Execution Version

 

 

$75,000,000

 

SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

Dated as of August 30, 2013

 

among

 

Francesca’s Collections, inc., as Borrower

 

Francesca’s LLC, as Parent

 

THE OTHER GUARANTORS PARTY HERETO,
as Guarantors

 

THE LENDERS PARTY HERETO

 

and

Royal Bank of Canada,

 

as Administrative Agent, Collateral Agent,

Joint Lead Arranger and Co-Bookrunner

 

and

 

KeyBank National Association,

 

as Syndication Agent,

Joint Lead Arranger and Co-Bookrunner

 

 

 

Table of Contents

 

		Page
ARTICLE I DEFINITIONS, INTERPRETATION AND ACCOUNTING TERMS		1
Section 1.1	Defined Terms	1
Section 1.2	UCC Terms	36
Section 1.3	Accounting Terms and Principles	36
Section 1.4	Payments	37
Section 1.5	Interpretation	37
ARTICLE II THE FACILITY		37
Section 2.1	The Commitments	37
Section 2.2	Borrowing Procedures	38
Section 2.3	[Reserved]	39
Section 2.4	Letters of Credit	39
Section 2.5	Reduction and Termination of the Commitments	43
Section 2.6	Repayment of Obligations	43
Section 2.7	Optional Prepayments	43
Section 2.8	[Reserved]	43
Section 2.9	Interest	43
Section 2.10	Conversion and Continuation Options	44
Section 2.11	Fees	45
Section 2.12	Application of Payments	45
Section 2.13	Payments and Computations	46
Section 2.14	Evidence of Debt	48
Section 2.15	Suspension of Eurodollar Rate Option	49
Section 2.16	Breakage Costs; Increased Costs; Capital Requirements	49
Section 2.17	Taxes	51
Section 2.18	Substitution of Lenders	54
Section 2.19	Defaulting Lenders	54
Section 2.20	Increase of Commitments and Incremental Term Loans	56
ARTICLE III CONDITIONS TO EFFECTIVENESS AND TO LOANS AND LETTERS OF CREDIT		58
Section 3.1	Conditions to Effectiveness	58
Section 3.2	Conditions Precedent to Each Loan and Letter of Credit	59
Section 3.3	Defaulting Lenders	59
Section 3.4	Determinations of Initial Borrowing Conditions	59
ARTICLE IV REPRESENTATIONS AND WARRANTIES		60
Section 4.1	Corporate Existence; Compliance with Law	60
Section 4.2	Loans	60
Section 4.3	Subsidiaries	61
Section 4.4	Financial Statements	61
Section 4.5	Material Adverse Effect	61
Section 4.6	Solvency	62
Section 4.7	Litigation	62
Section 4.8	Taxes	62

 

 

Section 4.9	Margin Regulations	62
Section 4.10	No Burdensome Obligations; No Defaults	62
Section 4.11	Investment Company Act	63
Section 4.12	Labor Matters	63
Section 4.13	ERISA	63
Section 4.14	Environmental Matters	63
Section 4.15	Intellectual Property	64
Section 4.16	Title; Real Property	64
Section 4.17	Full Disclosure	65
Section 4.18	Permits	65
Section 4.19	Anti-Terrorism Laws	65
Section 4.20	Insurance	65
ARTICLE V FINANCIAL COVENANTS		65
Section 5.1	Maximum Consolidated Total Lease Adjusted Leverage Ratio	65
Section 5.2	Maximum Capital Expenditures	66
ARTICLE VI REPORTING COVENANTS		66
Section 6.1	Financial Statements	66
Section 6.2	Other Events	68
Section 6.3	Copies of Notices and Reports	68
Section 6.4	[Reserved]	69
Section 6.5	ERISA Matters	69
Section 6.6	Environmental Matters	69
Section 6.7	Labor Matters	69
Section 6.8	Other Information	70
ARTICLE VII AFFIRMATIVE COVENANTS		70
Section 7.1	Maintenance of Corporate Existence	70
Section 7.2	Compliance with Laws, Etc	70
Section 7.3	Payment of Obligations	71
Section 7.4	Maintenance of Property	71
Section 7.5	Maintenance of Insurance	71
Section 7.6	Keeping of Books	71
Section 7.7	Access to Books and Property	72
Section 7.8	Environmental	72
Section 7.9	Use of Proceeds	72
Section 7.10	Additional Collateral and Guaranties	73
ARTICLE VIII NEGATIVE COVENANTS		74
Section 8.1	Indebtedness	74
Section 8.2	Liens	77
Section 8.3	Investments	78
Section 8.4	Asset Sales	80
Section 8.5	Restricted Payments	81
Section 8.6	Payment of Subordinated Debt and Certain Other Debt	82
Section 8.7	Fundamental Changes	83
Section 8.8	Change in Nature of Business	83
Section 8.9	Transactions with Affiliates	83

 

 

