiated such Letter of Credit, as the case may be;

(xi) honor of a presentation after the expiration date of any Letter of Credit notwithstanding that a presentation was made prior to such expiration date and dishonored by the

 

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Issuing Bank if subsequently the Issuing Bank or any court or other finder of fact determines such presentation should have been honored;

(xii) dishonor of any presentation that does not strictly comply or that is fraudulent, forged or otherwise not entitled to honor; or

(xiii) honor of a presentation that is subsequently determined by the Issuing Bank to have been made in violation of international, federal, state or local restrictions on the transaction of business with certain prohibited Persons.

(k) Upon the request of the Administrative Agent, (i) if the Issuing Bank has honored any full or partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Obligation that remains outstanding, or (ii) if, as of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, the Borrower shall, in each case, immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations. For purposes of this Section 2.03, Section 6 and Section 2.11, “Cash Collateralize” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Issuing Bank and the Lenders, as collateral for the L/C Obligations, cash or deposit account balances in an amount equal to 102.5% of the Outstanding Amount of all L/C Obligations (other than L/C Obligations with respect to Letters of Credit denominated in a currency other than Dollars, which L/C Obligations shall be Cash Collateralized in an amount equal to 107% of the Outstanding Amount of such L/C Obligations), pursuant to documentation in form and substance satisfactory to the Administrative Agent in its Permitted Discretion and the Issuing Bank (which documents are hereby Consented to by the Lenders). The Borrower hereby grants to the Administrative Agent a security interest in all such cash, deposit accounts and all balances therein and all proceeds of the foregoing constituting Cash Collateral. Cash Collateral shall be maintained in blocked, non-interest bearing deposit accounts at WFB. If at any time the Administrative Agent determines that any funds held as Cash Collateral are subject to any right or claim of any Person other than the Administrative Agent or that the total amount of such funds is less than the aggregate Outstanding Amount of all L/C Obligations, the Borrower will, forthwith upon written demand by the Administrative Agent, pay to the Administrative Agent, as additional funds to be deposited as Cash Collateral, an amount equal to the excess of (x) such aggregate Outstanding Amount over (y) the total amount of funds, if any, then held as Cash Collateral that the Administrative Agent determines, in its Permitted Discretion, to be free and clear of any such right and claim. Upon the drawing of any Letter of Credit for which funds are on deposit as Cash Collateral, such funds shall be applied, to the extent permitted under applicable laws, to reimburse the Issuing Bank and, to the extent not so applied, shall thereafter be applied to satisfy other Obligations under this Agreement and the other Loan Documents.

(l) Unless otherwise expressly agreed by the Issuing Bank and the Borrower when a Letter of Credit is issued (including any such agreement applicable to an Existing Letter of Credit), (i) the rules of the ISP and the UCP600 shall apply to each Standby Letter of Credit, and (ii) the rules of the UCP600 shall apply to each Commercial Letter of Credit.

(m) The Issuing Bank shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and the Issuing Bank shall have all of the benefits and immunities (A) provided to the Administrative Agent in Article VII with respect to any acts taken or omissions suffered by the Issuing Bank in connection with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in Article VII included the Issuing Bank with respect to such acts or omissions, and (B) as additionally provided herein with respect to the Issuing Bank.

 

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(n) In the event of a direct conflict between the provisions of this Section 2.03 and any provision contained in any Issuer Document, it is the intention of the parties hereto that such provisions be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.03 shall control and govern.

(o) With respect to any Letters of Credit that remain outstanding, the provisions of this Section 2.03 shall survive the termination of this Agreement and the repayment in full of the Obligations.

(p) At Borrower’s costs and expense, Borrower shall execute and deliver to Issuing Bank such additional certificates, instruments and/or documents and take such additional action as may be reasonably requested by Issuing Bank to enable Issuing Bank to issue any Letter of Credit pursuant to this Agreement and related Issuer Document, to protect, exercise and/or enforce Issuing Bank’s rights and interests under this Agreement or to give effect to the terms and provisions of this Agreement or any Issuer Document. Borrower irrevocably appoints Issuing Bank as its attorney-in-fact and authorizes Issuing Bank, without notice to Borrower, to execute and deliver ancillary documents and letters customary in the letter of credit business that may include but are not limited to advisements, indemnities, checks, bills of exchange and issuance documents. The power of attorney granted by Borrower is limited solely to such actions related to the issuance, confirmation or amendment of any Letter of Credit and to ancillary documents or letters customary in the letter of credit business. This appointment is coupled with an interest.

SECTION 2.04. SECTION 2.04. Repayment of Advances.

(a) Revolving Credit Advances. The Borrower shall repay to the Administrative Agent for the ratable account of the Revolving Credit Lenders on the Termination Date the aggregate principal amount of the Revolving Credit Advances then outstanding.

(b) Swing Line Advances. The Borrower shall repay to the Administrative Agent for the account of the Swing Line Bank and each other Revolving Credit Lender that has made a Swing Line Advance the outstanding principal amount of each Swing Line Advance made by each of them on the earlier of the maturity date specified in the applicable Notice of Swing Line Borrowing (which maturity shall be no later than the seventh day after the requested date of such Borrowing) and the Termination Date.

(c) Protective Advances. The Borrower shall repay to the Administrative Agent for the ratable account of the Revolving Credit Lenders that have made a Protective Advance the outstanding principal amount of each Protective Advance made by each of them on the earlier of demand and the Termination Date.

SECTION  2.05. SECTION 2.05. Termination or Reduction of the Commitments. (a) 

(a) Optional. The Borrower may, upon at least five Business Days’ notice to the Administrative Agent, terminate in whole or reduce in part the Aggregate Commitments; provided, however, that each partial reduction of the Aggregate Commitments (i) shall be in an aggregate amount of $1,000,000 or an integral multiple of $500,000 in excess thereof, and (ii) shall be made ratably among the Appropriate Lenders in accordance with their Pro Rata Share of the Aggregate Commitments; provided, further, that contemporaneously with such termination or reduction, the Borrower shall pay to the Administrative Agent, for the ratable benefit of the Lenders, such amounts as are required pursuant to the Second Amendment Fee Letter on account of such termination or reduction.

