This
CREDIT AGREEMENT
(this
"
Agreement
") is
entered into as of September 30, 2009, among
BARNES & NOBLE, INC.
, a
Delaware corporation (the "
Lead Borrower
"), the
Persons signatory hereto as borrowers and named on
Schedule 1.01
hereto
(collectively, together with the Lead Borrower and such other Persons as may be
joined as a borrower from time to time in accordance herewith, the "
Borrowers
"), the
Persons signatory hereto as guarantors and named on
Schedule 1.02
hereto
(collectively, together with such other Persons as may be joined as a guarantor
from time to time in accordance herewith, the "
Guarantors
"), each
lender from time to time party hereto (collectively, the "
Lenders
"),
BANK OF AMERICA, N.A.
, as
Administrative Agent, Collateral Agent and Swing Line Lender,
JPMORGAN CHASE BANK, N.A.
and
WELLS FARGO RETAIL FINANCE,
LLC,
as Co- Syndication Agents,
SUNTRUST BANK
and
US BANK, NATIONAL
ASSOCIATION.,
as Co- Documentation Agents, and
REGIONS BANK
and
SOVEREIGN BANK,
as Co-Senior
Managing Agents.
The
Borrowers have requested that the Lenders provide a revolving credit facility,
and the Lenders have indicated their willingness to lend and the LC Issuers have
indicated their willingness to issue Letters of Credit, in each case on the
terms and conditions set forth herein.
In
consideration of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:
ARTICLE
I
DEFINITIONS
AND ACCOUNTING TERMS
1.01
Defined
Terms
. As used in this Agreement, the following terms shall have the
meanings
set forth
below:
"
Accommodation
Payment
" as defined in
Section
10.21(d)
.
"
Account
" means
"accounts" as defined in the UCC, and also means, without limitation, 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, (b) for services rendered or to be rendered, or (c)
arising out of the use of a credit or charge card or information contained on or
for use with the card.
"
ACH
" means automated
clearing house transfers.
"
Acquisition
" means,
with respect to any Person (a) the purchase of a Controlling interest in the
Equity Interests of any other Person, (b) a purchase or other acquisition of all
or substantially all of the assets or properties of another Person or of any
business unit or line of business of another Person (other than acquisitions or
openings of new stores in the ordinary course of business), (c) any Material
Store Acquisition or (d) any merger or consolidation of such Person with any
other Person or other transaction or series of transactions resulting in the
acquisition of all or substantially all of the assets, or a Controlling interest
in the Equity Interests, of any Person.
"
Additional Commitment
Lender
" shall have the meaning provided in
Section
2.15(c)
.
"
Adjusted LIBO Rate
"
means, with respect to any LIBO Borrowing for any Interest Period, an interest
rate per annum (rounded upwards, if necessary, to the next 1/16 of one percent
(1.0%)) equal to (a) the LIBO Rate for such Interest Period multiplied by (b)
the Statutory Reserve Rate. The Adjusted
"
Adjustment Date
"
means the first day of each Fiscal Quarter of the Lead Borrower commencing with
the third full Fiscal Quarter after the Closing Date.
"
Administrative Agent
"
means Bank of America in its capacity as administrative agent under any of the
Loan Documents, or any successor administrative agent.
"
Administrative Agent’s
Office
" means the Administrative Agent’s address and, as appropriate,
account as set forth on
Schedule 10.02
, or
such other address or account as the Administrative Agent may from time to time
notify the Lead Borrower and the Lenders.
"
Administrative
Questionnaire
" means an Administrative Questionnaire for each Lender in a
form supplied by the Administrative Agent.
"
Affiliate
" means,
with respect to any Person, another Person that directly, or indirectly through
one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified.
"
Agent(s)
" means,
individually, the Administrative Agent or the Collateral Agent, and collectively
means both of them.
"
Agent Parties
" shall
have the meaning specified in
Section
10.02(c)
.
"
Aggregate
Commitments
" means the Commitments of all the Lenders. The Aggregate
Commitments as of the Closing Date total $1,000,000,000.
"
Agreement
" means this
Credit Agreement.
"
Allocable Amount
" has
the meaning specified in
Section
10.21(d)
.
"
Applicable Commitment Fee
Percentage
" means (a) for the period from the Closing Date through
October 31, 2009, 1.00% and (b) thereafter, the applicable percentage set forth
in the grid below:
|
|
Applicable
Commitment
|
|
Average
Usage
|
Fee
Percentage
|
|
Less
than 33.3% of the Aggregate Commitments
|
1.00%
|
|
Equal
to or greater than 33.3% but less than 66.6%
|
0.75%
|
|
of
the Aggregate Commitments
|
|
|
Equal
to or greater than 66.6% of the Aggregate
|
0.50%
|
|
Commitments
|
|
"
Applicable Margin
"
means (a) from and after the Closing Date until the first Adjustment Date, the
Applicable Margin shall be set at the percentages set forth in Level II of the
pricing grid below; and (b) from and after the first Adjustment Date (and each
subsequent Adjustment Date) until the next Adjustment Date, the Applicable
Margin shall be determined from the following pricing grid based upon the
Average Daily Availability for the Fiscal Quarter ending the day immediately
preceding such starting Adjustment Date;
provided
,
however
, that
notwithstanding anything to the contrary set forth herein, upon the occurrence
of an Event of Default or the Termination Date, the Administrative Agent may,
and at the direction of the Required Lenders shall, immediately increase the
Applicable Margin to that set forth in
|
|
|
LIBO
Rate
|
Base
Rate
|
|
Level
|
Average
Daily Availability
|
Margin
|
Margin
|
|
I
|
Less
than 33.3% of the Loan Cap
|
4.00%
|
3.00%
|
|
II
|
Equal
to or greater than 33.3% but
|
3.75%
|
2.75%
|
|
|
less
than 66.6% of the Loan Cap
|
|
|
|
III
|
Equal
to or greater than 66.6% of the
|
3.50%
|
2.50%
|
|
|
Loan
Cap
|
|
|
"
Applicable
Percentage
" means with respect to any Lender at any time, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender’s Commitment at such time. If the commitment of each
Lender to make Loans and the obligation of the LC Issuers to make LC Credit
Extensions have been terminated pursuant to
Section 8.02
or if
the Aggregate Commitments have expired, then the Applicable Percentage of each
Lender shall be determined based on the Applicable Percentage of such Lender
most recently in effect, giving effect to any subsequent assignments. The
initial Applicable Percentage of each Lender is set forth opposite the name of
such Lender on
Schedule 2.01
or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable.
"
Applicable Rate
"
means, at any time of calculation, a per annum rate equal to the Applicable
Margin for Loans which are LIBO Rate Loans.
"
Appraisal Percentage
"
means eighty-five percent (85.0%).
"
Appraised Value
"
means with respect to Eligible Real Estate, the fair market value of the
Eligible Real Estate as set forth in the most recent appraisal of the Eligible
Real Estate as determined from time to time by an independent appraiser engaged
by the Administrative Agent (in the case of any appraisal after the Closing
Date, pursuant to
Section 6.10(b)
hereof), which appraisal shall assume, among other things, a marketing time of
not greater than twelve (12) months (unless a longer period is otherwise agreed
to by the Administrative Agent and the Arrangers) or less than three (3)
months.
"
Approved Fund
" means
any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a
Lender or (c) an entity or an Affiliate of an entity that administers or manages
a Lender.
"
Arranger(s)
" means,
individually, Banc of America Securities LLC, J.P. Morgan Securities Inc. and
Wells Fargo Retail Finance, LLC, and collectively, all of them, in each case, in
their capacity as Joint Lead Arrangers.
"
Assignee Group
" means
two or more Eligible Assignees that are Affiliates of one another or two or more
Approved Funds managed by the same investment advisor.
"
Assignment and
Assumption
" means an assignment and assumption entered into by a Lender
and an Eligible Assignee (with the consent of any party whose consent is
required by
Section
10.06(b))
,
"
Attributable
Indebtedness
" means, on any date, (a) in respect of any Capital Lease
Obligation of any Person, the capitalized amount thereof that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease or similar payments under the relevant lease or other
applicable agreement or instrument that would appear on a balance sheet of such
Person prepared as of such date in accordance with GAAP if such lease, agreement
or instrument were accounted for as a capital lease.
"
Audited Financial
Statements
" means the audited consolidated balance sheet of the Lead
Borrower and its Subsidiaries for the fiscal year ended January 31, 2009, and
the related consolidated statements of income or operations, Shareholders’
Equity and cash flows for such fiscal year of the Lead Borrower and its
Subsidiaries, including the notes thereto.
"
Auto-Extension Letter of
Credit
" shall have the meaning specified in
Section
2.03(b)(iii)
.
"
Availability
" means,
as of any date of determination thereof by the Administrative Agent, the greater
of (a) the Loan Cap
minus
Total
Outstandings and (b) zero.
"
Availability Event
"
has the meaning provided in the definition of Trigger Event.
"
Availability Period
"
means the period from and including the Closing Date to the earliest of (a) the
Maturity Date, (b) the date of termination of the Aggregate Commitments in full
pursuant to
Section
2.06
, and (c) the
date of termination of the Commitment of each Lender to make Loans and of
the
obligation of
the LC Issuers to make LC Credit Extensions pursuant to
Section
8.02
.
"
Availability
Reserves
" means, without duplication of any other Reserves or items that
are otherwise addressed or excluded through eligibility criteria, such reserves
as the Administrative Agent from time to time determines in its Permitted
Discretion as being appropriate (a) to reflect the 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 upon the Collateral, (c) to reflect criteria, events,
conditions, contingencies or risks which adversely affect any component of the
Borrowing Base, or (d) to reflect that a Default then exists. Without limiting
the generality of the foregoing, Availability Reserves may include, in the
Administrative Agent’s discretion, (but are not limited to) reserves based on:
(i) rent; (ii) customs duties, and other costs to release Inventory that is (A)
included in the Borrowing Base and (B) being imported into the United States;
(iii) outstanding Taxes and other governmental charges, including, without
limitation, ad valorem, real estate, personal property, sales, and other Taxes
which may have priority over the interests of the Collateral Agent in the
Collateral; (iv) salaries, wages and benefits due to employees of any Borrower,
(v) Customer Credit Liabilities, (vi) warehousemen’s or bailee’s charges and
other Permitted Encumbrances which may have priority over the interests of the
Collateral Agent in the Collateral, (vii) Cash Management Reserves, and (viii)
Bank Products Reserves.
"
Average Daily
Availability
" means, as of any date of determination, the average daily
Availability for the immediately preceding Fiscal Quarter.
"
Average Usage
" means,
as of any date of determination, the average daily balance of all Credit
Extensions (excluding Swing Line Loans) in the immediately preceding Fiscal
Quarter.
"
Bank of America
"
means Bank of America, N.A. and its successors.
"
Bank Product
Reserves
" means such reserves as the Administrative Agent from time to
time determines in its discretion as being appropriate to reflect the
liabilities and obligations of the Loan Parties with respect to Bank Products
then provided or outstanding.
"
Base Rate
" means for
any day a fluctuating rate per annum equal to the highest of (a) the Federal
Funds Rate plus 1/2 of 1.0% (b) the rate of interest in effect for such day as
publicly announced from time to time by Bank of America as its "prime rate" and
(c) the Adjusted LIBO Rate for an Interest Period of one month,
plus
1.0%. The "prime
rate" is a rate set by Bank of America based upon various factors including Bank
of America’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. Any change in such rate
announced by Bank of America shall take effect at the opening of business on the
day specified in the public announcement of such change.
"
Base Rate Loan
" means
a Loan that bears interest based on the Base Rate.
"
Blocked Account
" has
the meaning provided in
Section
6.13(a)(iii)
.
"
Blocked Account
Agreement
" means with respect to an account established by a Loan Party,
an agreement, substantially in the form of
Exhibit M
hereto or
otherwise in form and substance reasonably satisfactory to the Collateral Agent,
establishing Control (as defined in the Security Agreement) of such account by
the Collateral Agent and whereby the bank maintaining such account agrees,
during any Trigger Period, to comply only with the instructions originated by
the Collateral Agent without the further consent of any Loan Party.
"
Blocked Account Bank
"
means each bank with whom deposit accounts are maintained in which any funds of
any of the Loan Parties from one or more DDAs are concentrated and with whom a
Blocked Account Agreement has been, or is required to be, executed in accordance
with the terms hereof.
"
BNCB
" means Barnes
& Noble College Booksellers, Inc., a New York corporation.
"
BNCB Acquisition
"
means the Acquisition of all the outstanding Equity Interests of BNCB by Lead
Borrower from the Sellers pursuant to the terms of the BNCB Acquisition
Documents.
"
BNCB Acquisition
Documents
" means the BNCB Purchase Agreement, the Seller Notes and all
related documents pertaining to the BNCB Acquisition.
"
BNCB Blocked Account
"
means any Blocked Account of any BNCB Loan Party which, for the avoidance of
doubt, shall not include any BNCB Trigger Period Accounts.
"
BNCB Loan Parties
"
means BNCB and each Subsidiary thereof that is a Loan Party.
"
BNCB Purchase
Agreement
" means that certain Stock Purchase Agreement dated August 7,
2009 by and among the Sellers and Lead Borrower.
"
BNCB Standstill
Period
" means the period during which (a) a Trigger Period has occurred
and is continuing, (b) the Borrowers have maintained Availability equal to or
greater than fifteen percent (15.0%) of the Loan Cap at all times and (c) any
BNCB Loan Party is engaged in Permitted Buy-Back Programs.
"
BNCB Trigger Period
Accounts
" has the meaning specified in
Section
6.13(e)
.
"
Borrower
" and "
Borrowers
" have the
meaning specified in the introductory paragraph hereto.
"
Borrower Materials
"
has the meaning specified in
Section
6.02
.
"
Borrowing
" means a Committed Borrowing or a
Swing Line Borrowing, as the context may
require.
"
Borrowing Base
"
means, at any time of calculation, an amount equal to:
(a) the
face amount of Eligible Credit Card Receivables
multiplied by
ninety
percent (90.0%);
plus
(b) the
face amount of Eligible Accounts Receivables (net of Receivables Reserves
applicable thereto) multiplied by eighty-five percent (85.0%);
plus
(c) the
lesser of (i) Net Orderly Liquidation Value of the Borrower’s Eligible
Inventory, net of Inventory Reserves not already reflected in Net Orderly
Liquidation Value, multiplied by the Appraisal Percentage, or (ii) the Cost of
the Borrower’s Eligible Inventory, net of Inventory Reserves, multiplied by
seventy-five percent (75.0%);
plus
(d) the
lesser of (i) the Appraised Value of Eligible Real Estate, if any, net of Realty
Reserves, in each case not already reflected in the Appraised Value of Eligible
Real Estate, applicable thereto
multiplied by
fifty
percent (50.0%) or (ii) $25,000,000;
minus
(e)
without duplication of any Reserves applied in clauses (a) – (d) above, all
other then existing Availability Reserves.
"
Borrowing Base
Certificate
" means a certificate substantially in the form of
Exhibit F
hereto
(with such changes therein as may be required by the Administrative Agent to
reflect the components of and reserves against the Borrowing Base as provided
for hereunder from time to time), executed and certified as accurate and
complete by a Responsible Officer of the Lead Borrower which shall include
appropriate exhibits, schedules, supporting documentation, and additional
reports as reasonably requested by the Administrative Agent.
"
Business
" means (a)
the operation of retail bookstores (including, without limitation, on-campus and
off-campus university or college bookstores) and cafés and gift shops relating
thereto, (b) the sale and distribution (whether in bookstores or on-line) of
books and other printed material, magazines,
newspapers, journals, course packs, music, movies, food and
beverages, gifts, housewares, electronics devices, software, school supplies,
greeting cards, posters, toys, games, kits, and children’s products and other
products and services commonly found in physical or on-line bookstores, (c)
without limitation of the foregoing clause (b), in the case of university or
college bookstores, the sale (whether in bookstores or on-line) of apparel,
athletic or insignia merchandise, school-related memorabilia, computer hardware
and software, and other products and services commonly found in on-campus or
off-campus university or college bookstores, (d) the rental or buyback (whether
in bookstores or on-line) of textbooks, trade books, course packs and similar
materials, (e) the sale of e-books and any other form of digital content
(including, without limitation, audio and video content) and of devices relating
to digital content (including, without limitation, accessories therefor), (f)
the wholesaling of new or used books (including e-books), (g) the publishing or
production of books and other printed material, journals, gifts, toys, games,
kits, children’s products and other products commonly found in physical or
online bookstores, (h) publishing and print services for books, magazines,
periodicals and other media, and (i) in the case of each of the foregoing
clauses (a) through (h), (x) any on-line operations relating thereto and (y) any
marketing or advertising activities relating thereto.
"
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 Office is located or in New York, New York and, if
such day relates to any LIBO 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, with respect to any Person for any period, (a) all expenditures made
(whether made in the form of cash or other property) or costs incurred for the
acquisition or improvement of fixed or capital assets of such Person (excluding
normal replacements and maintenance which are properly charged to current
operations), in each case that are (or should be) set forth as capital
expenditures in a Consolidated statement of cash flows of such Person for such
period, in each case prepared in accordance with GAAP, and (b) Capital Lease
Obligations incurred by a Person during such period,
provided
,
however
, that Capital
Expenditures for the Lead Borrower and its Subsidiaries shall not
include:
(i) expenditures
to the extent they are made with proceeds of the issuance of Equity Interests of
the Lead Borrower or any of its Subsidiaries,
(ii) expenditures
with proceeds of insurance settlements, condemnation awards and other
settlements in respect of lost, destroyed, damaged or condemned assets,
equipment or other property to the extent such proceeds are not otherwise used
or required to be used to prepay the Obligations or Cash Collateralize the
outstanding LC Obligations pursuant to the terms hereunder,
(iii) expenditures
that are accounted for as capital expenditures of the Lead Borrower or any
Subsidiary that are actually paid for by other third party, including tenant
allowances under leases and other amounts paid by landlords, and for which
neither the Lead Borrower nor any Subsidiary has provided or is required to
provide or incur, directly or indirectly, any consideration or obligation to
such third party or any other Person (whether before, during or after such
period),
(iv) the
book value of any asset owned by the Lead Borrower or any of its Subsidiaries
prior to or during such period to the extent that such book value is included as
a capital expenditure during such period as a result of the Lead Borrower or
such Subsidiary reusing or beginning to reuse such asset during such period
without a corresponding expenditure actually having been made in such period,
and
"
Capital Lease
Obligations
" means, with respect to any Person for any period, the
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as liabilities on a Consolidated balance sheet of such Person
under GAAP and the amount of which obligations shall be the capitalized amount
thereof determined in accordance with GAAP.
"
Cash Collateral
Account
" means a non-interest bearing account established by one or more
of the Loan Parties with Bank of America, and in the name of, the Collateral
Agent (or as the Collateral Agent shall otherwise direct) and under the sole and
exclusive dominion and control of the Collateral Agent, in which deposits are
required to be made in accordance with
Section 2.03(g)
or
Section
8.02(c)
.
"
Cash Collateralize
"
means the delivery of cash or deposit account balances to the Collateral Agent
as security for the payment of the Secured Obligations and pursuant to
documentation in form and substance reasonably satisfactory to the Collateral
Agent, in an amount equal to (a) with respect to LC Obligations, 105% of the
aggregate amount thereof, and (b) with respect to any Secured Obligations under
any Bank Product or Cash Management Services, such amount as may be agreed
between the Loan Party and Lender or Affiliate of a Lender party to such Swap
Contract constituting a Bank Product or to such Cash Management Services, as
applicable. "
Cash
Collateralization
" and "
Cash Collateral
" have
a correlative meaning.
"
Cash Equivalents
"
means Investments of the type referred to in
Section 7.02(b)
and
other similar short term and/or liquid Investments.
"
Cash Management
Reserves
" means such reserves as the Administrative Agent, from time to
time, determines in its discretion as being appropriate to reflect the
reasonably anticipated liabilities and obligations of the Loan Parties with
respect to Cash Management Services then provided or outstanding.
"
Cash Management
Services
" means any one or more of the following types or services or
facilities provided to any Loan Party by a Lender or any of its Affiliates: (a)
ACH transactions, (b) cash management services, including, without limitation,
controlled disbursement services, treasury, depository, overdraft, and
electronic funds transfer services, (c) foreign exchange facilities, and (d)
credit cards, debit cards, payroll cards, store value cards and purchasing cards
and related processing services.
"
CERCLA
" means the
Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C.
§ 9601 et seq.
"
CERCLIS
" means the
Comprehensive Environmental Response, Compensation, and Liability Information
System maintained by the United States Environmental Protection
Agency.
"
CFC
" means a Person
that is a controlled foreign corporation under Section 957 of the
Code.
"
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,
"
Change of Control
"
means an event or series of events by which:
(a) any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such
person or its subsidiaries, and any person or entity acting in its capacity as
trustee, agent or other fiduciary or administrator of any such plan) (other than
Leonard Riggio, his spouse, his lineal descendants, and trusts for the exclusive
benefit of any such individuals or the executor or administrator of the estate
or the legal representative of any of such individuals or any entity controlled
by them) becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Securities Exchange Act of 1934, except that a person or group shall
be deemed to have "beneficial ownership" of all securities that such person or
group has the right to acquire, whether such right is exercisable immediately or
only after the passage of time (such right, an "
option right
")),
directly or indirectly, of 40.0% or more of the Equity Interests of the Lead
Borrower entitled to vote for members of the board of directors or equivalent
governing body of the Lead Borrower on a fully-diluted basis (including taking
into account all such Equity Interests that such "person" or "group" has the
right to acquire pursuant to any option right); or
(b) during
any period of twenty-four (24) consecutive months, a majority of the members of
the board of directors or other equivalent governing body of the Lead Borrower
cease to be composed of individuals (i) who were members of that board or
equivalent governing body on the first day of such period, (ii) whose election
or nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and (ii)
above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both clause (ii) and clause (iii), any individual whose initial nomination for,
or assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors);
(c) any
"change in control" or similar event as defined in any document governing the
Permitted Senior Debt or the Seller Notes; or
(d) the
Lead Borrower ceases to own, directly or indirectly, 100% of the Equity
Interests of any Loan Party, except where such failure is as a result of a
transaction expressly permitted by the Loan Documents.
"
Closing Date
" means
the first date all the conditions precedent in
Section 4.01
are
satisfied or waived in accordance with
Section
10.01
.
"
Code
" means the
Internal Revenue Code of 1986, and the regulations promulgated thereunder, as
amended and in effect.
"
Co-Documentation
Agent
" means each of the co-documentation agents identified on the cover
page of this Agreement.
"
Collateral Access
Agreement
" means an agreement substantially in the form of
Exhibit I
hereto or
such other form as agreed to by the Collateral Agent in its Permitted Discretion
and in each case otherwise reasonably satisfactory in form and substance to the
Agents executed by (a) a bailee or other Person in possession of Collateral, and
(b) a landlord of Real Estate leased by any Loan Party, in each case, including
provisions pursuant to which such Person (i) acknowledges the Collateral Agent’s
Lien on the Collateral, (ii) releases or subordinates such Person’s Liens, if
any, in the Collateral held by such Person or located on such Real Estate, and
(iii) as to any landlord, provides the Collateral Agent with access to the
Collateral located in or on such Real Estate and a reasonable time to sell and
dispose of the Collateral from such Real Estate.
"
Collateral Agent
"
means Bank of America, acting in such capacity for its own benefit and the
ratable benefit of the other Secured Parties.
"
Commercial Letter of
Credit
" means any letter of credit or similar instrument (including,
without limitation, bankers’ acceptances) issued for the purpose of providing
the primary payment mechanism in connection with the purchase of any materials,
goods or services by the Lead Borrower or any of its Subsidiaries in the
ordinary course of business of such Person.
"
Commitment
" means, as
to each Lender, its obligation to (a) make Committed Loans to the Borrowers
pursuant to
Section
2.01
, (b) purchase participations in LC Obligations, and (c) purchase
participations in Swing Line Loans, in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite such Lender’s name
on
Schedule
2.01
or in any Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable, as such amount may be adjusted from time
to time in accordance with this Agreement.
"
Committed Borrowing
"
means a borrowing consisting of simultaneous Committed Loans of the same Type
and, in the case of LIBO Rate Loans, having the same Interest Period made by
each of the Lenders pursuant to
Section
2.01
.
"
Committed Loan
" has
the meaning specified in
Section
2.01
.
"
Committed Loan
Notice
" means a notice of (a) a Committed Borrowing, (b) a conversion of
Committed Loans from one Type to the other, or (c) a continuation of LIBO Rate
Loans, pursuant to
Section 2.01(a)
,
which, if in writing, shall be substantially in the form of
Exhibit
A-1
.
"
Compliance
Certificate
" means a certificate substantially in the form of
Exhibit
D
.
"
Concentration
Account
" has the meaning provided in
Section6.13(c)
.
"
Consent
" means actual
consent given by a Lender from whom such consent is sought.
"
Consolidated
" means,
when used to modify a financial term, test, statement, or report of a Person,
the application or preparation of such term, test, statement or report (as
applicable) based upon the consolidation, in accordance with GAAP, of the
financial condition or operating results of such Person and its
Subsidiaries.
"
Consolidated Adjusted Fixed
Charge Coverage Ratio
" means, at any date of determination for the
purpose of determining whether a particular Restricted Payment or prepayment of
Indebtedness (each a "
Subject Transaction
")
may be consummated pursuant to the terms of this Agreement, the ratio of (a)
Consolidated EBITDA for such period
minus
(i) Capital
Expenditures (other than in connection with Permitted Acquisitions) made during
such period
minus
(ii) the
aggregate amount of Federal, state, local and foreign income taxes paid in cash
or required to be paid in cash during such period to (b) the sum of (i) Debt
Service Charges (other than prepayments of principal in the Subject Transaction
and, if the Subject Transaction is a prepayment of Seller Notes, all other prior
prepayments of Seller Notes)
plus
(ii) the
aggregate amount of all Restricted Payments made in cash (other than those made
in the Subject Transaction and, if the Subject Transaction is a repurchase of
equity interests, all repurchases related to such Subject Transaction that have
previously been made as part of a single stock repurchase plan approved by the
board of directors of the Lead Borrower, if any), in each case, of or by the
Lead Borrower and its Subsidiaries for the most recently completed Measurement
Period, all as determined on a Consolidated basis in accordance with GAAP. For
the avoidance of doubt, Permitted Tax Distributions shall not be taken into
account in any calculation of the Consolidated Adjusted Fixed Charge Coverage
Ratio for any purpose hereunder except to the extent that such Permitted Tax
Distribution shall exceed $50,000,000 and then only shall such incremental
amount be taken into account in any calculation of Consolidated Adjusted Fixed
Charge Coverage Ratio.
"
Consolidated EBITDA
"
means, at any date of determination, an amount equal to Consolidated Net Income
of the Lead Borrower and its Subsidiaries on a Consolidated basis for the most
recently completed Measurement Period,
plus
(a) the
following to the extent deducted in calculating such Consolidated Net Income:
(i) Consolidated Interest Charges, (ii) the provision for Federal, state, local
and foreign income Taxes (net of any tax credits), (iii) depreciation and
amortization expense, (iv) other expenses or losses reducing such Consolidated
Net Income which do not represent a cash item in such period (including LIFO
reserves) or any future period and (v) expenses deducted in such period
resulting from the issuance of Equity Interests permitted hereunder, provided
that such expenses are and will be non-cash items in the period when taken and
in all later fiscal periods (in each case of or by the Lead Borrower and its
Subsidiaries for such Measurement Period),
minus
(b) all
non-cash gains increasing Consolidated Net Income (in each case of or by the
Lead Borrower and its Subsidiaries for such Measurement Period), all as
determined on a Consolidated basis in accordance with GAAP.
"
Consolidated Fixed Charge
Coverage Ratio
" means, at any date of determination, the ratio of (a)
Consolidated EBITDA for such period
minus
(i) Capital
Expenditures (other than in connection with Permitted Acquisitions) made during
such period
minus
(ii) the
aggregate amount of Federal, state, local and foreign income taxes paid in cash
or required to be paid in cash during such period to (b) the sum of (i) Debt
Service Charges plus (ii) the aggregate amount of all Restricted Payments made
in cash, in each case, of or by the Lead Borrower and its Subsidiaries for the
most recently completed Measurement Period, all as determined on a Consolidated
basis in accordance with GAAP. For the avoidance of doubt, Permitted Tax
Distributions shall not be taken into account in any calculation of the
Consolidated Fixed Charge Coverage Ratio for any purpose hereunder except to the
extent that such Permitted Tax Distribution shall exceed $50,000,000 and then
only shall such incremental amount be taken into account in any calculation of
Consolidated Fixed Charge Coverage Ratio.
"
Consolidated Interest
Charges
" means, for any Measurement Period, the sum of (a) all interest,
premium payments, debt discount, fees, charges and related expenses in
connection with borrowed money (including capitalized interest) 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 Swap Contracts,
but excluding any non-cash or deferred interest financing costs, and (b) the
portion of rent expense with respect to such period under Capital Lease
Obligations or
"
Consolidated Net
Income
" means, as of any date of determination, the net income of the
Lead Borrower and its Subsidiaries for the most recently completed Measurement
Period, all as determined on a Consolidated basis in accordance with GAAP,
provided
, however,
that there shall be excluded (a) extraordinary gains (or extraordinary losses)
for such Measurement Period, (b) the income (or loss) of any Subsidiary during
such Measurement Period in which any other Person has a joint interest, except
to the extent of the amount of cash dividends or other distributions actually
paid in cash to such Subsidiary during such period, (c) the income (or loss) of
any Person during such Measurement Period and accrued prior to the date it
becomes a Subsidiary or is merged into or consolidated with the Lead Borrower or
any of its Subsidiaries or such Person’s assets are acquired by the Lead
Borrower or any of its Subsidiaries, and (d) the income of any Subsidiary to the
extent that the declaration or payment of dividends or similar distributions by
that Subsidiary of that income is not at the time permitted by operation of the
terms of its Organization Documents or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary, except that the Lead Borrower’s equity in any net loss of any such
Subsidiary for such Measurement Period shall be included in determining
Consolidated Net Income.
"
Contractual
Obligation
" means, as to any Person, any provision of any agreement,
instrument or other undertaking to which such Person is a party or by which it
or any of its property is bound.
"
Control
" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the ability
to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto.
"
Conversion/Continuation
Notice
" means a notice of (a) a conversion of Loans from one Type to the
other, or (b) a continuation of LIBO Rate Loans, pursuant to
Section 2.02(c)
,
which, if in writing, shall be substantially in the form of
Exhibit
A-2
.
"
Cost
" means the lower
of cost or market value of Inventory, based upon the Borrowers’ accounting
practices, known to the Administrative Agent, which practices are in effect on
the Closing Date as such calculated cost is determined from invoices received by
the Borrowers and reported on the Borrowers’ stock ledger. "Cost" may include
freight charges inbound either to the Borrowers' distribution centers or by
direct shipments to Stores in amounts consistent with reporting on the
Borrowers' stock ledgers but shall not include inventory capitalization costs or
other non-purchase price charges (such as freight charges outbound from the
Borrowers' distributions centers) used in the Borrowers’ calculation of cost of
goods sold.
"
Co-Senior Managing
Agent
" means each of the co-senior managing agents identified on the
cover page of this Agreement.
"
Co-Syndication Agent
"
means each of the co-syndication agents identified on the cover page of this
Agreement.
"
Credit Card
Notifications
" has the meaning provided in
Section
6.13(a)(ii)
.