Section 8.10	Third-Party Restrictions on Indebtedness, Liens, Investments or Restricted Payments	86
Section 8.11	Modification of Certain Documents	86
Section 8.12	Accounting Changes; Fiscal Year	86
Section 8.13	Margin Regulations	86
Section 8.14	Compliance with ERISA	86
Section 8.15	Hazardous Materials	87
Section 8.16	Material Contracts	87
Section 8.17	Anti-Terrorism Laws; Anti-Money Laundering; Embargoed Persons	87
ARTICLE IX EVENTS OF DEFAULT		87
Section 9.1	Definition	87
Section 9.2	Remedies	89
Section 9.3	[Reserved]	89
Section 9.4	Actions in Respect of Letters of Credit	89
ARTICLE X THE AGENTS		89
Section 10.1	Appointment and Authority	89
Section 10.2	Agents Individually	90
Section 10.3	Duties of the Agents; Exculpatory Provisions	91
Section 10.4	Reliance by Agents	92
Section 10.5	Delegation of Duties	92
Section 10.6	Notice of Default	92
Section 10.7	Resignation of Agents	93
Section 10.8	Resignation of L/C Issuer	93
Section 10.9	Non-Reliance on Agents and Other Lender Parties	93
Section 10.10	Release of Collateral or Guarantors	94
Section 10.11	Additional Secured Parties	95
Section 10.12	Expenses; Indemnities	95
Section 10.13	No Other Duties, etc	96
Section 10.14	Withholding Tax	96
Section 10.15	Removal of Agents	97
ARTICLE XI MISCELLANEOUS		97
Section 11.1	Amendments, Waivers, Etc	97
Section 11.2	Assignments and Participations; Binding Effect	99
Section 11.3	Costs and Expenses	102
Section 11.4	Indemnities	103
Section 11.5	Survival	104
Section 11.6	Limitation of Liability for Certain Damages	104

Section 11.7	Lender-Creditor Relationship; No Fiduciary Duty	104
Section 11.8	Right of Setoff	105
Section 11.9	Sharing of Payments, Etc	105
Section 11.10	Marshaling; Payments Set Aside	105
Section 11.11	Notices	106
Section 11.12	Posting of Approved Electronic Communications	108
Section 11.13	Confidentiality	109
Section 11.14	Treatment of Information	110
Section 11.15	Governing Law	111
Section 11.16	Jurisdiction	111

 

 

Section 11.17	WAIVER OF JURY TRIAL	112
Section 11.18	Severability	112
Section 11.19	Execution in Counterparts	112
Section 11.20	Entire Agreement	112
Section 11.21	Use of Name	112
Section 11.22	Patriot Act Notice	113
Section 11.23	Borrower Ratification of Loan Documents	113
Section 11.24	Guarantor Ratification of Loan Documents	113

 

 

SCHEDULES
Schedule I	–	Commitments
Schedule 4.2	–	Consents
Schedule 4.3	–	Ownership of Borrower and Subsidiaries
Schedule 4.12	–	Labor Matters
Schedule 4.13	–	List of Plans
Schedule 4.14	–	Environmental Matters
Schedule 4.16	–	Real Property
Schedule 4.20	–	Insurance
Schedule 8.1	–	Existing Indebtedness
Schedule 8.2	–	Existing Liens
Schedule 8.3	–	Existing Investments
Schedule 8.10	–	Existing Third-Party Restrictions
EXHIBITS
Exhibit 1.1(1)	–	Form of Assignment
Exhibit 1.1(2)	–	Form of Compliance Certificate
Exhibit 1.1(3)	–	Form of Guaranty and Security Agreement
Exhibit 1.1(4)	–	Form of Perfection Certificate
Exhibit 2.2(a)	–	Form of Notice of Borrowing
Exhibit 2.4(b)	–	Form of L/C Request
Exhibit 2.10(b)	–	Form of Notice of Conversion or Continuation
Exhibit 2.14(e)	–	Form of Note
Exhibit 2.17(f)	–	Form of United States Tax Compliance Certificate

 

 

This SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of August 30, 2013, is entered into among Francesca’s Collections, inc., a Texas corporation (the “Borrower”), Francesca’s llc, a Delaware limited liability company (“Parent”), the other Guarantors (as defined below), the Lenders (as defined below), Royal Bank of Canada, as administrative agent (“Royal Bank”, in such capacity, and together with its successors and permitted assigns, the “Administrative Agent”) and as collateral agent (in such capacity, and together with its successors and permitted assigns, the “Collateral Agent”) for the Secured Parties, KEYBANK NATIONAL ASSOCIATION, as syndication agent (“KeyBank”, in such capacity the “Syndication Agent”) and as L/C Issuer (in such capacity, and together with its successors and permitted assigns, the “L/C Issuer”), ) and Royal Bank and KeyBank, as joint lead arrangers and co-bookrunners (in such capacities, “Arrangers”).

 

WHEREAS, the Borrower, certain affiliates thereof, the lenders party thereto (the “Existing Lenders”), the Administrative Agent and the other financial institutions named as agents and arrangers therein have entered into that certain Amended and Restated Credit Agreement dated as of July 27, 2011 (the “Original Credit Agreement”); and

 

WHEREAS, the Borrower and such affiliates desire to amend and restate the Original Credit Agreement; and

 

WHEREAS, the parties hereto intend that (a) the Obligations (as defined in the Original Credit Agreement) which remain unpaid and outstanding as of the date hereof shall continue to exist under this Agreement on the terms set forth herein and (b) the Collateral (as defined in the Original Credit Agreement) shall continue to secure, support and otherwise benefit the Obligations (as defined herein) of the Loan Parties under this Agreement and the other Loan Documents.

 

NOW, THEREFORE, the parties hereto agree as follows:

 

ARTICLE I

  

DEFINITIONS, INTERPRETATION AND ACCOUNTING TERMS

 

Section 1.1        Defined Terms. As used in this Agreement, the following terms have the following meanings:

 

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

 

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

 

“Affected Lender” has the meaning specified in Section 2.18(a).