 

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(b) Mandatory. (i) The Letter of Credit Sublimit shall be permanently reduced from time to time on the date of each permanent reduction in the Revolving Credit Facility by the amount, if any, by which the amount of the Letter of Credit Sublimit exceeds the Revolving Credit Facility after giving effect to such permanent reduction of the Revolving Credit Facility.

(ii) The Swing Line Facility shall be permanently reduced from time to time on the date of each permanent reduction in the Revolving Credit Facility by the amount, if any, by which the amount of the Swing Line Facility exceeds the Revolving Credit Facility after giving effect to such permanent reduction of the Revolving Credit Facility.

(c) In connection with any reduction in the Aggregate Commitments prior to the Termination Date, if any Loan Party or any of its Subsidiaries owns any Margin Stock, the Borrower shall deliver to the Administrative Agent an updated Form U-1 (with sufficient additional originals thereof for each Lender), duly executed and delivered by the Borrower, together with such other documentation as the Administrative Agent shall reasonably request, in order to enable the Agents and the Lenders to comply with any of the requirements under Regulations T, U or X of the Board.

SECTION  2.06. SECTION 2.06. Prepayments. (a) 

(a) Optional. With regards to the prepayment of any Revolving Credit Advance, the Borrower may, upon at least one Business Day’s notice in the case of Base Rate Advances and three Business Days’ notice in the case of Eurodollar Rate Advances, in each case to the Administrative Agent stating the proposed date and aggregate principal amount of the prepayment, and if such notice is given, the Borrower shall prepay the outstanding aggregate principal amount of the Advances comprising part of the same Borrowing in whole or ratably in part, together with accrued interest to the date of such prepayment on the aggregate principal amount prepaid without premium or penalty (but subject to the payment of such amounts as are required pursuant to the Second Amendment Fee Letter on account of any termination or permanent reduction in the Aggregate Commitments occurring in connection with such prepayment); provided, however, that (x) each partial prepayment shall be in an aggregate principal amount of $1,000,000 or an integral multiple of $500,000 in excess thereof and (y) if any prepayment of a Eurodollar Rate Advance is made on a date other than the last day of an Interest Period for such Advance, the Borrower shall also pay any amounts owing pursuant to Section 9.04(c). Notwithstanding anything to the contrary contained in this Agreement, the Borrower may rescind any notice of prepayment under this Section 2.06(a) if such prepayment would have resulted from a refinancing of a Facility, which refinancing shall not be consummated or shall otherwise be delayed.

(b) Mandatory. (i) The Borrower shall, subject to Section 2.11, on each Business Day, prepay an aggregate principal amount of the Revolving Credit Advances comprising part of the same Borrowings, the Letter of Credit Advances and the Swing Line Advances and deposit an amount in the Collateral Account in an amount equal to the amount by which (A) the sum of the aggregate principal amount of the Advances then outstanding plus the aggregate Outstanding Amount of all L/C Obligations exceeds (B) the Loan Cap on such Business Day.

(ii) The Borrower shall, on each Business Day, pay to the Administrative Agent for deposit in the Collateral Account an amount sufficient to cause the aggregate amount on deposit in the Collateral Account to equal the amount by which the aggregate Outstanding Amount of all L/C Obligations exceeds the Letter of Credit Sublimit on such Business Day.

(iii) After the occurrence and during the continuance of a Triggering Event, the Borrower shall prepay the Advances and Cash Collateralize the L/C Obligations in accordance with the provisions of the Security Agreement and this Agreement.

 

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(iv) Within one (1) Business Day following receipt by any Loan Party or any Affiliate thereof of any portion of the 2020 Tax Refund Proceeds, the Borrower shall (A) first, make a prepayment in respect of certain Term Obligations to the extent required pursuant to Section 2.06(b)(iii) of the Term Credit Agreement as in effect as of the Second Amendment Effective Date, and (B) second, to the extent the amount of the 2020 Tax Refund Proceeds so received is greater than the amount of the prepayment required pursuant to the foregoing clause (A), prepay the Advances and Cash Collateralize the L/C Obligations in an amount equal to such excess, irrespective of whether or not a Triggering Event then exists and is continuing. The foregoing application of such amounts shall not reduce the Commitments. If all Obligations then due are paid, any excess Net Proceeds shall be remitted to the operating account of the Borrower maintained with the Administrative Agent.

(v) Unless any such amount is required to reduce the Term Obligations in accordance with the terms of the Term Credit Agreement, and is actually applied to reduce the Term Obligations in accordance with the terms of the Term Credit Agreement, upon the incurrence by a Loan Party of any Debt for borrowed money other than Debt permitted to be incurred pursuant to Section 5.02(b), not later than two (2) Business Days following the date of receipt by any Loan Party of any Net Proceeds thereof, the Borrower shall prepay the Advances and Cash Collateralize the L/C Obligations in an amount equal to such Net Proceeds, irrespective of whether or not a Triggering Event then exists and is continuing. The foregoing application of such Net Proceeds shall not reduce the Commitments. If all Obligations then due are paid, any excess Net Proceeds shall be remitted to the operating account of the Borrower maintained with the Administrative Agent.

(c) Excess Cash. If the Loan Parties have Excess Cash as of the end of any Business Day, the Borrower shall prepay the Obligations on the immediately following Business Day, which prepayment shall be in an amount equal to the lesser of (i) the amount of such Excess Cash as of the end of such immediately preceding Business Day, and (ii) the aggregate principal amount of Obligations then outstanding.