"
Credit Card
Receivables
" means each "Account" (as defined in the UCC) together with
all income, payments and proceeds thereof, owed by a major credit card issuer
(including, but not limited to, Visa, MasterCard, American Express, Discover and
Pay Pal and such other issuers approved by the
"
Credit Extensions
"
mean each of the following: (a) a Borrowing and (b) an LC Credit
Extension.
"
Credit Party
" or
"
Credit
Parties
" means (a) individually, (i) each Lender, (ii) each Lender and/or
its Affiliate in its capacity as a provider of any Bank Products or Cash
Management Services, (iii) each Agent, (iv) each LC Issuer, (v) any other Person
to whom Secured Obligations under this Agreement and other Loan Documents are
owing, and (vi) the successors and assigns of each of the foregoing, and (b)
collectively, all of the foregoing.
"
Credit Party
Expenses
" means, without limitation, (a) all reasonable out-of-pocket
expenses incurred by the Agents and their respective Affiliates, in connection
with this Agreement and the other Loan Documents, including without limitation
(i) the reasonable fees, charges and disbursements of (A) counsel for the
Agents, (B) outside consultants for the Agents, (C) appraisers, (D) commercial
finance examiners, and (E) without duplication of any amounts reimbursed
pursuant to the foregoing subclauses (i) (A) – (D), all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of the Secured Obligations, (ii) in connection with (A) the syndication of the
credit facilities provided for herein, (B) the administration and management of
this Agreement and the other Loan Documents or the preparation, negotiation,
execution and delivery the Loan Documents or of any amendments, modifications or
waivers of the provisions thereof (whether or not the transactions contemplated
thereby shall be consummated), (C) the enforcement or protection of their rights
in connection with this Agreement or the Loan Documents or efforts to preserve,
protect, collect, or enforce the Collateral or in connection with any proceeding
under any Debtor Relief Laws, or (D) without duplication of any amounts
reimbursed pursuant to the foregoing subclause (ii)(C), any workout,
restructuring or negotiations in respect of any Secured Obligations, and (b)
with respect to any LC Issuer, and its Affiliates, all reasonable out-of-pocket
expenses incurred in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder; and (c)
all reasonable out-of-pocket expenses incurred by the Credit Parties who are not
the Agents, an LC Issuer or any Affiliate of any of them, after the occurrence
and during the continuance of an Event of Default, including, without
limitation, enforcement or protection of their rights or efforts to preserve,
protect, collect, or enforce the Collateral or in connection with any proceeding
under any Debtor Relief Laws,
provided
that such
Credit Parties shall be entitled to reimbursement for no more than one
counsel
representing
all such Credit Parties (absent a conflict of interest in which case the Credit
Parties may engage and be reimbursed for additional counsel).
"
Customary BNCB
Dispositions
" has the meaning specified in
Section
7.05(c)
.
"
Customer Credit
Liabilities
" means at any time, the aggregate remaining value at such
time of (a) outstanding merchandise credits, gift certificates and gift cards of
the Borrowers entitling the holder thereof to use all or a portion of the
credit, certificate or gift card to pay all or a portion of the purchase price
for any Inventory, and (b) outstanding customer deposits of the
Borrowers.
"
DDA
" means each
checking, savings or other demand deposit account maintained by any of the Loan
Parties. All funds in each DDA shall be presumed to be Collateral and proceeds
of Collateral and the Agents and the Lenders shall have no duty to inquire as to
the source of the amounts on deposit in any DDA.
"
DDA Notification
" has
the meaning provided therefor in
Section
6.13(a)(i)
.
"
Debtor Relief Laws
"
means the Bankruptcy Code of the United States, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, 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 or condition that constitutes an Event of Default or that, with the giving
of any notice, the passage of time, or both, would be an Event of
Default.
"
Default 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 Loans, plus (iii) two percent ( 2.0%) per annum;
provided, however, that with respect to a LIBO Rate Loan, the Default Rate shall
be an interest rate equal to the interest rate (including any Applicable Margin)
otherwise applicable to such Loan plus two percent ( 2.0%) per annum, and (b)
when used with respect to Letter of Credit Fees, a rate equal to the Applicable
Rate for Letters of Credit, plus two percent ( 2.0%) per annum.
"
Defaulting Lender
"
means any Lender that (a) has failed to fund any portion of the Committed Loans,
participations in LC Obligations or participations in Swing Line Loans required
to be funded by it hereunder within one (1) Business Day of the date required to
be funded by it hereunder, (b) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by
it hereunder within three (3) Business Days of the date when due, unless the
subject of a good faith dispute, or (c) has been deemed insolvent or become the
subject of a bankruptcy, insolvency or similar proceeding;
provided
that receipt
of financial or other support from a Governmental Entity shall not, in and of
itself, constitute or be deemed to constitute insolvency under this clause
(c).
"
Deteriorating Lender
"
means any Defaulting Lender or any Lender as to which (a) the LC Issuer has a
good faith belief that such Lender has defaulted in fulfilling its obligations
under more than one other syndicated credit facility, or (b) a Person that
Controls such Lender has been deemed insolvent or become the subject of a
bankruptcy, insolvency or similar proceeding;
provided
, that
receipt of financial or other support from a Governmental Entity shall not, in
and of itself, constitute or be deemed to constitute insolvency under this
clause (b).
"
Disposition
" or
"
Dispose
" means
the sale, transfer, license, lease or other disposition (including any sale and
leaseback transaction and any sale, transfer, license or other disposition of
(whether in one transaction or in a series of transactions) of any property
(including, without limitation, any issuance and sale of any Equity Interests in
another Person) by any Person (or the granting of any option or other right to
do any of the foregoing), including any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any
rights and claims associated therewith. For the avoidance of doubt, the
termination of any Lease by a counterparty pursuant to any right of termination
(other than upon a default by any Loan Party) under such Lease does not
constitute a Disposition by any Loan Party.
"
Disqualified Stock
"
means any Equity Interest that, by its terms (or by the terms of any security
into which it is convertible, or for which it is exchangeable, in each case at
the option of the holder
thereof), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder thereof, in whole or in part, on or prior
to the date that is ninety-one (91) days after the Maturity Date;
provided
,
however
, that (i)
only the portion of such Equity Interests which so matures or is mandatorily
redeemable, is so convertible or exchangeable or is so redeemable at the option
of the holder thereof prior to such date shall be deemed to be Disqualified
Stock and (ii) with respect to any Equity Interests issued to any employee or to
any plan for the benefit of employees of the Lead Borrower or its Subsidiaries
or by any such plan to such employees, such Equity Interest shall not constitute
Disqualified Stock solely because it may be required to be repurchased by the
Lead Borrower or one of its Subsidiaries in order to satisfy applicable
statutory or regulatory obligations or as a result of such employee’s
termination, resignation, death or disability and (iii) if any class of Equity
Interest of such Person that by its terms authorizes such Person to satisfy its
obligations thereunder by delivery of an Equity Interest that is not
Disqualified Stock, such Equity Interests shall not be deemed to be Disqualified
Stock. Notwithstanding the preceding sentence, any Equity Interest that would
constitute Disqualified Stock solely because the holders thereof have the right
to require a Loan Party to repurchase such Equity Interest upon the occurrence
of a change of control or an asset sale shall not constitute Disqualified Stock.
The amount of Disqualified Stock deemed to be outstanding at any time for
purposes of this Agreement will be the maximum amount that the Lead Borrower and
its Subsidiaries may become obligated to pay upon maturity of, or pursuant to
any mandatory redemption provisions of, such Disqualified Stock or portion
thereof, plus accrued dividends.
"
Dollars
" and "
$
" mean lawful money
of the United States.
"
Domestic Subsidiary
"
means any Subsidiary that is organized under the laws of any political
subdivision of the United States.
"
Eligible Assignee
"
means (a) a Credit Party or any of its Affiliates; (b) a bank, insurance
company, or company engaged in the business of making commercial loans, which
Person, together with its Affiliates, has a combined capital and surplus in
excess of $500,000,000.00; (c) an Approved Fund; (d) any Person to whom a Credit
Party assigns its rights and obligations under this Agreement as part of an
assignment and transfer of such Credit Party’s rights in and to a material
portion of such Credit Party’s portfolio of asset based credit facilities, and
(e) any other Person (other than a natural person) approved by (i) the
Administrative Agent, the LC Issuer and the Swing Line Lender, and (ii) unless
an Event of Default has occurred and is continuing, the Lead Borrower (each such
approval not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, "Eligible Assignee" shall not include a Loan
Party or any of the Loan Parties’ Affiliates or Subsidiaries.
"
Eligible Accounts
Receivables
" means Accounts arising from the sale of a Borrower’s
Inventory (other than those consisting of Credit Card Receivables) or the
rendition of services that satisfies the following criteria at the time of
creation and continues to meet the same at the time of such determination: such
Account (i) has been earned by full performance and represents the bona fide
amounts due to a Borrower from an account debtor, and in each case originated in
the ordinary course of business of such Borrower, and (ii) is not ineligible for
inclusion in the calculation of the Borrowing Base pursuant to any of clauses
(a) through (s) below. Without limiting the foregoing, to qualify as an Eligible
Accounts Receivable, an Account shall indicate no Person other than a Borrower
as payee or remittance party. In determining the amount to be so included, the
face amount of an Account shall be reduced by, without duplication, to the
extent not reflected in such face amount, (i) 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 Borrower may be obligated to rebate to a customer pursuant to
the terms of any agreement or understanding (written or oral)) and (ii) the
aggregate amount of all cash received in respect of such Account but not yet
applied by the Borrowers to reduce the amount of such Eligible Account
Receivable. Any Accounts meeting the foregoing criteria shall be
(a)
Accounts
that are not evidenced by an invoice;
(b) Accounts
that have been outstanding for more than ninety (90) days from the invoice date
or more than sixty (60) days past the due date;
(c) Accounts
due from any account debtor for which more than 50.0% of the Accounts owing from
such account debtor and its Affiliates are ineligible under clause (b)
above.
(d) Accounts
with respect to which a Borrower does not have good, valid and marketable title
thereto, free and clear of any Lien (other than Liens granted to the Collateral
Agent pursuant to the Security Documents) or which are not subject to a first
priority security interest in favor of the Collateral Agent;
(e) Accounts
which are disputed or with respect to which a claim, counterclaim, offset or
chargeback has been asserted, but only to the extent of such dispute,
counterclaim, offset or chargeback;
(f) Accounts
which arise out of any sale made not in the ordinary course of business, made on
a basis other than upon credit terms usual to the business of the Borrowers or
are not payable in Dollars;
(g) Accounts
which do not conform in all material respects to all representations, warranties
or other provisions in the Loan Documents relating to Accounts;
(h)
Accounts
which are owed by any Affiliate or any employee of a Loan
Party;
(i) Accounts
due from an account debtor which is the subject of any bankruptcy or insolvency
proceeding, has had a trustee or receiver appointed for all or a substantial
part of its property, has made an assignment for the benefit of creditors or has
suspended its business;
(j) Accounts
due from any Governmental Authority other than (i) Accounts for which all
consents, approvals or authorizations of, or registrations or declarations with,
any Governmental Authority required to be obtained, effected or given in
connection with the performance of such Account by the account debtor or in
connection with the enforcement of such Account by the Agent, in each case, have
been duly obtained, effected or given or are in full force and effect and (ii)
Eligible State University Accounts;
(k) Accounts
(i) owing from any Person that is also a supplier to or creditor of a Loan Party
or any of its Subsidiaries unless such Person has waived any right of setoff in
a manner acceptable to the Administrative Agent, (ii) representing any
manufacturer’s or supplier’s credits, discounts, incentive plans or similar
arrangements entitling a Loan Party or any of its Subsidiaries to discounts on
future purchase therefrom or (iii) representing a progress billing or
retainage;
(l) Accounts
arising out of sales on a bill-and-hold, guaranteed sale, sale-or-return, sale
on approval or consignment basis or subject to any right of return, setoff or
charge back;
(o)
Accounts
evidenced by a promissory note or other instrument;
(p)
Accounts
consisting of amounts due from vendors as rebates or
allowances;
(q) Accounts
which are in excess of the credit limit for such account debtor established by
the Loan Parties in the ordinary course of business and consistent with past
practices;
(r) Accounts
which include extended payment terms (datings) beyond those generally furnished
to other account debtors in the ordinary course of business without the consent
of the Administrative Agent; or
(s) Accounts
which the Administrative Agent determines in its Permitted Discretion to be
unacceptable for inclusion in the Borrowing Base.
"
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: such Credit
Card Receivable (i) has been earned by performance and represents the bona fide
amounts due to a Borrower from a credit card payment processor and/or credit
card issuer, and in each case originated in the ordinary course of business of
such Borrower, and (ii) is not ineligible for inclusion in the calculation of
the Borrowing Base pursuant to any of clauses (a) through (k) below. Without
limiting the foregoing, to qualify as an Eligible Credit Card Receivable, an
Account shall indicate no Person other than a Borrower as payee or remittance
party. In determining the amount to be so included, the face amount of an
Account shall be reduced by, without duplication, to the extent not reflected in
such face amount, (i) 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 Borrower may be
obligated to rebate to a customer, a credit card payment processor, or credit
card issuer pursuant to the terms of any agreement or understanding (written or
oral)) and (ii) the aggregate amount of all cash received in respect of such
Account but not yet applied by the Loan Parties to reduce the amount of such
Credit Card Receivable. Any Credit Card Receivables meeting the foregoing
criteria shall be deemed Eligible Credit Card Receivables but only as long as
such Credit Card Receivable is not included within any of the following
categories, in which case such Credit Card Receivable shall not constitute an
Eligible Credit Card Receivable:
(a)
Credit Card Receivables which do not
constitute an "Account" (as defined in the
UCC);
(b) Credit
Card Receivables that have been outstanding for more than five (5) Business Days
from the date of sale;
(c) Credit
Card Receivables with respect to which a Loan Party does not have good, valid
and marketable title, free and clear of any Lien (other than Liens granted to
the Collateral Agent);
(e) Credit
Card Receivables which are disputed, are with recourse, or with respect to which
a claim, counterclaim, offset or chargeback has been asserted (to the extent of
such claim, counterclaim, offset or chargeback) by any Person;
(f) Credit
Card Receivables as to which the processor has the right under certain
circumstances to require a Loan Party to repurchase the Accounts from such
credit card processor;
(g) Credit
Card Receivables due from an issuer or payment processor of the applicable
credit card which is the subject of any bankruptcy, insolvency or similar
proceedings;
(h) Credit
Card Receivables which are not a valid, legally enforceable obligation of the
applicable issuer with respect thereto;
(i) Credit
Card Receivables which do not conform in all material respects to all
representations, warranties or other provisions in the Loan Documents relating
to Credit Card Receivables;
(j) Credit
Card Receivables which are evidenced by "chattel paper" or an "instrument" of
any kind unless such "chattel paper" or "instrument" is in the possession of the
Collateral Agent, and to the extent necessary or appropriate, endorsed to the
Collateral Agent; or
(k) Credit
Card Receivables which the Administrative Agent determines in its Permitted
Discretion to be uncertain of collection.
"
Eligible Inventory
"
means, as of the date of determination thereof, without duplication, items of
Inventory of a Borrower that are finished goods, merchantable and readily
saleable to the public in the ordinary course that, in each case, complies with
each of the representations and warranties expressly respecting Inventory made
by the Borrowers in the Loan Documents, and that is not excluded as ineligible
by virtue of one or more of the criteria set forth below. The following items of
Inventory shall not be included in Eligible Inventory:
(a) Inventory
that is not solely owned by a Borrower or a Borrower does not have good and
valid title thereto;
(b) Inventory
that is leased by or is on consignment to a Borrower or which is consigned by a
Borrower to a Person that is not a Loan Party;
(c) Inventory
that is not located in the United States of America (excluding territories or
possessions of the United States);
(d) Inventory
at a location that is owned or leased by a Borrower, except to the extent that
the Borrowers have furnished the Administrative Agent with (i) any UCC financing
statements or other documents that the Administrative Agent may determine to be
necessary to perfect its security interest in such Inventory at such location,
and (ii) with respect to any Material Storage Location, a Collateral Access
Agreement executed by the Person owning any such Material Storage Location on
terms reasonably acceptable to the Administrative Agent;
(e) Inventory
that is comprised of goods which (i) are damaged, defective, "seconds," or
otherwise unmerchantable, (ii) that have been or are in the process of being
returned to the vendor, (iii) are obsolete or slow moving, or custom items,
work-in-process, raw materials, or that constitute spare parts, promotional,
marketing, packaging and shipping materials or supplies used or consumed in a
Borrower’s business, (iv) are seasonal in nature and which have been packed away
for sale in the subsequent season, (v) are not in compliance with all standards
imposed by any Governmental Authority having regulatory authority over such
Inventory, its use or sale, (vi) are bill and hold goods or (vii) are
in-transit;
(f) Inventory
that is not subject to a perfected first-priority security interest in favor of
the Collateral Agent, subject only to any interest, title or lien of a landlord,
lessor or other property owner under a Lease or applicable Laws (
provided
that, for
the avoidance of doubt, no provisions with respect to the subordination of Liens
or other landlord rights in any Collateral Access Agreement shall be deemed to
violate this clause (f));
(g) Inventory
that consists of samples, labels, bags, packaging, and other similar
non-merchandise categories;
(h)
Inventory
that is not insured in compliance with the provisions of
Section 5.10
hereof;
(i) Inventory
that has been sold but not yet delivered or as to which a Borrower has accepted
a deposit;
(j) Inventory
that is subject to any licensing, patent, royalty, trademark, trade name or
copyright agreement with any third party which has expired or has been
terminated or with respect to which any Borrower or any of its Subsidiaries has
received notice of a dispute in respect of any such agreement;
(k) Inventory
acquired in a Permitted Acquisition, unless and until the Collateral Agent has
completed or received (A) an appraisal of such Inventory from appraisers
satisfactory to the Collateral Agent, establishes an advance rate and Inventory
Reserves (if applicable) therefor, and otherwise agrees that such Inventory
shall be deemed Eligible Inventory, and (B) such other due diligence as the
Agents may require, all of the results of the foregoing to be reasonably
satisfactory to the Agents; or
(l) Inventory
which the Administrative Agent determines in its Permitted Discretion to be
unacceptable for inclusion in the Borrowing Base.
"
Eligible Real Estate
"
means Real Estate which satisfies all of the following conditions:
(a)
such Real
Estate is located in the continental United States;
(b)
a
Borrower owns such Real Estate in fee simple absolute;
(c) the
Administrative Agent shall have received evidence that all actions have been
taken for which the Administrative Agent shall have notified the Lead Borrower
that the Administrative Agent has reasonably deemed necessary in order to create
a valid first priority Lien (subject in priority only to (i) Permitted
Encumbrances set forth in
Sections 7.01(a)
,
(c)
,
(d)
and
(h)
,
provided
, that, with
respect to Liens for Taxes being contested in compliance with Section 6.04 and
Permitted Encumbrances set forth in
Section 7.01(d)
, such
Liens are insured
(d) the
Real Estate or any portion thereof (the loss of which shall have, in the
Permitted Discretion of the Collateral Agent, a material impact on the use,
operation or value of the “Property” (as defined in the applicable Mortgage))
shall not have been damaged or taken through condemnation (which term shall
include any damage or taking by any Governmental Authority, quasi-governmental
authority, any Person having the power of condemnation, or any transfer by
private sale in lieu thereof), either temporarily or permanently;
(e) the
Administrative Agent shall have received an appraisal of such Real Estate
complying with the requirements of FIRREA by a third party appraiser engaged by
the Administrative Agent and otherwise in form and substance reasonably
satisfactory to the Administrative Agent; and
(f) all
Real Estate Eligibility Requirements with respect to such Real Estate shall have
been satisfied in the Administrative Agent’s Permitted Discretion.
"
Eligible State University
Accounts
" means Accounts that otherwise satisfy the eligibility
requirements of “Eligible Accounts Receivable” and that are owing from colleges
or universities that are agencies or political subdivisions of state or local
Governmental Authorities and that arise in the ordinary course of Business of
the Borrowers from management agreements, textbook or course pack sales, trade
or general merchandise sales, guarantees of payments due from students or
otherwise.
"
Environmental
Assessment
" has the meaning specified in the definition of Real Estate
Eligibility Requirements.
"
Environmental Laws
"
means any and all Federal, state, local, and foreign statutes, laws,
regulations, ordinances, rules, judgments, orders, decrees, permits,
concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any hazardous materials into the environment, including those related
to hazardous substances or hazardous wastes, air emissions and discharges to
waste or public systems.
"
Environmental
Liability
" means any liability, obligation, damage, loss, claim, action,
suit, judgment, order, fine, penalty, fee, expense, or cost, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of any Borrower, any other Loan
Party or any of their respective Subsidiaries directly or indirectly resulting
from or based upon (a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage, treatment or disposal or presence of any
Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or
threatened release of any Hazardous Materials into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.
"
Equity Interests
"
means, with respect to any Person, all of the shares of capital stock of (or
membership or other ownership or profit interests in) such Person, all of the
warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or membership or other ownership or profit
interests in) such Person, all of the 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
acquisition from such Person of such shares (or such membership or other
interests), and all of the other ownership or profit interests in such Person
(including partnership, member
"
ERISA
" means the
Employee Retirement Income Security Act of 1974.
"
ERISA Affiliate
"
means any trade or business (whether or not incorporated) under common control
with a Loan Party within the meaning of Section 414(b) or (c) of the Code (and
Sections 414(m) and (o) of the Code for purposes of provisions relating to
Section 412 of the Code).
"
ERISA Event
" means
(a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by a
Loan Party or any ERISA Affiliate from a Pension Plan subject to Section 4063 of
ERISA during a plan year in which it was a substantial employer (as defined in
Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by a Loan Party or any ERISA Affiliate from a Multiemployer Plan or
notification to a Loan Party that a Multiemployer Plan is in reorganization; (d)
the filing of a notice of intent to terminate, the treatment of a Plan amendment
as a termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which constitutes grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (f) the imposition of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon a Loan Party or any ERISA Affiliate.
"
Event of Default
" has
the meaning specified in
Section 8.01
. An
Event of Default shall be deemed to be continuing unless and until that Event of
Default has been duly waived as provided in
Section 10.01
hereof.
"
Excluded Assets
" has
the meaning given to such term in the Security Agreement.
"
Excluded Taxes
"
means, with respect to the Administrative Agent, any Lender, the LC Issuer or
any other recipient of any payment to be made by or on account of any obligation
of the Borrowers hereunder, (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
and (c) in the case of a Foreign Lender (other than an assignee pursuant to a
request by the Lead Borrower under
Section 10.13
), any
withholding tax that is imposed on amounts payable to such Foreign Lender at the
time such Foreign Lender becomes a party hereto (or designates a new Lending
Office) or is attributable to such Foreign Lender’s failure or inability (other
than as a result of a Change in Law) to comply with
Section 3.01(e)
,
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new Lending Office (or assignment), to
receive additional amounts from the Borrowers with respect to such withholding
tax pursuant to
Section
3.01(a)
.
"
Executive Order
" has
the meaning set forth in
Section
10.18
.
“
Existing BNCB Credit
Agreement
” means that certain Credit Agreement, dated as of November 13,
2006, among BNCB, certain subsidiaries of BNCB from time to time party thereto,
Bank of America, N.A., as agent, and a syndicate of lenders.
"
Existing Letters of
Credit
" means the letters of credit described on
Schedule 1.04
hereto.
"
Facility Guaranty
"
means any Guarantee made by the Guarantors in favor of the Credit Parties,
including as set forth in
Article XI
hereto or
in any guaranty agreement in form reasonably satisfactory to the Administrative
Agent.
"
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 no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate (rounded upward, if necessary,
to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on
such transactions as determined by the Administrative Agent.
"
Fee Letter
" means the
amended and restated fee letter agreement, dated August 7, 2009, among the Lead
Borrower, the Administrative Agent, the other institutions party thereto and the
Joint Lead Arrangers.
"
FIRREA Documents
" has
the meaning specified in the definition of Real Estate Eligibility
Requirements.
"
Fiscal Month
" means
any fiscal month of any Fiscal Year determined in accordance with the fiscal
accounting calendar of the Loan Parties.
"
Fiscal Quarter
" means
any fiscal quarter of any Fiscal Year determined in accordance with the fiscal
accounting calendar of the Loan Parties.
"
Fiscal Year
" means
any period of twelve (12) consecutive months ending on the Saturday that is
closest to the last day of January of any calendar year,
provided
that after
the change contemplated by
Section 7.13
, “
Fiscal Year
” shall
mean any period of twelve (12) consecutive months ending on the
Saturday that
is closest to the end of April of any calendar year that is in accordance with
the National Retail Federation calendar.
"
Fixed Charge Trigger
Event
" means the failure of the Borrowers to maintain at any time
Availability at least equal to the greater of (i) fifteen percent (15.0%) of the
Loan Cap or (ii) $110,000,000.
"
Fixed Charge Trigger
Period
" means the period beginning upon the occurrence of a Fixed Charge
Trigger Event and ending on the date Availability has equaled or exceeded the
greater of (i) fifteen percent (15.0%) of the Loan Cap or (ii) $110,000,000 for
a period of forty-five (45) consecutive calendar days.
"
Flood Zone
Certification
" has the meaning specified in the definition of Real Estate
Eligibility Requirements.
"
Foreign Lender
" means
any Lender and each LC Issuer, if such Person is organized under the laws of a
jurisdiction other than that in which the Lead Borrower is resident for tax
purposes. For purposes of this definition, the United States, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.
"
Foreign Subsidiary
"
means any Subsidiary organized under the laws of a political subdivision outside
of the United States.
"
Fronting Fee
" has the
meaning assigned to such term in
Section
2.03(j)
.
"
FRB
" means the Board
of Governors of the Federal Reserve System of the United States.
"
Fully Satisfied
"
means (a) with respect to any Secured Obligations or Obligations, as applicable,
the full cash payment thereof, including all principal, interest and fees with
respect thereto and any interest, fees and other charges accruing during a
proceeding under any Debtor Relief Law (whether or not such amounts are allowed
or allowable in whole or in part in such proceeding), but shall not include any
roll up of any Secured Obligations or Obligations in any debtor in possession
financing during any such proceeding; and (b) with respect to LC Obligations,
Other Liabilities or Obligations that are inchoate or contingent in nature, the
Cash Collateralization thereof (or delivery of a standby letter of credit
acceptable to the applicable Credit Party in its discretion, in the amount of
required Cash Collateral). No Loans shall be deemed to have been Fully Satisfied
until all Commitments related to such Loans have expired or been
terminated.
"
Fund
" means any
Person (other than a natural person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business.
"
GAAP
" means generally
accepted accounting principles in the United States set forth in the opinions
and pronouncements of the Accounting Principles Board and the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board or such other principles as may be approved
by a significant segment of the accounting profession in the United States, that
are applicable to the circumstances as of the date of determination,
consistently applied.
"
Governmental
Authority
" means the government of the United States or any other nation,
or of any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra- national bodies such as the European Union or the European Central
Bank).
"
Guarantee
" means, as
to any Person, any (a) any obligation, contingent or otherwise, of such Person
guaranteeing or having the economic effect of guaranteeing any Indebtedness or
other obligation payable or performable by another Person (the "primary
obligor") in any manner, whether directly or indirectly, and including any
obligation of such Person, direct or indirect, (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation, (ii) to purchase or lease property, securities or services for
the purpose of assuring the obligee in respect of such Indebtedness or other
obligation of the payment or performance of such Indebtedness or other
obligation, (iii) to maintain working capital, equity capital or any other
financial statement condition or liquidity or level of income or cash flow of
the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien), but excluding in all
cases endorsements for collection or deposit in the ordinary course of business.
The amount of any Guarantee shall be deemed to be an amount equal to the stated
or determinable amount of the related primary obligation, or portion thereof, in
respect of which such Guarantee is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term "Guarantee" as a verb has a
corresponding meaning.
"
Guaranteed
Obligations
" has the meaning specified in
Section
11.01
.
"
Guarantor
" means each
wholly-owned Subsidiary of the Lead Borrower (other than any Borrower, any CFC
or any Immaterial Subsidiary) and each other Subsidiary of the Lead Borrower
that is not a Borrower and that is required to execute and deliver a Facility
Guaranty pursuant to
Section
6.12
.
"
Hazardous Materials
"
means all explosive or radioactive substances or wastes and all hazardous or
toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos-containing materials, polychlorinated
biphenyls, radon gas, infectious or medical wastes and all other substances or
wastes of any nature regulated pursuant to any Environmental Law.
"
Honor Date
" has the
meaning specified in
Section
2.03(c)(i)
.
"
Immaterial
Subsidiary
" means each Subsidiary of the Lead Borrower that has been
designated by the Lead Borrower in writing to the Administrative Agent as an
"Immaterial Subsidiary" for purposes of this Agreement and the other Loan
Documents, provided that (a) for purposes of this Agreement, at no time shall
(i) the total assets of all Immaterial Subsidiaries, as of the end of the most
recent Fiscal Quarter for which financial statements have been delivered
pursuant to
Section
6.01(a)
or
Section 6.01(b)
hereof, equal or exceed five percent (5.0%) of the Consolidated total assets of
the Lead Borrower and its Subsidiaries, or (ii) any Immaterial Subsidiary own
any assets included in the Borrowing Base, or (iii) the gross revenues of all
Immaterial Subsidiaries for any Measurement Period equal or exceed five percent
(5.0%) of the Consolidated gross revenues of the Lead Borrower and its
Subsidiaries for such Measurement Period, in each case as determined in
accordance with GAAP, and (b) no Subsidiary that has been designated an
"Immaterial Subsidiary" may be re-designated a "Subsidiary" or be treated under
the Loan Documents as a Loan Party without the written approval of the
Administrative Agent which approval may be withheld for any reason. As of the
Closing Date, the Subsidiaries specified on
Schedule
1.03
hereto are the
only Subsidiaries designated by the Lead Borrower as Immaterial Subsidiaries
for
purposes of
this Agreement and the other Loan Documents.
"
Increase Effective
Date
" shall have the meaning provided therefor in
Section
2.15(d)
.
"
Increased Commitment
Lender
" shall have the meaning provide in
Section
2.15(b)
.
"
Indebtedness
" means,
as to any Person at a particular time, without duplication, all of the
following, whether or not included as indebtedness or liabilities in accordance
with GAAP:
(a)
all obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other similar
instruments;
(c)
net
obligations of such Person under any Swap Contract;
(d) all
obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of business
and, in each case, paid in accordance with the payment terms thereof and
otherwise not past due for more than 90 days);
(e) indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or
being purchased by such Person (including indebtedness arising under conditional
sales or other title retention agreements), whether or not such indebtedness
shall have been assumed by such Person or is limited in recourse;
(f)
all
Attributable Indebtedness of such Person;
(g) all
Disqualified Stock and all other obligations of such Person to purchase, redeem,
retire, defease or otherwise make any payment in respect of any Equity Interest
in such Person or any other Person, or any warrant, right or option to acquire
such Equity Interest, valued, in the case of a redeemable preferred interest, at
the greater of its voluntary or involuntary liquidation preference
plus
accrued and
unpaid dividends; and
(h)
all
Guarantees of such Person in respect of any of the foregoing.
For all
purposes hereof, the Indebtedness of any Person shall include the Indebtedness
of any partnership or joint venture (other than a joint venture that is itself a
corporation or limited liability company) in which such Person is a general
partner or a joint venturer, unless such Indebtedness is expressly made
non-recourse to such Person. The amount of any net obligation under any Swap
Contract on any date shall be deemed to be the Swap Termination Value thereof as
of such date.
"
Indemnified Taxes
"
means Taxes other than Excluded Taxes.