 

“Affiliate” means, with respect to any Person, each officer, director, general partner or joint-venturer of such Person and any other Person that directly or indirectly controls, is controlled by, or is under common control with, such Person; provided, that no Secured Party shall be an Affiliate of the Borrower. For purpose of this definition, “control” means the possession of either (a) the power to vote, or the beneficial ownership of, 10% or more of the Voting Stock of such Person or (b) the power to direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.

 

“Agency Fee Letter” means any fee letter evidencing the obligations to pay any agency fee payable pursuant to Section 2.11(c).

 

 

“Agents” means the Administrative Agent, the Collateral Agent and the Syndication Agent.

 

“Agent’s Group” has the meaning specified in Section 10.2(b).

 

“Agreement” means this Second Amended and Restated Credit Agreement.

 

“Amendment Effective Date” means August 30, 2013

 

“Anti-Terrorism Laws” has the meaning specified in Section 4.19.

 

“Applicable Margin” means, with respect to Loans and the Unused Commitment Fee, the percentage set forth below:

 

Level		Total Secured Leverage Ratio		Base Rate Loans		Eurodollar Rate Loans		Unused Commitment Fee
I		< 1.50x		0.75%		1.75%		0.25%
II		> 1.50x < 2.50x		1.00%		2.00%		0.25%
III		> 2.50x		1.25%		2.25%		0.375%

 

Any increase or decrease in the Applicable Margin resulting from a change in Total Secured Leverage Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 6.1(c); provided that, on and after the Amendment Effective Date and until delivery of the first Compliance Certificate delivered after the Amendment Effective Date pursuant to Section 6.1(c), Level I shall apply. If a Compliance Certificate is not delivered to the Administrative Agent when due, then Level III shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered and shall continue to apply until the first Business Day immediately following the date a Compliance Certificate is delivered to the Agent.

 

“Approved Electronic Communication” means each Communication that any Loan Party is obligated to, or otherwise chooses to, provide to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein, including any financial statement, financial or other report, notice, request, certificate or other information; provided, however, that, solely with respect to delivery of any such Communication by any Loan Party to the Administrative Agent and without limiting or otherwise affecting either the Administrative Agent’s right to effect delivery of such Communication by posting such Communication to the Approved Electronic Platform or the protections afforded hereby to the Administrative Agent in connection with any such posting, “Approved Electronic Communication” shall exclude (i) any notice of borrowing, letter of credit request, notice of conversion or continuation, and any other notice, demand, communication, information, document and other material relating to a request for a new, or a conversion of an existing, Borrowing, (ii) any notice pursuant to Section 2.7 and any other notice relating to the payment of any principal or other amount due under any Loan Document prior to the scheduled date therefor, (iii) all notices of any Default or Event of Default and (iv) any notice, demand, communication, information, document and other material required to be delivered to satisfy any of the conditions set forth in Article III or any other condition to any Borrowing or other extension of credit hereunder or any condition precedent to the effectiveness of this Agreement.

 

“Approved Electronic Platform” has the meaning specified in Section 11.12(a).

 

“Approved Fund” means, with respect to any Lender, any Person (other than a natural Person) that (a) 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, and (b) is advised or managed by (i) such Lender, (ii) any Affiliate of such Lender or (iii) any Person (other than an individual) or any Affiliate of any Person (other than an individual) that administers or manages such Lender.

 

 

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

 

“Assignment” means an assignment agreement entered into by a Lender, as assignor, and any Person, as assignee, pursuant to the terms and provisions of Section 11.2 (with the consent of any party whose consent is required by Section 11.2), and accepted by the Administrative Agent, in substantially the form of Exhibit 1.1(1), or any other form approved by the Administrative Agent.

 

“Available Investment Basket” means, on any date of determination an amount equal to: (a) $150,000,000; plus (b) additional cash on hand of the Borrower (in excess of the amount of the Available Investment Basket otherwise available pursuant to this definition without giving effect to this clause (b)) at the time of any applicable usage of the Available Investment Basket; provided that the proceeds of Borrowings under the Facility shall not constitute “cash on hand” for purposes of this clause (b); minus (c) the aggregate amount of all Investments made after the Amendment Effective Date by applying a portion of the Available Investment Basket pursuant to clause (d) of Section 8.3; minus (d) the aggregate amount of all Investments made after the Amendment Effective Date by applying a portion of the Available Investment Basket pursuant to clause (p) of Section 8.3; minus (e) the aggregate amount of all dividends made after the Amendment Effective Date by applying a portion of the Available Investment Basket pursuant to clause (c) of Section 8.5; minus (f) the aggregate amount of all dividends made after the Amendment Effective Date by applying a portion of the Available Investment Basket pursuant to clause (e) of Section 8.5; provided that if the proceeds of Borrowings under the Facility are used directly or indirectly to fund any usage of the Available Investment Basket, then immediately after such usage, the Borrower shall have at least $25,000,000 of availability under the Facility.

 

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

 

(a) the Prime Rate;

 

(b) ½ of 1% per annum above the Federal Funds Rate; or

 

(c) the rate per annum equal to the rate determined by the Administrative Agent to be the offered rate that appears on the Reuters Screen LIBOR01 (or any successor thereto) that displays an average British Bankers Association Interest Settlement Rate for deposits in Dollars for an interest period of one month as in effect on such day plus 1.00%.

 

“Base Rate Loan” means any Loan that bears interest based on the Base Rate.

 

“Benefit Plan” means any employee pension benefit plan as defined in Section 3(2) of ERISA) to which any Group Member incurs or otherwise has any obligation or liability, contingent or otherwise.