(d) (iii)  Application of Proceeds. Prepayments of the Revolving Credit Facility made pursuant to clause (isubsections (b) and (c) above shall be made to each of the Revolving Credit Lenders on a pro rata basis to be first applied to prepay Letter of Credit Advances then outstanding until such Advances are paid in full, second applied to prepay Swing Line Advances then outstanding until such Advances are paid in full, third applied to prepay Revolving Credit Advances then outstanding comprising part of the same Borrowings until such Advances are paid in full and fourth deposited in the Collateral Account to Cash Collateralize the Letters of Credit then outstanding. Upon the drawing of any Letter of Credit for which funds are on deposit in the Collateral Account, such funds shall be applied to reimburse the Issuing Bank or Revolving Credit Lenders, as applicable.

(e) (iv)  Payment of Interest. All prepayments under this subsectionsubsections (b) and (c) shall be made together with accrued interest to the date of such prepayment on the principal amount prepaid, together with any amounts owing pursuant to Section 9.04(c).

SECTION 2.07. SECTION 2.07. Interest. (a) Scheduled Interest. The Borrower shall pay interest on the unpaid principal amount of each Advance owing to each Lender from the date of such Advance until such principal amount shall be paid in full, at the following rates per annum:

(i) Base Rate Advances. DuringSubject to Section 2.07(b), during such periods as such Advance is a Base Rate Advance, a rate per annum equal at all times to the sum of (A) the Base Rate in effect from time to time plus (B) the Applicable Margin in effect from time to time,

 

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payable in arrears quarterly on the first day of each May, August, November and February during such periodscalendar month and on the date such Base Rate Advance shall be Converted or paid in full; provided, however, that interest shall be payable on the first day of each calendar month after the occurrence and during the continuance of a Triggering Event or an Event of Default.

(ii) Eurodollar Rate Advances. DuringSubject to Sections 2.07(b) and 2.10, during such periods as such Advance is a Eurodollar Rate Advance, a rate per annum equal at all times during each Interest Period for such Advance to the sum of (A) the Eurodollar Rate for such Interest Period for such Advance plus (B) the Applicable Margin in effect on the first day of such Interest Period, payable in arrears on the last day of such Interest Period and, if such Interest Period has a duration of more than three months, on each day that occurs during such Interest Period every three months from the first day of such Interest Period and on the date such Eurodollar Rate Advance shall be Converted or paid in full.

(b) Default Interest. Upon the occurrence and during the continuation of (i) an Event of Default under Section 6.01(f), or (ii) an Event of Default under Section 6.01(a), in the case of this clause (ii), upon the request of the Required Lenders, the Borrower shall pay interest (“Default Interest”) on (A) any overdue principal amount, payable in arrears on the dates referred to in clause (i) or (ii) of Section 2.07(a), as applicable, and on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid on such principal amount pursuant to clause (i) or (ii) of Section 2.07(a), as applicable, and (B) to the fullest extent permitted by applicable law, the amount of any interest under this Agreement or any other Loan Document to any Agent or any Lender Party that is not paid when due, from the date such amount shall be due until such amount shall be paid in full, payable in arrears on the date such amount shall be paid in full and on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid on Base Rate Advances pursuant to clause (i) of Section 2.07(a).

(i) If any amount payable under any Loan Document is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable law and shall be payable on demand.

(ii) If any Event of Default has occurred and is continuing, then the Administrative Agent may, and upon the request of the Required Lenders shall, notify the Borrower that all outstanding Obligations shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate and thereafter, until such Event of Default has been duly waived as provided in Section 9.01 hereof, such Obligations shall bear interest at the Default Rate to the fullest extent permitted by applicable law and shall be payable on demand.

(c) Notice of Interest Period and Interest Rate. Promptly after receipt of a Notice of Borrowing pursuant to Section 2.02(a), a notice of Conversion pursuant to Section 2.09 or a notice of selection of an Interest Period pursuant to the terms of the definition of “Interest Period,” the Administrative Agent shall give notice to the Borrower and each Appropriate Lender of the applicable Interest Period and the applicable interest rate determined by the Administrative Agent for purposes of clause (a)(i) or (a)(ii) above.

SECTION  2.08. SECTION 2.08. Fees. (a) 

(a) Commitment Fee. The Borrower shall pay to the Administrative Agent for the account of the Revolving Credit Lenders a commitment fee, from the Effective Date in the case of each Initial

 

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Lender and from the effective date specified in the Assignment and Assumption pursuant to which it became a Lender in the case of each other Lender until the Termination Date, payable in arrears (i) so long as no Triggering Event has occurred and is continuing, quarterly on the first day of each May, August, November and February, (ii) at any time that a Triggering Event has occurred and is continuing, monthly on the first day of each calendar month, and (iii) in any event, on the Termination Date (pro rated for the number of days elapsed in such quarter or month, as applicable), atequal to the rate of 0.20% per annum onCommitment Fee Percentage multiplied by the sum of the average daily Unused Commitment of such Lender during such quarter or month, as applicable, plus its Pro Rata Share of the average daily outstanding Swing Line Advances during such quarter or month, as applicable; provided, however, that no commitment fee shall accrue on any of the Commitments of a Defaulting Lender so long as such Lender shall be a Defaulting Lender.

(b) Letter of Credit Fees, Etc.

(i) The Borrower shall pay to the Agent for the account of each Lender in accordance with its Pro Rata Share a Letter of Credit fee (the “Letter of Credit Fee”) for each Letter of Credit equal to (A) in the case of Standby Letters of Credit, the Applicable Margin applicable to Eurodollar Rate Advances times the daily Available Amount under each such Standby Letter of Credit and (B) in the case of DocumentaryCommercial Letters of Credit, the Applicable Margin applicable to Eurodollar Rate Advances minus 0.5% times the daily Available Amount under each such DocumentaryCommercial Letter of Credit; provided that notwithstanding anything to the contrary contained herein, while any Event of Default exists, all Letter of Credit Fees shall accrue at the foregoing applicable rate, plus 2% per annum. Letter of Credit Fees shall be (1) due and payable (x) so long as no Triggering Event has occurred and is continuing, on the first Business Day of each May, August, November and February, (y) at any time that a Triggering Event has occurred and is continuing, on the first Business Day of each month, and (z) on the Termination Date, in each case, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand, and (2) computed on a monthly or quarterly basis, as applicable, in arrears. For purposes of computing the daily Available Amount of each Letter of Credit, the amount of the Letter of Credit shall be determined in accordance with Section 1.05. If there is any change in the Applicable Margin during any quarter or month, as applicable, the daily Available Amount of each Letter of Credit shall be computed and multiplied by the Applicable Margin separately for each period during such quarter or month, as applicable, that such Applicable Margin was in effect.