"
Indemnitees
" has the
meaning specified in
Section
10.04(b)
.
"
Information
" has the
meaning specified in
Section
10.07
.
"
Intellectual
Property
" means all present and future: trade secrets, know-how and other
proprietary information; trademarks, trademark applications, internet domain
names, service marks, trade dress, trade names, business names, designs, logos,
slogans (and all translations, adaptations, derivations and combinations of the
foregoing) indicia and other source and/or business identifiers, and all
registrations or applications for registrations which have heretofore been or
may hereafter be issued thereon throughout the world; copyrights and copyright
applications; (including copyrights for computer programs) and all tangible and
intangible property embodying the copyrights, unpatented inventions (whether or
not patentable); patents and patent applications; industrial design applications
and registered industrial designs; license agreements related to any of the
foregoing and income therefrom; books, records, writings, computer tapes or
disks, flow diagrams, specification sheets, computer software, source codes,
object codes, executable code, data, databases and other physical
manifestations, embodiments or incorporations of any of the foregoing; all other
intellectual property; and all common law and other rights throughout the world
in and to all of the foregoing.
"
Interest Period
"
means, as to each LIBO Rate Loan, the period commencing on the date such LIBO
Rate Loan is disbursed or converted to or continued as a LIBO Rate Loan and
ending on the date one (1), two (2), three (3) or six (6) months thereafter, as
selected by the Lead Borrower in its Committed Loan Notice; provided
that:
(i) any
Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day unless such Business Day
falls in another calendar month, in which case such Interest Period shall end on
the next preceding Business Day;
(ii) any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of the
calendar month at the end of such Interest Period;
(iii)
no
Interest Period shall extend beyond the Maturity Date; and
(iv) notwithstanding
the provisions of clause (iii) no Interest Period shall have a duration of less
than one (1) month, and if any Interest Period applicable to a LIBO Borrowing
would be for a shorter period, such Interest Period shall not be available
hereunder.
For
purposes hereof, the date of a Borrowing initially shall be the date on which
such Borrowing is made and thereafter shall be the effective date of the most
recent conversion or continuation of such Borrowing.
“
Internal Control
Event
” means (a) with respect to the Lead Borrower, a determination by
management or the Audit Committee of the Board of Directors of the Lead Borrower
or by the Lead Borrower’s Public Accountants that (i) a material weakness in
internal controls over financial reporting, as described in PCAOB Auditing
Standard No. 5, exists in the Lead Borrower’s internal control over financial
reporting, or (ii) a member of the senior management of the Lead Borrower has
committed a material act of fraud, and (b) with respect to the any Subsidiary of
the Lead Borrower, a determination by management or the Audit Committee of the
Board of Directors of the Lead Borrower or by the Lead Borrower’s Public
Accountants that (i) a material weakness in internal controls over financial
reporting, as described in PCAOB Auditing Standard No. 5, exists in the such
Subsidiary’s internal control over financial reporting, or (ii) a member of the
senior management of such Subsidiary has committed an act of fraud, in either
case under this clause (b) that could reasonably be expected to result in an
Material Adverse Effect;
provided
, that, for
the avoidance of doubt in the case of clause (b)(i) with respect to BNCB, a
determination by management or the audit committee of the Lead Borrower’s Board
of Directors or by the Lead Borrower’s Public Accountants of the existence of a
material weakness due to a deficiency in the design or operation of BNCB’s
internal controls over financial reporting, as described in PCAOB Auditing
Standard No. 5, shall not be considered to result in a Material Adverse Effect
so long as (i) such determination is made solely with respect to the internal
controls of BNCB as a wholly-owned subsidiary of the Lead Borrower immediately
after giving effect to the BNCB Acquisition, (ii) the failure to rectify such
weakness shall not have resulted in a violation of applicable securities or
other Laws and
"
Inventory
" has the
meaning given that term in the UCC, and shall also include, without limitation,
all: (a) goods which (i) are leased by a Person as lessor, (ii) are held by a
Person for sale or lease or to be furnished under a contract of service, (iii)
are furnished by a Person under a contract of service, or (iv) consist of raw
materials, work in process, or materials used or consumed in a business; (b)
goods of said description in transit; (c) goods of said description which are
returned, repossessed or rejected; and (d) packaging, advertising, and shipping
materials related to any of the foregoing.
"
Inventory Reserves
"
means such reserves as may be established from time to time by the
Administrative Agent in the Administrative Agent’s Permitted Discretion with
respect to the determination of the saleability, at retail, of the Eligible
Inventory or which reflect such other factors as affect the market value of the
Eligible Inventory. Without limiting the generality of the foregoing, Inventory
Reserves may, in the Administrative Agent’s Permitted Discretion, include (but
are not limited to) reserves based on:
|
|
(e)
|
change
in Inventory character;
|
|
|
(f)
|
change
in Inventory composition;
|
|
|
(g)
|
change
in Inventory mix;
|
|
|
(h)
|
mark-downs
(both permanent and point of sale);
|
|
|
|
|
|
|
(i)
|
retail
mark-ons and mark-ups inconsistent with prior period practice and
performance, industry standards, current business plans or advertising
calendar and planned advertising events;
|
|
|
(j)
|
reasonably
anticipated changes in appraised value of Inventory between appraisals;
and
|
|
|
(k)
|
Out-of-date
and/or expired Inventory.
|
"
Investment
" means, as
to any Person, any direct or indirect acquisition or investment by such Person,
whether by means of (a) the purchase or other acquisition of Equity Interests of
another Person, (b) a loan, advance or capital contribution to, Guarantee or
assumption of debt of, or purchase or other acquisition of any other debt or
equity participation or interest in, another Person, including any partnership
or joint venture interest in such other Person and any arrangement pursuant to
which the investor Guarantees Indebtedness of such other Person, or (c) any
Acquisition;
provided
,
however
, that any
amount payable by a vendor to any Loan Party with respect to the return of
inventory or supplies by such Loan Party to such vendor in the ordinary course
of business shall not constitute an “Investment” hereunder so long as (i) such
amount has not been outstanding for more than 150 days and (ii)
such
"
IRS
" means the United
States Internal Revenue Service.
"
ISP
" means, with
respect to any Letter of Credit, the "International Standby Practices 1998"
published by the Institute of International Banking Law & Practice (or such
later version thereof as may be in effect at the time of issuance).
"
Issuer Documents
"
means with respect to any Letter of Credit, the Letter of Credit Application,
and any other document, agreement and instrument entered into by the LC Issuer
and any Borrower (or any Subsidiary) or in favor the LC Issuer and relating to
any such Letter of Credit.
"
Joinder Agreement
"
means an agreement, substantially in the form of
Exhibit J
hereto and
otherwise in form satisfactory to the Administrative Agent pursuant to which,
among other things, a Person becomes a party to, and bound by the terms of, this
Agreement and/or the other Loan Documents in the same capacity and to the same
extent as either a Borrower or a Guarantor, as the Administrative Agent may
determine.
"
Junior Subordinated Seller
Note
" means that certain Junior Subordinated Seller Note dated as of the
date hereof by the Lead Borrower in favor of the Sellers in an original
principal amount of $150,000,000 and having a maturity date of September __,
2014, in the form of
Exhibit H
hereto.
"
Laws
" means each
international, foreign, federal, state and local statute, treaty, rule,
guideline, regulation, ordinance, code and administrative or judicial precedent
or authority, including the interpretation or administration thereof by any
Governmental Authority charged with the enforcement, interpretation or
administration thereof, and each applicable administrative order, directed duty,
request, license, authorization and permit of, and agreement with, any
Governmental Authority, in each case whether or not having the force of
law.
"
LC Advance
" means,
with respect to each Lender, such Lender’s funding of its participation in any
LC Borrowing in accordance with its Applicable Percentage.
"
LC Borrowing
" means
an extension of credit resulting from a drawing under any Letter of Credit which
has not been reimbursed on the date when made or refinanced as a Committed
Borrowing.
"
LC 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.
"
LC Issuer
" means (a)
Bank of America, JPMorgan Chase Bank, N.A., Wells Fargo Retail Finance, LLC
(through its Affiliate, Wells Fargo Bank, N.A.) and Sovereign Bank, each in its
capacity as issuer of Letters of Credit hereunder, or any successor issuer of
Letters of Credit hereunder (which successor may only be a Lender selected by
the Administrative Agent in its discretion and, so long as no Event of Default
has occurred and is continuing, consented to by the Lead Borrower), and (b) with
respect to the Existing Letters of Credit and until such Existing Letters of
Credit expire or are returned undrawn, Bank of America. The LC Issuer may, in
its discretion and with the consent of the Lead Borrower which shall not be
unreasonably withheld, arrange for one or more Letters of Credit to be issued by
Affiliates of the LC Issuer, in which case the term "LC Issuer" shall include
any such Affiliate with respect to Letters of Credit issued by such
Affiliate.
"
Lease
" means any
agreement, whether written or oral, no matter how styled or structured, pursuant
to which a Loan Party is entitled to the use or occupancy of any real property
for any period of time.
"
Lender
" has the
meaning specified in the introductory paragraph hereto and, as the context
requires, includes the Swing Line Lender.
"
Lending Office
"
means, as to any Lender, the office or offices of such Lender described as such
in such Lender’s Administrative Questionnaire, or such other office or offices
as a Lender may from time to time notify the Lead Borrower and the
Administrative Agent.
"
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 and bankers’
acceptances.
"
Letter of Credit
Application
" means an application and agreement for the issuance or
amendment of a Letter of Credit in the form from time to time in use by any
applicable LC Issuer.
"
Letter of Credit Expiration
Date
" means the day that is five (5) days prior to the Maturity Date then
in effect (or, if such day is not a Business Day, the next preceding Business
Day).
"
Letter of Credit Fee
"
has the meaning specified in
Section
2.03(i)
.
"
Letter of Credit
Sublimit
" means an amount equal to $100,000,000. 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 Lead Borrower’s option, less than) the
Aggregate Commitments.
"
LIBO Borrowing
" means
a Borrowing comprised of LIBO Rate Loans.
"
LIBO Rate
" means for
any Interest Period with respect to a LIBO Rate Loan, the rate per annum equal
to the British Bankers Association LIBOR Rate ("
BBA LIBOR
"), as
published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as designated by the Administrative Agent from time to
time) at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, for Dollar deposits (for delivery on the
first day of such Interest Period) with a term equivalent to such Interest
Period. If such rate is not available at such time for any reason, then the
"LIBO Rate" for such Interest Period shall be the rate per annum determined by
the Administrative Agent to be the rate at which deposits in Dollars for
delivery on the first day of such Interest Period in same day funds in the
approximate amount of the LIBO Rate Loan being made, continued or converted by
Bank of America and with a term equivalent to such Interest Period would be
offered by Bank of America’s London Branch to major banks in the London
interbank eurodollar market
"
LIBO Rate Loan
" means
a Committed Loan that bears interest at a rate based on the Adjusted LIBO
Rate.
"
Lien
" means (a) 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,
Capital Lease Obligation, Synthetic Lease Obligation, or other title retention
agreement, any easement, right of way or other encumbrance on title to real
property, and any financing lease having substantially the same economic effect
as any of the foregoing) and (b) in the case of securities, any purchase option,
call or similar right of a third party with respect to such
securities.
"
Liquidation
" means
the exercise by the Administrative Agent or Collateral Agent of those rights and
remedies accorded to such Agents under the Loan Documents and applicable Law as
a creditor of the Loan Parties with respect to the realization on the
Collateral, including (after the occurrence and during the continuation of an
Event of Default) the conduct by the Loan Parties acting with the consent of the
Administrative Agent and the Arrangers, of any public, private or
"going-out-of-business", "store closing" or other similar sale or any other
disposition of the Collateral for the purpose of liquidating the Collateral.
Derivations of the word "Liquidation" (such as "Liquidate") are used with like
meaning in this Agreement.
"
Loan
" means an
extension of credit by a Lender to any Borrower under
Article II
in the
form of a Committed Loan or a Swing Line Loan.
"
Loan Cap
" means, at
any time of determination, the lesser of (a) the Aggregate Commitments at such
time and (b) the Borrowing Base at such time.
"
Loan Account
" has the
meaning assigned to such term in
Section
2.11(a)
.
"
Loan Documents
" means
this Agreement, each Note, each Issuer Document, the Fee Letter, all Borrowing
Base Certificates, the Blocked Account Agreements, the DDA Notifications, the
Credit Card Notifications, the Security Documents, the Facility Guaranty, and
any other instrument or agreement now or hereafter executed and delivered in
connection herewith, each as amended and in effect from time to
time.
"
Loan Party
" means the
Borrowers and each Guarantor.
"
Material Adverse
Effect
" means (a) a material adverse change in, or a material adverse
effect upon, the operations, business, properties, liabilities (actual or
contingent), or condition (financial or otherwise) of any Loan Party or the Lead
Borrower and its Subsidiaries taken as a whole; (b) impairment of the ability of
any Loan Party to perform its material obligations under any material Loan
Document to which it is a party; or (c) a material impairment of the rights and
remedies of the Agent or the Lenders under any material Loan Document or a
material adverse effect upon the legality, validity, binding effect or
enforceability against any Loan Party of any Loan Document to which it is a
party. In determining whether any individual event would result in a Material
Adverse Effect, notwithstanding that such event in and of itself does not have
such effect, a Material Adverse Effect shall be deemed to have occurred if the
cumulative effect of such event and all other then existing events would result
in a Material Adverse Effect.
"
Material
Indebtedness
" means Indebtedness (other than the Obligations) of the Loan
Parties in an aggregate principal amount exceeding $35,000,000. Without
limitation of the foregoing, the obligations under the Seller Notes, each as
amended and in effect on the Closing Date, and any Permitted Senior Debt shall
be deemed Material Indebtedness. For purposes of determining the amount of
Material Indebtedness at any time, the amount of the obligations in respect of
any Swap Contract at such time shall be calculated at the Swap Termination Value
thereof.
"
Material Storage
Location
" means (a) the warehouse leased by the Lead Borrower in Monroe,
New Jersey, or Reno, Nevada, (b) the warehouse leased by Sterling Publishing
Co., Inc., at 48 Saw Mill Pond Road, Edison, New Jersey or 30 Saw Mill Pond
Road, Edison, New Jersey, or (c) any replacement for such facilities or any
other warehouse or other storage space leased by any Loan Party for the storage
of similar amounts of Inventory as are or are anticipated to be stored at any of
the locations described in clauses (a) and (b) of this definition as of the
Closing Date.
"
Material Store
Acquisition
" means (a) with respect to the Lead Borrower and its
Subsidiaries (other than BNCB and its Subsidiaries), the acquisition in a single
transaction or series of related transactions of stores, store leases and or
inventory at store locations (other than acquisitions or openings of new stores
in the ordinary course of business) for consideration in excess of (i)
$25,000,000 for any such single or series of related transactions or (ii)
$75,00,000 in the aggregate for any Fiscal Year and (b) with respect to BNCB and
its Subsidiaries, the acquisition of more than 50 bookstore contracts or leases
in a single transaction or series of related transactions, either through
assumption or replacement of existing contracts or leases between third parties
and the applicable college, university or other educational
institution.
"
Maturity Date
" means
September 29, 2013.
"
Maximum DDA Balance
"
means, with respect to each DDA, an amount equal to (a) $1,000
times
(b) the
aggregate number of Stores that maintain deposits in such DDA.
"
Maximum Rate
" has the
meaning provided therefor in
Section
10.09
.
"
Measurement Period
"
means, at any date of determination, the most recently completed twelve (12)
consecutive Fiscal Months of the Lead Borrower for which financial statements
have or should have been delivered in accordance with
Section
6.01
.
"
Moody’s
" means
Moody’s Investors Service, Inc. and any successor thereto.
"
Mortgage
" means each
fee mortgage or deed of trust, security agreement and assignment by a Loan Party
owning the Real Estate encumbered thereby in favor of the Collateral Agent in
form and substance acceptable to the Collateral Agent in its Permitted
Discretion.
"
Mortgage Related
Document
" means each Title Policy, Survey, Environmental Assessment,
Flood Zone Certification and FIRREA Documents related to each parcel of Real
Estate subject to a Mortgage and all related certifications, evidences of
permits and licenses and other documents and certifications reasonably requested
by the Administrative Agent in connection with establishing,
"
Multiemployer Plan
"
means any employee benefit plan of the type described in Section 4001(a)(3) of
ERISA, to which a Loan Party or any ERISA Affiliate makes or is obligated to
make contributions, or during the preceding five plan years, has made or been
obligated to make contributions.
"
Net Orderly Liquidation
Value
" means the appraised orderly liquidation value of the Borrowers’
Inventory, net of costs and expenses to be incurred in connection with any such
liquidation, which value is expressed as a percentage of Cost of the Borrowers’
Inventory as set forth in the Borrowers’ inventory stock ledger, which value
shall be determined from time to time by the most recent appraisal undertaken by
an independent appraiser engaged by the Administrative Agent.
"
Net Proceeds
" means
(a) with respect to any Prepayment Event described in clause (a) or (b) of the
definition thereof, the excess, if any, of (i) the sum of cash and cash
equivalents received in connection with such transaction (including any cash or
cash equivalents received by way of deferred payment pursuant to, or by
monetization of, a note receivable or otherwise, but only as and when so
received) over (ii) the sum of (A) the principal amount of any Indebtedness that
is secured by the applicable asset by a Lien permitted hereunder which is senior
to the Collateral Agent’s Lien on such asset and that is required to be repaid
(or to establish an escrow for the future repayment thereof) in connection with
such transaction (other than Indebtedness under the Loan Documents), (B) the
reasonable and customary out-of-pocket expenses incurred by such Loan Party or
such Subsidiary in connection with such transaction (including, without
limitation, appraisals, and brokerage, legal, title and recording or transfer
tax expenses and commissions) paid by any Loan Party to third parties (other
than Affiliates)), (C) commercially reasonable amounts provided as a funded
reserve against any liabilities under any indemnification obligations or
purchase price adjustments associated with such Dispositions, and (D) if no
Trigger Period shall then be in effect, all federal, state, provincial, foreign
and local taxes required to be accrued as a liability under GAAP, and (b) with
respect to the sale or issuance of any Equity Interest by any Loan Party or any
of its Subsidiaries, or the incurrence or issuance of any Indebtedness by any
Loan Party or any of its Subsidiaries, the excess of (i) the sum of the cash and
cash equivalents received in connection with such transaction over (ii) the sum
of (x) the underwriting discounts and commissions, and other reasonable and
customary out-of-pocket expenses, incurred by such Loan Party or such Subsidiary
in connection therewith and (y) all distributions and other payments required to
be made to minority interest holders in such Person as a result of such
sale.
"
Non-Consenting
Lender
" has the meaning provided therefor in
Section
10.01
.
"
Non-Extension Notice
Date
" has the meaning specified in
Section
2.03(b)(iii)
.
"
Note
" means (a) a
promissory note made by the Borrowers in favor of a Lender evidencing Loans made
by such Lender, substantially in the form of
Exhibit C-1
, and (b)
the Swing Line Note, as each may be amended, supplemented or modified from time
to time.
"
NPL
" means the
National Priorities List under CERCLA.
"
Obligations
" means
all advances to, and debts (including principal, interest, fees, costs, and
expenses), liabilities, obligations, covenants, indemnities, and duties of, any
Loan Party arising under any Loan Document or otherwise with respect to any Loan
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
"
Organization
Documents
" means, (a) with respect to any corporation, the certificate or
articles of incorporation and the bylaws (or equivalent or comparable
constitutive documents with respect to any non-U.S. jurisdiction); (b) with
respect to any limited liability company, the certificate or articles of
formation or organization and operating agreement; and (c) with respect to any
partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"
Other Liabilities
"
means any obligation of any Loan Party (a) arising under any document or
agreement relating to or (b) on account of (i) any Cash Management Services
and/or (ii) any Bank Product.
"
Other Taxes
" means
all present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies arising from any payment made hereunder or
under any other Loan Document or from the execution, delivery or enforcement of,
or otherwise with respect to, this Agreement or any other Loan
Document.
"
Outstanding Amount
"
means (i) with respect to Committed Loans and Swing Line Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Committed Loans and Swing Line
Loans, as the case may be, occurring on such date; and (ii) with respect to any
LC Obligations on any date, the amount of such LC Obligations on such date after
giving effect to (A) any LC Credit Extension occurring on such date and (B) any
other changes in the aggregate amount of the LC Obligations as of such date,
including as a result of any reimbursements by the Borrowers of Unreimbursed
Amounts.
"
Overadvance
" means a
Credit Extension to the extent that, immediately after its having been made,
Availability is less than zero.
"
Participant
" has the
meaning specified in
Section
10.06(d)
.
“
Participant Register
”
has the meaning specified in
Section
10.06(d)
.
"
Patriot Act
" shall
have the meaning provided in
Section
4.01(j)
.
"
PBGC
" means the
Pension Benefit Guaranty Corporation.
"
PCAOB
" means the
Public Company Accounting Oversight Board.
"
Pension Plan
" means
any "employee pension benefit plan" (as such term is defined in Section 3(2) of
ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA
and is sponsored or maintained by a Loan Party or any ERISA Affiliate or to
which a Loan Party or any ERISA Affiliate contributes or has an obligation to
contribute, or in the case of a multiple employer or other plan described in
Section 4064(a) of ERISA, has made contributions at any time during the
immediately preceding three plan years.
(a)
no
Default then exists or would arise from the consummation of such
Acquisition;
(b) such
Acquisition shall have been approved by the Board of Directors of the Person (or
similar governing body if such Person is not a corporation) which is the subject
of such Acquisition and such Person does not otherwise oppose such
Acquisition;
(c)
the
Lead Borrower shall have furnished the Administrative Agent with (i) thirty
(30) days’
prior written notice (or such shorter period of not less than ten (10) days
prior to such Acquisition as the Administrative Agent may agree in its
reasonable discretion) of each such intended Acquisition;
(d) with
respect to any such Acquisition (in a single or series of related transactions)
involving aggregate consideration (whether in cash, tangible property, notes or
other property) in excess of $25,000,000 individually or in excess of
$75,000,000 in the aggregate, the Lead Borrower promptly (and in any event, no
less than five (5) Business Days prior to the consummation of such Acquisition
or such shorter period as may otherwise be agreed by the Administrative Agent in
its reasonable discretion) shall furnish to the Administrative Agent such
documentation, if any, that the Administrative Agent may reasonably request,
which may include a current draft of the documents, agreements and instruments
contemplated to be executed in connection therewith (and final copies thereof as
and when executed), a summary of any due diligence undertaken by the Loan
Parties in connection with such Acquisition;
(e) any
assets acquired shall be utilized in, and if the Acquisition involves a merger,
consolidation or stock acquisition, the Person which is the subject of such
Acquisition shall be engaged in, a Business substantially the same as one or
more line or lines of Business of the Lead Borrower and its Subsidiaries or
Substantially related, incidental or complimentary thereto and otherwise
permitted to be engaged in by a Borrower under this Agreement;
(f) if
the Person which is the subject of such Acquisition will be maintained as a
wholly-owned Subsidiary of a Loan Party, or if the assets acquired in an
Acquisition will be transferred to a wholly-owned Subsidiary which is not then a
Loan Party, such wholly-owned Subsidiary shall, to the extent not prohibited by
the terms of Indebtedness of such Person permitted by
Section 7.03(h)
hereof, have been joined as a "Borrower" hereunder or as a Guarantor, as the
Administrative Agent shall determine in its Permitted Discretion, and the
Collateral Agent shall, to the extent not prohibited by the terms of
Indebtedness of such Person permitted by
Section 7.03(h)
hereof, have received a first-priority security interest in such Subsidiary’s
Inventory, Accounts, Real Estate and other property of the same nature as
constitutes Collateral of the Borrowers under the Security Documents;
and
(g) (i)
Projected Excess Availability and Pro Forma Excess Availability as of the date
of consummation of such Acquisition will be equal to or greater than twenty
percent (20.0%) of the Loan Cap, (ii) the Consolidated Fixed Charge Coverage
Ratio, on a pro-forma basis for the Measurement Period immediately prior to such
Acquisition, will be equal to or greater than 1.1 to 1.0 and (iii) the Lead
Borrower shall have delivered written certification as to satisfaction, and a
reasonably detailed calculation, of items (i) and (ii) above five (5) Business
Days (or such shorter period not less than two (2) Business Days prior to such
Acquisition as the Administrative Agent may agree to in its reasonable
discretion) prior to the date of such Acquisition.
"
Permitted Discretion
"
means a determination made in good faith and in the exercise of commercially
reasonable business judgment, determined in a manner consistent with its credit
procedures for asset-based lending transactions in the retail industry and
otherwise in similar circumstances.
"
Permitted
Disposition
" has the meaning specified in
Section
7.05
.
"
Permitted
Encumbrances
" has the meaning specified in
Section
7.01
.
"
Permitted
Indebtedness
" has the meaning specified in
Section
7.03
.
"
Permitted
Investments
" has the meaning specified in
Section
7.02
.
"
Permitted
Overadvance
" means an Overadvance made by the Administrative Agent, in
its discretion (unless the Required Lenders direct the Administrative Agent not
to make or to discontinue making Overadvances), which:
(a) Is
made to maintain, protect or preserve the Collateral and/or the Credit Parties’
rights under the Loan Documents or which is otherwise for the benefit of the
Credit Parties; or
(b)
Is made
to enhance the likelihood of, or to maximize the amount of, repayment of
any
Obligation;
(c)
Is made
to pay any other amount chargeable to any Loan Party hereunder;
and
(d) Together
with all other Permitted Overadvances then outstanding, shall not (i) exceed
five percent (5.0%) of the Loan Cap at any time or (ii) unless a Liquidation is
occurring, remain outstanding for more than forty-five (45) consecutive Business
Days, unless in each case, the Required Lenders otherwise agree.
provided however
,
that the foregoing shall not (i) modify or abrogate any of the provisions
of
Section 2.03
regarding the Lender’s obligations with respect to Letters of Credit, or
(ii) result in any claim or
liability
against the Administrative Agent (regardless of the amount of any Overadvance)
for "inadvertent Overadvances" (i.e. where an Overadvance results from changed
circumstances beyond the control of the Administrative Agent (such as a
reduction in the collateral value)), and such "inadvertent Overadvances" shall
not reduce the amount of Permitted Overadvances allowed hereunder, and
further provided that
in no event shall the Administrative Agent make an Overadvance, if after giving
effect thereto, the principal amount of the Credit Extensions would exceed the
Aggregate Commitments (as in effect prior to any termination of the Commitments
pursuant to
Section
2.06
hereof).
"
Permitted Real Estate
Liens
" means with respect to any Eligible Real Estate encumbered by a
Mortgage in favor of the Collateral Agent, collectively, Permitted Encumbrances
and, the Liens referred to in Schedule B of the Title Policy insuring the
Collateral Agent’s interest under such Mortgage.
"
Permitted
Refinancing
" means, with respect to any Indebtedness, any refinancing,
refunding, renewal or extension of such Indebtedness, so long as (i) the amount
of such Indebtedness is not increased at the time of such refinancing,
refunding, renewal or extension except by an amount equal to a reasonable
premium or other reasonable amount paid, and fees and expenses reasonably
incurred, in
connection with such refinancing and by an amount equal to any
existing commitments unutilized thereunder, and the direct or contingent obligor
with respect thereto is not changed as a result of or in connection with such
refinancing, refunding, renewal or extension, (ii) such extension, renewal or
replacement shall not result in an earlier maturity date or decreased weighted
average life of such Indebtedness, (iii) the terms relating to principal amount,
amortization, maturity, collateral (if any) and subordination (if any), and
other material terms taken as a whole, of any such refinancing, refunding,
renewing or extending Indebtedness, and of any agreement entered into and of any
instrument issued in connection therewith, are no less favorable in any material
respect to the Credit Parties than the terms of any agreement or instrument
governing the Indebtedness being refinanced, refunded, renewed or extended and
(iv) the interest rate applicable to any such refinancing, refunding, renewing
or extending Indebtedness does not exceed the then applicable market interest
rate for comparative transactions of such nature.
"
Permitted Self-Insurance
Program
" means a self-insurance program of the Lead Borrower and its
Subsidiaries (a)(i) that is administered through Chelsea Insurance Company Ltd.,
a wholly-owned Subsidiary of the Lead Borrower, (ii) that is permitted under
applicable Laws, (iii) of an amount and type customarily carried by Persons
engaged in the same or similar business and operating in the same or similar
locations, (iv) with respect to which the Lead Borrower has provided the
Administrative Agent notice of activation of such program at least 30 days prior
to such program becoming effective, and (v) that otherwise satisfies the
requirements set forth in
Section 6.07
;
provided
,
however
, that no
self- insurance program may directly insure all or any portion of the Collateral
unless (x) such self-insurance program satisfies the foregoing requirements and
(y) the Collateral Agent (in consultation with the Arrangers) consents in
writing (such consent not to be unreasonably withheld or delayed) to the form
and substance of such self-insurance program; and (b) with respect to worker’s
compensation that is permitted under applicable Laws and of an amount and type
customarily carried by Persons engaged in the same or similar business and
operating in the same or similar locations.
"
Permitted Senior
Debt
" means Indebtedness of the Lead Borrower evidenced by senior notes
or similar instruments and any guaranty obligations of the Lead Borrower's
Subsidiaries (other than Immaterial Subsidiaries) with respect thereto, in any
aggregate principal amount of up to $750,000,000, all pursuant to an indenture
and guaranty agreements, as applicable, and on terms and conditions reasonably
acceptable to the Administrative Agent, the majority of the Arrangers and the
Required Lenders, such terms and conditions to include, but not be limited to
the following:
(a) no
portion of the principal of such Indebtedness shall be required to be paid,
whether by stated maturity, mandatory or scheduled prepayment or redemption or
otherwise, prior to the date that is 180 days after the Maturity Date, other
than in the event of (i) a default under such Indebtedness, (ii) a change of
control of the Lead Borrower or (iii) certain asset sales in each case, subject
to the standstill and the lien subordination provisions described in clause (d)
below;
(b) such
Indebtedness may be secured by a first priority Lien on Excluded Assets only and
a second priority Lien on any Collateral (provided the Administrative Agent for
the benefit of the Secured Parties is granted a second priority Lien on all
Excluded Assets securing such Indebtedness);
(c) the
documents, instruments and other agreements pursuant to which such Indebtedness
shall be issued or outstanding shall not be more restrictive than those
contained in this Agreement or the other Loan Documents taken as a whole or
conflict with or violate the covenants or otherwise create Defaults under this
Agreement or the other Loan Documents; and
(d) such Indebtedness shall be subject to an intercreditor agreement
acceptable to the Administrative Agent, the majority of the Arrangers and the
Required Lenders addressing, among other things, (A) the priority of the Liens
securing the Collateral and Excluded Assets and the payment of proceeds
therefrom, (B) a standstill by the holders of such Indebtedness as to remedies
against the Collateral, (C) waivers by the holders of such Indebtedness of
rights to contest validity or priority of Liens of the Administrative Agent or
the Lenders or object to dispositions of Collateral (including an affirmative
agreement by such holders to release Liens of such holders in the event of a
disposition of Collateral approved by the Administrative Agent and Required
Lenders), (D) waiver of rights to object to the use of cash collateral or sale
of Collateral, and restrictions on certain claims and actions, in any proceeding
under any Debtor Relief Laws by the holders of such Indebtedness, and (E)
restrictions on amendments to, or consents, waivers or other modifications with
respect to, the documents evidencing such Indebtedness.