 

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

 

“Borrowing” means a borrowing consisting of Loans (other than Loans deemed made pursuant to Section 2.4) on the same day by the Lenders according to their respective Commitments.

 

“Business” means any business or business activity conducted by the Borrower and any Subsidiary on the Closing Date and any business or business activities incidental or related thereto, or any business or activity that is reasonably similar thereto or a reasonable extension, development or expansion thereof or ancillary thereto.

 

 

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized or required to close under the Laws of, or are in fact closed in, the province or state where the Administrative Agent’s Office is located and in the State of New York; provided that if such day relates to any interest rate settings as to a Eurodollar Rate Loan, any fundings, disbursements, settlements and payments in respect of any such Eurodollar Rate Loan, or any other dealings in Dollars to be carried out pursuant to this Agreement in respect of any such Eurodollar Rate Loan, Business Day also means any such day on which dealings in deposits in Dollars are conducted by and between banks in the London interbank market.

 

“Capital Expenditure Limitation” means an annual cap of $30,000,000.

 

“Capital Expenditures” means, for any Person for any period, the aggregate of all expenditures, whether or not made through the incurrence of Indebtedness, by such Person and its Subsidiaries during such period for the acquisition, leasing (pursuant to a Capital Lease), construction, replacement, repair, substitution or improvement of fixed or capital assets or additions to equipment, in each case required to be capitalized under GAAP on a Consolidated balance sheet of such Person, excluding:

 

(a)        interest capitalized during such period;

 

(b)        any expenditure to the extent, for purpose of the definition of Permitted Acquisition, such expenditure is part of the aggregate amounts payable in connection with, or other consideration for, any Permitted Acquisition consummated during or prior to such period;

 

(c)        [reserved];

 

(d)        expenditures of 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 expenditures are made to replace or repair such lost, destroyed, damaged or condemned assets, equipment or other property or otherwise to acquire, maintain, develop, construct, improve, upgrade or repair assets or properties useful in the business of the Borrower and the Subsidiaries within 12 months of receipt of such proceeds;

 

(e)        expenditures accounted for as capital expenditures of such Person and that actually are paid for by a third party (excluding Parent, the Borrower or any Subsidiary thereof) and for which neither Parent, the Borrower nor any Subsidiary thereof 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), and without duplication thereof, expenditures funded through tenants’ improvement allowances;

 

(f)        the book value of any asset owned by such Person prior to or during such period to the extent that such book value would otherwise be included as a Capital Expenditure during such period as a result of such Person reusing or beginning to reuse such asset during such period without a corresponding expenditure actually having been made in such period; provided, that (i) any expenditure necessary in order to permit such asset to be reused shall be included as a Capital Expenditure during the period that such expenditure actually is made, and (ii) such book value shall have been included as a Capital Expenditure when such asset was originally acquired;

 

 

(g)        the purchase price of equipment purchased during such period to the extent the consideration therefor consists of any combination of (i) used, obsolete, worn out or surplus equipment traded in at the time of such purchase and (ii) the proceeds of a sale of used, obsolete, worn out or surplus equipment, in each case, in the ordinary course of business;

 

(h)        [reserved]; and

 

(i)        expenditures to the extent they are financed with the proceeds of an issuance of Junior Capital permitted by Section 8.1 not later than 120 days after the receipt of such proceeds by Parent or the Borrower.

 

“Capital Lease” means, with respect to any Person, any lease of, or other arrangement conveying the right to use, any property (whether real, personal or mixed) by such Person as lessee that has been or is required to be accounted for as a capital lease on a balance sheet of such Person prepared in accordance with GAAP; provided, however, that any lease of a type that would be classified as an operating lease on the date of this Agreement prior to the consummation of the transactions contemplated hereby shall be deemed not to be a Capital Lease notwithstanding any subsequent change in GAAP.

 

“Capitalized Lease Obligations” means, at any time, with respect to any Capital Lease, the amount of all obligations of such Person that is capitalized on a balance sheet of such Person prepared in accordance with GAAP.

 

“Cash Collateral Account” means a deposit account (other than deposit accounts maintained in the ordinary course of business solely for funding (w) 401(k) and other retirement plans and employee benefits, including rabbi trusts for deferred compensation, (x) payroll, (y) health care benefits, and (z) escrow arrangements) or securities account in the name of the Borrower and under the sole control (as defined in the applicable UCC) of the Collateral Agent and (a) in the case of a deposit account, from which the Borrower may not make withdrawals except as permitted by the Collateral Agent and (b) in the case of a securities account, with respect to which the Collateral Agent shall be the entitlement holder and the only Person authorized to give entitlement orders with respect thereto.

 

“Cash Collateralize” means, in respect of an obligation, provide and pledge (as a first priority perfected security interest) cash collateral in Dollars, at a location and pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent (and “Cash Collateralization” has a corresponding meaning).