(ii) Documentary and Processing Charges Payable to Issuing Bank. The Borrower shall pay directly to the Issuing Bank, for its own account, on demand (it being acknowledged and agreed that any charging of such fees, commissions, and charges to the Loan Account pursuant to the provisions of Section 2.02(g) shall be deemed to constitute a demand for payment thereof for the purposes of this Section 2.09(b)(ii)) (i) a fronting fee which shall be imposed by the Issuing Bank upon the issuance of each Letter of Credit of 0.125% per annum of the face amount thereof, plus (ii) any and all other customary commissions, fees and charges then in effect imposed by, and any and all expenses incurred by, the Issuing Bank, or by any adviser, confirming institution or entity or other nominated person, relating to Letters of Credit, at the time of issuance of any Letter of Credit and upon the occurrence of any other activity with respect to any Letter of Credit (including transfers, assignments of proceeds, amendments, drawings, renewals or cancellations).

(c) Agents’ Fees. The Borrower shall pay to each Agent for its own account such fees as may from time to time be agreed between the Borrower and such Agent.

 

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SECTION  2.09. SECTION 2.09. Conversion of Advances. (a) 

(a) Optional. The Borrower may on any Business Day, upon notice given to the Administrative Agent not later than 11:00 A.M. (New York City time) on the third Business Day prior to the date of the proposed Conversion and subject to the provisions of Section 2.10, Convert all or any portion of the Advances of one Type comprising the same Borrowing into Advances of the other Type; provided, however, that any Conversion of Eurodollar Rate Advances into Base Rate Advances shall be made only on the last day of an Interest Period for such Eurodollar Rate Advances, any Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in an amount not less than $1,000,000, no Conversion of any Advances shall result in more than 15 Interest Periods in effect and each Conversion of Advances comprising part of the same Borrowing under any Facility shall be made ratably among the Appropriate Lenders in accordance with their Commitments under such Facility. Each such notice of Conversion shall, within the restrictions specified above, specify (i) the date of such Conversion, (ii) the Advances to be Converted and (iii) if such Conversion is into Eurodollar Rate Advances, the duration of the initial Interest Period for such Advances. Each notice of Conversion shall be irrevocable and binding on the Borrower.

(b) Mandatory. (i) If the Borrower shall fail to select the duration of any Interest Period for any Eurodollar Rate Advances in accordance with the provisions contained in the definition of “Interest Period” in Section 1.01, the Administrative Agent will forthwith so notify the Borrower and the Appropriate Lenders, whereupon with respect to each such Eurodollar Rate Advance, on the last day of the then existing Interest Period therefor, Borrower shall be deemed to have selected an Interest Period of one month’s duration.

(ii) Upon the occurrence and during the continuance of any Event of Default, the Administrative Agent and the Required Lenders may require, by notice to the Borrower, that (x) at the end of the then existing applicable Interest Period each Eurodollar Rate Advance be Converted into a Base Rate Advance and (y) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended.

SECTION  2.10. SECTION 2.10. Increased Costs, Etc.

(a) (a) If, due to either (i) any Change in Law or (ii) the compliance with any guideline or request or directive from any central bank or other governmental authority (whether or not having the force of law), (A) any reserve, deposit, or similar requirement is or shall be imposed or modified in respect of any Letter of Credit issued or caused to be issued hereunder or hereby, or any Advances or obligations to make Advances hereunder or hereby, or (B) there shall be imposed on the Issuing Bank or any other Lender Party any other condition regarding any Letter of Credit, Advance, or obligations to make Advances hereunder, and the result of the foregoing is to increase the cost to any Lender Party of agreeing to make or of making, funding or maintaining Eurodollar Rate Advances or, in the case of any Issuing Bank or Revolving Credit Lender, of agreeing to issue or of issuing or maintaining or participating in Letters of Credit or of agreeing to make or of making or maintaining Letter of Credit Advances (excluding, for purposes of this Section 2.10, any such increased costs resulting from (x) Taxes described in the definitions of Excluded Taxes, Indemnified Taxes or Other Taxes (as to which Section 2.12 shall govern) and (y) changes in the basis of imposition, or the rate, of any taxes, levies, imposts, deductions, charges, withholdings or liabilities that are excluded from the definition of Taxes), or to reduce the amount receivable in respect thereof, then the Borrower shall from time to time, upon demand by such Lender Party (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender Party additional amounts sufficient to compensate such Lender Party for such increased cost or reduced receipt. A certificate as to the amount of such increased cost or reduced receipt, submitted to the Borrower by such Lender Party, shall be conclusive

 

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and binding for all purposes, absent manifest error. Notwithstanding anything contained herein to the contrary, the Borrower shall not be required to compensate a Lender or the Issuing Bank pursuant to this Section 2.10(a) for any such increased cost or reduced receipt incurred more than one-hundred-eighty (180) days prior to the date that such Lender or Issuing Bank demands compensation therefor; provided that, if the circumstance giving rise to such increased cost or reduced receipt is retroactive, then such 180 day period shall be extended to include the period of retroactive effect thereof.