"
Permitted Senior Seller Note
Payments
" means any payment or prepayment of the principal amount of the
Senior Subordinated Seller Note permitted (a) pursuant to the terms thereof
(including terms of subordination) as in effect on the Closing Date and (b)
under
Section
7.07
.
"
Permitted Tax
Distribution
" means the cash distributions in an aggregate amount of up
to $50,000,000 made to one or more of the Sellers pursuant to the terms of the
BNCB Purchase Agreement in respect of the income tax liability of the Sellers
associated with the ordinary business income of BNCB through the Closing Date,
notice of which shall be delivered pursuant to
Section 6.02(g)
hereof.
"
Person
" means any
natural person, corporation, limited liability company, trust, joint venture,
association, company, partnership, limited partnership, Governmental Authority
or other entity.
"
Plan
" means any
"employee benefit plan" (as such term is defined in Section 3(3) of ERISA)
established by the Borrowers or, with respect to any such plan that is subject
to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
"
Platform
" has the
meaning specified in
Section
6.02
.
"
Prepayment Event
"
means:
(a) Any
Disposition of any Inventory, Accounts or Mortgaged Property of a Loan Party,
other than (i) sales of Inventory in the ordinary course of business and (ii) so
long as no Trigger Period exists, a Disposition (or series of related
dispositions) of Inventory, Accounts or Mortgaged Property resulting in Net
Proceeds of $15,000,000 or less;
(b) Any
casualty or other insured damage to, or any taking under power of eminent domain
or by condemnation or similar proceeding of, any Mortgaged Real Estate of a Loan
Party, unless (i) the proceeds therefrom are required to be paid to the holder
of a Lien on such property or asset having priority over the Lien of the
Collateral Agent; or (ii) other than during a Trigger Period, the proceeds
therefrom are utilized for purposes of replacing or repairing the assets in
respect of which such proceeds, awards or payments were received within 270 days
of the occurrence of the damage to or loss of the assets being repaired or
replaced; or
(c)
The issuance by a Loan Party other than the Lead Borrower of any Equity
Interests,
other than any such issuance of Equity Interests (i) to a Loan Party, (ii) as
consideration for a Permitted Acquisition or (iii) as a compensatory issuance or
in connection with any employee retention program, plan or agreement to any
employee, director, or consultant
"
Pro Forma Excess
Availability
" means, for any date of calculation, the pro forma average
Availability for each Fiscal Month for the Measurement Period most recently
ended prior to such date of calculation determined as if the applicable
transaction or payment had been consummated as the beginning of such Twelve
Month Period.
"
Projected Excess
Availability
" means, for any date of calculation, the projected average
Availability for each Fiscal Month during the Twelve Month Period immediately
following such date of calculation.
"
Public Lender
" has
the meaning specified in
Section
6.02
.
"
Real Estate
" means
(i) all land, together with the buildings, structures, parking areas, and other
improvements thereon, now or hereafter owned by any Loan Party, including all
easements, rights-of- way, and similar rights of a Loan Party or in favor of a
Loan Party relating thereto and all leases, tenancies, and occupancies thereof
and (ii) all Leases.
"
Real Estate Eligibility
Requirements
" means, collectively, each of the following:
(a) the
applicable Borrower has executed and delivered to the Collateral Agent a
Mortgage with respect to any Real Estate intended, by such Borrower, to be
included in Eligible Real Estate;
(b) such
Real Estate is vacant land or used by a Borrower or a lessee or licensee of a
Borrower for offices, as a Store or distribution center or for other purposes
not prohibited by this Agreement or the other Loan Documents;
(c) as
to any particular property, the applicable Borrower is in compliance in all
material respects with the representations, warranties and covenants set forth
in the Mortgage relating to such Real Estate;
(d) the
Collateral Agent shall have received fully paid American Land Title Association
Lender’s Extended Coverage title insurance policies (or marked-up title
insurance commitments having the effect of a policy of title insurance) (the
"
Title
Policies
") in form and substance, with the endorsements reasonably
required by the Collateral Agent (to the extent available at commercially
reasonable rates) and in amounts reasonably acceptable to the Collateral Agent,
issued by First American Title Insurance Company, Fidelity Title Insurance
Company or other title insurers reasonably acceptable to the Collateral Agent,
insuring the Mortgages to be valid first priority Liens on the property
described therein, subject only to Permitted Encumbrances set forth in
Sections 7.01(a)
,
(c)
and
(h)
,
provided
that with
respect to any Liens for Taxes being contested in compliance with
Section 6.04
, such
Liens are insured over by the applicable Title Policy and such other Liens as
may be approved by the Collateral Agent in its Permitted
Discretion;
(e) the
Collateral Agent shall have received: (i) American Land Title
Association/American Congress on Surveying and Mapping form surveys, for which
all necessary fees (where applicable) have been paid, certified to the
Collateral Agent and the issuer of the Title Policies in a manner reasonably
satisfactory to the Collateral Agent by a land surveyor duly registered and
licensed in the states in which the property described in such surveys is
located and reasonably acceptable to the Collateral Agent, showing all buildings
and other improvements, the location of any easements, parking spaces, rights of
way, building set-back lines and other dimensional regulations and the absence
of encroachments, either
(f) with
respect to any Real Estate intended by any Borrower to be included in Eligible
Real Estate, the Collateral Agent shall have received a Phase I Environmental
Site Assessment in accordance with ASTM Standard E1527-05, in form and substance
reasonably satisfactory to the Collateral Agent, from Environmental Resources
Management or another environmental consulting firm reasonably acceptable to the
Collateral Agent (each an "
Environmental
Assessment
"), for such Real Estate to be included in Eligible Real
Estate, the Collateral Agent may, upon the receipt of an Environmental
Assessment, require the delivery of further environmental assessments or reports
to the extent such further assessments or reports are recommended in the
Environmental Assessment;
(g) Borrower
shall have delivered to the Collateral Agent (i) evidence of flood insurance, if
required by applicable Law, that covers any parcel of improved Real Estate that
is encumbered by a Mortgage in favor of the Collateral Agent, which insurance
shall name the Collateral Agent as mortgagee and shall be in an amount and in
such form that complies with the requirements under the National Flood Insurance
Act or (ii) a flood zone certification that such parcel is not located in a
flood zone and that such flood insurance is not required by applicable Law (in
either case, "
Flood
Zone Certification
");
(h) the
applicable Borrower shall have delivered such other information and documents as
may be reasonably requested by the Agents to the extent necessary to comply with
FIRREA ("
FIRREA
Documents
");
(i) no
material waste, impairment, or deterioration of the “Property” (as defined in
the Mortgages) shall have been committed and such Property shall not have been
abandoned;
(j) the
applicable Borrower shall have delivered a favorable opinion of local counsel to
the Loan Parties in the jurisdiction where such Real Estate is located,
addressed to the Administrative Agent and the Lenders, as to such matters
concerning such Borrower, the Mortgage and the Real Estate as the Administrative
Agent may request in its Permitted Discretion; and
(k) if
requested by the Collateral Agent, the Borrower shall have delivered a
commercially reasonable subordination, non-disturbance and attornment agreement,
in form and substance acceptable to the Collateral Agent in its Permitted
Discretion, with any tenants with respect to such Real Estate.
"
Realty Reserves
"
means, without duplication of any other Reserve or items that are otherwise
addressed or excluded thorough eligibility criteria, such reserves as the
Administrative Agent from time to time determines in the Administrative Agent’s
Permitted Discretion, as reflecting (i) the impediments to the Agents’ ability
to realize upon any Eligible Real Estate, or (ii) claims and liabilities that
the Administrative Agent determines in its Permitted Discretion will need to be
satisfied in connection with the realization upon Eligible Real
Estate.
"
Receivables Reserves
"
mean such reserves as may be established from time to time by the Administrative
Agent in the Administrative Agent’s Permitted Discretion with respect to the
determination of the collectability in the ordinary course of Eligible Accounts
Receivables, including, without limitation, reserves for dilution.
"
Registered Public Accounting
Firm
" has the meaning specified by the Securities Laws and shall be
independent of the Lead Borrower and its Subsidiaries as prescribed by the
Securities Laws.
"
Related Parties
"
means, with respect to any Person, such Person’s Affiliates and the partners,
directors, officers, employees, agents and advisors of such Person and of such
Person’s Affiliates.
"
Reportable Event
"
means any of the events set forth in Section 4043(c) of ERISA, other than events
for which the 30 day notice period has been waived.
"
Reports
" has the
meaning provided in
Section
9.12(b)
.
"
Request for Credit
Extension
" means (a) with respect to a Borrowing, conversion or
continuation of Committed Loans, a Committed Loan Notice, (b) with respect to a
conversion or continuation of Committed Loans, a Conversion/Continuation
Certificate, (c) with respect to an LC Credit Extension, a Letter of Credit
Application, and (d) with respect to a Swing Line Loan, a Swing Line Loan
Notice.
"
Required Lenders
"
means, as of any date of determination, Lenders holding more than 50.0% of the
Aggregate Commitments or, if the commitment of each Lender to make Loans and the
obligation of the LC Issuer to make LC Credit Extensions have been terminated
pursuant to
Section
8.02
, Lenders holding in the aggregate more than 50.0% of the Total
Outstandings (with the aggregate amount of each Lender’s risk participation and
funded participation in LC Obligations and Swing Line Loans being deemed "held"
by such Lender for purposes of this definition); provided that the Commitment
of, and the portion of the Total Outstandings held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Lenders.
"
Reserves
" means all
Inventory Reserves, Availability Reserves, Receivables Reserves and Realty
Reserves.
"
Responsible Officer
"
means the chief executive officer, president, chief financial officer, treasurer
or assistant treasurer or vice president or director of finance of a Loan Party
or any of the other individuals 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,
provided
that for the
purposes of any Committed Loan Notice, Conversion/Continuation Notice, Letter
of
Credit
Application and Swing Line Loan Notice, Responsible Officer shall also include
any officer, director or manager of the treasury department of the Lead Borrower
who is duly authorized to bind the Lead Borrower and with respect to whom the
Administrative Agent has received an incumbency certificate. Any document
delivered hereunder that is signed by a Responsible Officer of a Loan Party
shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party.
"
Restricted Payment
"
means any dividend or other distribution (whether in cash, securities or other
property) with respect to any capital stock or other Equity Interest of any
Person or any of its Subsidiaries, or any payment (whether in cash, securities
or other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, defeasance, acquisition, cancellation or
termination of any such capital stock or other Equity Interest, or on account of
any return of capital to such Person’s stockholders, partners or members (or the
equivalent of any thereof), or any option, warrant or other right to acquire any
such dividend or other distribution or payment. Without limiting the foregoing,
"Restricted Payments" with respect to any Person shall also include all payments
made by such
"
S&P
" means
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc. and any successor thereto.
"
Sarbanes-Oxley
" means
the Sarbanes-Oxley Act of 2002.
"
SEC
" means the
Securities and Exchange Commission, or any Governmental Authority succeeding to
any of its principal functions.
"
Secured Obligations
"
means all Obligations, all Guaranteed Obligations and all Other
Liabilities.
"
Secured Parties
" has
the meaning set forth in the Security Agreement.
"
Securities Laws
"
means the Securities Act of 1933, the Securities Exchange Act of 1934,
Sarbanes-Oxley, and the applicable accounting and auditing principles, rules,
standards and practices promulgated, approved or incorporated by the SEC or the
PCAOB.
"
Security Agreement
"
means the Security Agreement dated as of the Closing Date among the Loan Parties
and the Collateral Agent.
"
Security Documents
"
means the Security Agreement, the Blocked Account Agreements, the Securities
Account Control Agreements, the DDA Notifications, the Credit Card
Notifications, the Mortgages and each other security agreement or other
instrument or document executed and delivered to the Collateral Agent pursuant
to this Agreement or any other Loan Document granting a Lien to secure any of
the Secured Obligations (including, without limitation, any Lien that may be
granted from time to time upon all or any portion of the Excluded
Assets).
"
Sellers
" means
Leonard Riggio and Louise Riggio.
"
Seller Notes
" means the Junior Subordinated Seller Note and the Senior Subordinated Seller
Note.
"
Senior Subordinated Seller
Note
" means that certain Senior Subordinated Seller Note dated as of the
date hereof by the Lead Borrower in favor of the Sellers in an original
principal amount of $100,000,000 and having a maturity date of December 15,
2010, in the form of
Exhibit N
hereto.
"
Settlement Date
" has
the meaning provided in
Section
2.14(a)
.
"
Shareholders’ Equity
"
means, as of any date of determination, consolidated shareholders’ equity of the
Lead Borrower and its Subsidiaries as of that date determined in accordance with
GAAP.
"
Shrink
" means Inventory which has been lost,
misplaced, stolen, or is otherwise unaccounted
for.
"
Solvent
" and "
Solvency
" means, with
respect to any Person on a particular date, that on such date (a) at fair
valuation, the value of all of the properties and assets of such Person are
greater than the sum of the debts, including contingent liabilities, of such
Person, (b) the present fair saleable value of the
properties and assets of such Person is not less than the amount
that would be required to pay the probable liability of such Person on its debts
as they become absolute and matured, (c) such Person is able to realize upon its
properties and assets and pay its debts and other liabilities, contingent
obligations and other commitments as they mature in the normal course of
business, (d) such Person does not intend to, and does not believe that it will,
incur debts beyond such Person’s ability to pay as such debts mature, and (e)
such Person is not engaged in a business or a transaction, and is not about to
engage in a business or transaction, for which such Person’s properties and
assets would constitute unreasonably small capital after giving due
consideration to the prevailing practices in the industry in which such Person
is engaged. The amount of all guarantees at any time shall be computed as the
amount that, in light of all the facts and circumstances existing at the time,
can reasonably be expected to become an actual or matured
liability.
"
Specified Default
"
means any event or condition that constitutes, or with the passage of time would
constitute, an Event of Default under any of clauses (a), (b) (solely with
respect to
Section
7.15
), (f), (g), (k) or (l) of
Section
8.01
.
"
Specified
Indebtedness
" means Permitted Senior Debt or Subordinated
Indebtedness.
"
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.
"
Stated Amount
" means
at any time the maximum amount for which a Letter of Credit may be
honored.
"
Statutory Reserve
Rate
" means a fraction (expressed as a decimal), the numerator of which
is the number one and the denominator of which is the number one minus the
aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the
FRB to which the Administrative Agent is subject with respect to the Adjusted
LIBO Rate, for eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. LIBO Rate Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.
"
Store
" means any
retail store (which may include any real property, fixtures, equipment,
inventory and other property related thereto) operated, or to be operated, by
any Loan Party.
"
Subordinated
Indebtedness
" means (a) the Seller Notes and (b) other Indebtedness which
is expressly subordinated in right of payment to the prior payment in full of
the Secured Obligations and which is in form and on terms approved in writing by
the Administrative Agent.
"
Subsidiary
" of a
Person means a corporation, partnership, joint venture, limited liability
company or other business entity of which a majority of the shares Equity
Interests having ordinary voting power for the election of directors or other
governing body (other than securities or interests having such power only by
reason of the happening of a contingency) are at the time beneficially owned, or
the management of which is otherwise controlled, directly, or indirectly through
one or more
"
Super-Majority Required
Lenders
" means, as of any date of determination, Lenders holding more
than 66.67% of the Aggregate Commitments or, if the commitment of each Lender to
make Loans and the obligation of the LC Issuer to make LC Credit Extensions have
been terminated pursuant to
Section 8.02
, Lenders
holding in the aggregate more than 66.67% of the Total Outstandings (with
the
aggregate
amount of each Lender’s risk participation and funded participation in LC
Obligations and Swing Line Loans being deemed "held" by such Lender for purposes
of this definition); provided that the Commitment of, and the portion of the
Total Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Super-Majority Required
Lenders.
"
Surveys
" has the
meaning specified in the definition of Real Estate Eligibility
Requirements.
"
Swap Contract
" means
(a) any and all rate swap transactions, basis swaps, credit derivative
transactions, forward rate transactions, commodity swaps, commodity options,
forward commodity contracts, equity or equity index swaps or options, bond or
bond price or bond index swaps or options or forward bond or forward bond price
or forward bond index transactions, interest rate options, forward foreign
exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions,
currency options, spot contracts, or any other similar transactions or any
combination of any of the foregoing (including any options to enter into any of
the foregoing), whether or not any such transaction is governed by or subject to
any master agreement, and (b) any and all transactions of any kind, and the
related confirmations, which are subject to the terms and conditions of, or
governed by, any form of master agreement published by the International Swaps
and Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement (any such master agreement, together
with any related schedules, a "Master Agreement"), including any such
obligations or liabilities under any Master Agreement.
"
Swap Termination
Value
" means, in respect of any one or more Swap Contracts, after taking
into account the effect of any legally enforceable netting agreement relating to
such Swap Contracts, (a) for any date on or after the date such Swap Contracts
have been closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (b) for any date prior to the date
referenced in clause (a), the amount(s) determined as the mark-to-market
value(s) for such Swap Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"
Swing Line
" means the
revolving credit facility made available by the Swing Line Lender pursuant to
Section
2.04
.
"
Swing Line Borrowing
"
means a borrowing of a Swing Line Loan pursuant to
Section
2.04
.
"
Swing Line Lender
"
means Bank of America in its capacity as provider of Swing Line Loans, or any
successor swing line lender hereunder.
"
Swing Line Loan
" has
the meaning specified in
Section
2.04(a)
.
"
Swing Line Loan
Notice
" means a notice of a Swing Line Borrowing pursuant to
Section
2.04(b)
, which, if in
writing, shall be substantially in the form of
Exhibit
B
.
"
Swing Line Sublimit
"
means an amount equal to the lesser of (a) $75,000,000 and (b) the Aggregate
Commitments. The Swing Line Sublimit is part of, and not in addition to, the
Aggregate Commitments.
"
Synthetic Lease
Obligation
" means the monetary obligation of a Person under (a) a
so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property (including sale and leaseback
transactions), in each case, creating obligations that do not appear on the
balance sheet of such Person but which, upon the application of any Debtor
Relief Laws to such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
"
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.
"
Termination Date
"
means the earliest to occur of (i) the Maturity Date, (ii) the date on which the
maturity of the Obligations is accelerated (or deemed accelerated) and the
Commitments are irrevocably terminated (or deemed terminated) in accordance with
Article VIII
or
(iii) the termination of the Commitments in accordance with
Section 2.06
hereof.
"
Title Policy
" has the
meaning specified in the definition of Real Estate Eligibility
Requirements.
"
Total Outstandings
"
means the aggregate Outstanding Amount of all Loans and all LC
Obligations.
"
Trading with the Enemy
Act
" has the meaning set forth in
Section
10.18
.
"
Trigger Event
" means
(a) the occurrence and continuance of an Event of Default, (b) the failure of
the Borrowers to maintain Availability at least equal to the greater of (i)
twenty percent (20.0%) of the Loan Cap or (ii) $135,000,000 and such failure
shall continue for a period of five (5) or more consecutive calendar days or (c)
the failure of the Borrowers maintain at all times Availability at least equal
to seventeen percent (17.0%) of the Loan Cap. The failure under clauses (b) or
(c) hereof is referred to herein as an "
Availability
Event
".
"
Trigger Period
" means
the period beginning upon the occurrence of a Trigger Event and ending on (a) if
such Trigger Event arises as a result of an Event of Default, the date such
Event of Default is waived in accordance with this Agreement, or (b) if such
Trigger Event arises as a result of an Availability Event, the date Availability
has equaled or exceeded the greater of (i) twenty percent (20.0%) of the Loan
Cap or (ii) $135,000,000 for a period of forty-five (45) consecutive calendar
days;
provided
,
however
, that
if any Trigger Event shall have occurred and the resulting Trigger Period ended
for any
reason
hereunder on three (3) occasions, the Trigger Period for any subsequent (fourth)
Trigger Event shall be unlimited in duration and such Trigger Period shall
continue for the remainder of the term of this Agreement.
"
Trigger Period Compliance
Certificate
" has the meaning set forth in
Section
6.02(a)
.
"
Type
" means, with
respect to a Committed Loan, its character as a Base Rate Loan or a LIBO Rate
Loan.
"
UCC
" or "
Uniform Commercial
Code
" means the Uniform Commercial Code as in effect from time to time in
the State of New York; provided, however, that if a term is defined in Article 9
of the Uniform Commercial Code differently than in another Article thereof, the
term shall have the meaning set forth in Article 9; provided further that, if by
reason of mandatory provisions of law, perfection, or the effect of perfection
or non-perfection, of a security interest in any Collateral or the availability
of any remedy hereunder is governed by the Uniform Commercial Code as in effect
in a jurisdiction other than the State of New York, "Uniform Commercial Code"
means the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions hereof relating to such perfection or effect of
perfection or non-perfection or availability of such remedy, as the case may
be.
"
UFCA
" has the meaning
specified in
Section
10.21(d)
.
"
UFTA
" has the meaning
specified in
Section
10.21(d)
.
"
Unfunded Pension
Liability
" means the excess of a Pension Plan’s benefit liabilities under
Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s
assets, determined in accordance with the assumptions used for funding the
Pension Plan pursuant to Section 412 of the Code for the applicable plan
year.
"
United States
" and
"
U.S.
" mean the
United States of America.
"
Unreimbursed Amount
"
has the meaning specified in
Section
2.03(c)(i)
.
1.02
Other
Interpretive Provisions
. With reference to this Agreement and each other
Loan
Document,
unless otherwise specified herein or in such other Loan Document:
(a) The
definitions of terms herein shall apply equally to the singular and plural forms
of the terms defined. Whenever the context may require, any pronoun shall
include the corresponding masculine, feminine and neuter forms. The words "
include
," "
includes
" and "
including
" shall be
deemed to be followed by the phrase "without limitation." The word "
will
" shall be
construed to have the same meaning and effect as the word "
shall
." Unless the
context requires otherwise, (i) any definition of or reference to any agreement,
instrument or other document (including any Organization Document) shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein
or in any other Loan Document), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words
"
herein
,"
"
hereof
" and
"
hereunder
,"
and words of similar import when used in any Loan Document, shall be construed
to refer to such Loan Document in its entirety and not to any particular
provision thereof, (iv) all references in a Loan Document to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, the Loan Document in which such references
appear, (v) any reference to any law shall include all statutory and regulatory
provisions consolidating, amending replacing or interpreting such law and any
reference to any law or regulation shall, unless otherwise specified, refer to
such law or regulation as amended, modified or supplemented from time to time,
(vi) the words
(b) In
the computation of periods of time from a specified date to a later specified
date, the word "
from
" means "
from and including
;"
the words "
to
"
and "
until
"
each mean "
to
but
excluding
;" and the
word "
through
"
means "
to and
including
."
(c) Section
headings herein and in the other Loan Documents are included for convenience of
reference only and shall not affect the interpretation of this Agreement or any
other Loan Document.
(a)
Generally
. All
accounting terms not specifically or completely defined herein
shall be
construed in conformity with, and all financial data (including financial ratios
and other financial calculations) required to be submitted pursuant to this
Agreement shall be prepared in conformity with, GAAP applied on a consistent
basis, as in effect from time to time, applied in a manner consistent with that
used in preparing the Audited Financial Statements,
except
as otherwise
specifically prescribed herein.
(b)
Changes in GAAP
. If
at any time any change in GAAP would affect the
computation of
any financial ratio or requirement set forth in any Loan Document, and either
the Lead Borrower or the Required Lenders shall so request, the Administrative
Agent, the Lenders and the Lead Borrower shall negotiate in good faith to amend
such ratio or requirement to preserve the original intent thereof in light of
such change in GAAP (subject to the approval of the Required Lenders);
provided that
, until
so amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Lead Borrower
shall provide to the Administrative Agent and the Lenders financial statements
and other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in
GAAP.
1.04
Rounding
.
Any financial ratios required to be maintained by the Borrowers pursuant to
this
Agreement shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by
which such ratio is expressed herein and rounding the result up or down to the
nearest number (with a rounding-up if there is no nearest number).
1.05
Times of
Day
. Unless otherwise specified, all references herein to times of day
shall be
references
to Eastern time (daylight or standard, as applicable).
1.06
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 Stated 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 or by the terms of any Issuer
Documents related thereto, provides for one or more automatic increases in the
Stated Amount thereof, the amount of such Letter of Credit shall be deemed to be
the maximum Stated Amount of such Letter of Credit after giving effect to all
such increases, whether or not such maximum Stated Amount is in effect at such
time.
1.07
Covenant
Adjustments
.
(a)
Covenant Acquisition
Adjustments
. Except as otherwise expressly provided
herein, for
purposes of calculating the financial covenant in
Section 7.15
for any
period (or a portion of a period) that includes the date of the consummation of
any Permitted Acquisition, references to “Lead Borrower and its Subsidiaries”
shall include each acquired Person, or lines of business, as applicable, and the
EBITDA (and each other component of such financial covenant) of such acquired
Person or line of business (such EBITDA to be formulated on the basis of the
definition of Consolidated EBITDA set forth herein), as if the Acquisition had
been consummated on the first day of any such period of
measurement.
(b)
Covenant Disposition
Adjustments
. Except as otherwise expressly provided
herein, for
purposes of calculating the financial covenant in
Section 7.15
for any
period (or a portion of a period) that includes the date of any Disposition of a
Subsidiary or line of business, as applicable, Consolidated EBITDA shall be
determined on a historical pro forma basis to exclude the results of operations
of such Subsidiary or line of business, as applicable so disposed.
1.09
Exclusion
of Certain Subsidiaries
. In no event shall Chelsea Insurance Company
Ltd.
be
required to be a Loan Party.
1.10
Notices
Generally
. Unless otherwise expressly provided herein, any notice
required to
be
provided by the Loan Parties shall be substantially in the form of notice
attached as
Exhibit
O
hereto.
ARTICLE
II
THE
COMMITMENTS AND CREDIT EXTENSIONS
2.01
Committed
Loans; Reserves
. (a) Subject to the terms and conditions set forth
herein,
each Lender
severally agrees to make loans (each such loan, a "
Committed Loan
") to
the Borrowers from time to time, on any Business Day during the Availability
Period, in an aggregate outstanding amount not to exceed at any time the lesser
of (x) the amount of such Lender’s Commitment, or (y) such Lender’s Applicable
Percentage of the Borrowing Base, subject in each case to the following
limitations:
(i)
after giving effect to any Committed Borrowing, the Total Outstandings shall not
exceed the Loan Cap,
(ii)
after giving effect to any Committed Borrowing, the aggregate Outstanding Amount
of the Committed Loans of any Lender,
plus
such Lender’s
Applicable Percentage of the Outstanding Amount of all LC Obligations,
plus
such Lender’s
Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall
not exceed such Lender’s Commitment,
(iii)
the Outstanding Amount of all LC Obligations shall not at any time exceed the
Letter of Credit Sublimit
Within
the limits of each Lender’s Commitment, and subject to the other terms and
conditions hereof, the Borrowers may borrow under this
Section 2.01
, prepay
under
Section
2.05
, and reborrow under this
Section 2.01
.
Committed Loans may be Base Rate Loans or LIBO Rate Loans, as further
provided
herein.
(c) The
Administrative Agent shall (i) have the right, at any time and from time to time
after the Closing Date in its Permitted Discretion to establish, and modify or
eliminate Reserves, and (ii) so long as no Trigger Period shall exist, shall
give the Lead Borrower two (2) Business Days prior written notice before any
such change becomes effective.
2.02
Borrowings,
Conversions and Continuations of Committed Loans
.
(a)
Committed Loans (other than Swing Line Loans) shall be either Base Rate Loans or
LIBO Rate Loans as the Lead Borrower may request subject to and in accordance
with this
Section
2.02
. All Swing Line
Loans shall be only Base Rate Loans. Subject to the other provisions of
this
Section
2.02
, Committed Borrowings of more than one Type may be incurred at the
same time.
(b) Each
Committed Borrowing shall be made upon the Lead Borrower’s irrevocable (except
as otherwise provided in
Section 3.03
) notice
to the Administrative Agent, which may be given by telephone. Each such notice
must be received by the Administrative Agent not later than 1:00 p.m. (i) three
(3) Business Days prior to the requested date of any Borrowing of LIBO Rate
Loans, and (ii) on the requested date of any Borrowing of Base Rate Loans. Each
telephonic notice by the Lead Borrower pursuant to this
Section 2.02(b)
must
be confirmed promptly by delivery to the Administrative Agent of a written
Committed Loan Notice, appropriately completed and signed by a Responsible
Officer of the Lead Borrower. Each Borrowing of LIBO Rate Loans shall be in a
principal amount of $5,000,000.00 or a whole multiple of $1,000,000 in excess
thereof. Except as provided in
Sections 2.03(c)
and
2.04(c)
, each
Borrowing of Base Rate Loans shall be in a principal amount of not less than
$500,000 and integral multiples of $100,000 in excess thereof. Each Committed
Loan Notice (whether telephonic or written) shall specify (i) the requested date
of the Borrowing (which shall be a Business Day), (ii) the principal amount of
Committed Loans to be borrowed, (iii) the Type of Committed Loans to be
borrowed, and (iv) if applicable, the duration of the Interest Period with
respect thereto. If the Lead Borrower fails to specify a Type of Committed Loan
in a Committed Loan Notice, then the applicable Committed Loans shall be made as
Base Rate Loans. If the Lead Borrower requests a Borrowing of LIBO Rate Loans in
any such Committed Loan Notice, but fails to specify an Interest Period, it will
be deemed to have specified an Interest Period of one month. Following receipt
of a Committed Loan Notice, the Administrative Agent shall promptly notify each
Lender of the amount of its Applicable Percentage of the applicable Committed
Loans, and each Lender shall make the amount of its Committed Loan available to
the Administrative Agent in immediately available funds at the Administrative
Agent’s Office not later than 3:00 p.m. on the Business Day specified in the
applicable Committed Loan Notice. Upon satisfaction of the applicable conditions
set forth in
Section
4.02
(and, if such Borrowing is the initial Credit Extension,
Section 4.01
), the
Administrative Agent shall use reasonable efforts to make all funds so
received
available to
the Borrowers in like funds by no later than 4:00 p.m. on the day of receipt by
the Administrative Agent either by (i) crediting the account of the Lead
Borrower on the books of Bank of America with the amount of such funds or (ii)
wire transfer of such funds, in each case in accordance with instructions
provided to (and reasonably acceptable to) the Administrative Agent by the Lead
Borrower;
provided
,
however
, that if, on
the date the Committed Loan Notice with respect to such Borrowing is
given by the
Lead Borrower, there are LC Borrowings outstanding, then the proceeds of such
Borrowing,
first
, shall be
applied to the payment in full of any such LC Borrowings, and
second
, shall be
made
available to
the Borrowers as provided above.
(c) Each
conversion of Committed Loans from one Type to the other and each continuation
of LIBO Rate Loans shall be made upon the Lead Borrower’s irrevocable notice to
the
Administrative Agent, which may be given by telephone. Each such
notice must be received by the Administrative Agent not later than 1:00 p.m.
three (3) Business Days prior to the requested date of any conversion to or
continuation of LIBO Rate Loans or of any conversion of LIBO Rate Loans to Base
Rate Loans. Each telephonic notice by the Lead Borrower pursuant to this
Section 2.02(c)
must
be confirmed promptly by delivery to the Administrative Agent of a written
Conversion/Continuation Notice, appropriately completed and signed by a
Responsible Officer of the Lead Borrower. Each conversion to or continuation of
LIBO Rate Loans shall be in a principal amount of $5,000,000 or a whole multiple
of $1,000,000 in excess thereof. Except as provided in
Sections 2.03(c)
and
2.04(c)
, each
conversion to or continuation of Base Rate Loans shall be in a principal amount
of not less than $500,000 and integral multiples of $100,000 in excess thereof.