 

“Cash Equivalents” means (a) any readily-marketable securities (i) issued by, or directly, unconditionally and fully guaranteed or insured by the United States federal government or (ii) issued by any agency of the United States federal government the obligations of which are fully backed by the full faith and credit of the United States federal government, (b) any readily-marketable direct obligations issued by any other agency of the United States federal government, any state of the United States or any political subdivision of any such state or any public instrumentality thereof, in each case having a rating of at least “A-1” from S&P or at least “P-1” from Moody’s, (c) any commercial paper rated at least “A-1” by S&P or “P-1” by Moody’s and issued by any Person organized under the laws of any state of the United States, (d) any Dollar-denominated time deposit, insured certificate of deposit, overnight bank deposit or bankers’ acceptance issued or accepted by (i) any Lender or (ii) any commercial bank that is (A) organized under the laws of the United States, any state thereof or the District of Columbia, (B) “adequately capitalized” (as defined in the regulations of its primary federal banking regulators) and (C) has Tier 1 capital (as defined in such regulations) in excess of $250,000,000, (e) shares of any United States money market fund that (i) has substantially all of its assets invested continuously in the types of investments referred to in clause (a), (b), (c) or (d) above with maturities as set forth in the proviso below, (ii) has net assets in excess of $500,000,000 and (iii) has obtained from either S&P or Moody’s the highest rating obtainable for money market funds in the United States, and (f) repurchase obligations with a term of not more than 180 days for underlying securities of the types described in clause (a) above entered into with a bank meeting the qualifications described in clause (d)(ii) above; provided, that the maturities of all obligations specified in any of (x) clauses (a) and (b) above shall not exceed two years, and (y)  clauses (c) and (d) above shall not exceed 365 days.

 

 

“Cash Management Bank” means any Person that, at the time it enters into a Secured Cash Management Agreement, is a Lender or an Affiliate of a Lender, in its capacity as a party to such Secured Cash Management Agreement.

 

“CERCLA” means the United States Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. §§ 9601 et seq.).

 

“Change of Control” means the occurrence of any of the following:

 

(a)        any person other than the Management Group shall become, directly or indirectly, the legal or beneficial owner of, or shall have acquired, directly or indirectly pursuant to any Contractual Obligation or otherwise, control over or control over the voting rights of, at least the greater of (A) 35% of the ordinary voting power represented by the issued and outstanding Voting Stock of Holdings on a fully diluted basis, or (B) a percentage in excess of the percentage of the ordinary voting power represented by the issued and outstanding Voting Stock of Holdings of which the Management Group are, directly or indirectly, the beneficial owners, in each case, on a fully diluted basis; or

 

(b)        continuing directors shall cease for any reason other than death or disability to constitute a majority of the members of the board of directors of Holdings then in office;

 

(c)        Holdings shall cease to own and control legally and beneficially all of the economic and voting rights associated with all classes of the outstanding Stock and Stock Equivalents of Parent and the Borrower; or

 

(d)        a “change of control” occurs under any Indebtedness having a principal amount of $3.0 million or more (as defined in the agreement governing such Indebtedness).

 

For the purposes of this definition, the following terms shall have the following meanings, notwithstanding any other definition for any such term in any other provisions of this Agreement: (x) “person” means any “person” as such term is used in the United States Securities Exchange Act of 1934, as amended, including any partnership, limited partnership, syndicate or group of persons that is deemed to be a “person” for purposes of Sections 13(d) and 14(d)(2) of such Securities Exchange Act; (y) “beneficial owner” means any “beneficial owner” under and as defined in Rules 13d-3 and 13d-5 of the United States Securities and Exchange Commission under such Securities Exchange Act; and (z) “continuing director” means, at any date of determination, each individual member of the board of directors of Parent who (i) has been a member of such board in the period of twelve successive calendar months last ended prior to such date or (ii) whose nomination for election by the stockholders of Parent was approved by a vote of at least a majority of the directors who were continuing directors at the time of such nomination.

 

“Closing Date” means July 27, 2011.

 

“Code” means the United States Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and published administrative guidance issued thereunder.

 

 

“Collateral” means all property and interests in property and proceeds thereof now owned or hereafter acquired by any Loan Party in or upon which a Lien is granted or purported to be granted pursuant to any Loan Document.

 

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

 

“Commitment” means, with respect to any Lender, the commitment of such Lender to make Loans and acquire interests in L/C Obligations, which commitment is in the amount set forth opposite such Lender’s name on Schedule I under the caption “Commitment”, as amended to reflect Assignments and as such amount may be reduced or increased pursuant to this Agreement. The aggregate amount of the Commitments on the Amendment Effective Date equals $75,000,000.

 

“Communication” means each notice, demand, communication, information, document or other material provided for hereunder or under any other Loan Document, or otherwise transmitted between the parties hereto, relating this Agreement, the other Loan Documents, any Loan Party or its Affiliates, or the transactions contemplated by this Agreement or the other Loan Documents including, without limitation, all Approved Electronic Communications.

 

“Compliance Certificate” means a certificate substantially in the form of Exhibit 1.1(2).

 

“Consolidated” means, with respect to any Person, the accounts of such Person and its Subsidiaries, consolidated in accordance with GAAP.

 

“Consolidated Current Assets” means, with respect to any Person at any date, the total Consolidated assets of such Person at such date other than (a) cash, Cash Equivalents and any Indebtedness owing to such Person or any of its Subsidiaries by Affiliates of such Person that would, in accordance with GAAP, be classified on a Consolidated balance sheet of such Person as current assets at such date, and (b) amounts related to current or deferred Taxes based on income or profits.

 

“Consolidated Current Liabilities” means, with respect to any Person at any date, all liabilities of such Person and its Subsidiaries at such date that would, in accordance with GAAP, be classified as current liabilities on a Consolidated balance sheet of such Person; provided, that “Consolidated Current Liabilities” shall exclude the principal amount of the Loans then outstanding.