(b) If any Lender Party determines that any compliance with any law or regulation or any guideline or request from any central bank or other governmental authority (whether or not having the force of law) affects or would affect the amount of capital or liquidity required or expected to be maintained by such Lender Party or any holding company controlling such Lender Party and that the amount of such capital or liquidity is increased by or based upon the existence of such Lender Party’s commitment to lend or to issue or participate in Letters of Credit hereunder, then, upon demand by such Lender Party or such holding company (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender Party, from time to time as specified by such Lender Party, additional amounts sufficient to compensate such Lender Party in the light of such circumstances, to the extent that such Lender Party reasonably determines such increase in capital or liquidity to be allocable to the existence of such Lender Party’s commitment to lend or to issue or participate in Letters of Credit hereunder or to the issuance or maintenance of or participation in any Letters of Credit, for any reduction in the rate of return on such Lender Party’s capital or liquidity or on the capital or liquidity of such Lender Party’s holding company. A certificate as to such amounts submitted to the Borrower by such Lender Party shall be conclusive and binding for all purposes, absent manifest error. Notwithstanding anything contained herein to the contrary, the Borrower shall not be required to compensate a Lender pursuant to this Section 2.10(b) for any such increased cost incurred more than one-hundred-eighty (180) days prior to the date that such Lender demands compensation therefor; provided that, if the circumstance giving rise to such increased cost is retroactive, then such 180 day period shall be extended to include the period of retroactive effect thereof.

(c) If, with respect to any Eurodollar Rate Advances under any Facility, Lenders owed at least a majority of the then aggregate unpaid principal amount thereof notify the Administrative Agent that the Eurodollar Rate for any Interest Period for such Advances will not adequately reflect the cost to such Lenders of making, funding or maintaining their Eurodollar Rate Advances for such Interest Period, the Administrative Agent shall forthwith so notify the Borrower and the Appropriate Lenders, whereupon (i) each such Eurodollar Rate Advance under such Facility will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance and (ii) the obligation of the Appropriate Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended until the Administrative Agent shall notify the Borrower that such Lenders have determined that the circumstances causing such suspension no longer exist.

(d) Notwithstanding any other provision of this Agreement, if any Change in Law shall make it unlawful, or any central bank or other governmental authority shall assert that it is unlawful, for any Lender or its Eurodollar Lending Office to perform its obligations hereunder to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder, then, on notice thereof and demand therefor by such Lender to the Borrower through the Administrative Agent, (i) each Eurodollar Rate Advance under each Facility under which such Lender has a Commitment will automatically, upon such demand, Convert into a Base Rate Advance and (ii) the obligation of the Appropriate Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended until the Administrative Agent shall notify the Borrower that such Lender has determined that the circumstances causing such suspension no longer exist; provided, however, that, before making any such demand, such Lender agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different Eurodollar Lending Office if the making of such a

 

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designation would allow such Lender or its Eurodollar Lending Office to continue to perform its obligations to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate Advances and would not, in the judgment of such Lender, be otherwise disadvantageous to such Lender.

(e) The Borrower shall pay to each Lender, as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “”Eurocurrency liabilities””), additional interest on the unpaid principal amount of each Eurodollar Rate Advance equal to the actual costs of such reserves allocated to such Eurodollar Rate Advance by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), which shall be due and payable on each date on which interest is payable on such Eurodollar Rate Advance, provided the Borrower shall have received at least 10 days’ prior notice (with a copy to the Administrative Agent) of such additional interest from such Lender. If a Lender fails to give notice 10 days prior to the relevant interest payment date, such additional interest shall be due and payable 10 days from receipt of such notice.

(f) IfSubject to Section 2.10(g) below, if the Required Lenders determine that for any reason in connection with any request for a Eurodollar Rate Advance or a conversion to or continuation thereof that (ai) Dollar deposits are not being offered to banks in the London interbank market for the applicable amount and Interest Period of such Eurodollar Rate Advance, (bii) adequate and reasonable means do not exist for determining the LIBO Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Advance, or (ciii) the LIBO Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Advance does not adequately and fairly reflect the cost to such Lenders of funding such Advance, or (iv) any requirement of law or Change in Law has made it, or that any Governmental Authority has asserted that it is, unlawful for any Lender to make, maintain or fund Eurodollar Rate Advances or to determine or charge interest rates based upon the LIBO Rate, the Administrative Agent will promptly so notify the Borrower and each Lender. Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate Advances shall be suspended until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice, which such revocation of notice shall be provided at the earliest time that the circumstances in clauses (ai), through (biv ) and (c) in the immediately preceding sentence no longer exist. Upon receipt of such notice, the Borrower may revoke any pending request for a borrowing of, conversion to or continuation of Eurodollar Rate Advances or, failing that, will be deemed to have converted such request into a request for a Base Rate Advance in the amount specified therein, without any cost, expense or penalty (including no cost, expense or penalty of the type described in Section 9.04) to the Borrower.

(g) Effect of Benchmark Transition Event.

(i) Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan Document, upon the occurrence of a Benchmark Transition Event or an Early Opt-in Election, as applicable, the Administrative Agent and the Borrower may amend this Agreement to replace the LIBO Rate with a Benchmark Replacement. Any such amendment with respect to a Benchmark Transition Event will become effective at 5:00 p.m. on the fifth (5th) Business Day after the Administrative Agent has posted such proposed amendment to all Lenders and the Borrower so long as the Administrative Agent has not received, by such time, written notice of objection to such amendment from Lenders comprising the Required Lenders. Any such amendment with respect to an Early Opt-in Election will become effective on the date that Lenders comprising the Required Lenders have delivered to the Administrative Agent written notice that such Required Lenders accept such amendment, notwithstanding anything (including, without limitation, Section 9.01) herein to the contrary. No replacement of the LIBO Rate with a Benchmark Replacement pursuant to this Section 2.10(g) will occur prior to the applicable Benchmark Transition Start Date.

 

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(ii) Benchmark Replacement Conforming Changes. In connection with the implementation of a Benchmark Replacement, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document (including, without limitation, Section 9.01 hereof), any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement.