Each Conversion/Continuation Notice (whether telephonic or written) shall
specify (i) whether the Borrowers are requesting a conversion of Committed Loans
from one Type to the other or a continuation of LIBO Rate Loans, (ii) the
requested date of the conversion or continuation, as the case may be (which
shall be a Business Day), (iii) the principal amount of Committed Loans to be
converted or continued, (iv) the Type of Committed Loans to which existing
Committed Loans are to be converted, and (v) if applicable, the duration of the
Interest Period with respect thereto. If the Lead Borrower fails to give a
timely notice of a conversion or continuation in a Conversion/Continuation
Notice, then the applicable Committed Loans shall be converted to Base Rate
Loans. Any such automatic conversion to Base Rate Loans shall be effective as of
the last day of the Interest Period then in effect with respect to the
applicable LIBO Rate Loans. If the Lead Borrower requests a conversion to or
continuation of LIBO Rate Loans in a Conversion/Continuation Notice, but fails
to specify an Interest Period, it will be deemed to have specified an Interest
Period of one month. Notwithstanding anything to the contrary herein, a Swing
Line Loan may not be converted to a LIBO Rate Loan. If no timely notice of a
conversion or continuation in a Conversion/Continuation Notice is provided by
the Lead Borrower, the Administrative Agent shall notify each Lender of the
details of any automatic conversion to Base Rate Loans described in this
Section
2.03(c)
.
(d)
The Administrative Agent, without the request of the Lead Borrower, may advance
any interest, fee, service charge, Credit Party Expenses, or other payment to
which any Credit Party is entitled from the Loan Parties pursuant hereto or any
other Loan Document and may charge the same to the Loan Account notwithstanding
that an Overadvance may result thereby,
provided
, that no
such charge shall increase the time that any such Permitted Overadvance may
remain outstanding. The Administrative Agent shall advise the Lead Borrower of
any such advance or charge promptly 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 Borrowers’ obligations under
Sections 2.05(c)
,
2.05(d)
or
2.05(e)
. Any
amount which is added to the principal balance of the Loan Account as provided
in this
Section
2.02(b)
shall
bear interest at the interest rate then and thereafter applicable to Base Rate
Loans.
(e)
Except as otherwise provided herein, a LIBO Rate Loan may be continued or
converted only on the last day of an Interest Period for such LIBO Rate Loan.
During the existence of a Default, no Loans may be requested as, converted to or
continued as LIBO Rate Loans without the Consent of the Required
Lenders.
(f)
The Administrative Agent shall promptly notify the Lead Borrower and the Lenders
of the interest rate applicable to any Interest Period for LIBO Rate Loans upon
determination of such interest rate. At any time that Base Rate Loans are
outstanding, the Administrative Agent shall notify the Lead Borrower and the
Lenders of any change in Bank of America’s prime rate used in determining the
Base Rate promptly following the public announcement of such
change.
(g)
After giving effect to all Committed Borrowings, all conversions of Committed
Loans from one Type to the other, and all continuations of Committed Loans as
the same Type, there shall not be more than seven (7) Interest Periods in effect
with respect to Committed Loans.
(h) The Administrative Agent, the Lenders, the Swing Line Lender and
the LC Issuer shall have no obligation to make any Loan or to provide any Letter
of Credit if an Overadvance would result. The Administrative Agent may, in its
discretion, make Permitted Overadvances without the consent of the Lenders, the
Swing Line Lender and the LC Issuer and each Lender shall be bound thereby;
provided
,
however
, that the
Administrative Agent shall cease making Permitted Overadvances if so directed by
the Required Lenders. Any Permitted Overadvance may constitute a Swing Line
Loan. A Permitted Overadvance is for the account of the Borrowers and shall
constitute a Loan and an Obligation and shall be repaid by the Borrowers in
accordance with the provisions of
Section 2.05(e)
. The
making of any such Permitted Overadvance on any one occasion shall not obligate
the Administrative Agent or any Lender to make or permit any Permitted
Overadvance on any other occasion or to permit such Permitted Overadvances to
remain outstanding. The making by the Administrative Agent of a Permitted
Overadvance 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 2.04
regarding the Lenders’ obligations to purchase participations with respect to
Swing Line Loans. The Administrative Agent shall have no liability for, and no
Loan Party or Credit Party shall have the right to, or shall, bring any claim of
any kind whatsoever against the Administrative Agent with respect to
"inadvertent Overadvances" (i.e. where an Overadvance results from changed
circumstances beyond the control of the Administrative Agent (such as a
reduction in the collateral value)) regardless of the amount of any such
Overadvance(s).
(a)
The Letter of Credit
Commitment
.
(i) Subject
to the terms and conditions set forth herein, (A) the LC Issuer agrees, in
reliance upon the agreements of the Lenders set forth in this
Section 2.03
, (1)
from time to time on any Business Day during the period from the Closing Date
until the Termination Date, to issue Letters of Credit for the account of the
Borrowers, and to amend or extend Letters of Credit previously issued by it, in
accordance with
Section 2.03(b)
below, and (2) to honor drawings under the Letters of Credit; and (B) the
Lenders severally agree to participate in Letters of Credit issued for the
account of the Borrowers and any drawings thereunder;
provided
that after
giving effect to any LC Credit Extension with respect to any Letter of Credit,
(x) the Total Outstandings shall not exceed the lesser of (1) the Aggregate
Commitments and (2) the Borrowing Base, (y) the aggregate Outstanding Amount of
the Committed Loans of any Lender,
plus
such Lender’s
Applicable Percentage of the Outstanding Amount of all LC Obligations,
plus
such Lender’s
Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall
not exceed such Lender’s Commitment, and (z) the Outstanding Amount of the LC
Obligations shall not exceed the Letter of Credit Sublimit. Each request by the
Lead Borrower for the issuance or amendment of a Letter of Credit shall be
deemed to be a representation by the Borrowers that the LC Credit Extension so
requested complies with the conditions set forth in the proviso to the preceding
sentence. Within the foregoing limits, and subject to the terms and conditions
hereof, the Borrowers’ ability to obtain Letters of Credit shall be fully
revolving, and accordingly the Borrowers may, during the foregoing period,
obtain Letters of Credit to replace Letters of Credit that have expired or that
have been drawn upon and reimbursed. Any LC Issuer (other than Bank of America
or any of its Affiliates) shall notify the Administrative Agent in writing on
each Business Day of all Letters of Credit issued on the prior Business Day by
such LC Issuer,
provided
that (A)
until the Administrative Agent advises any such LC Issuer that the provisions of
Section 4.02
are not satisfied, or (B) 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 the LC Issuer, such LC Issuer shall be required to so notify the
Administrative Agent in writing only once each week of the Letters of Credit
issued by such LC Issuer 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 LC Issuer may agree.
All
(ii)
The LC Issuer shall not issue any
Letter of Credit, if:
(A)
subject to
Section
2.03(b)(iii)
, the expiry date of a requested Standby Letter of Credit
would occur more than twelve months after the date of issuance or last
extension, unless the LC Issuer and the Administrative Agent each consent, in
their sole discretion, to a later expiry date; or
(B)
the expiry date of a requested Commercial Letter of Credit would occur more than
180 days after the date of issuance or last extension, unless the LC Issuer and
the Administrative Agent each consent, in their sole discretion, to a later
expiry date; or
(C)
the expiry date of any requested Letter of Credit would occur after the fifth
day prior to the Letter of Credit Expiration Date, unless such Letter of Credit
is required to be (and at the applicable time is) Cash Collateralized on or
prior to the thirtieth day prior to the Letter of Credit Expiration
Date.
(iii) The
LC Issuer shall not issue any Letter of Credit without the prior consent of the
Administrative Agent if:
(A)
any order, judgment or decree of any Governmental Authority or arbitrator shall
by its terms purport to enjoin or restrain the LC Issuer from issuing such
Letter of Credit, or any Law applicable to the LC Issuer or any request or
directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over the LC Issuer shall prohibit, or request that
the LC Issuer refrain from, the issuance of letters of credit generally or such
Letter of Credit in particular or shall impose upon the LC Issuer with respect
to such Letter of Credit any restriction, reserve or capital requirement (for
which the LC Issuer is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon the LC Issuer any unreimbursed loss, cost or
expense which was not applicable on the Closing Date and which the LC Issuer in
good faith deems material to it;
(B) the
issuance of such Letter of Credit would violate one or more policies of the LC
Issuer applicable to letters of credit generally;
(C) such
Letter of Credit is to be denominated in a currency other than Dollars;
provided
that if the
LC Issuer, in its discretion, issues a Letter of Credit denominated in a
currency other than Dollars, all reimbursements by the Borrowers of the honoring
of any drawing under such Letter of Credit shall be paid in the currency in
which such Letter of Credit was denominated;
(D) such
Letter of Credit contains any provisions for automatic reinstatement of the
Stated Amount after any drawing thereunder; or
(E) a
default of any Lender’s obligations to fund under
Section
2.03(c)
exists or any
Lender is at such time a Defaulting Lender or Deteriorating Lender
hereunder,
unless the LC Issuer has entered into arrangements satisfactory to the LC Issuer
with the Borrowers or such Lender to eliminate the LC Issuer’s risk with respect
to such Lender.
(v) The
LC Issuer shall act on behalf of the Lenders with respect to any Letters of
Credit issued by it and the documents associated therewith, and the LC Issuer
shall have all of the benefits and immunities (A) provided to the Administrative
Agent in
Article
IX
with respect to any acts taken or omissions suffered by the LC Issuer
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 IX
included
the LC Issuer with respect to such acts or omissions, and (B) as additionally
provided herein with respect to the LC Issuer.
(b)
Procedures for Issuance and
Amendment of Letters of Credit; Auto-Extension
Letters of
Credit
.
(i) Each
Letter of Credit shall be issued or amended, as the case may be, upon the
request of the Lead Borrower delivered to the LC Issuer by mail or fax (with a
copy to the Administrative Agent) or online, consistent with past practice, in
the form of a Letter of Credit Application, appropriately completed and signed
(if delivered by mail or fax) by a Responsible Officer of the Lead Borrower.
Such Letter of Credit Application must be received by the LC Issuer and the
Administrative Agent not later than 11:00 a.m. at least three (3) Business Days
(or such other date and time as the Administrative Agent and the LC Issuer may
agree in a particular instance in their sole discretion) prior to the proposed
issuance date or date of amendment, as the case may be. In the case of a request
for an initial issuance of a Letter of Credit, such Letter of Credit Application
shall specify in form and detail satisfactory to the LC Issuer: (A) the proposed
issuance date of the requested Letter of Credit (which shall be a Business Day);
(B) the amount thereof; (C) the expiry date thereof; (D) the name and address of
the beneficiary thereof; (E) the documents to be presented by such beneficiary
in case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (G) such
other matters as the LC Issuer may require. In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit Application
shall specify in form and detail satisfactory to the LC Issuer (A) the Letter of
Credit to be amended; (B) the proposed date of amendment thereof (which shall be
a Business Day); (C) the nature of the proposed amendment; and (D) such other
matters as the LC Issuer may require. Additionally, the Lead Borrower shall
furnish to the LC Issuer and the Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or amendment,
including any Issuer Documents, as the LC Issuer or the Administrative Agent may
require.
(ii) Promptly
after receipt of any Letter of Credit Application, the LC Issuer will confirm
with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has been notified thereof by the Borrowers. Unless the LC
Issuer has received written notice from any Lender, the Administrative Agent or
any Loan Party, at least one Business Day prior to the requested date of
issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in
Article IV
shall not
then be satisfied, then, subject to the terms and conditions hereof, the LC
Issuer shall, on the requested date, issue a Letter of Credit for the account of
the applicable Borrower (or the applicable Subsidiary) or enter into the
applicable amendment, as the case may be, in each case in accordance with the LC
Issuer's usual and customary business practices. Immediately upon the issuance
or amendment of each Letter of Credit, each Lender shall be deemed to (without
any further action), and hereby irrevocably and unconditionally agrees to,
purchase from the LC Issuer, without recourse or warranty, a risk participation
in such Letter of Credit in an amount equal to the product of such Lender’s
Applicable Percentage
times
the amount of
such Letter of Credit. Upon any change in the Commitments
(iii) If
the Lead Borrower so requests in any applicable Letter of Credit Application,
the LC Issuer 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 LC Issuer 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 LC Issuer, the Lead Borrower shall not be required to
make a specific request to the LC Issuer 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 LC Issuer to permit the extension of
such Standby Letter of Credit at any time to an expiry date not later than
twelve months following the Letter of Credit Expiration Date;
provided
,
however
, that the LC
Issuer shall not permit any such extension if (A) the LC Issuer 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 clauses (ii) or (iii) of
Section 2.03(a)
or
otherwise), or (B) it 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 Lead Borrower that one or more of the applicable
conditions specified in
Section 4.02
is not
then satisfied, and in each such case directing the LC Issuer not to permit such
extension.
(iv) Promptly
after its delivery of any Letter of Credit or any amendment to a Letter of
Credit to an advising bank with respect thereto or to the beneficiary thereof,
the LC Issuer will also deliver to the Lead Borrower and the Administrative
Agent a true and complete copy of such Letter of Credit or
amendment.
(c)
Drawings
and Reimbursements; Funding of Participations
.
(i) Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the LC Issuer shall notify the Lead Borrower and
the Administrative Agent thereof;
provided
,
however
, that any
failure to give or delay in giving such notice shall not relieve the Borrowers
of their obligation to reimburse the LC Issuer and the Lenders with respect to
any such payment. Not later than 11:00 a.m. on the Business Day following the
date of any payment by the LC Issuer under a Letter of Credit (each such date,
an "
Honor
Date
"), the Borrowers shall reimburse the LC Issuer through the
Administrative Agent in an amount equal to the amount of such drawing. If the
Borrowers fail to so reimburse the LC Issuer by such time, the Administrative
Agent shall promptly notify each Lender of the Honor Date, the amount of the
unreimbursed drawing (the "
Unreimbursed
Amount
"), and the amount of such Lender’s Applicable Percentage thereof.
In such event, the Borrowers shall be deemed to have requested a Committed
Borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and multiples
specified in
Section
2.02
for the principal amount of Base Rate Loans, but subject to the
amount of the unutilized portion of the Aggregate Commitments and the conditions
set forth in
Section
4.02
(other than the delivery of a Committed Loan Notice). Any notice
given by the LC Issuer or the Administrative Agent pursuant to this
Section 2.03(c)(i)
may be given by telephone if immediately confirmed in writing;
provided
that the
lack of such an immediate confirmation shall not affect the conclusiveness or
binding effect of such notice.
(iii) With
respect to any Unreimbursed Amount that is not fully refinanced by a Committed
Borrowing of Base Rate Loans because the conditions set forth in
Section 4.02
cannot
be satisfied or for any other reason, the Borrowers shall be deemed to have
incurred from the LC Issuer an LC Borrowing in the amount of the Unreimbursed
Amount that is not so refinanced, which LC Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at the Default Rate. In
such event, each Lender’s payment to the Administrative Agent for the account of
the LC Issuer pursuant to
Section 2.03(c)(ii)
shall be deemed payment in respect of its participation in such LC Borrowing and
shall constitute an LC Advance from such Lender in satisfaction of its
participation obligation under this
Section
2.03
.
(iv) Until
each Lender funds its Committed Loan or LC Advance pursuant to this
Section 2.03(c)
to
reimburse the LC Issuer for any amount drawn under any Letter of Credit,
interest in respect of such Lender’s Applicable Percentage of such amount shall
be solely for the account of the LC Issuer.
(v) Each
Lender’s obligation to make Committed Loans or LC Advances to reimburse the LC
Issuer for amounts drawn under Letters of Credit, as contemplated by this
Section
2.03(c)
, shall be
absolute and unconditional and shall not be affected by any circumstance,
including (A)
any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against the LC Issuer, any 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
Lender’s obligation to make Committed Loans pursuant to this
Section 2.03(c)
is
subject to the conditions set forth in
Section 4.02
(other
than delivery by the Lead Borrower of
a Committed
Loan Notice). No such making of an LC Advance shall relieve or otherwise impair
the obligation of the Borrowers to reimburse the LC Issuer for the amount of any
payment made by the LC Issuer under any Letter of Credit, together with interest
as provided herein.
(vi) If
any Lender fails to make available to the Administrative Agent for the account
of the LC Issuer any amount required to be paid by such Lender pursuant to the
foregoing provisions of this
Section 2.03(c)
by
the time specified in
Section 2.03(c)(ii)
,
the LC Issuer shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to the LC Issuer at a rate per annum equal to the
greater of the Federal Funds Rate and a rate determined by the LC Issuer in
accordance with banking industry rules on interbank compensation plus any
administrative, processing or similar fees customarily charged by the LC Issuer
in connection with the foregoing. If such Lender pays such amount (with interest
and fees as aforesaid), the amount so paid shall constitute such Lender’s
Committed Loan included in the relevant Committed Borrowing or LC Advance in
respect of the relevant LC Borrowing, as the case may be. A certificate of the
LC Issuer submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (vi) shall be conclusive absent
manifest error.
(i) At
any time after the LC Issuer has made a payment under any Letter of Credit and
has received from any Lender such Lender’s LC Advance in respect of such payment
in accordance with
Section 2.03(c)
, if
the Administrative Agent receives for the account of the LC Issuer any payment
in respect of the related Unreimbursed Amount or interest thereon (whether
directly from the Borrowers or otherwise, including proceeds of Cash Collateral
applied thereto by the Administrative Agent), the Administrative Agent will
distribute to such Lender its Applicable Percentage thereof (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender’s LC Advance was outstanding) in the same funds as those
received by the Administrative Agent.
(ii) If
any payment received by the Administrative Agent for the account of the LC
Issuer pursuant to
Section 2.03(c)(i)
is
required to be returned under any of the circumstances described in
Section 10.05
(including pursuant to any settlement entered into by the LC Issuer in its
discretion), each Lender shall pay to the Administrative Agent for the account
of the LC Issuer its Applicable Percentage thereof on demand of the
Administrative Agent, plus interest thereon from the date of such demand to the
date such amount is returned by such Lender, at a rate per annum equal to the
Federal Funds Rate from time to time in effect. The obligations of the Lenders
under this clause shall survive the payment in full of the Secured Obligations
and the termination of this Agreement.
(e)
Obligations Absolute
.
The obligation of the Borrowers to reimburse the LC Issuer for each drawing
under each Letter of Credit and to repay each LC Borrowing shall be absolute,
unconditional and irrevocable, and shall be paid strictly in accordance with the
terms of this Agreement under all circumstances, including the
following:
(i) any
lack of validity or enforceability of such Letter of Credit, this Agreement, or
any other Loan Document;
(ii) the
existence of any claim, counterclaim, setoff, defense or other right that the
Borrowers or any Subsidiary may have at any time against any beneficiary or any
transferee of such Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting), the LC Issuer or any other Person,
whether in connection with this Agreement, the transactions contemplated hereby
or by such Letter of Credit or any agreement or instrument relating thereto, or
any unrelated transaction;
(iii) any
draft, demand, certificate or other document presented under such Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any respect
or any statement therein being untrue or inaccurate in any respect; or any loss
or delay in the transmission or otherwise of any document required in order to
make a drawing under such Letter of Credit;
(iv) any
payment by the LC Issuer under such Letter of Credit against presentation of a
draft or certificate that does not strictly comply with the terms of such Letter
of Credit; or any payment made by the LC Issuer under such Letter of Credit to
any Person purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of such
Letter of Credit, including any arising in connection with any proceeding under
any Debtor Relief Law;
(v) any
other circumstance or happening whatsoever, whether or not similar to any of the
foregoing, including any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Borrowers or any of their
Subsidiaries; or
The Lead
Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Lead Borrower’s instructions or other irregularity, the
Lead Borrower will immediately notify the LC Issuer. The Borrowers shall be
conclusively deemed to have waived any such claim against the LC Issuer and its
correspondents unless such notice is given as aforesaid.
(f)
Role of LC Issuer
.
Each Lender and the Borrowers agree that, in paying any drawing under a Letter
of Credit, the LC Issuer shall not have any responsibility to obtain any
document (other than any sight draft, certificates and documents expressly
required by the Letter of Credit) or to ascertain or inquire as to the validity
or accuracy of any such document or the authority of the Person executing or
delivering any such document. None of the LC Issuer, the Administrative Agent,
any of their respective Related Parties nor any correspondent, participant or
assignee of the LC Issuer shall be liable to any Lender for (i) any action taken
or omitted in connection herewith at the request or with the approval of the
Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted
in the absence of gross negligence or willful misconduct; (iii) any error,
omission, interruption, loss or delay in transmission or delivery of any draft,
notice or other communication under or relating to any Letter of Credit or any
error in interpretation of technical terms; or (iv) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or Issuer Document. The Borrowers hereby assume all
risks of the acts or omissions of any beneficiary or transferee with respect to
its use of any Letter of Credit;
provided
,
however
, that this
assumption is not intended to, and shall not, preclude the Borrowers’ pursuing
such rights and remedies as it may have against the beneficiary or transferee at
law or under any other agreement. None of the LC Issuer, the Administrative
Agent, any of their respective Related Parties nor any correspondent,
participant or assignee of the LC Issuer shall be liable or responsible for any
of the matters described in clauses (i) through (v) of
Section 2.03(e)
;
provided
,
however
, that
anything in such clauses to the contrary notwithstanding, the Borrowers may
have a claim
against the LC Issuer, and the LC Issuer may be liable to the Borrowers, to the
extent, but only to the extent, of any direct, as opposed to consequential or
exemplary, damages suffered by the Borrowers which the Borrowers prove were
caused by the LC Issuer's willful misconduct or gross negligence, bad faith or
the LC Issuer's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing, the LC Issuer may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary
(or the LC Issuer may refuse to accept and make payment upon such documents if
such documents are not in strict compliance with the terms of such Letter of
Credit), and except as expressly stated above, the LC Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
(g)
Cash
Collateral
. Upon the request of the Administrative Agent or
the LC Issuer,
(i) if
the LC Issuer has honored any full or partial drawing request under any Letter
of Credit and such drawing has resulted in an LC Borrowing, or (ii) if, as of
the thirtieth day prior to the Letter of Credit Expiration Date, any LC
Obligation for any reason remains outstanding, the Borrowers shall, in each
case, immediately Cash Collateralize the then Outstanding Amount of all LC
Obligations. The Borrowers hereby grant to the Collateral Agent a security
interest in all such Cash Collateral and all proceeds thereof. Cash Collateral
shall be maintained in blocked, non-interest bearing deposit accounts at Bank of
America except that, other than during the continuance of an Event of Default,
Permitted Investments of the type listed in
Section 7.02(b)
may
be made at the request of the Lead Borrower at the option and in the sole
discretion of the Collateral Agent (and at the Borrowers’ risk and expense) and
interest or profits, if
any, on such investments shall accumulate in such account. If at any
time the Collateral Agent determines that any funds held as Cash Collateral are
subject to any right or claim of any Person other than the Collateral Agent or
that the total amount of such funds is less than the aggregate Outstanding
Amount of all LC Obligations, the Borrowers will, forthwith upon demand by the
Collateral Agent, pay to the Collateral 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 Collateral Agent determines 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 LC Issuer and, to
the extent not so applied, shall thereafter be applied to satisfy other Secured
Obligations.
(h)
Applicability of ISP and
UCP
. Unless otherwise expressly agreed by the LC Issuer and the Lead
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 shall
apply to each Standby Letter of Credit, and (ii) the rules of the Uniform
Customs and Practice for Documentary Credits, as most recently published by the
International Chamber of Commerce at the time of issuance shall apply to each
Commercial Letter of Credit.
(i)
Letter of Credit
Fees
. The Borrowers shall pay to the Administrative Agent for the account
of each Lender in accordance with its Applicable Percentage a Letter of Credit
fee (the "
Letter of
Credit Fee
") for each Letter of Credit equal to the Applicable Rate for
LIBO Rate Loans
times
the maximum
daily amount available to be drawn under each such Letter of Credit (whether or
not such maximum amount is then in effect under such Letter of Credit). For
purposes of computing the daily amount available to be drawn under any Letter of
Credit, the amount of the Letter of Credit shall be determined in accordance
with
Section
1.06
. Letter of Credit Fees shall be (i) due and payable on the first
Business Day after the end of each March, June, September and December,
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
(ii) computed on a quarterly basis in arrears. If there is any change in the
Applicable Rate during any quarter, the daily amount available to be drawn under
each Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect. Notwithstanding anything to the contrary contained herein, while any
Event of Default exists, the Administrative Agent may, and upon the request of
the Required Lenders shall, notify the Lead Borrower that all Letter of Credit
Fees shall accrue at the Default Rate and thereafter such Letter of Credit Fees
shall accrue at the Default Rate to the fullest extent permitted by applicable
Laws.
(j)
Fronting Fee and Documentary
and Processing Charges Payable to LC Issuer
. The Borrowers shall pay
directly to the LC Issuer for its own account a fronting fee (i) with respect to
each commercial Letter of Credit, one-eighth of one percent (.125%), computed on
the amount of such Letter of Credit, and payable upon the issuance thereof, and
(ii) with respect to each standby Letter of Credit, one-eighth of one percent
(.125%) per annum, computed on the daily amount available to be drawn under such
Letter of Credit on a quarterly basis in arrears and payable on the first
Business Day after the end of each March, June, September and December in
respect of the most recently-ended quarterly period (or portion thereof, in the
case of the first payment), 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. For purposes of computing the daily amount available
to be drawn under any Letter of Credit, the amount of the Letter of Credit shall
be determined in accordance with
Section 1.06
. In
addition, the Borrowers shall pay directly to the LC Issuer for its own account
the customary issuance, presentation, amendment and other processing fees, and
other standard costs and charges, of the LC Issuer relating to letters of credit
as from time to time in effect. Such customary fees and standard costs and
charges are due and payable on demand and are nonrefundable.
(l)
Letters of Credit Issued for
Subsidiaries
. Notwithstanding that a Letter of Credit issued or
outstanding hereunder is in support of any obligations of, or is for the account
of, a Subsidiary, the Borrowers shall be obligated to reimburse the LC Issuer
hereunder for any and all drawings under such Letter of Credit. The Borrowers
hereby acknowledge that the issuance of Letters of Credit for the account of
Subsidiaries inures to the benefit of the Borrowers, and that the Borrowers’
business derives substantial benefits from the businesses of such
Subsidiaries.
2.04
Swing
Line Loans
.
(a)
The Swing Line
.
Subject to the terms and conditions set forth herein, the Swing Line Lender may,
in its discretion and in reliance upon the agreements of the other Lenders set
forth in this
Section
2.04
, make loans (each such loan, a "
Swing Line Loan
") to
the Lead Borrower from time to time on any Business Day during the Availability
Period in an aggregate amount not to exceed at any time outstanding the amount
of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans,
when aggregated with the Applicable Percentage of the Outstanding Amount of
Committed Loans and LC Obligations of the Lender acting as Swing Line Lender,
may exceed the amount of such Lender’s Commitment;
provided
,
however
, that after
giving effect to any Swing Line Loan, (i) the Total Outstandings shall not
exceed the Loan Cap and (ii) the aggregate Outstanding Amount of the Committed
Loans of any Lender at such time,
plus
such Lender’s
Applicable Percentage of the Outstanding Amount of all LC Obligations at such
time,
plus
such
Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans
at such time shall not exceed such Lender’s Commitment, and
provided
,
further
, that the
Borrowers shall not use the proceeds of any Swing Line Loan to refinance any
outstanding Swing Line Loan. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Borrowers may borrow under this
Section 2.04
, prepay
under
Section
2.05
, and reborrow under this
Section 2.04
. Each
Swing Line Loan shall bear interest only at a rate based on the Base Rate.
Immediately
upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a
risk participation in such Swing Line Loan in an amount equal to the product of
such Lender’s Applicable Percentage
times
the amount of
such Swing Line Loan.
(b)
Borrowing Procedures
.
Each Swing Line Borrowing shall be made upon the Lead Borrower’s irrevocable
notice to the Swing Line Lender and the Administrative Agent, which may be given
by telephone. Each such notice must be received by the Swing Line Lender and the
Administrative Agent not later than 1:00 p.m. on the requested borrowing date,
and shall specify (i) the amount to be borrowed, which shall be a minimum of
$100,000, and (ii) the requested borrowing date, which shall be a Business Day.
Each such telephonic notice must be confirmed promptly by delivery to the Swing
Line Lender and the Administrative Agent of a written Swing Line Loan Notice,
appropriately completed and signed by a Responsible Officer of the Lead
Borrower. Promptly after receipt by the Swing Line Lender of any telephonic
Swing Line Loan Notice, the Swing Line Lender will confirm with the
Administrative Agent (by telephone or in writing) that the Administrative Agent
has also received such Swing Line Loan Notice and, if not, the Swing Line Lender
will notify the Administrative Agent (by telephone or in writing) of the
contents thereof. Unless the Swing Line Lender has received notice (by telephone
or in writing) from the Administrative Agent at the request of the Required
Lenders prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A)
directing the Swing Line Lender not to make such Swing Line Loan as a result of
the limitations set forth in the proviso to the first sentence of
Section 2.04(a)
, or
(B) that one or more of the applicable conditions specified in
Article IV
is not
then
satisfied,
then, subject to the terms and conditions hereof, the Swing Line Lender may in
its discretion, not later than 3:00 p.m. on the borrowing date specified in such
Swing Line Loan Notice, make the
(c)
Refinancing
of Swing Line Loans
.
(i) Subject
to the provisions of
Section 2.14
, the
Swing Line Lender at any time in its sole and absolute discretion may request,
on behalf of the Borrowers (which hereby irrevocably authorize the Swing Line
Lender to so request on their behalf), that each Lender make a Base Rate Loan in
an amount equal to such Lender's Applicable Percentage of the amount of Swing
Line Loans then outstanding. Such request shall be made in writing (which
written request shall be deemed to be a Committed Loan Notice for purposes
hereof) and in accordance with the requirements of
Section 2.02
, without
regard to the minimum and multiples specified therein for the principal amount
of Base Rate Loans, but subject to the unutilized portion of the Aggregate
Commitments and the conditions set forth in
Section 4.02
. The
Swing Line Lender shall furnish the Lead Borrower with a copy of the
applicable
Committed Loan
Notice promptly after delivering such notice to the Administrative Agent. Each
Lender shall make an amount equal to its Applicable Percentage of the amount
specified in such Committed Loan Notice available to the Administrative Agent in
immediately available funds for the account of the Swing Line Lender at the
Administrative Agent’s Office not later than 3:00 p.m. on the day specified in
such Committed Loan Notice, whereupon, subject to
Section 2.04(c)(ii)
,
each Lender that so makes funds available shall be deemed to have made a Base
Rate Loan to the Borrowers in such amount. The Administrative Agent shall remit
the funds so received to the Swing Line Lender.
(ii) If
for any reason any Swing Line Loan cannot be refinanced by such a Committed
Borrowing in accordance with
Section 2.04(c)(i)
,
the request for Base Rate Loans submitted by the Swing Line Lender as set forth
herein shall be deemed to be a request by the Swing Line Lender that each of the
Lenders fund its risk participation in the relevant Swing Line Loan and each
Lender’s payment to the Administrative Agent for the account of the Swing Line
Lender pursuant to
Section
2.04(c)(i)
shall be
deemed payment in respect of such participation.