 

“Consolidated EBITDA” means, with respect to any Person for any period, without duplication, an amount equal to such Person’s Consolidated Net Income for such period determined in accordance with GAAP, plus (a) to the extent applicable to such Person in such period, the sum of (without duplication and only to the extent the amounts described in this clause (a) decreased such Consolidated Net Income for the respective period for which Consolidated EBITDA is being determined) (i) provision for Taxes based on income, profits or capital of such Person and its Subsidiaries for such period, including, without limitation, state, franchise and similar taxes, (ii) Consolidated Interest Expense of such Person for such period, (iii) depreciation and amortization expense of such Person and its Subsidiaries for such period, (iv) business optimization expenses and other restructuring charges of such Person and its Subsidiaries for such period, provided, that (A) with respect to each business optimization expense or other such restructuring charge, the Borrower shall have delivered to the Administrative Agent a certificate of a Responsible Officer of the Borrower specifying and quantifying such expense or charge and stating that such expense or charge is a business optimization expense or other restructuring charge, as the case may be, and (B) the aggregate amount of cash business optimization expenses and other cash restructuring charges for purposes of this clause (iv) shall not exceed 5% of Consolidated EBITDA for such period (as calculated prior to giving effect to the addition of amounts specified in this clause (iv)), (v) any other non-cash charges of such Person and its Subsidiaries for such period (but excluding (a) any such charges which represent the accrual of, or a cash reserve for, anticipated cash charges in any future period and (b) any such non-cash charge to the extent that it represents the amortization of a prepaid cash charge that was paid in a prior period unless such non-cash charge represents an amount that was not recognized in any prior period), (vi) management, consulting, monitoring, transaction, and advisory fees, and related expenses of such Person and its Subsidiaries for such period paid to the Permitted Investors (or any accruals related to such fees and related expenses), provided, that the aggregate amount of such fees and related expenses for purposes of this clause (vi) shall not exceed in any period of four consecutive Fiscal Quarters, $500,000 as of the date of determination, (vii) any fees, expenses or charges related to the documentation and closing of this Agreement and (vii) any fees, expenses or charges related to Specified Stock Repurchases; minus (b) the sum (without duplication and only to the extent the amounts described in this clause (b) increased such Consolidated Net Income for the respective period for which Consolidated EBITDA is being determined) of non-cash items increasing Consolidated Net Income of such Person for such period (but excluding any such items (i) in respect of which cash was received in a prior period or will be received in a future period, or (ii) which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period).

 

 

“Consolidated EBITDAR” means Consolidated EBITDA, plus, to the extent applicable to such Person in such period, the amount of (without duplication and only to the extent that such amounts decreased Consolidated Net Income for the respective period for which Consolidated EBITDA is being determined) Consolidated Rent Expense for such period.

 

“Consolidated Interest Expense” means, for any Person for any period, Consolidated total interest expense of such Person and its Subsidiaries for such period and including, in any event, (i) interest capitalized during such period and net cash costs under Interest Rate Contracts for such period and (ii) all fees, charges, commissions, discounts and other similar obligations (other than reimbursement obligations) with respect to letters of credit, bank guarantees, banker’s acceptances, surety bonds and performance bonds (whether or not matured) payable by such Person and its Subsidiaries during such period.

 

“Consolidated Net Income” means, with respect to any Person, for any period, the aggregate of the Net Income of such Person and its Subsidiaries attributable to such Person (after giving effect to non-controlling interests) for such period, on a Consolidated basis; provided, that, without duplication, (i) any net after-tax (A) extraordinary, (B) nonrecurring, or (C) unusual gains or losses or income or expenses (less all fees and expenses relating thereto), including any severance expenses, and fees, expenses or charges related to the IPO, any other offering of the Stock of Holdings, any Investment, acquisition or Indebtedness permitted to be incurred hereunder (in each case, whether or not successful), including any such fees, expenses, charges or change in control payments related to any acquisition consummated after the Closing Date, in each case, shall be excluded, (ii) any net after-tax income or loss from discontinued operations and any net after-tax gain or loss on disposal of discontinued operations shall be excluded, (iii) any net after-tax gain or loss (less all fees and expenses or charges relating thereto) attributable to business dispositions or asset dispositions other than in the ordinary course of business (as determined in good faith by the board of directors (or equivalent) of the Borrower) shall be excluded (other than write downs of current assets in the ordinary course of business), (iv) any net after-tax income or loss (less all fees and expenses or charges relating thereto) attributable to the early extinguishment of Indebtedness shall be excluded, (v) Consolidated Net Income for such period shall not include the cumulative effect of a change in accounting principles during such period, (vi) any increase in amortization or depreciation or any one-time non-cash charges resulting from purchase accounting in connection with any acquisition that is consummated after the Closing Date shall be excluded, (vii) any non-cash impairment charges resulting from the application of Statement of Financial Accounting Standards No. 142 and 144, and the amortization of intangibles arising pursuant to No. 141, shall be excluded, (vii) the effect of mark-to-market accounting for derivatives contracts under Statement of Financial Accounting Standards No. 157 shall be excluded, (ix) any non-cash compensation expenses realized from grants of stock appreciation or similar rights, stock options or other rights to officers, directors and employees of such Person or any of its Subsidiaries shall be excluded, (x) any pre-opening expenses shall be excluded, (xi) to the extent covered by insurance and actually reimbursed, or, so long as such person has made a determination that there exists reasonable evidence that such amount will in fact be reimbursed by the insurer and only to the extent that such amount is (a) not denied by the applicable carrier in writing within 180 days and (b) in fact reimbursed within 365 days of the date of such evidence (with a deduction for any amount so added back to the extent not so reimbursed within 365 days), expenses with respect to liability or casualty events or business interruption shall be excluded; provided that any proceeds of such reimbursement when received shall be excluded from the calculation of Consolidated Net Income to the extent the expense reimbursed was previously excluded pursuant to this clause (xi), and (xii) the net income for such period of any entity (other than a Subsidiary of such Person) in which any Person other than such Person and its Subsidiaries has an ownership interest shall be excluded, except to the extent that cash in an amount equal to any such income has actually been received by such Person or any of its Subsidiaries during such period.