(iii) Notices; Standards for Decisions and Determinations. The Administrative Agent will promptly notify the Borrower and the Lenders of (1) any occurrence of a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date and Benchmark Transition Start Date, (2) the implementation of any Benchmark Replacement, (3) the effectiveness of any Benchmark Replacement Conforming Changes and (4) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrative Agent or the Lenders pursuant to this Section 2.10(g) including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party hereto, except, in each case, as expressly required pursuant to this Section 2.10(g).

(iv) Benchmark Unavailability Period. Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower may revoke any request for a Borrowing consisting of Eurodollar Rate Advances of, conversion to or continuation of Eurodollar Rate Advances to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Borrower will be deemed to have converted any such request into a request for a Borrowing of or conversion to Base Rate Advance. During any Benchmark Unavailability Period, the component of Base Rate based upon the LIBO Rate will not be used in any determination of the Base Rate.

(v) Effect of Amendment. Notwithstanding anything to the contrary herein, any amendment contemplated by this Section 2.10(g) in connection with a Benchmark Transition Event or an Early Opt-in Election shall be effective as contemplated by this Section 2.10(g).

(h) (g) Anything to the contrary contained herein notwithstanding, neither any Agent, nor any Lender, nor any of their Participants, is required actually to acquire eurodollar deposits to fund or otherwise match fund any Obligation as to which interest accrues at the LIBO Rate.

SECTION  2.11. SECTION 2.11. Payments and Computations. (a) 

(a) The Borrower shall make each payment hereunder and under the other Loan Documents, irrespective of any right of counterclaim or set-off (except as otherwise provided in Section 2.15), not later than 10:30 A.M. (New York City time) on the day when due in U.S. dollarsDollars to the Administrative Agent at the Administrative Agent’s Account in same day funds, with payments being received by the Administrative Agent after such time being deemed to have been received on the next succeeding Business Day (it being acknowledged and agreed by the Borrower that should any payment item not be honored when presented for payment, then Borrower shall be deemed not to have made such payment). The Administrative Agent will promptly thereafter cause like funds to be distributed (i) if such payment by the Borrower is in respect of principal, interest, commitment fees or any other Obligation then payable hereunder and under the other Loan Documents to more than one Lender Party, to such Lender Parties for the account of their respective Applicable Lending Offices ratably in accordance with

 

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the amounts of such respective Obligations then payable to such Lender Parties and (ii) if such payment by the Borrower is in respect of any Obligation then payable hereunder to one Lender Party, to such Lender Party for the account of its Applicable Lending Office, in each case to be applied in accordance with the terms of this Agreement. Upon its acceptance of an Assignment and Assumption and recording of the information contained therein in the Register pursuant to Section 9.07(d), from and after the effective date of such Assignment and Assumption, the Administrative Agent shall make all payments hereunder and under the other Loan Documents in respect of the interest assigned thereby to the assignee thereunder, and the parties to such Assignment and Assumption shall make all appropriate adjustments in such payments for periods prior to such effective date directly between themselves.

(b) INTENTIONALLY OMITTED.[Intentionally Omitted].

(c) All computations of interest based on the Base Rate shall be made by the Administrative Agent on the basis of a year of 365 or 366 days, as the case may be, and all computations of interest based on the Eurodollar Rate and of fees shall be made by the Administrative Agent on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest, fees or commissions are payable. Each determination by the Administrative Agent of an interest rate, fee or commission hereunder shall be conclusive and binding for all purposes, absent manifest error.

(d) Whenever any payment hereunder or under the other Loan Documents shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or commitment or letter of credit fee or commission, as the case may be; provided, however, that, if such extension would cause payment of interest on or principal of Eurodollar Rate Advances to be made in the next following calendar month, such payment shall be made on the preceding Business Day.

(e) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to any Lender Party hereunder that the Borrower will not make such payment in full, the Administrative Agent may assume that the Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon such assumption, cause to be distributed to each such Lender Party on such due date an amount equal to the amount then due such Lender Party. If and to the extent the Borrower shall not have so made such payment in full to the Administrative Agent, each such Lender Party shall repay to the Administrative Agent forthwith on demand such amount distributed to such Lender Party together with interest thereon, for each day from the date such amount is distributed to such Lender Party until the date such Lender Party repays such amount to the Administrative Agent, at the Federal Funds Rate.

(f) Whenever any payment received by the Administrative Agent from the Borrower under this Agreement or any of the other Loan Documents is insufficient to pay in full all amounts due and payable to the Agents and the Lender Parties by the Borrower under or in respect of this Agreement and the other Loan Documents on any date, such payment shall be distributed by the Administrative Agent and applied by the Agents and the Lender Parties in the following order of priority (x) upon the occurrence and during the continuance of an Event of Default or (y) at any other time that the Administrative Agent receives a payment from the Borrower without direction as to the application of such payment:

(i) first, to the payment of all of the fees, indemnification payments, costs and expenses that are due and payable to the Agents (solely in their respective capacities as Agents) under or in respect of this Agreement and the other Loan Documents on such date by the

 

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Borrower, ratably based upon the respective aggregate amounts of all such fees, indemnification payments, costs and expenses owing to the Agents on such date;

(ii) second, to the payment of all of the fees, indemnification payments other than indemnification payments as set forth in clause (iii) below, costs and expenses that are due and payable to the applicable Issuing Bank and the applicable Lenders under or in respect of this Agreement and the other Loan Documents on such date by the Borrower, ratably based upon the respective aggregate amounts of all such fees, indemnification payments, costs and expenses owing to the applicable Issuing Bank and the applicable Lenders on such date;

(iii) third, to the payment of all of the indemnification payments, costs and expenses that are due and payable to the Lenders under Sections 9.04 hereof, Section 22 of the Security Agreement and any similar Section of any other Loan Documents on such date by the Borrower, ratably based upon the respective aggregate amounts of all such indemnification payments, costs and expenses owing to the applicable Lenders on such date;