(iii) If
any Lender fails to make available to the Administrative Agent for the account
of the Swing Line Lender any amount required to be paid by such Lender pursuant
to the foregoing provisions of this
Section 2.04(c)
by
the time specified in
Section 2.04(c)(i)
,
the Swing Line Lender shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest thereon
for the period from the date such payment is required to the date on which such
payment is immediately available to the Swing Line Lender at a rate per annum
equal to the greater of the Federal Funds Rate and a rate determined by the
Swing Line Lender in accordance with banking industry rules on interbank
compensation plus any administrative, processing or similar fees customarily
charged by the Swing Line Lender in connection with the foregoing. If such
Lender pays such amount (with interest and fees as aforesaid), the amount so
paid shall constitute such Lender’s Committed Loan included in the relevant
Committed Borrowing or funded participation in the relevant Swing Line Loan, as
the case may be. A certificate of the Swing Line Lender submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing under this
clause (iii) shall be conclusive absent manifest error.
(iv) Each
Lender’s obligation to make Committed Loans or to purchase and fund risk
participations in Swing Line Loans pursuant to this
Section 2.04(c)
shall
be absolute and unconditional and shall not be affected by any circumstance,
including (A) any setoff, counterclaim, recoupment, defense or other right which
such Lender may have against the Swing Line Lender, the Borrowers or any other
Person for any reason whatsoever, (B) the occurrence or continuance of a
Default
(d)
Repayment
of Participations
.
(i) At
any time after any Lender has purchased and funded a risk participation in a
Swing Line Loan, if the Swing Line Lender receives any payment on account of
such Swing Line Loan, the Swing Line Lender will distribute to such Lender its
Applicable Percentage of such payment (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender’s risk
participation was funded) in the same funds as those received by the Swing Line
Lender.
(ii) If
any payment received by the Swing Line Lender in respect of principal or
interest on any Swing Line Loan is required to be returned by the Swing Line
Lender under any of the circumstances described in
Section 10.05
(including pursuant to any settlement entered into by the Swing Line Lender in
its discretion), each Lender shall pay to the Swing Line Lender its Applicable
Percentage thereof on demand of the Administrative Agent, plus interest thereon
from the date of such demand to the date such amount is returned, at a rate per
annum equal to the Federal Funds Rate. The Administrative Agent will make such
demand upon the request of the Swing Line Lender. The obligations of the Lenders
under this clause shall survive the payment in full of the Secured Obligations
and the termination of this Agreement.
(e)
Interest for Account of
Swing Line Lender
. The Swing Line Lender shall be responsible for
invoicing the Borrowers for interest on the Swing Line Loans. Until each Lender
funds its Base Rate Loan or risk participation pursuant to this
Section 2.04
to
refinance such Lender’s Applicable Percentage of any Swing Line Loan, interest
in respect of such Applicable Percentage shall be solely for the account of the
Swing Line Lender.
(f)
Payments Directly to Swing
Line Lender
. The Borrowers shall make all payments of principal and
interest in respect of the Swing Line Loans directly to the Swing Line
Lender.
2.05
Prepayments
.
(a) The
Borrowers may, upon irrevocable notice from the Lead Borrower to the
Administrative Agent, at any time or from time to time voluntarily prepay
Committed Loans in whole or in part without premium or penalty;
provided
that (i)
such notice must be received by the Administrative Agent not later than 11:00
a.m. (A) three (3) Business Days prior to any date of prepayment of LIBO Rate
Loans and (B) on the date of prepayment of Base Rate Loans; (ii) any prepayment
of LIBO Rate Loans shall be in a principal amount of $1,000,000 or a whole
multiple of $1,000,000 in excess thereof; and (iii) any prepayment of Base Rate
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000
in excess thereof or, in each case, if less, the entire principal amount thereof
then outstanding. Each such notice shall specify the date and amount of such
prepayment and the Type(s) of Loans to be prepaid and, if LIBO Rate Loans, the
Interest Period(s) of such Loans. The Administrative Agent will promptly notify
each Lender of its receipt of each such notice, and of the amount of such
Lender’s Applicable Percentage of such prepayment. If such notice is given by
the Lead Borrower, the Borrowers shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein. Any prepayment of a LIBO Rate Loan shall be accompanied by all accrued
interest on the amount prepaid, together with any additional amounts required
pursuant to
Section
3.05
.
(b) The
Borrowers may, upon irrevocable notice from the Lead Borrower to the Swing Line
Lender (with a copy to the Administrative Agent), at any time or from time to
time, voluntarily prepay Swing Line Loans in whole or in part without premium or
penalty;
provided
that (i)
such notice must be received by the Swing Line Lender and the Administrative
Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such
prepayment shall be in a minimum principal amount of $100,000. Each such notice
shall specify the date and amount of such prepayment. If such notice is given by
the Lead Borrower, the Borrowers shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein.
(c) If
for any reason the Total Outstandings at any time exceed the Loan Cap, the
Borrowers shall immediately prepay Loans, Swing Line Loans and LC Borrowings
and/or Cash Collateralize the LC Obligations (other than LC Borrowings) in an
aggregate amount equal to such excess;
provided
,
however
, that the
Borrowers shall not be required to Cash Collateralize the LC Obligations
pursuant to this
Section 2.05(c)
unless after the prepayment in full of the Loans the Total Outstandings exceed
the Loan Cap.
(d) During
a Trigger Period, the Borrowers shall prepay the Loans in accordance with the
provisions of
Section
6.13
and, if an Event of Default shall have occurred and be continuing,
Cash Collateralize the LC Obligations in accordance with the provisions of
Section
2.03(g)
.
(e) The
Borrowers shall prepay the Loans and, if an Event of Default shall have occurred
and be continuing, Cash Collateralize the LC Obligations in an amount equal to
the Net Proceeds received by a Loan Party on account of a Prepayment Event. The
application of such amount to the prepayment of Loans and Cash Collateralization
of the LC Obligations shall not reduce the Commitments.
(f) Prepayments
made pursuant to this
Section 2.05
,
first
, shall be
applied ratably to the LC Borrowings and the Swing Line Loans,
second
, shall be
applied ratably to the outstanding Committed Loans that are Base Rate Loans,
third
, shall be
applied ratably to the outstanding Committed Loans that are LIBO Rate Loans,
fourth
, if an
Event of Default shall have occurred and be continuing, shall be used to Cash
Collateralize the remaining LC Obligations; and,
fifth
, the amount
remaining, if any, after the prepayment in full of all LC Borrowings, Swing Line
Loans and Committed Loans outstanding at such time and the Cash
Collateralization of the remaining LC Obligations in full may be retained by the
Borrowers for use in the ordinary course of its business. Upon the drawing of
any Letter of Credit that has been Cash Collateralized, the funds held as Cash
Collateral shall be applied (without any further action by or notice to or from
the Borrowers or any other Loan Party) to reimburse the LC Issuer or the
Lenders, as applicable.
2.06
Termination
or Reduction of Commitments
.
(a) The
Borrowers may, upon irrevocable notice from the Lead Borrower to the
Administrative Agent, terminate the Aggregate Commitments, the Letter of Credit
Sublimit or the Swing Line Sublimit or from time to time permanently reduce the
Aggregate Commitments, the Letter of Credit Sublimit or the Swing Line Sublimit;
provided
that
(i) any such notice shall be received by the Administrative Agent not later than
11:00 a.m. three (3) Business Days prior to the date of termination or
reduction, (ii) any such partial reduction shall be in an aggregate amount of
$5,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the
Borrowers shall not terminate or reduce (A) the Aggregate Commitments if, after
giving effect thereto and to
(b) If,
after giving effect to any reduction of the Aggregate Commitments, the Letter of
Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate
Commitments, such Letter of Credit Sublimit or Swing Line Sublimit shall be
automatically reduced by the amount of such excess.
(c) The
Administrative Agent will promptly notify the Lenders of any termination or
reduction of the Letter of Credit Sublimit, Swing Line Sublimit or the Aggregate
Commitments under this
Section 2.06
. Upon
any reduction of the Aggregate Commitments, the Commitment of each Lender shall
be reduced by such Lender’s Applicable Percentage of such reduction amount. All
fees (including, without limitation, commitment fees and Letter of Credit Fees)
and interest in respect of the Aggregate Commitments accrued until the effective
date of any termination of the Aggregate Commitments shall be paid on the
effective date of such termination.
2.07
Repayment
of Loans
. On the Termination Date, the Borrowers shall cause all
Secured
Obligations
to be Fully Satisfied.
(a) Subject
to the provisions of
Section 2.08(b)
below, (i) each LIBO Rate Loan shall bear interest on the outstanding principal
amount thereof for each Interest Period at a rate per annum equal to the
Adjusted LIBO Rate for such Interest Period
plus
the Applicable
Margin; (ii) each Base Rate Loan shall bear interest on the outstanding
principal amount thereof from the applicable borrowing date at a rate per annum
equal to the Base Rate
plus
the Applicable
Margin; and (iii) each Swing Line Loan shall bear interest on the outstanding
principal amount thereof from the applicable borrowing date at a rate per annum
equal to the Base Rate
plus
the Applicable
Margin.
(b)
(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 Laws.
(ii)
If any other Event of Default exists, then the Administrative Agent may, and
upon the request of the Required Lenders shall, notify the Lead 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
such Obligations shall bear interest at the Default Rate to the fullest extent
permitted by applicable Laws.
(iii)
Accrued and unpaid interest on past due amounts (including interest on past due
interest) shall be due and payable upon demand.
(c) Interest
on each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein. Interest
hereunder shall be due and payable in accordance with the terms hereof before
and after judgment, and before and after the commencement of any proceeding
under any Debtor Relief Law.
(a)
Commitment Fee
. The
Borrowers shall pay to the Administrative Agent for the account of each Lender,
in accordance with its Applicable Percentage, a commitment fee, payable
quarterly in arrears on the first Business Day of each Fiscal Quarter,
commencing with the first such date to occur after the Closing Date, and on the
last day of the Availability Period equal to the Applicable Commitment Fee
Percentage
times
the average
daily amount by which the Aggregate Commitments exceeded the Average Usage, in
each case calculated on a per annum basis for the actual number of days elapsed
in the Fiscal Quarter ending on the day immediately preceding the related
payment date (or, if applicable, the actual number of days in the Fiscal Quarter
to and including last day of the Availability Period). The commitment fee shall
accrue at all times during the Availability Period, including at any time during
which one or more of the conditions in
Article IV
is not
met.
(b)
Other Fees
. The
Borrowers shall pay to the Joint Lead Arrangers and the Administrative Agent for
their own respective accounts fees in the amounts and at the times specified in
the Fee Letter. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.
2.10
Computation
of Interest and Fees
. All computations of interest for Base Rate
Loans
when
the Base Rate is determined by Bank of America’s "prime rate" shall be made on
the basis of a year of 365 or 366 days, as the case may be, and actual days
elapsed. All other computations of fees and interest shall be made on the basis
of a 360-day year and actual days elapsed (which results in more fees or
interest, as applicable, being paid than if computed on the basis of a 365-day
year). Interest shall accrue on each Loan for the day on which the Loan is made,
and shall not accrue on a Loan, or any portion thereof, for the day on which the
Loan or such portion is paid,
provided
that any
Loan that is repaid on the same day on which it is made shall, subject to
Section 2.12(a)
, bear
interest for one day. Each determination by the Administrative Agent of an
interest rate or fee hereunder shall be conclusive and binding for all purposes,
absent manifest error.
(a) The
Credit Extensions made by each Lender shall be evidenced by one or more accounts
or records maintained by the Administrative Agent (the "
Loan Account
") in the
ordinary course of business. In addition, each Lender may record in such
Lender’s internal records, an appropriate notation evidencing the date and
amount of each Loan from such Lender, each payment and prepayment of principal
of any such Loan, and each payment of interest, fees and other amounts due in
connection with the Obligations due to such Lender. The accounts or records
maintained by the Administrative Agent and each Lender shall be conclusive
absent manifest error of the amount of the Credit Extensions made by the Lenders
to the Borrowers and the interest and payments thereon. Any failure to so record
or any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrowers hereunder to pay any amount owing with respect to
the Obligations. In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the Administrative
Agent shall control in the absence of manifest error. Upon the request of any
Lender made through the Administrative Agent, the Borrowers shall execute and
deliver to such Lender (through the Administrative Agent) a Note, which shall
evidence such Lender’s Loans in addition to such accounts or records. Each
Lender may attach schedules to its Note and endorse thereon the date, Type (if
applicable), amount and maturity of its Loans and payments with respect thereto.
Any failure to so attach or endorse, or any error in doing so, shall not,
however, limit or otherwise affect the obligation of the Borrowers hereunder to
pay any amount owing with respect to the Obligations. Upon receipt of an
affidavit of a Lender as to the loss, theft, destruction or mutilation of such
Lender’s Note with appropriate indemnification provisions in form and
substance
(b) In
addition to the accounts and records referred to in
Section 2.11(a)
, each
Lender and the Administrative Agent shall maintain in accordance with its usual
practice accounts or records evidencing the purchases and sales by such Lender
of participations in Letters of Credit and Swing Line Loans. In the event of any
conflict between the accounts and records maintained by the Administrative Agent
and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.
2.12
Payments
Generally; Administrative Agent’s Clawback
.
(a)
General
. All payments
to be made by the Borrowers shall be made without condition or deduction for any
counterclaim, defense, recoupment or setoff. Except as otherwise expressly
provided herein, all payments by the Borrowers hereunder shall be made to the
Administrative Agent, for the account of the respective Lenders to which such
payment is owed, at the Administrative Agent’s Office in Dollars and in
immediately available funds not later than 2:00 p.m. on the date specified
herein. The Administrative Agent will promptly distribute to each Lender its
Applicable Percentage (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender’s Lending
Office. All payments received by the Administrative Agent after 2:00 p.m. shall,
at the option of the Administrative Agent, be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue. If any payment to be made by the Borrowers shall come due on a day other
than a Business Day, payment shall be made on the next following Business Day,
and such extension of time shall be reflected in computing interest or fees, as
the case may be.
(b)
Funding by Lenders;
Presumption by Administrative Agent
. (i) Unless the Administrative Agent
shall have received notice from a Lender prior to the proposed date of any
Borrowing of LIBO Rate Loans (or in the case of any Borrowing of Base Rate
Loans, prior to 2:00 p.m. on the date of such Borrowing) that such Lender will
not make available to the Administrative Agent such Lender’s share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with
Section 2.02
(or in
the case of a Borrowing of Base Rate Loans, that such Lender has made such share
available in accordance with and at the time required by
Section 2.02
) and
may, in reliance upon such assumption, make available to the Borrowers a
corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Committed Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrowers severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount in immediately available
funds with interest thereon, for each day from and including the date such
amount is made available to the Borrowers to but excluding the date of payment
to the Administrative Agent, at (A) in the case of a payment to be made by such
Lender, the greater of the Federal Funds Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation plus any administrative processing or similar fees customarily
charged by the Administrative Agent in connection with the foregoing, and (B) in
the case of a payment to be made by the Borrowers, the interest rate applicable
to Base Rate Loans. If the Borrowers and such Lender shall pay such interest to
the Administrative Agent for the same or an overlapping period, the
Administrative Agent shall promptly remit to the Borrowers the amount of such
interest paid by the Borrowers for such period. If such Lender pays its share of
the applicable Committed Borrowing to the Administrative Agent, then the amount
so paid shall constitute such Lender’s Committed Loan included in such Committed
Borrowing. Any payment by the Borrowers shall be without prejudice to any
claim
(ii)
Payments by Borrowers;
Presumptions by Administrative Agent
. Unless the Administrative Agent
shall have received notice from the Lead Borrower prior to the time at which any
payment is due to the Administrative Agent for the account of the Lenders or the
LC Issuer hereunder that the Borrowers will not make such payment, the
Administrative Agent may assume that the Borrowers have made such payment on
such date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders or the LC Issuer, as the case may be, the amount due.
In such event, if the Borrowers have not in fact made such payment, then each of
the Lenders or the LC Issuer, as the case may be, severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such
Lender or the LC Issuer, in immediately available funds with interest thereon,
for each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.
A notice
of the Administrative Agent to any Lender or the Lead Borrower with respect to
any amount owing under this subsection (b) shall be conclusive, absent manifest
error.
(c)
Failure to Satisfy
Conditions Precedent
. If any Lender makes available to the Administrative
Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this
Article II
, and such
funds are not made available to the Borrowers by the Administrative Agent
because the conditions to the applicable Credit Extension set forth in
Article IV
are not
satisfied or waived in accordance with the terms hereof (subject to the
provisions of the last paragraph of
Section 4.02
hereof),
the Administrative Agent promptly shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.
(d)
Obligations of Lenders
Several
. The obligations of the Lenders hereunder to make Committed
Loans, to fund participations in Letters of Credit and Swing Line Loans and to
make payments pursuant to
Section 10.04(c)
are
several and not joint. The failure of any Lender to make any Committed Loan, to
fund any such participation or to make any payment under
Section 10.04(c)
on
any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Committed Loan,
to purchase its participation or to make its payment under
Section
10.04(c)
.
(e)
Funding Source
.
Nothing herein shall be deemed to obligate any Lender to obtain the funds for
any Loan in any particular place or manner or to constitute a representation by
any Lender that it has obtained or will obtain the funds for any Loan in any
particular place or manner.
2.13
Sharing
of Payments by Lenders
. If any Lender shall, by exercising any right of
setoff
or
counterclaim or otherwise, obtain payment in respect of any principal of,
interest on, or other amounts with respect to, any of the Obligations resulting
in such Lender’s receiving payment of a proportion of the aggregate amount of
such Obligations greater than its
pro rata
share
thereof as provided herein (including in contravention of the priorities of
payment set forth in
Section 8.03
), then
the Lender receiving such greater proportion shall (a) notify the Administrative
Agent of such fact, and (b) purchase (for cash at face value) participations in
the Obligations of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the
Lenders ratably and in the priorities set forth in
Section 8.03
,
provided
that:
(i)
if any such participations or subparticipations are purchased and all or
any portion of the payment giving rise thereto is recovered, such participations
or subparticipations
(ii) the
provisions of this
Section 2.13
shall
not be construed to apply to (x) any payment made by the Loan Parties pursuant
to and in accordance with the express terms of this Agreement or (y) any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Committed Loans or subparticipations in LC
Obligations or Swing Line Loans to any assignee or participant, other than to
the Borrowers or any Subsidiary thereof (as to which the provisions of this
Section 2.13
shall apply).
Each Loan
Party consents to the foregoing and agrees, to the extent it may effectively do
so under applicable Law, that any Lender acquiring a participation pursuant to
the foregoing arrangements may exercise against such Loan Party rights of setoff
and counterclaim with respect to such participation as fully as if such Lender
were a direct creditor of such Loan Party in the amount of such
participation.
2.14
Settlement
Among Lenders
.
(a) The
amount of each Lender’s Applicable Percentage of outstanding Loans (including
outstanding Swing Line Loans, shall be computed weekly (or more frequently in
the Administrative Agent’s discretion) and shall be adjusted upward or downward
based on all Loans (including Swing Line Loans) and repayments of Loans
(including Swing Line Loans) received by the Administrative Agent as of 3:00
p.m. on the first Business Day (such date, the "
Settlement
Date
") following the
end of the period specified by the Administrative Agent.
(b) The
Administrative Agent shall deliver to each of the Lenders promptly after a
Settlement Date a summary statement of the amount of outstanding Committed Loans
for the period and the amount of repayments received for the period. As
reflected on the summary statement, (i) the Administrative Agent shall transfer
to each Lender its Applicable Percentage of repayments, and (ii) each Lender
shall transfer to the Administrative Agent (as provided below) or the
Administrative Agent shall transfer to each Lender, such amounts as are
necessary to insure that, after giving effect to all such transfers, the amount
of Committed Loans made by each Lender shall be equal to such Lender’s
Applicable Percentage of all Committed Loans outstanding as of such Settlement
Date. If the summary statement requires transfers to be made to the
Administrative Agent by the Lenders and is received prior to 1:00 p.m. on a
Business Day, such transfers shall be made in immediately available funds no
later than 3:00 p.m. that day; and, if received after 1:00 p.m., then no later
than 3:00 p.m. on the next Business Day. The obligation of each Lender to
transfer such funds is irrevocable, unconditional and without recourse to or
warranty by the Administrative Agent. If and to the extent any Lender shall not
have so made its transfer to the Administrative Agent, such Lender agrees to pay
to the Administrative Agent, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to the Administrative Agent, equal to the greater of the Federal Funds Rate and
a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation plus any administrative, processing, or
similar fees customarily charged by the Administrative Agent in connection with
the foregoing.
2.15
Increase
in Commitments
.
(a)
Request for Increase
.
Provided no Event of Default then exists and no Default
would arise
therefrom, at any time and from time to time after the date that occurs ninety
(90) days after the Closing Date, upon notice to the Administrative Agent (which
shall promptly notify the Lenders), the Lead Borrower may request an increase in
the Aggregate Commitments by an amount (for all such
(b)
Lender Elections to
Increase
. Each Lender shall notify the Administrative Agent within such
time period whether or not it agrees to increase its Commitment and, if so (each
an "
Increased
Commitment
Lender
"), whether by an amount equal to, greater than, or less than its
Applicable
Percentage of
such requested increase. Any Lender not responding within such time period shall
be deemed to have declined to increase its Commitment.
(c)
Notification by
Administrative Agent; Additional Lenders
. The Administrative Agent shall
notify the Lead Borrower and each Lender of the Lenders’ responses to each
request made in this
Section 2.15
. To
achieve the full amount of a requested increase and subject to the approval of
the Administrative Agent, the LC Issuer and the Swing Line Lender (which
approvals shall not be unreasonably withheld), to the extent that the existing
Lenders decline to increase their Commitments, or decline to increase their
Commitments to the amount requested by the Lead Borrower, the Administrative
Agent or its Affiliates, in consultation with the Lead Borrower, will use its
reasonable efforts to arrange for other Eligible Assignees to become a Lender
hereunder and to issue commitments in an amount equal to the amount of the
increase in the Aggregate Commitments requested by the Lead Borrower and not
accepted by the existing Lenders (and the Lead Borrower may also invite
additional Eligible Assignees to become Lenders) (each such Eligible Assignee
issuing a commitment and becoming a Lender, an "
Additional Commitment
Lender
"),
provided
,
however
, that without
the consent of the Administrative Agent, at no time shall the Commitment of any
Additional Commitment Lender be less than $10,000,000.
(d)
Effective Date and
Allocations
. If the Aggregate Commitments are increased in accordance
with this
Section
2.15
, the Administrative Agent and the Lead Borrower shall determine the
effective date (the "
Increase Effective
Date
") of such increase (such increase, a "
Commitment
Increase
"). The Administrative Agent shall promptly notify the Lead
Borrower and the Lenders of the final allocation of such Commitment Increase and
the Increase Effective Date and on the Effective Date (i) the Aggregate
Commitments under, and for all purposes of, this Agreement shall be increased by
the aggregate amount of such Commitment Increases, and (ii)
Schedule 2.01
shall
be deemed modified, without further action, to reflect the revised Commitments
and Applicable Percentages of the Lenders.
(e)
Conditions to Effectiveness
of Increase
. As a condition precedent to such increase, (i) the Lead
Borrower shall deliver to the Administrative Agent a certificate of each Loan
Party dated as of the Increase Effective Date (in sufficient copies for each
Lender) signed by a Responsible Officer of such Loan Party (A) certifying and
attaching the resolutions, if necessary, adopted by such Loan Party approving or
consenting to such Commitment Increase, and (B) in the case of the Borrowers,
certifying that, before and after giving effect to such Commitment Increase, (1)
the representations and warranties contained in
Article V
and the
other Loan Documents are true and correct on and as of the Increase Effective
Date, except to the extent that such representations and warranties specifically
refer to an earlier date, in which case they are true and correct as of such
earlier date, and except that for purposes of this
Section 2.15
, the
representations and warranties contained in subsections (a) and (b) of
Section
5.05
shall be deemed
to refer to the most recent statements furnished pursuant to clauses (a) and
(b),
respectively,
of
Section
6.01
, (ii) the Borrowers, the Administrative Agent, and any Additional
Commitment Lender shall have executed and delivered a joinder to the Loan
Documents in such form as the Administrative Agent shall reasonably require;
(iii) the Borrowers shall have paid such fees and other compensation to the
Additional Commitment Lenders and the Increased Commitment Lenders as
the
(f)
Terms of Commitment
Increase
. Any Commitment Increase contemplated by the provisions of this
Section 2.15
shall, except as provided in
Section 2.15(e)(iii)
and
(e)(iv)
,
bear interest and be entitled to fees and other compensation on the same basis
as all other Commitments.
(g)
Conflicting
Provisions
. This
Section 2.15
shall
supersede any provisions in
Sections 2.13
or
10.01 to the contrary.
ARTICLE
III
TAXES,
YIELD PROTECTION AND ILLEGALITY; APPOINTMENT OF LEAD BORROWER
3.01
Taxes
.
(a)
Payments Free of
Taxes
. Any and all payments by or on account of any obligation of the
Borrowers hereunder or under any other Loan Document shall be made free and
clear of and without reduction or withholding for any Indemnified Taxes or Other
Taxes,
provided
that if the Borrowers shall be required by applicable law to deduct any
Indemnified Taxes (including any Other Taxes) from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this
Section
3.01
) the
Administrative Agent, Lender or LC Issuer, as the case may be, receives an
amount equal to the
sum it would
have received had no such deductions been made, (ii) the Borrowers shall make
such deductions and (iii) the Borrowers shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law;
provided
further, that the Borrowers shall not be required to pay any additional amounts
with respect to income or tax or amounts owing to a Lender that (x) is a Foreign
Lender and (y) has not delivered the forms required by
Section
3.01(e)
.
(b)
Payment of Other Taxes by
the Borrowers
. Without limiting the provisions of subsection (a) above,
the Borrowers shall timely pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable Law.
(c)
Indemnification by the Loan
Parties
. The Loan Parties shall indemnify the Administrative Agent, each
Lender and each LC Issuer, within three (3) Business Days after demand is made
therefor, for the full amount of any Indemnified Taxes or Other Taxes (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this
Section 3.01
) paid by
the Administrative Agent, such Lender or LC Issuer, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto;
provided
, that the
Borrower shall not be
obligated to make any payment pursuant to this Section in respect of
penalties, interest and other consequential liabilities attributable to any
Taxes or Other Taxes if (i) written demand therefor has not been made by such
Lender Party within 30 days from the date on which senior in-house legal counsel
or the chief financial officer such Lender Party had actual knowledge of the
imposition of Taxes or Other Taxes by the relevant taxing or Governmental
Authority, (ii) such penalties, interest and other consequential liabilities, as
a result of gross negligence or willful misconduct of such payee as determined
by a final, non-appealable decision of a court of competent jurisdiction, have
accrued after the date that Borrower indemnified or paid in full all amounts
owing under this Section as of such date, or (iii) such penalties, interest and
other liabilities are attributable to the gross negligence or willful misconduct
of such payee, as determined by a final, non-appealable decision of a court of
competent jurisdiction;
provided
,
further
, that the
Loan Parties shall not be required to make any indemnification with respect
to
any
Foreign Lender that has not complied in all material respects with
Section 3.01(e)
. A
certificate as to the amount of such payment or liability delivered to the Lead
Borrower by a Lender or the LC Issuer (with a copy to the Administrative Agent),
or by the Administrative Agent on its own behalf or on behalf of a Lender or the
LC Issuer, shall be conclusive absent manifest error.
(d)
Evidence of Payments
.
As soon as practicable after any payment of Indemnified Taxes or Other Taxes by
the Borrowers to a Governmental Authority, the Lead Borrower shall deliver to
the Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.
(e)
Status of Lenders
.
Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which any Borrower is
resident for tax purposes, or any treaty to which such jurisdiction is a party,
with respect to payments hereunder or under any other Loan Document shall
deliver to the Lead Borrower (with a copy to the Administrative Agent), at the
time or times prescribed by applicable Law or reasonably requested by the Lead
Borrower or the Administrative Agent, such properly completed and executed
documentation prescribed by applicable Law as will permit such payments to be
made without withholding or at a reduced rate of withholding. In addition, any
Lender, if requested by the Lead Borrower or the Administrative Agent, shall
deliver such other documentation prescribed by applicable Law or reasonably
requested by the Lead Borrower or the Administrative Agent as will enable the
Lead Borrower or the Administrative Agent to determine whether or not such
Lender is subject to backup withholding or information reporting
requirements.
Without
limiting the generality of the foregoing, any Foreign Lender shall deliver to
the Lead Borrower and the Administrative Agent (in such number of copies as
shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the request of the Lead Borrower or the Administrative Agent,
but only if such Foreign Lender is legally entitled to do so), whichever of the
following is applicable:
(i)
duly completed copies of
Internal Revenue Service Form W-8BEN claiming eligibility for benefits of an
income tax treaty to which the United States is a party,
(ii)
duly
completed copies of Internal Revenue Service Form W-8ECI,
(iii)
in the
case of a Foreign Lender claiming the benefits of the exemption
for
portfolio interest under section 881(c) of the Code, (x) a certificate to the
effect that such Foreign Lender is not (A) a "bank" within the meaning of
section 881(c)(3)(A) of the Code, (B) a "10 percent shareholder" of the
Borrowers within the meaning of section 881(c)(3)(B) of the Code, or (C) a
"controlled foreign corporation" described in section 881(c)(3)(C) of the Code
and (y) duly completed copies of Internal Revenue Service Form W-8BEN,
or
(f)
Treatment of Certain
Refunds
. If the Administrative Agent, any Lender or the LC Issuer
determines, in its sole discretion, that it has received a refund of any Taxes
or Other Taxes as to which it has been indemnified by the Borrowers or with
respect to which the Borrowers have paid additional amounts pursuant to this
Section 3.01
,
it shall pay to the Borrowers an amount equal to such refund (but only to the
extent of indemnity payments made, or additional amounts paid, by the Borrowers
under this
Section
3.01
with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out- of-pocket expenses of the Administrative Agent, such
Lender or the LC Issuer, as the case may be, and without interest (other than
any interest paid by the relevant Governmental Authority with respect to such
refund),
provided
that the
Borrowers, upon the request of the Administrative Agent, such Lender or the LC
Issuer, agree to repay the amount paid over to the Borrowers (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent, such Lender or the LC Issuer in the
event the Administrative Agent, such Lender or the LC Issuer is required to
repay such refund to such Governmental Authority. This subsection shall not be
construed to require the Administrative Agent, any Lender or the LC Issuer to
make available its tax returns (or any other information relating to its taxes
that it deems confidential) to the Borrowers or any other Person.
3.02
Illegality
.
If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority
has asserted that it is unlawful, for any Lender or its applicable Lending
Office to make, maintain or fund LIBO Rate Loans, or to determine or charge
interest rates based upon the LIBO Rate, or any Governmental Authority has
imposed material restrictions on the authority of such Lender to purchase or
sell, or to take deposits of, Dollars in the London interbank market, then, on
written notice thereof by such Lender to the Lead Borrower through the
Administrative Agent, any obligation of such Lender to make or continue LIBO
Rate Loans or to convert Base Rate Loans to LIBO Rate Loans shall be suspended
until such Lender notifies the Administrative Agent and the Lead Borrower that
the circumstances giving rise to such determination no longer exist. Upon
receipt of such notice, the Borrowers shall, upon demand from such Lender (with
a copy to the Administrative Agent), prepay or, if applicable, convert all LIBO
Rate Loans of such Lender to Base Rate Loans, either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such
LIBO Rate Loans to such day, or immediately, if such Lender may not lawfully
continue to maintain such LIBO Rate Loans. Upon any such prepayment or
conversion, the Borrowers shall also pay accrued interest on the amount so
prepaid or converted.