 

 

“Consolidated Rent Expense” means, for any period, the rental expense attributable to leases of real property that is deducted in determining Consolidated Net Income for such period, determined on a consolidated basis in accordance with GAAP.

 

“Consolidated Total Assets” means, as of any date, the total assets of the Borrower and the Consolidated Subsidiaries, determined in accordance with GAAP, set forth on the Consolidated balance sheet of the Borrower as of such date (for the avoidance of doubt, the Consolidated Total Assets as of October 31, 2010 is $52,965,111); provided that, in no event shall Consolidated Total Assets include the amount of goodwill that would be recorded from the acquisition of the Borrower by the Fund and the Fund Affiliates to the extent purchase accounting treatment was given or is given to such acquisition.

 

“Consolidated Total Debt” of any Person means on any date (A) (i) all Indebtedness of a type described in clauses (a), (b), (c)(i), (d), (f) and (g) of the definition thereof, other than letters of credit to the extent undrawn and (ii) all Guaranty Obligations with respect to any Indebtedness of any other Person of a type described in clause (i) above, in each case of such Person and its Subsidiaries on a Consolidated basis, less (B) the amount of unrestricted cash and Cash Equivalents of such Person and its Subsidiaries (reduced, in the case of any Subsidiary that is not a Wholly Owned Subsidiary, to reflect the extent of the relative aggregate direct and indirect beneficial ownership interest of the Borrower therein) on such date in an amount not to exceed $7,500,000 less the outstanding principal amount of Loans on such date (provided that such unrestricted cash and Cash Equivalents that reduces Consolidated Total Debt pursuant to this clause (B) shall be maintained in an account subject to a Control Agreement (as defined in the Guaranty and Security Agreement)).

 

“Consolidated Total Lease Adjusted Leverage Ratio” means, with respect to any Person as of any date, the ratio of (i) the sum of Consolidated Total Debt of such Person outstanding as of such date plus the product of (a) Consolidated Rent Expense of such Person for the most recent period of four consecutive Fiscal Quarters ending on or before such date, multiplied by (b) 6.00 to (ii) Consolidated EBITDAR of such Person for the most recent period of four consecutive Fiscal Quarters ending on or before such date; provided, that Consolidated EBITDAR shall be determined on a Pro Forma Basis.

 

“Constituent Documents” means, with respect to any Person, collectively and, in each case, together with any modification of any term thereof, (a) the articles of incorporation, certificate of incorporation, constitution or certificate of formation of such Person, (b) the bylaws, operating agreement or joint venture agreement of such Person, (c) any other constitutive, organizational or governing document of such Person, whether or not equivalent, and (d) any other document setting forth the manner of election or duties of the directors, officers or managing members of such Person or the designation, amount or relative rights, limitations and preferences of any Stock of such Person.

 

 

“Contractual Obligation” means, with respect to any Person, any provision of any Security issued by such Person or of any document or undertaking (other than a Loan Document) to which such Person is a party or by which it or any of its property is bound or to which any of its property is subject.

 

“Copyrights” means all rights, title and interests (and all related IP Ancillary Rights) arising under any Requirement of Law in or relating to copyrights and all mask work, database and design rights, whether or not registered or published, all registrations and recordations thereof and all applications in connection therewith.

 

“Corporate Chart” means a document setting forth, as of a date set forth therein, for each Person that is a Loan Party, that is subject to Section 7.10 or that is a Subsidiary or Joint Venture of any of them, other than a Foreign Subsidiary that is not a first-tier Foreign Subsidiary, (a) the full legal name of such Person, (b) the jurisdiction of organization and any organizational number and tax identification number of such Person, (c) the location of such Person’s chief executive office (or, if applicable, sole place of business) and (d) the number of shares of each class of Stock of such Person (other than the Borrower) authorized, the number outstanding and the number and percentage of such outstanding shares for each such class owned, directly or indirectly, by any Loan Party or any Subsidiary of any of them.

 

“Customary Permitted Liens” means, with respect to any Person, any of the following:

 

(a)        Liens (i) with respect to the payment of taxes, assessments or other governmental charges or levies or (ii) of landlords, suppliers, carriers, materialmen, warehousemen, repairmen, workmen or mechanics and other similar Liens, in each case imposed by law or arising in the ordinary course of business, and, for each of the Liens in clauses (i) and (ii) above for amounts that are not overdue by more than 30 days or that are being contested in good faith by appropriate proceedings with respect to which, if applicable, adequate reserves or other appropriate provisions are maintained on the books of such Person in accordance with GAAP;

 

(b)        (i) Liens arising solely by virtue of any statutory or common law provision relating to a banker’s liens, rights of set-off or similar rights, including Liens of a collection bank on items in the course of collection arising under Section 4-208 of the UCC as in effect in the State of New York or any similar section under any applicable UCC or any similar Requirement of Law of any foreign jurisdiction, and (ii) Liens that are contractual rights of set-off (x) relating to the establishment of depository relations with banks not given in connection with the issuance of Indebtedness or (y) relating to pooled deposit or sweep accounts of the Borrower or any Subsidiary to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business of the Borrower or any Subsidiary;

 