(iv) fourth, to the payment of all of the amounts that are due and payable to the Administrative Agent and the Lender Parties under Sections 2.10 and 2.12 hereof on such date by the Borrower, ratably based upon the respective aggregate amounts thereof owing to the Administrative Agent and the Lender Parties on such date;

(v) fifth, to the payment of all of the fees that are due and payable to the Appropriate Lenders under Section 2.08(a) on such date by the Borrower, ratably based upon the respective applicable undrawn aggregate Commitments of the Lenders under the applicable Facilities on such date;

(vi) sixth, to the payment of all of the accrued and unpaid interest on the Obligations of the Borrower under or in respect of the Loan Documents that is due and payable to the Agents and the applicable Lender Parties under Section 2.07(b) on such date, ratably based upon the respective aggregate amounts of all such interest owing to the Agents and the applicable Lender Parties on such date;

(vii) seventh, to the payment of all of the accrued and unpaid interest on the applicable Advances that is due and payable to the applicable Lender Parties under Section 2.07(a) on such date, ratably based upon the respective aggregate amounts of all such interest owing to such applicable Lender Parties on such date;

(viii) eighth, to the payment of the principal amount of all of the outstanding applicable Advances that is due and payable to the Agents and the applicable Lender Parties on such date by the Borrower, ratably based upon the respective aggregate amounts of all such principal owing to the Agents and the applicable Lender Parties on such date; and

(ix) ninth, to the payment of all other Obligations owing under or in respect of the Loan Documents that are due and payable to the Administrative Agent and the other Secured Parties on such date by the Borrower, ratably based upon the respective aggregate amounts of all such Obligations owing to the Administrative Agent and the other Secured Parties on such date.

(g) Whenever any cash proceeds are received by the Administrative Agent from any sale of, collection from, or other realization upon all or any part of the Collateral pursuant to Section 22 of the Security Agreement, such cash proceeds shall be distributed by the Administrative Agent and applied by

 

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the Agents and the Lender Parties and Hedge Banks in the following order of priority upon the occurrence and during the continuance of an Event of Default:

(i) first, to the payment of all of the fees, indemnification payments, costs and expenses that are due and payable to the Agents (solely in their respective capacities as Agents) under or in respect of this Agreement and the other Loan Documents on such date by the Borrower, ratably based upon the respective aggregate amounts of all such fees, indemnification payments, costs and expenses owing to the Agents on such date;

(ii) second, to the payment of all of the fees, indemnification payments (other than indemnification payments as set forth in clause (iii) below), costs and expenses that are due and payable to the applicable Issuing Bank and the applicable Lenders under or in respect of this Agreement and the other Loan Documents and the applicable Hedge Banks under or in respect of the Secured Hedge Agreements, in each case on such date by the Borrower, ratably based upon the respective aggregate amounts of all such fees, indemnification payments, costs and expenses owing to the applicable Issuing Bank, the applicable Lenders and the applicable Hedge Banks on such date;

(iii) third, to the payment of all of the indemnification payments, costs and expenses that are due and payable to the Lenders under Sections 9.04 hereof, Section 22 of the Security Agreement and any similar section of any other Loan Documents on such date by the Borrower, ratably based upon the respective aggregate amounts of all such indemnification payments, costs and expenses owing to the applicable Lenders on such date;

(iv) fourth, to the payment of all of the amounts that are due and payable to the Administrative Agent and the Lender Parties under Sections 2.10 and 2.12 hereof on such date by the Borrower, ratably based upon the respective aggregate amounts thereof owing to the Administrative Agent and the Lender Parties on such date;

(v) fifth, to the payment of all of the fees that are due and payable to the Appropriate Lenders under Section 2.08(a) on such date by the Borrower, ratably based upon the respective applicable undrawn aggregate Commitments of the Lenders under the applicable Facilities on such date;

(vi) sixth, to the payment of all of the accrued and unpaid interest on the Obligations of the Borrower under or in respect of the Loan Documents that is due and payable to the Agents and the applicable Lender Parties under Section 2.07(b) on such date, ratably based upon the respective aggregate amounts of all such interest owing to the Agents and the applicable Lender Parties on such date;

(vii) seventh, to the payment of all of the accrued and unpaid interest on the applicable Advances that is due and payable to the applicable Lender Parties under Section 2.07(a) on such date, ratably based upon the respective aggregate amounts of all such interest owing to such applicable Lender Parties on such date;

(viii) eighth, to the payment of the principal amount of all of the outstanding applicable Advances that is due and payable to the Agents and the applicable Lender Parties on such date by the Borrower, ratably based upon the respective aggregate amounts of all such principal owing to the Agents and the applicable Lender Parties on such date (which, for the avoidance of doubt, shall include payment to the Administrative Agent, for the account of the Issuing Bank, to Cash Collateralize the Letters of Credit then outstanding);

 

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(ix) ninth, to the payment of all amounts due under Secured Hedge Agreements, Secured Bank Product Agreements, and Secured Cash Management Agreements, ratably among the Lenders, Hedge Banks and the Cash Management Banks in proportion to the respective aggregate amount owing to such Lenders, Hedge Banks and Cash Management Banks; and

(x) tenth, to the payment of all other Obligations owing under or in respect of the Loan Documents that are due and payable to the Administrative Agent and the other Secured Parties on such date by the Borrower, ratably based upon the respective aggregate amounts of all such Obligations owing to the Administrative Agent and the other Secured Parties on such date.

(h) For the avoidance of doubt, notwithstanding any other provision of any Loan Document, no amount received directly or indirectly from any Loan Party that is not a Qualified ECP Guarantor shall be applied directly or indirectly by Administrative Agent or otherwise to the payment of any Excluded Swap Obligations.