3.03
Inability
to Determine Rates
. If the Required Lenders determine that for any reason
in
connection with
any request for a LIBO Rate Loan or a conversion to or continuation thereof that
(a) Dollar deposits are not being offered to banks in the London interbank
market for the applicable amount and Interest Period of such LIBO Rate Loan, (b)
adequate and reasonable means do not exist for determining the LIBO Rate for any
requested Interest Period with respect to a proposed LIBO Rate Loan , or (c) the
LIBO Rate for any requested Interest Period with respect to a proposed LIBO Rate
Loan does not adequately and fairly reflect the cost to such Lenders of funding
such Loan, the Administrative Agent will promptly so notify the Lead Borrower
and each Lender. Thereafter, the obligation of the Lenders to make or maintain
LIBO Rate Loans shall be suspended until the Administrative Agent (upon the
instruction of the Required Lenders) revokes such notice. Upon receipt of such
notice, the Lead Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of LIBO Rate Loans or, failing that, will be
deemed to have converted such request into a request for a Committed Borrowing
of Base Rate Loans in the amount specified therein.
(a)
Increased Costs
Generally
. If any Change in Law shall:
(i)
impose, modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for
the account of, or credit extended or participated in by, any Lender (except any
reserve requirement reflected in the Adjusted LIBO Rate) or the LC
Issuer;
(ii)
subject any Lender or the LC Issuer to any tax of any kind whatsoever with
respect to this Agreement, any Letter of Credit, any participation in a Letter
of Credit or any LIBO Rate Loan made by it, or change the basis of taxation of
payments to such Lender or the LC Issuer in respect thereof (except for
Indemnified Taxes or Other Taxes covered by
Section
3.01
and the
imposition of, or any change in the rate of, any Excluded Tax payable by
such
Lender or the
LC Issuer); or
(iii)
impose on any Lender or the LC Issuer or the London interbank market any other
condition, cost or expense affecting this Agreement or LIBO Rate Loans made by
such Lender or any Letter of Credit or participation therein;
and the
result of any of the foregoing shall be to increase the cost to such Lender of
making or maintaining any LIBO Rate Loan (or of maintaining its obligation to
make any such Loan), or to increase the cost to such Lender or the LC Issuer of
participating in, issuing or maintaining any Letter of Credit (or of maintaining
its obligation to participate in or to issue any Letter of Credit), or to reduce
the amount of any sum received or receivable by such Lender or the LC Issuer
hereunder (whether of principal, interest or any other amount) then, upon
request of such Lender or the LC Issuer, the Borrowers will pay to such Lender
or the LC Issuer, as the case may be, such additional amount or amounts as will
compensate such Lender or the LC Issuer, as the case may be, for such additional
costs incurred or reduction suffered.
(b)
Capital Requirements
.
If any Lender or the LC Issuer determines that any Change in Law affecting such
Lender or the LC Issuer or any Lending Office of such Lender or such Lender’s or
the LC Issuer’s holding company, if any, regarding capital requirements has or
would have the effect of reducing the rate of return on such Lender’s or the LC
Issuer’s capital or on the capital of such Lender’s or the LC Issuer’s holding
company, if any, as a consequence of this Agreement, the Commitments of such
Lender or the Loans made by, or participations in Letters of Credit held by,
such Lender, or the Letters of Credit issued by the LC Issuer, to a level below
that which such Lender or the LC Issuer or such Lender’s or the LC Issuer’s
holding company could have achieved but for such Change in Law (taking into
consideration such Lender’s or the LC Issuer’s policies and the policies of such
Lender’s or the LC Issuer’s holding company with respect to capital adequacy),
then from time to time the Borrowers will pay to such Lender or the LC Issuer,
as the case may be, such additional amount or amounts as will compensate such
Lender or the LC Issuer or such Lender’s or the LC Issuer’s holding company for
any such reduction suffered.
(c)
Certificates for
Reimbursement
. A certificate of a Lender or the LC Issuer setting forth
the amount or amounts necessary to compensate such Lender or the LC Issuer or
its holding company, as the case may be, as specified in subsection (a) or (b)
of this
Section
3.04
and delivered to the Lead Borrower shall be presumptively correct
absent manifest error. The Borrowers shall pay such Lender or the LC Issuer, as
the case may be, the amount shown as due on any such certificate within 10 days
after receipt thereof.
(e)
Reserves on LIBO Rate
Loans
. The Borrowers 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 LIBO Rate Loan equal to the actual costs of such reserves allocated to
such Loan 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 Loan,
provided
the Lead
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.
3.05
Compensation
for Losses
. Upon demand of any Lender (with a copy to the
Administrative Agent)
from time to time, the Borrowers shall promptly compensate such Lender for and
hold such Lender harmless from any loss, cost or expense incurred by it as a
result of:
(a) any
continuation, conversion, payment or prepayment of any Loan other than a Base
Rate Loan on a day other than the last day of the Interest Period for such Loan
(whether voluntary, mandatory, automatic, by reason of acceleration, or
otherwise);
(b) any
failure by the Borrowers (for a reason other than the failure of such Lender to
make a Loan) to prepay, borrow, continue or convert any Loan other than a Base
Rate Loan on the date or in the amount notified by the Lead Borrower;
or
(c) any
assignment of a LIBO Rate Loan on a day other than the last day of the Interest
Period therefor as a result of a request by the Lead Borrower pursuant to
Section
10.13
;
including
any loss or expense arising from the liquidation or reemployment of funds
obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained. The Borrowers shall also pay any
customary administrative fees charged by such Lender in connection with the
foregoing.
For
purposes of calculating amounts payable by the Borrowers to the Lenders under
this
Section
3.05
, each
Lender shall be deemed to have funded each LIBO Rate Loan made by it at the LIBO
Rate for
such Loan by a
matching deposit or other borrowing in the London interbank market for a
comparable amount and for a comparable period, whether or not such LIBO Rate
Loan was in fact so funded.
3.06
Mitigation
Obligations; Replacement of Lenders
.
(a)
Designation of a Different
Lending Office
. If any Lender requests compensation under
Section 3.04
, or the
Borrowers are required to pay any additional amount to any Lender or
any
Governmental Authority for the account of any Lender pursuant to
Section 3.01
,
or if any Lender gives a notice pursuant to
Section 3.02
, then
such Lender shall use reasonable efforts to designate a different Lending Office
for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would eliminate
or reduce amounts payable pursuant to
Section 3.01
or
3.04
, as the case may
be, in the future, or eliminate the need for the notice pursuant to
Section 3.02
,
as
applicable, and
(ii) in each case, would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrowers
hereby agree to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b)
Replacement of
Lenders
. If any Lender requests compensation under
Section
3.04
, or if the
Borrowers are required to pay any additional amount to any Lender or any
Governmental
Authority for
the account of any Lender pursuant to
Section 3.01
, the
Borrowers may replace such Lender in accordance with
Section
10.13
.
3.07
Survival
.
All of the Borrowers’ obligations under this
Article III
shall survive
termination of the
Aggregate Commitments and repayment of all other Secured Obligations
hereunder.
3.08
Designation
of Lead Borrower as Borrowers’ Agent
.
(a) Each
Borrower hereby irrevocably designates and appoints the Lead Borrower as such
Borrower’s agent to obtain Credit Extensions, the proceeds of which shall be
available to each Borrower for such uses as are permitted under this Agreement.
As the disclosed principal for its agent, each Borrower shall be obligated to
each Credit Party on account of Credit Extensions so made as if made directly by
the applicable Credit Party to such Borrower, notwithstanding the manner by
which such Credit Extensions are recorded on the books and records of the Lead
Borrower and of any other Borrower. In addition, each Loan Party other than the
Borrowers hereby irrevocably designates and appoints the Lead Borrower as such
Loan Party’s agent to represent such Loan Party in all respects under this
Agreement and the other Loan Documents.
(b) Each
Borrower recognizes that credit available to it hereunder is in excess of and on
better terms than it otherwise could obtain on and for its own account and that
one of the reasons therefor is its joining in the credit facility contemplated
herein with all other Borrowers. Consequently, each Borrower hereby assumes and
agrees to discharge all Secured Obligations of each of the other
Borrowers.
(c) The
Lead Borrower shall act as a conduit for each Borrower (including itself, as a
"Borrower") on whose behalf the Lead Borrower has requested a Credit Extension.
Neither the Administrative Agent nor any other Credit Party shall have any
obligation to see to the application of such proceeds therefrom.
ARTICLE
IV
CONDITIONS
PRECEDENT TO CREDIT EXTENSIONS
4.01
Conditions
of Initial Credit Extension
. The obligation of the LC Issuer and
each
Lender to make
its initial Credit Extension hereunder is subject to satisfaction of the
following conditions precedent:
(a) The
Administrative Agent’s receipt of the following, each of which shall be
originals or telecopies (followed promptly by originals) unless otherwise
specified, each properly
(i)
executed counterparts of this Agreement
sufficient in number for distribution to the Administrative Agent, each Lender
and the Lead Borrower;
(ii)
a Note
executed by the Borrowers in favor of each Lender requesting a
Note;
(iii) such
certificates of resolutions or other action, incumbency certificates and/or
other certificates of Responsible Officers of each Loan Party as the
Administrative Agent and the Arrangers may require evidencing (A) the authority
of each Loan Party to enter into this Agreement and the other Loan Documents to
which such Loan Party is a party or is to be a party and (B) the identity,
authority and capacity of each Responsible Officer thereof authorized to act as
a Responsible Officer in connection with this Agreement and the other Loan
Documents to which such Loan Party is a party or is to be a party;
(iv) copies
of each Loan Party’s Organization Documents and such other documents and
certifications as the Administrative Agent and the Arrangers may reasonably
require to evidence that each Loan Party is duly organized or formed, and that
each Loan Party is validly existing, in good standing and qualified to engage in
business in each jurisdiction where its ownership, lease or operation of
properties or the conduct of its business requires such qualification, except to
the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect;
(v) a
favorable opinion of (i) Davis Polk & Wardwell LLP, counsel to the Loan
Parties and (ii) such local counsel to the Loan Parties, in each case addressed
to the Administrative Agent and each Lender and as to such matters concerning
the Loan Parties and the Loan Documents as the Administrative Agent and the
Arrangers may reasonably request (including, without limitation, with respect to
enforceability, due authorization, perfection of the Liens in favor of the
Collateral Agent and absence of conflicts with specified material
agreements);
(vi) a
certificate signed by a Responsible Officer of the Lead Borrower certifying (A)
that the conditions specified in
Sections 4.02(a)
and
(b)
have been
satisfied, (B) that there has 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 and (C)
either that (1) no consents, licenses or approvals are required in connection
with the execution, delivery and performance by such Loan Party and the validity
against such Loan Party of the Loan Documents to which it is a party, or (2)
that all such consents, licenses and approvals have been obtained and are in
full force and effect;
(vii) evidence
that all insurance required to be maintained pursuant to the Loan Documents and,
except for the endorsements specified on
Schedule 4.01(a)
hereto which shall be delivered no later than 15 days after the Closing Date,
all endorsements in favor of the Collateral Agent required under the Loan
Documents have been obtained and are in effect;
(ix) a
certificate from the chief financial officer of the Lead Borrower, satisfactory
in form and substance to the Administrative Agent, attesting to the Solvency of
the Loan Parties on a Consolidated basis as of the Closing Date after giving
effect to the transactions contemplated hereby;
(x) except
for the Securities Account Control Agreements specified on
Schedule 4.01(b)
hereto, which shall be duly executed and delivered no later than 15
days
after
the Closing Date, the Security Documents (other than the Mortgages), each duly
executed by the applicable Loan Parties (it being understood that no Mortgages
will be executed and delivered as of the Closing Date);
(xi) all
other Loan Documents, each duly executed by the applicable Loan
Parties;
(xii) results
of searches or other evidence reasonably satisfactory to the Collateral Agent
and the Arrangers (in each case dated as of a date reasonably satisfactory to
the Collateral Agent and the Arrangers) indicating the absence of Liens on the
assets of the Loan Parties, except for Permitted Encumbrances and Liens for
which termination statements and releases, satisfactions and discharges of any
mortgages, and releases or subordination agreements satisfactory to the
Collateral Agent and the Arrangers are being tendered concurrently with such
extension of credit or other arrangements satisfactory to the Collateral Agent
and the Arrangers for the delivery of such termination statements and releases,
satisfactions and discharges have been made;
(xiii) (A)
all documents and instruments, including Uniform Commercial Code financing
statements, required by law or reasonably requested by the Collateral Agent and
the Arrangers to be filed, registered or recorded to create or perfect the first
priority Liens intended to be created under the Loan Documents and all such
documents and instruments shall have been so filed, registered or recorded, in
each case, to the reasonable satisfaction of the Collateral Agent and the
Arrangers, (B) the Blocked Account Agreements required pursuant to
Section 6.13
hereof,
and (C) control agreements with respect to the Loan Parties’ securities and
investment accounts;
(xiv) certified
copies of each of the BNCB Acquisition Documents, including the Seller Notes, as
amended and in effect on the Closing Date, duly executed by the parties thereto
and in form and substance substantially the same as the form and substance of
such agreements and documents dated August __, 2009 delivered to and approved by
the Administrative Agent, together with all agreements, instruments and other
documents delivered in connection therewith as the Administrative Agent shall
request; and
(xv) such
other assurances, certificates, documents, consents or opinions as the Agents
reasonably may require.
(c) After
giving effect to (i) the consummation of the BNCB Acquisition, (ii) the first
funding under the Loans, (iii) any charges to the Loan Account made in
connection with the establishment of the credit facility contemplated hereby and
(iv) all Letters of Credit to be issued at, or immediately subsequent to, such
establishment, Availability shall be not less than $400,000,000.
(d) The
Administrative Agent shall have received a Borrowing Base Certificate dated the
Closing Date and relating to the month ended on August 29, 2009, duly executed
by a Responsible Officer of the Lead Borrower.
(e) To
event or condition has occurred since April 30, 2009, that could reasonably be
expected, individually or in the aggregate, to constitute or have (i) a material
adverse change in, or a material adverse effect on, the operations, business,
assets, properties, liabilities (actual or contingent) or condition (financial
or otherwise) of the Lead Borrower, BNCB and their subsidiaries, taken as a
whole; (ii) a material impairment of the ability of any Loan Party to perform
its material obligations under any material Loan Document to which it is a
party; or (iii) a material impairment of the rights and remedies of the
Administrative Agent or the Lenders under any material Loan Document or (iv) a
material adverse effect upon the legality, validity, binding effect or
enforceability against any Loan Party of any material Loan Document or material
BNCB Acquisition Document to which it is a party.
(f) The
Administrative Agent and the Arrangers shall have received and be reasonably
satisfied with (i) the pro forma consolidated projected financial statements of
the Lead Borrower and its Subsidiaries, giving effect to all elements of the
BNCB Acquisition to be effected on or before the Closing Date, (ii) forecasts
prepared by the Lead Borrower consisting of (A) pro forma consolidated balance
sheets, income statements, and cash flow statements (including a projection of
Availability) on a monthly basis through December 31, 2010, and (B) consolidated
balance sheets, income statements, and cash flow statements (including a
projection of Availability) on an annual basis thereafter through and including
the year in which the Maturity Date occurs; and (iii) historical financial
statements consisting of consolidated balance sheets, income statements, and
cash flow statements (A) for the Lead Borrower and its Subsidiaries for Fiscal
Quarter and Fiscal Month of the Lead Borrower ended August 1, 2009, and (B) for
BNCB and its subsidiaries for fiscal quarter and fiscal month of BNCB ending
August 1, 2009.
(g) All
necessary consents and approvals to the transactions contemplated hereby shall
have been obtained.
(h) After
giving effect to the consummation of the BNCB Acquisition and the other
transactions contemplated under this Agreement and the other Loan Documents on
the Closing Date (including any Loans made or Letters of Credit issued
hereunder), no Default shall exist.
(i) All
fees required to be paid to the Agents or the Arrangers on or before the Closing
Date shall have been paid in full, and all fees required to be paid to the
Lenders on or before the Closing Date shall have been paid in full.
(j) The
Administrative Agent shall have received all documentation and other information
required by regulatory authorities under applicable "know your customer" and
anti-money laundering rules and regulations, including without limitation the
USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the "
Patriot
Act
").
4.02
Conditions
to all Credit Extensions
. The obligation of each Lender to honor any
Request for Credit
Extension (other than a Conversion/Continuation Notice requesting only a
conversion of Committed Loans to the other Type or a continuation of LIBO Rate
Loans) and of each LC Issuer to issue each Letter of Credit is subject to the
following conditions precedent:
(a) The
representations and warranties of the Lead Borrower and each other Loan Party
contained in
Article
V
or any other Loan Document, or which are contained in any document
furnished at any time under or in connection herewith or therewith, (i) which
are qualified by materiality shall be true and correct, and (ii) which are not
qualified by materiality shall be true and correct in all material respects, in
each case, on and as of the date of such Credit Extension, except to the extent
that such representations and warranties specifically refer to an earlier date,
in which case they shall be true and correct, or true and correct in all
material respects, as the case may be, as of such earlier date, and except that
for purposes of this
Section
4.02
, the
representations and warranties contained in subsections (a) and
(b) of
Section
5.05
shall be deemed to refer to the most recent consolidated
statements furnished pursuant to clauses (a) and (b), respectively, of
Section
6.01
.
(b) No
Default shall exist or would result from such proposed Credit Extension or from
the application of the proceeds thereof.
(c) The
Administrative Agent and, if applicable, the LC Issuer or the Swing Line Lender
shall have received a Request for Credit Extension in accordance with the
requirements hereof.
Each
Request for Credit Extension (other than a Conversion/Continuation Notice
requesting only a conversion of Committed Loans to the other Type or a
continuation of LIBO Rate Loans) submitted by the Lead Borrower shall be deemed
to be a representation and warranty by the Borrowers that the conditions
specified in
Sections
4.02(a)
and
4.02(b)
have been
satisfied on and as of the date of the applicable Credit Extension. The
conditions set forth in this
Section 4.02
are for
the sole benefit of the Credit Parties but until the Required Lenders otherwise
direct the Administrative Agent to cease making Committed Loans, the Lenders
will fund their Applicable Percentage of all Loans and LC Advances and
participate in all Swing Line Loans and Letters of Credit whenever made or
issued, which are requested by the Lead Borrower and which, notwithstanding the
failure of the Loan Parties to comply with the provisions of this
Article IV
are agreed
to by the Administrative Agent;
provided
,
however
, that, if the
Administrative Agent has actual knowledge that any Specified Default or any
Event of Default under
Section 6.13
shall
have occurred and be continuing, the Administrative Agent shall cease
making
Committed Loans
unless the Required Lenders otherwise direct in writing;
provided
,
further
, that the
making of any such Loans or the issuance of any Letters of Credit shall not be
deemed a modification or waiver by any Credit Party of the provisions of this
Article IV
on
any future occasion or a waiver of any rights of the Credit Parties as a result
of any such failure to comply.
ARTICLE
V
REPRESENTATIONS
AND WARRANTIES
5.01
Existence,
Qualification and Power
. Each Loan Party (a) is a corporation,
limited
liability
company, partnership or limited partnership, duly organized or formed, validly
existing and, where applicable, in good standing under the Laws of the
jurisdiction of its incorporation or organization,
(b) has
all requisite power and authority and all requisite governmental licenses,
permits, authorizations, consents and approvals to (i) own, lease or operate its
assets and carry on its business as now conducted and (ii) execute, deliver and
perform its obligations under the Loan Documents to which it is a party, and
(c)
is duly
qualified and is licensed and, where applicable, in good standing under the Laws
of each jurisdiction where its ownership, lease or operation of properties or
the conduct of its business requires such qualification or license; except in
each case referred to in clause (b)(i) or (c), to the extent that failure to do
so could not reasonably be expected to have a Material Adverse Effect.
Schedule
5.01
annexed hereto sets forth, as of the Closing Date, each Loan Party’s
name as it appears in official filings in its state of incorporation or
organization, its state of incorporation or organization, organization type,
organization number, if any, issued by its state of incorporation or
organization, and its federal employer identification
number.
5.02
Authorization;
No Contravention
. The execution, delivery and performance by each
Loan
Party of each Loan Document to which such Person is or is to be a party, has
been duly authorized by all necessary corporate or other organizational action,
and does not and will not (a) contravene the terms of any of such Person's
Organization Documents; (b) conflict with or result in any breach, termination,
or contravention of, or constitute a default under, or require any payment to be
made under (i)
any
Material Contract or any Material Indebtedness to which such Person is a party
or affecting such Person or the properties of such Person or any of its
Subsidiaries, or (ii) any order, injunction, writ or decree of any Governmental
Authority or any arbitral award to which such Person or its property is subject;
(c) result in or require the creation of any Lien upon any asset of any Loan
Party (other than Permitted Encumbrances); or (d) violate any Law.
5.03
Governmental
Authorization; Other Consents
. No approval, consent, exemption,
authorization,
or other action by, or notice to, or filing with, any Governmental Authority or
any other Person is necessary or required in connection with the execution,
delivery or performance by, or enforcement against, any Loan Party of this
Agreement or any other Loan Document, except for (a) the perfection or
maintenance of the Liens created under the Security Documents (including the
first priority nature thereof to the extent specified in the Security Agreement)
or (b) such as have been obtained or made and are in full force and
effect.
5.04
Binding
Effect
. This Agreement has been, and each other Loan Document, when
delivered,
will have been, duly executed and delivered by each Loan Party that is party
thereto. This Agreement constitutes, and each other Loan Document when so
delivered will constitute, a legal, valid and binding obligation of such Loan
Party, enforceable against each Loan Party that is party thereto in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.
5.05
Financial
Statements; No Material Adverse Effect
.
(a) The
Audited Financial Statements (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; (ii) fairly present the financial condition of the Lead
Borrower and its Subsidiaries as of the date thereof
(b) The
unaudited Consolidated balance sheet of the Lead Borrower and its Subsidiaries
dated August 1, 2009, and the related Consolidated statements of income or
operations, Shareholders’ Equity and cash flows for the fiscal quarter ended on
that date (i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, and (ii) fairly present the financial condition of the Lead Borrower
and its Subsidiaries as of the date thereof and their results of operations for
the period covered thereby, subject, in the case of clauses (i) and (ii), to the
absence of footnotes and to normal year-end audit adjustments.
Schedule 5.05
sets
forth all Material Indebtedness and other liabilities, direct or contingent, of
the Loan
Parties and
their Consolidated Subsidiaries as of the date of such financial statements,
including liabilities for taxes, material commitments and Material
Indebtedness.
(c) Since
the date of the Audited Financial Statements, there has been no event or
circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.
(d) The
Consolidated forecasted balance sheet and statements of income and cash flows of
the Lead Borrower and its Subsidiaries delivered pursuant to
Section 4.01(f)
and
Section 6.01(d)
were prepared in good faith on the basis of the assumptions stated therein,
which assumptions were fair in light of the conditions existing at the time of
delivery of such forecasts, and represented, at the time of delivery, the Loan
Parties’ reasonable estimate of its future financial performance (it being
understood that such forecasted financial information is subject to significant
uncertainties and contingencies, many of which are beyond the control of the
Loan Parties, that no assurance is given that any particular forecasts will be
realized, that results may differ and that such differences may be
material).
5.06
Litigation
.
There are no actions, suits, proceedings, claims or disputes pending or, to
the
knowledge
of the Loan Parties after due and diligent investigation, threatened or
contemplated, at law, in equity, in arbitration or before any Governmental
Authority, by or against any Loan Party or any of its Subsidiaries or against
any of its properties or revenues that (a) purport to affect or pertain to this
Agreement or any other Loan Document, or any of the transactions contemplated
hereby, or (b) except as specifically disclosed in
Schedule 5.06
, either
individually or in the aggregate, if determined adversely, could reasonably be
expected to have a Material Adverse Effect.
5.07
No
Default
. No Default has occurred and is continuing or would result from
the
consummation
of the transactions contemplated by this Agreement or any other Loan
Document.
5.08
Ownership
of Property; Liens
. Each of the Loan Parties and each Subsidiary
thereof
has
good record and marketable title in fee simple to or valid leasehold interests
in or other rights to use or operate, all real property necessary or used in the
ordinary conduct of its business, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each of the Loan Parties and each Subsidiary has good and
marketable title to, valid leasehold interests in, or valid licenses to use all
personal property and assets used in the ordinary conduct of its business,
except for such defects in title as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(a)
Schedule 5.08(b)(1)
sets forth the address (including street address, county and state) of all Real
Estate that is owned by the Loan Parties.
Schedule 5.08(b)(2)
sets forth the address
(b) The
personal property of each Loan Party and each of its Subsidiaries is subject to
no Liens, other than Liens set forth on
Schedule 7.01
, and
Permitted Encumbrances. The real property of each Loan Party and each of its
Subsidiaries is subject to no Liens, other than Permitted Encumbrances, or, in
the case of Real Estate included in the Borrowing Base, Permitted Real Estate
Liens.
(c)
Schedule 7.02
sets
forth a complete and accurate list of all Investments held by any Loan Party or
any Subsidiary of a Loan Party on the date hereof, showing as of the date hereof
the amount, obligor or issuer, how held (directly or through a securities
intermediary) and maturity, if any, thereof.
(d)
Schedule 7.03
sets
forth a complete and accurate list of all Indebtedness of each Loan Party or any
Subsidiary of a Loan Party on the date hereof, showing as of the date hereof the
amount, holder, obligor or issuer and maturity thereof.
5.09
Environmental
Compliance
. Except as specifically disclosed in
Schedule 5.09
, no
Loan
Party or any
Subsidiary thereof (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability, except, in each of the cases of (i), (ii), (iii) and (iv), as could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(b) Except
as otherwise set forth in
Schedule 5.09
, and
except as could not, individually or in the aggregate reasonably be expected to
have a Material Adverse Effect (i) none of the real properties currently or
formerly owned or operated by any Loan Party or any Subsidiary thereof is listed
or, to the knowledge of the Loan Parties, proposed for listing on the NPL or on
the CERCLIS or any analogous foreign, state or local list or, to the knowledge
of the Loan Parties, is adjacent to any such property; (ii) there are no and
never have been any underground or above-ground storage tanks or any surface
impoundments, septic tanks, pits, sumps or lagoons in which Hazardous Materials
are being or have been treated, stored or disposed of on any property currently
owned or operated by any Loan Party or any Subsidiary thereof or, to the
knowledge of the Loan Parties, on any property formerly owned or operated by any
Loan Party or Subsidiary thereof; (iii) there is no asbestos or
asbestos-containing material on any property currently owned or operated by any
Loan Party or Subsidiary thereof; and (iv) Hazardous Materials have not been
released, discharged or disposed of on any property currently or, to the
knowledge of the Loan Parties, formerly owned or operated by any Loan Party or
any Subsidiary thereof.
(c) Except
as otherwise set forth on
Schedule 5.09
, and
except as could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect (i) no Loan Party or any Subsidiary thereof is
undertaking, and no Loan Party or any Subsidiary thereof has completed, either
individually or together with other potentially responsible parties, any
investigation or assessment or remedial or response action relating to any
actual or threatened release, discharge or disposal of Hazardous Materials at
any site, location or operation, either voluntarily or pursuant to the order of
any Governmental Authority or the requirements of any Environmental Law, other
than any than as may have been required under
Section 6.16(c)
to
5.10
Insurance
.
The properties (including, without limitation, all Collateral) of the Loan
Parties
and their Subsidiaries are insured with financially sound and reputable
insurance companies which are not Affiliates of the Loan Parties (with the
exception of Chelsea Insurance Company Ltd. so long as it is duly licensed by
the appropriate Government Authority in its state of incorporation to conduct
business as an insurer in such state and meets and maintains the appropriate
capital requirements to maintain such licensure), in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Loan Parties or the applicable Subsidiary operates.
Schedule 5.10
sets
forth a description of all insurance maintained by or on behalf of the Loan
Parties as of the Closing Date. As of the Closing Date, each insurance policy
listed on
Schedule
5.10
, and, thereafter, each insurance policy reflected on an Accord
Certificate or other evidence of insurance most recently delivered to the
Administrative Agent in accordance herewith is in full force and effect and all
premiums in respect thereof that are due and payable have been
paid.
5.11
Taxes
.
The Loan Parties and their Subsidiaries have filed all Federal, state and
other
material
tax returns and reports required to be filed, and have paid all Federal, state
and other material taxes, assessments, fees and other governmental charges
levied or imposed upon them or their properties, income or assets otherwise due
and payable, except those which are being contested in good faith by appropriate
proceedings being diligently conducted, for which adequate reserves have been
provided in accordance with GAAP, as to which Taxes no material Lien has been
filed and which contest effectively suspends the collection of the contested
obligation and the enforcement of any Lien securing such obligation. There is no
proposed tax assessment against any Loan Party or any Subsidiary that would, if
made, be reasonably expected to have a Material Adverse Effect. No Loan Party or
any Subsidiary thereof is a party to any tax sharing agreement other than (i)
the tax sharing agreement between Lead Borrower and Game Stop Corp. and (ii) the
BNCB Acquisition Documents.
(a) Each
Plan is in compliance in all material respects with the applicable provisions of
ERISA, the Code and other Federal or state Laws. Each Plan that is intended to
qualify under Section 401(a) of the Code has received a favorable determination
letter from the IRS or an application for such a letter is currently being
processed by the IRS with respect thereto and, to the best knowledge of the Lead
Borrower, nothing has occurred which would prevent, or cause the loss of, such
qualification. The Loan Parties and each ERISA Affiliate have made all required
contributions to each Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code is pending or in effect with respect to any
Plan, except to the extent any failure to make such contribution would
reasonably be expected to have a Material Adverse Effect.
(b) There
are no pending or, to the best knowledge of the Lead Borrower, threatened
claims, actions or lawsuits, or action by any Governmental Authority, with
respect to any Plan that would reasonably be expected to have a Material Adverse
Effect. There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan that has resulted or would
reasonably be expected to result in a Material Adverse Effect.
5.13
Subsidiaries;
Equity Interests
. As of the Closing Date, the Loan Parties have no
Subsidiaries
other than those specifically disclosed in Part (a) of
Schedule 5.13
, which
Schedule sets forth the legal name, jurisdiction of incorporation or formation
and authorized Equity Interests of each such Subsidiary. As of the Closing Date,
(a) all of the outstanding Equity Interests in such Subsidiaries have been
validly issued, are fully paid and non-assessable and are owned by a Loan Party
(or a Subsidiary of a Loan Party) in the amounts specified on Part (a) of
Schedule 5.13
free
and clear of all Liens, (b) except as set forth in
Schedule 5.13
, there
are no outstanding rights to purchase any Equity Interests in any Subsidiary and
(c) the Loan Parties have no equity investments in any other corporation or
entity other than those specifically disclosed in Part(b) of
Schedule
5.13
.
5.14
Margin
Regulations; Investment Company Act
.
(a) No
Loan Party is engaged or will be engaged, principally or as one of its important
activities, in the business of purchasing or carrying margin stock (within the
meaning of Regulation U issued by the FRB), or extending credit for the purpose
of purchasing or carrying margin stock. None of the proceeds of the Credit
Extensions shall be used directly or indirectly for the purpose of purchasing or
carrying any margin stock, for the purpose of reducing or retiring any
Indebtedness that was originally incurred to purchase or carry any margin stock
or for any other purpose that might cause any of the Credit Extensions to be
considered a "purpose credit" within the meaning of Regulations T, U, or X
issued by the FRB.
(b) None
of the Loan Parties nor any Subsidiary is or is required to be registered as an
"investment company" under the Investment Company Act of 1940.
5.15
Disclosure
.