SECTION  2.12. SECTION 2.12. Taxes. (a) 

(a) Any and all payments by any Loan Party to or for the account of any Lender Party or any Agent hereunder or under any other Loan Document shall be made, in accordance with Section 2.11 or the applicable provisions of such other Loan Document, if any, free and clear of and without deduction for any Indemnified Taxes or Other Taxes. If any Loan Party shall be required by law to deduct any Indemnified Taxes or Other Taxes from or in respect of any sum payable hereunder or under any other Loan Document to any Lender Party or any Agent, (i) the sum payable by such Loan Party shall be increased as may be necessary so that after such Loan Party and the Administrative Agent have made all required deductions (including deductions applicable to additional sums payable under this Section 2.12) such Lender Party or such Agent, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, (ii) such Loan Party shall make all such deductions and (iii) such Loan Party shall pay the full amount deducted to the relevant taxation authority or other authority in accordance with applicable law.

(b) Without limiting the provisions of clause (a) above, each Loan Party shall timely pay any present or future stamp, documentary, excise, property, intangible, mortgage recording or similar taxes, charges or levies that arise from any payment made by such Loan Party hereunder or under any other Loan Documents or from the execution, delivery or registration of, performance under, or otherwise with respect to, this Agreement or the other Loan Documents (hereinafter referred to ascollectively, the “Other Taxes”) to the relevant Governmental Authority in accordance with applicable law.

(c) The Loan Parties shall indemnify each Lender Party and each Agent for and hold them harmless against the full amount of Indemnified Taxes and Other Taxes, and for the full amount of taxes of any kind imposed or asserted by any jurisdiction on amounts payable under this Section 2.12, imposed on or paid by such Lender Party or such Agent (as the case may be) and any liability (including penalties, additions to tax, interest and expenses) arising therefrom or with respect thereto. This indemnification shall be made within 30 days from the date such Lender Party or such Agent (as the case may be) makes written demand therefor. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender Party (with a copy to the Administrative Agent) or by the Agents on their own behalf or on behalf of a Lender Party shall be conclusive absent manifest error.

(d) Within 30 days after the date of any payment of Indemnified Taxes, the appropriate Loan Party shall furnish to the Administrative Agent, at its address referred to in Section 9.02, the original or a certified copy of a receipt evidencing such payment, to the extent such a receipt is issued therefor, or other written proof of payment thereof that is reasonably satisfactory to the Administrative Agent. For

 

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purposes of subsections (d) and (e) of this Section 2.12, the terms “United States” and “United States person” shall have the meanings specified in Section 7701 of the Internal Revenue Code.

(e)(I) Each Payee organized under the laws of a jurisdiction outside the United States shall, on or prior to the date of its execution and delivery of this Agreement in the case of each Initial Lender Party and on the date pursuant to which it becomes a Payee in the case of each other Payee, and from time to time thereafter as reasonably requested in writing by the Borrower (but only so long thereafter as such Lender Party remains lawfully able to do so), provide each of the Administrative Agent and the Borrower with two originalexecuted copies of Internal Revenue Service Forms W-8IMY (together with certification documents from the applicable beneficial owners), W-8BEN, W-8BEN-E or W-8ECI or (in the case of a Payee that has certified in writing to Borrower and the Administrative Agent that it is not (i) a “bank” as defined in Section 881(c)(3)(A) of the Internal Revenue Code, (ii) a 10-percent shareholder (within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code) of any Loan Party or (iii) a controlled foreign corporation related to any Loan Party (within the meaning of Section 864(d)(4) of the Internal Revenue Code), Internal Revenue Service Form W-8BEN or W-8BEN-E, as appropriate, or any successor or other form prescribed by the Internal Revenue Service, certifying that such Payee is exempt from or entitled to a reduced rate of United States withholding tax on payments pursuant to this Agreement or any other Loan Document. If, at the time such Payee first becomes a Payee hereunder payments pursuant to this Agreement or any other Loan Document are subject to withholding tax rate at a rate in excess of zero, withholding tax at such rate shall be considered excluded from Indemnified Taxes unless and until such Lender Party provides the appropriate forms certifying that a lesser rate applies, whereupon withholding tax at such lesser rate only shall be considered excluded from Indemnified Taxes for periods governed by such forms; provided, however, that if, at the effective date of the Assignment and Assumption pursuant to which a Lender Party becomes a party to this Agreement, the Lender Party assignor was entitled to payments under subsection (a) of this Section 2.12 in respect of United States withholding tax with respect to interest paid at such date, then, to such extent, the term Indemnified Taxes shall include (in addition to withholding taxes that may be imposed in the future as a result of a changeChange in lawLaw after the date that a Lender becomes a party to this Agreement) United States withholding tax, if any, applicable with respect to the Lender Party assignee on such date.

(II) Each Payee that is a “United States person” shall deliver to the Administrative Agent two duly signed completed copies of IRS Form W-9. If such Payee fails to deliver such forms, then Borrower and the Administrative Agent may withhold from any interest payment to such Lender an amount equivalent to the applicable backup withholding tax imposed by the Internal Revenue Code, without reduction, and such amount shall be excluded from Indemnified Taxes.

(f) For any period with respect to which a Payee has failed to provide the Borrower with the appropriate form, certificate or other document described in subsection (e) above (other than if such failure is due to a changeChange in lawLaw, or in the interpretation or application thereof, occurring after the date on which a form, certificate or other document originally was required to be provided), such Lender Party shall not be entitled to indemnification under subsection (a) or (c) of this Section 2.12 with respect to Taxes imposed by the United States by reason of such failure; provided, however, that should a Payee become subject to Taxes because of its failure to deliver a form, certificate or other document required hereunder, the Loan Parties shall take such steps as such Payee shall reasonably request to assist such Payee to recover such Taxes.

(g) If a payment made to a Payee under this Agreement would be subject to withholding tax imposed by the United States of America with respect to FATCA if such Payee were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Internal Revenue Code, as applicable), such Payee shall deliver to the Borrower and the Administrative Agent, at the time or times prescribed by law and at such time or times reasonably

 

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