Each Loan Party has disclosed to the Administrative Agent and the Lenders
all agreements,
instruments and corporate or other restrictions to which it or any of its
Subsidiaries is subject, and all other matters known to it, that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect. No report, financial statement, certificate or other information
furnished (whether in writing or orally) and prepared by or on behalf of any
Loan Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder or under any other Loan Document (in each case, as modified
or supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not materially misleading;
provided
that, with
respect to projected financial information, the Loan Parties represent only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time (it being understood that such projections are subject
to significant uncertainties and contingencies, many of which are beyond the
control of the Loan Parties, that no assurance is given that any particular
forecasts will be realized, that actual results may differ and that such
differences may be material).
\
5.17
Intellectual
Property; Licenses, Etc
. (a) As of the effective date of the BNCB
Acquisition
and at all times thereafter, the Loan Parties and their Subsidiaries own, or
possess the right to use, all the Intellectual Property that is reasonably
necessary for the operation of their respective businesses, and (b) to the
knowledge of any Responsible Officer, no Loan Party nor any Subsidiary has
infringed upon any rights held by any other Person, in each case except as would
not reasonably be expected to have a Material Adverse Effect.
5.18
Labor
Matters
. There are no strikes, lockouts, slowdowns or other material
labor
disputes
against any Loan Party or any Subsidiary thereof pending or, to the knowledge of
any Loan Party, threatened. The hours worked by and payments made to employees
of the Loan Parties comply with the Fair Labor Standards Act and any other
applicable federal, state, local or foreign Law dealing with such matters except
to the extent that any such violation could not reasonably be expected to have a
Material Adverse Effect. No Loan Party or any of its Subsidiaries has incurred
any liability or obligation under the Worker Adjustment and Retraining Act or
similar state Law. All payments due from any Loan Party and its Subsidiaries, or
for which any claim may be made against any Loan Party, on account of wages and
employee health and welfare insurance and other benefits, have been paid or
properly accrued in accordance with GAAP as a liability on the books of such
Loan Party. Except as set forth on
Schedule
5.18
no Loan Party or
any Subsidiary is a party to or bound by any collective bargaining
agreement.
There are no
representation proceedings pending or, to any Loan Party’s knowledge, threatened
to be filed with the National Labor Relations Board, and no labor organization
or group of employees of any Loan Party or any Subsidiary has made a pending
demand for recognition in each case which could individually or in the aggregate
be reasonably expected to result in a Material Adverse Effect. There are no
complaints, unfair labor practice charges, grievances, arbitrations, unfair
employment practices charges or any other claims or complaints against any Loan
Party or any Subsidiary pending or, to the knowledge of any Loan Party,
threatened to be filed with any Governmental Authority or arbitrator based on,
arising out of, in connection with, or otherwise relating to the employment or
termination of employment of any employee of any Loan Party or any of its
Subsidiaries which could, individually or in the aggregate, be reasonably
expected to result in a Material Adverse Effect. The consummation of the
transactions contemplated by the Loan Documents will not give rise to any right
of termination or right of renegotiation on the part of any union under any
collective bargaining agreement to which any Loan Party or any of its
Subsidiaries is bound except as could not reasonably be expected to have
individually or in the aggregate, a Material Adverse Effect.
5.19
Security
Documents
.
(a) The
Security Documents, other than any Mortgages, create in favor of the Collateral
Agent, for the benefit of the Secured Parties referred to therein, a legal,
valid, continuing and enforceable security interest in the Collateral (as
defined in the Security Agreement), the enforceability of which is subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.
The financing statements, releases and other filings are in appropriate form and
have been or will be filed in the offices specified in the Perfection
Certificate. Upon such filings and/or the obtaining of "control," the Collateral
Agent will have a perfected Lien on, and security interest in, to and under all
right, title and interest of the grantors thereunder in all Collateral that may
be
(b) As
of the date that any Real Estate is to be designated as Eligible Real Estate and
included in the Borrowing Base, all Real Estate Eligibility Requirements
(including delivery of all Mortgage Related Documents) have been met with
respect to such Real Estate.
(c) Each
Mortgage, if any, as may be executed and delivered by any Borrower from time to
time, creates in favor of the Collateral Agent, for the benefit of the Secured
Parties referred to therein, a legal, valid, and enforceable Lien in the
Mortgaged Property (as defined in applicable Mortgage), the enforceability of
which is subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law. Upon the recording of each Mortgage with the appropriate
Governmental Authorities and the payment of any mortgage recording taxes or
fees, the Collateral Agent will have a perfected Lien on, and security interest
in, to and under all right, title and interest of the grantors thereunder in
such Mortgaged Property (including without limitation the proceeds of such
Mortgaged Property) that may be perfected by such recording.
5.20
Solvency
.
After giving effect to the transactions contemplated by this Agreement, and
before
and after giving effect to each Credit Extension, the Loan Parties, on a
Consolidated basis, are, and will be, Solvent. No transfer of property has been
or will be made by any Loan Party and no obligation has been or will be incurred
by any Loan Party in connection with the transactions contemplated by this
Agreement or the other Loan Documents with the intent to hinder, delay, or
defraud either present or future creditors of any Loan Party.
5.21
Deposit
and Securities Accounts; Credit Card Arrangements
.
(a) Annexed
hereto as
Schedule
5.21(a)
is a list of all DDAs maintained by the Loan Parties as of the
Closing Date, which Schedule includes, with respect to each DDA (i) the name and
address of and contact person at the depository; (ii) the account number(s)
maintained with such depository; and (iv) the identification of each Blocked
Account Bank.
(b) Annexed
hereto as
Schedule
5.21(b)
is a list describing all arrangements as of the Closing Date to
which any Loan Party is a party with respect to the processing and/or payment to
such Loan Party of the proceeds of any credit card charges for sales made by
such Loan Party.
(c) Annexed
hereto as
Schedule
5.21(c)
is a list describing each securities account of the Loan Parties
as of the Closing Date which schedule includes, with respect to each securities
account, (i) the name and address of the Securities Intermediary, (ii) a
description and value of all property held therein and (iii) the account numbers
and name of such accounts.
5.22
Brokers
.
No broker or finder brought about the obtaining, making or closing of the
Loans
or transactions contemplated by the Loan Documents, and no Loan Party or
Affiliate thereof has any obligation to any Person in respect of any finder’s or
brokerage fees in connection therewith.
5.23
Customer
and Trade Relations
. There exists no actual or, to the knowledge of
any
Loan
Party, threatened, termination or cancellation of, or any modification or change
in the business
5.24
Storage
Locations
. There are no warehouse or other storage or distribution
facilities
leased
by the Loan Parties (excluding Stores) in which, in the aggregate, more than
$15,000,000 of Inventory is or may be located from time to time and with respect
to which the Loan Parties have not caused to be delivered to the Administrative
Agent a Collateral Access Agreements.
ARTICLE
VI
AFFIRMATIVE
COVENANTS
So long
as any Obligation hereunder (other than contingent indemnification obligations
as to which no claim has been asserted) shall not be Fully Satisfied, the Loan
Parties shall, and (except in the case of the covenants set forth in
Sections 6.01
,
6.02
and
6.03
) shall cause
each Subsidiary to:
6.01
Financial
Statements
. Deliver to the Administrative Agent, in form and detail
reasonably satisfactory
to the Administrative Agent:
(a) as
soon as available, but in any event within 90 days after the end of each Fiscal
Year of the Lead Borrower, a Consolidated balance sheet of the Lead Borrower and
its Subsidiaries as at the end of such Fiscal Year, and the related consolidated
statements of income or operations, Shareholders’ Equity and cash flows for such
Fiscal Year, setting forth in each case in comparative form the figures for the
previous Fiscal Year, all in reasonable detail and prepared in accordance with
GAAP, such consolidated statements to be audited and accompanied by a report and
unqualified opinion of a Registered Public Accounting Firm of nationally
recognized standing reasonably acceptable to the Administrative Agent, which
report and opinion shall be prepared in accordance with generally accepted
auditing standards and shall not be subject to any "going concern" or like
qualification or exception or any qualification or exception as to the scope of
such audit;
(b) as
soon as available, but in any event within 45 days after the end of each of the
first three Fiscal Quarters of each Fiscal Year of the Lead Borrower, a
Consolidated balance sheet of the Lead Borrower and its Subsidiaries as at the
end of such Fiscal Quarter, and the related consolidated statements of income or
operations, Shareholders’ Equity and cash flows for such Fiscal Quarter and for
the portion of the Lead Borrower's Fiscal Year then ended, setting forth in each
case in comparative form the figures for (A) the corresponding Fiscal Quarter of
the previous Fiscal Year and (B) the corresponding portion of the previous
Fiscal Year, all in reasonable detail, such Consolidated statements to be
certified by a Responsible Officer of the Lead Borrower as fairly presenting the
financial condition, results of operations, Shareholders’ Equity and cash flows
of the Lead Borrower and its Subsidiaries as of the end of such Fiscal Quarter
in accordance with GAAP, subject only to normal year-end audit adjustments and
the absence of footnotes;
(c) as
soon as available, but in any event within 30 days after the end of each Fiscal
Month of each Fiscal Year (excluding the end of any Fiscal Month which is also
the end of a Fiscal Quarter), a consolidated balance sheet of the Lead Borrower
and its Subsidiaries as at the end of such Fiscal Month, and the related
consolidated statements of income or operations, Shareholders’ Equity and cash
flows for such Fiscal Month, and for the portion of the Lead Borrower's Fiscal
Year then ended, setting forth in each case in comparative form the figures for
(A) the corresponding Fiscal Month of the previous Fiscal Year and (B) the
corresponding portion of the previous Fiscal Year, all in reasonable detail,
such consolidated statements to be
(d) as
soon as available, but in any event not more than 60 days after the end of each
Fiscal Year of the Lead Borrower, forecasts prepared by management of the Lead
Borrower, in form reasonably satisfactory to the Administrative Agent, of
consolidated balance sheets and statements of income or operations and cash
flows of the Lead Borrower and its Subsidiaries, as well as projected
Availability, on a monthly basis for the immediately following Fiscal Year
(including the Fiscal Year in which the Maturity Date occurs), and as soon as
available, any significant revisions to such forecast with respect to such
Fiscal Year.
The
Administrative Agent and the Lenders acknowledge and agree that notwithstanding
the allotted time periods for monthly delivery of financial statements and
Compliance Certificates set forth in
Section
6.01(c)
and
Section 6.02(b)
, the
time periods for delivering such financial statements and Compliance
Certificates
for the months of April and May of each Fiscal Year shall be extended by 30 days
for April and 15 days for May (each an "
Extension Period
");
provided that no prepayment of Indebtedness, Acquisition, Restricted Payment,
Investment or other transaction or payment permitted hereunder based upon a
calculation of Consolidated Fixed Charge Coverage Ratio or Consolidated Adjusted
Fixed Charge Coverage Ratio shall be permitted during any Extension Period if
the applicable financial statements and Compliance Certificates for such periods
have not been delivered.
6.02
Certificates;
Other Information
.
Deliver to the Administrative Agent, in form and
detail reasonably
satisfactory to the Administrative Agent:
(a) concurrently
with the delivery of the financial statements referred to in
Section
6.01(a)
and
(b)
, (i) a duly
completed Compliance Certificate signed by a Responsible Officer of
the Lead
Borrower which (among other things) includes a detailed calculation of the
Consolidated Fixed Charge Coverage Ratio (regardless of whether a Fixed Charge
Trigger Period exists), (ii) a certificate setting forth any change in generally
accepted accounting principles used in the preparation of such financial
statements and (iii) and a copy of management’s discussion and analysis with
respect to such financial statements;
provided
, that (x)
upon the occurrence of any event giving rise to a Fixed Charge Trigger Period or
a Trigger Period, if no Compliance Certificate has been delivered thirty (30) or
fewer days prior to such commencement date, the Lead Borrower immediately shall
deliver to the Administrative Agent a Compliance Certificate signed by a
Responsible Officer of the Lead Borrower which (among other things) shall
include a detailed calculation of the Consolidated Fixed Charge Coverage Ratio
as of the most recently ended Measurement Period (each, a “
Trigger Period Compliance
Certificate
”) and (y) thereafter during any Fixed Charge Trigger Period
or Trigger Period, the Lead Borrower shall deliver to the Administrative Agent,
as soon as available but in any event within 30 days after the end of each
Fiscal Month, a Trigger Period Compliance Certificate;
(b) on
the 15
th
day of
each Fiscal Month (or, if such day is not a Business Day, on the next succeeding
Business Day) or such later Business Day as the Administrative Agent may agree
in its reasonable discretion but not beyond the 20
th
day of
any such Fiscal Month, a certificate in the form of
Exhibit F
(a "
Borrowing Base
Certificate
") showing the Borrowing Base as of the close of business as
of the last day of the immediately preceding Fiscal Month, each Borrowing Base
Certificate to be certified as complete and correct by a Responsible Officer of
the Lead Borrower;
provided
that during
any Trigger Period, such Borrowing Base Certificate shall be delivered no later
than the third Business Day (or, if agreed by the Administrative
Agent
(c) no
more than ten (10) Business Days after receipt thereof, copies of any detailed
audit reports, final management letters or recommendations submitted to the
board of directors (or the audit committee of the board of directors) of any
Loan Party by its Registered Public Accounting Firm in connection with the
accounts or books of the Loan Parties or any Subsidiary, or any audit of any of
them, including, without limitation, specifying any Internal Control
Event;
(d) promptly
upon the filing thereof, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of the Loan
Parties, and copies of all annual, regular, periodic and special reports and
registration statements which any Loan Party may file or be required to file
with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934 or
with any national securities exchange, and in any case not otherwise required to
be delivered to the Administrative Agent pursuant hereto;
(f) upon
the renewal of any insurance policy of the Loan Parties, evidence of insurance
reasonably satisfactory to the Collateral Agent, summarizing the insurance
coverage (specifying type, amount and carrier) in effect for each Loan Party and
its Subsidiaries, and as soon as available, but in any event within 30 days
after such renewal, a certificate of such insurance coverage;
(g) promptly,
and in any event within five Business Days after receipt thereof by any Loan
Party or any Subsidiary thereof, copies of each notice or other correspondence
received from any Governmental Authority (including, without limitation, the SEC
(or comparable agency in any applicable non-U.S. jurisdiction)) concerning any
proceeding with, or investigation or possible investigation or other inquiry by
such Governmental Authority regarding financial or other operational results of
any Loan Party or any Subsidiary thereof or any other matter which, if adversely
determined, could reasonably expected to have a Material Adverse
Effect;
(h) promptly,
such additional information regarding the business affairs, financial condition
or operations of any Loan Party or any Subsidiary, or compliance with the terms
of the Loan Documents, as the Administrative Agent or any Lender may from time
to time reasonably request; and
(i) no
less than five (5) Business Days prior to making any Permitted Tax Distribution,
written notice regarding the Tax Distribution Amount (including any statements
and calculations prepared or delivered in accordance with Section 2.04 of the
BNCB Purchase Agreement).
Documents
required to be delivered pursuant to
Section 6.01(a)
,
(b)
, or
(c)
or
Section 6.02(c)
(to
the extent any such documents are included in materials otherwise filed with the
SEC) may be delivered electronically and if so delivered, shall be deemed to
have been delivered on the date (i) on which the Lead Borrower posts such
documents, or provides a link thereto on the Lead Borrower’s website on the
Internet at the website address listed on
Schedule 10.02
; or
(ii) on which such documents are posted on
The Loan
Parties hereby acknowledge that (a) the Administrative Agent and/or the Arranger
will make available to the Lenders and the LC Issuer materials and/or
information provided by or on behalf of the Loan Parties hereunder
(collectively, "
Borrower Materials
")
by posting the Borrower Materials on IntraLinks or another similar electronic
system (the "
Platform
") and (b)
certain of the Lenders may be "public-side" Lenders (
i.e.
, Lenders that do
not wish to receive material non-public information with respect to the Loan
Parties or their securities) (each, a "
Public Lender
"). The
Loan Parties hereby agree that they will use commercially reasonable efforts to
identify that portion of the Borrower Materials that may be distributed to the
Public Lenders and that (w) all such Borrower Materials shall be clearly and
conspicuously marked "PUBLIC" which, at a minimum, shall mean that the word
"PUBLIC" shall appear prominently on the first page thereof; (x) by marking
Borrower Materials "PUBLIC," the Loan Parties shall be deemed to have authorized
the Administrative Agent, the Arranger, the LC Issuer and the Lenders to treat
such Borrower Materials as not containing any material non-public information
(although it may be sensitive and proprietary) with respect to the Loan Parties
or their securities for purposes of United States Federal and state securities
laws (
provided
,
however
, that
to the extent such Borrower Materials constitute Information, they shall be
treated as set forth in
Section 10.07
); (y)
all Borrower Materials marked "PUBLIC" are permitted to be made available
through a portion of the Platform designated "Public Investor"; and (z) the
Administrative Agent and the Arranger shall be entitled to treat any Borrower
Materials that are not marked "PUBLIC" as being suitable only for posting on a
portion of the Platform not designated "Public Investor."
6.03
Notices
. Promptly, unless expressly indicated
otherwise, notify the Administrative
Agent:
(a) of
the occurrence of (i) any Specified Default and (ii) upon a Responsible Officer
obtaining actual knowledge thereof, any Default other than a Specified
Default;
(b) immediately
upon obtaining actual knowledge thereof, any other Trigger Event or Fixed Charge
Trigger Event;
(c) of
any matter that has resulted or could reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Material Contract or with respect to Material Indebtedness of
any Loan Party or any Subsidiary thereof; (ii) any material dispute, litigation,
investigation, proceeding or suspension between any Loan Party or any Subsidiary
thereof and any Governmental Authority; or (iii) the commencement of, or any
material development in, any material litigation or proceeding affecting any
Loan Party or any Subsidiary thereof, including pursuant to any applicable
Environmental Laws;
(d)
of
the occurrence of any ERISA Event;
(f) any
material change in accounting policies or financial reporting practices by any
Loan Party or any Subsidiary thereof;
(g) of
the Public Accountants’ determination (in connection with its preparation of its
report under
Section
6.01(a))
or the Lead Borrower's determination of the occurrence or
existence of any Internal Control Event ;
(h)
of
the formation or acquisition of any Subsidiary;
(i) of
any change in the name, corporate form or state of organization of any Loan
Party or any change in the name or names under which any Loan Party’s Business
is transacted
(j) immediately
upon receipt of notice thereof, of the filing of any Lien against any Loan Party
for unpaid Taxes against any material portion of the Collateral;
(k) of
any casualty or other insured damage to any material portion of the Collateral
or the commencement of any action or proceeding for the taking of any interest
in a material portion of the Collateral under power of eminent domain or by
condemnation or similar proceeding or if any material portion of the Collateral
is damaged or destroyed; and
(l) of
any notice of any material non-compliance with applicable Laws with respect to
any “Property” (as defined in any Mortgages relating to Eligible Real Estate)
which it receives or any pending proceedings in respect thereof.
Each
notice pursuant to this
Section 6.03
shall be
accompanied by a statement of a Responsible Officer of the Lead Borrower setting
forth details of the occurrence referred to therein and stating what action the
Lead Borrower has taken and proposes to take with respect thereto. Each notice
pursuant to
Section
6.03(a)
shall
describe with particularity any and all provisions of this Agreement and any
other Loan
Document that
have been breached.
6.04
Payment
of Obligations
.
Pay and discharge as the same shall become due and payable,
all its obligations and
liabilities, including (a) all tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, (b) all lawful claims
(including, without limitation, claims of landlords, warehousemen, customs
brokers, and carriers) which, if unpaid, would by law become a Lien upon its
property (other than Permitted Encumbrances); and (c) all Material Indebtedness,
as and when due and payable, but subject to any subordination provisions
contained in any instrument or agreement evidencing such Material Indebtedness,
except, in each case, where (i) the validity or amount thereof is being
contested in good faith by appropriate proceedings, (ii) such Loan Party has set
aside on its books adequate reserves with respect thereto in accordance with
GAAP, (iii) such contest effectively suspends collection of the contested
obligation and enforcement of any Lien securing such obligation, (iv) no Lien
(other than Permitted Encumbrances) has been filed with respect thereto and (iv)
the failure to make payment pending such contest could not reasonably be
expected to result in a Material Adverse Effect. Nothing contained herein shall
be deemed to limit the rights of the Administrative Agent with respect to
establishing Reserves pursuant to this Agreement.
6.05
Preservation
of Existence, Etc
. (a) Preserve, renew and maintain in full force and
effect
its legal
existence and good standing under the Laws of the jurisdiction of its
organization or formation except in a transaction permitted by
Section 7.04
or
7.05
; (b) take all
reasonable action to maintain all
6.06
Maintenance
of Properties
. (a) Maintain (except for any maintenance required to
be
performed by the
landlord, lessor or other property owner under any applicable Lease), preserve
and protect all of its material properties and equipment necessary in the
operation of its business in good working order and condition, ordinary wear and
tear excepted except where the failure to do so could not reasonably be expected
to have a Material Adverse Effect and (b) make all necessary repairs thereto and
renewals and replacements thereof (except for any repairs, renewals or
replacements required to be made by the landlord, lessor or other property owner
under any applicable Lease) except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
6.07
Maintenance
of Insurance
.
Maintain with financially sound and reputable insurance
companies not Affiliates
of the Loan Parties (other than a Permitted Self-Insurance Program), reasonably
acceptable to the Administrative Agent, insurance with respect to its properties
and business against loss or damage of the kinds customarily insured against by
Persons engaged in the same or similar business and operating in the same or
similar locations or as is required by applicable Law, of such types and in such
amounts (after giving effect to any self-insurance compatible with the following
standards) as are customarily carried under similar circumstances by such other
Persons and as are reasonably acceptable to the Administrative
Agent.
(a) Fire
and extended coverage policies maintained with respect to any Collateral shall
be endorsed or otherwise amended to include (i) a non-contributing mortgage
clause (regarding improvements to real property) and lenders’ loss payable
clause (regarding personal property), in form and substance satisfactory to the
Collateral Agent, which endorsements or amendments shall provide that the
insurer shall pay all proceeds otherwise payable to the Loan Parties under the
policies directly to the Collateral Agent (and the Collateral Agent agrees,
unless a Trigger Event is then continuing or the proceeds are required to be
applied to the Obligations in accordance with
Section 2.05(c)
or
2.05(e)
, to
deliver such insurance proceeds as the Lead Borrower may direct), (ii) a
provision to the effect that none of the Loan Parties, Credit Parties or any
other Person shall be a co-insurer and (iii) such other provisions as the
Collateral Agent may reasonably require from time to time to protect the
interests of the Credit Parties. Commercial general liability policies shall be
endorsed to name the Collateral Agent as an additional insured. Business
interruption policies shall name the Collateral Agent as a loss payee and shall
be endorsed or amended to include (i) a provision that, from and after the
Closing Date, the insurer shall pay all proceeds otherwise payable to the Loan
Parties under the policies directly to the Collateral Agent (and the Collateral
Agent agrees, unless a Trigger Event is then continuing or the proceeds are
required to be applied to the Obligations in accordance with
Section 2.05(c)
or
2.05(e)
, to
deliver such insurance proceeds as the Lead Borrower may direct), (ii) a
provision to the effect that none of the Loan Parties, the Administrative Agent,
the Collateral Agent or any other party shall be a co-insurer and (iii) such
other provisions as the Collateral Agent may reasonably require from time to
time to protect the interests of the Credit Parties. Each such policy referred
to in this
Section
6.07(b)
shall also provide that it shall not be canceled, modified or not
renewed (i) by reason of nonpayment of premium except upon not less than ten
(10) days’ prior written notice thereof by the insurer to the Collateral Agent
(giving the Collateral Agent the right to cure defaults in the payment of
premiums) or (ii) for any other reason except upon not less than thirty (30)
days’ prior written notice thereof by the insurer to the Collateral Agent. The
Lead Borrower shall deliver to the Collateral Agent, prior to the cancellation,
modification or non-renewal of any such policy of insurance, a copy of a renewal
or replacement policy (or other evidence of renewal of a
(b) None
of the Credit Parties, or their agents or employees shall be liable for any loss
or damage insured by the insurance policies required to be maintained under this
Section 6.07
.
Each Loan Party shall look solely to its insurance companies or any other
parties other than the Credit Parties for the recovery of such loss or damage
and such insurance companies shall have no rights of subrogation against any
Credit Party or its agents or employees. If, however, the insurance policies do
not provide waiver of subrogation rights against such parties, as required
above, then the Loan Parties hereby agree, to the extent permitted by law, to
waive their right of recovery, if any, against the Credit Parties and their
agents and employees. The designation of any form, type or amount of insurance
coverage by the any Credit Party under this
Section 6.07
shall in
no event be deemed a representation, warranty or advice by such Credit Party
that such insurance is adequate for the purposes of the business of the Loan
Parties or the protection of their properties.
(c) Maintain
for themselves and their Subsidiaries, a Directors and Officers insurance
policy, and a "Blanket Crime" policy including employee dishonesty, forgery or
alteration, theft, disappearance and destruction, robbery and safe burglary,
property, and computer fraud coverage with responsible companies in such amounts
as are customarily carried by business entities engaged in similar businesses
similarly situated, and will upon request by the Administrative Agent furnish
the Administrative Agent certificates evidencing renewal of each such
policy.
(d) If
at any time the area in which any Eligible Real Estate is located is designated
(i) a "flood hazard area" in any Flood Insurance Rate Map published by the
Federal Emergency Management Agency (or any successor agency), obtain flood
insurance in an amount and form that complies with the requirements under the
National Flood Insurance Act, or (ii) a "Zone 1" area, obtain earthquake
insurance in such total amount as is reasonable and customary for companies
engaged in the Business.
(e) Permit
any representatives that are designated by the Collateral Agent to inspect the
insurance policies maintained by or on behalf of the Loan Parties and to inspect
books and records related thereto and any properties covered thereby, all at the
Loan Parties’ expense.
6.08
Compliance
with Laws
.
Comply
in all material respects with the requirements of all
Laws and all orders,
writs, injunctions and decrees applicable to it or to its business or property,
except in such instances in which (a) such requirement of Law or order, writ,
injunction or decree is being contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves have been set
aside and maintained by the Loan Parties in accordance with GAAP; (b) such
contest effectively suspends enforcement of the contested Laws; and (c) the
failure to comply therewith could not reasonably be expected to have a Material
Adverse Effect.
6.09
Books and
Records; Accountants
.
(a) (i)
Maintain proper books of record and account, in which full, true and correct
entries in conformity with GAAP consistently applied shall be made of all
financial transactions and matters involving the assets and business of the Loan
Parties or such Subsidiary, as the case may be; and (ii) maintain such books of
record and account in material conformity with all applicable requirements of
any Governmental Authority having regulatory jurisdiction over the Loan Parties
or such Subsidiary, as the case may be.
(a) Permit
representatives and independent contractors of the Administrative Agent to visit
and inspect any of its properties, to examine its corporate, financial and
operating records, and make copies thereof or abstracts therefrom, and to
discuss its affairs, finances and accounts with its directors, officers, and
Registered Public Accounting Firm (once in any 12 month period or, during any
Trigger Period, at the Administrative Agent’s reasonable discretion), all at the
expense of the Loan Parties and at such reasonable times during normal business
hours, upon reasonable advance notice to the Lead Borrower;
provided
,
however
, that during
a Trigger Period, the Administrative Agent (or any of its representatives or
independent contractors) may do any of the foregoing at the expense of the Loan
Parties at any time during normal business hours and without advance
notice.
(b) After
reasonable prior notice from the Administrative Agent, permit the Administrative
Agent or professionals (including investment bankers, consultants, accountants,
lawyers and appraisers) retained by the Administrative Agent to conduct
appraisals, commercial finance examinations and other evaluations, including,
without limitation, of (i) the Lead Borrower’s practices in the computation of
the Borrowing Base, (ii) the personal property included in the Borrowing Base
and related financial information such as, but not limited to, sales, gross
margins, payables, accruals and reserves and (iii) the Real Estate included in
the Borrowing Base and related financial information and Environmental
Assessments. The Loan Parties shall pay the reasonable and documented fees and
out-of-pocket expenses of the Administrative Agent or such professionals for
such evaluations and appraisals (A) with respect to (b)(i) and (ii) above (1)
other than during a Trigger Period, two (2) appraisals of the Loan Parties’
Inventory and two (2) commercial finance examinations during any calendar year
and (2) during a Trigger Period, three (3) appraisals of the Loan Parties’
Inventory and three (3) commercial finance examinations during the calendar year
in which such Trigger Period arose, and (B) with respect to (b)(iii) above, if
Real Estate is then included in the Borrowing Base, up to one (1) such appraisal
of such Eligible Real Estate during any calendar year, (C) all other commercial
finance examinations and appraisals with respect to the Collateral (other than
Real Estate) and up to one additional appraisal with respect to Eligible Real
Estate, in each case undertaken at any time at the request of the Administrative
Agent if required by applicable Law and (D) all commercial finance examinations
and appraisals deemed necessary by the Administrative Agent and undertaken at
the request of the Administrative Agent after the occurrence and the
continuation of an Event of Default.
(c) Permit
the Administrative Agent, from time to time, to engage an independent engineer
or other qualified environmental consultant or expert, reasonably acceptable to
the Administrative Agent, at the reasonable expense of the Loan Parties, to
undertake Phase I environmental site assessments during the term of this
Agreement of the Eligible Real Estate, provided that such assessments may only
be undertaken (i) during the continuance of an Event of Default, or (ii) if a
Loan Party receives any notice or obtains knowledge of (A) any potential or
known material release of any Hazardous Materials at or from any
Eligible Real Estate,
notification of which release must be given to any Governmental
Authority under any Environmental Law, or notification of which has, in fact,
been given to any Governmental Authority, or (B) any material complaint, order,
citation or notice with regard to air emissions, water discharges, exposure to
Hazardous Materials, or any other environmental or health or safety exposure
matter affecting any Loan Party or any Eligible Real Estate from any Person
(including, without limitation, the U.S. Environmental Protection Agency).
Environmental assessments may include detailed visual inspections of the
Eligible Real Estate, including, without limitation, any and all storage areas,
storage tanks, drains, dry wells and leaching areas, as well as such other
non-invasive investigations or analyses as are reasonably necessary for a
determination of the compliance of the Eligible Real Estate and the use and
operation thereof with all applicable Environmental Laws;
provided
,
however
, that the
scope of any assessment undertaken under this provision shall be limited to that
which is necessary to investigate the release, complaint, order, citation or
notice which prompted the assessment. The Borrowers will, and will cause each of
their Subsidiaries to, cooperate with the Administrative Agent and such third
parties to enable such assessment to be timely completed in a manner reasonably
satisfactory to the Administrative Agent, provided such assessment shall not
unreasonably interfere with the ordinary business operations of the Loan
Parties, their Subsidiaries or the Eligible Real Property.
6.11
Use of
Proceeds
. Use the proceeds of the Credit Extensions (a) to finance the
BNCB
Acquisition,
(b) to refinance the Indebtedness of the Lead Borrower and its Subsidiaries
under the Existing Credit Agreement, (c) to finance the acquisition of working
capital assets of the Borrowers, including Permitted Acquisitions and the
purchase of inventory and equipment, in each case in the ordinary course of
business, (d) to finance Capital Expenditures of the Borrowers, and (e) for
general corporate purposes of the Loan Parties, in each case to the extent
permitted under applicable Law and the Loan Documents.
6.12
Additional
Loan Parties; Additional Collateral; Further
Assurances
.
(a) Each
Loan Party shall cause (i) each of its Domestic Subsidiaries (other than any
Immaterial Subsidiary (except as otherwise provided in paragraph (e) of this
Section 6.12