(c)        pledges or cash deposits made in the ordinary course of business (i) in connection with workers’ compensation, unemployment insurance or other types of social security benefits (other than any Lien imposed by ERISA) and to secure liability to insurance carriers under insurance or self-insurance arrangement in respect of such obligations, (ii) for reimbursement or indemnification obligations (including obligations in respect of letters of credit or bank guarantees for the benefit of) insurance carriers providing property, casualty or liability insurance to the Borrower or any Subsidiary, (iii) to secure the performance of bids, tenders, leases (other than Capital Leases), governmental contracts, sales contracts, other trade contracts (other than for the repayment of borrowed money), or other obligations of like nature (including letters of credit in lieu thereof or to support the issuance thereof), including those incurred pursuant to any Environmental Law, or (iv) made in lieu of, or to secure the performance of, statutory obligations, surety and appeal bonds, customs, reclamation or performance and return of money bonds (in each case not related to judgments or litigation);

 

 

(d)        judgment liens (other than for the payment of taxes, assessments or other governmental charges) securing judgments and other proceedings not constituting an Event of Default under Section 9.1(e) and pledges or cash deposits made in lieu of, or to secure the performance of, judgment or appeal bonds in respect of such judgments and proceedings;

 

(e)        Liens (i) arising by reason of zoning restrictions, survey exceptions and such matters as an accurate survey would disclose, easements, trackage rights, licenses, reservations, restrictions, declarations, rights-of-way, covenants, conditions, special assessments, rights-of-way, encroachments, defects or irregularities in title (including leasehold title) and other similar encumbrances on the use or operation of real property, (ii) consisting of leases, licenses or subleases granted by a lessor, licensor or sublessor on its property (in each case other than Capital Leases) otherwise permitted under Section 8.4 that, for each of the Liens in clauses (i) and (ii) above and clause (iii) below, do not, in the aggregate, materially (x) impair the value of such real property or (y) interfere with the ordinary conduct of the business conducted and proposed to be conducted at such real property or (iii) arising by reason of servicing agreements, development agreements, site plan agreements and other similar encumbrances incurred in the ordinary course of business and title defects or irregularities that are of a minor nature and that, in the aggregate, do not interfere in any material respect with the ordinary conduct of the business of the Borrower or any Subsidiary;

 

(f)        Liens of landlords (i) arising by statute or under any lease or related Contractual Obligation entered into in the ordinary course of business, (ii) on fixtures and movable tangible property located on the real property leased or subleased from such landlord, (iii) for amounts not yet due or that are being contested in good faith by appropriate proceedings diligently conducted and (iv) for which adequate reserves or other appropriate provisions are maintained on the books of such Person in accordance with GAAP;

 

(g)        Liens on real property disclosed by the title insurance policies delivered pursuant to Section 7.10 and any replacement, extension or renewal of any such Lien; provided, that such replacement, extension or renewal Lien shall not cover any property other than the property that was subject to such Lien prior to such replacement, extension or renewal; provided, further, that such Liens do not secure any Indebtedness, are of a minor nature and, in the aggregate, do not interfere in any material respect with the ordinary conduct of the business of the Borrower or any Subsidiary;

 

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

 

(i)        Liens solely on any cash earnest money deposits made by the Borrower or any of the Subsidiaries in connection with any letter of intent or purchase agreement permitted hereunder;

 

(j)        the prior rights of consignees and their lenders under consignment arrangements entered into in the ordinary course of business;

 

(k)        Liens arising from precautionary UCC financing statements regarding operating leases; and

 

(l)        Liens on securities that are the subject of repurchase agreements constituting Cash Equivalents under clause (f) of the definition thereof.

 

 

“Default” means any Event of Default and any event that, with the passing of time or the giving of notice or both, would become an Event of Default.

 

“Defaulting Lender” means, at any time, a Lender as to which the Administrative Agent has notified the Borrower that (i) such Lender has failed for three or more Business Days to comply with its obligations under this Agreement to make a Loan and/or make a payment to the L/C Issuer in respect of a L/C Request (each a “funding obligation”), (ii) such Lender has notified the Administrative Agent, or has stated publicly, that it will not comply with any such funding obligation hereunder, or has defaulted on its funding obligations under any other loan agreement or credit agreement or other financing agreement, (iii) such Lender has, for three or more Business Days, failed to confirm in writing to the Administrative Agent, in response to a written request of the Administrative Agent, that it will comply with its funding obligations hereunder, or (iv) a Lender Insolvency Event has occurred and is continuing with respect to such Lender (provided that neither the reallocation of funding obligations provided for in Section 2.19(a) as a result of a Lender's being a Defaulting Lender nor the performance by Non-Defaulting Lenders of such reallocated funding obligations will by themselves cause the relevant Defaulting Lender to become a Non-Defaulting Lender). Any determination that a Lender is a Defaulting Lender under clauses (i) through (iv) above will be made by the Administrative Agent in its sole discretion acting in good faith. The Administrative Agent will promptly send to all parties hereto a copy of any notice to the Borrower provided for in this definition. Notwithstanding anything to the contrary above, a Lender will not be a Defaulting Lender solely by virtue of the ownership or acquisition of any stock in such Lender or its parent by any Governmental Authority.

 

“Departing Lender” means any Existing Lender that is not a Lender under this Agreement.

 

“Designated Non-Cash Consideration” shall mean the fair market value (as determined in good faith by the Borrower) of non-cash consideration received by the Borrower or one of its Subsidiaries in connection with a Sale of any property that is so designated as Designated Non-Cash Consideration pursuant to a certificate of a Responsible Officer, setting forth the basis of such valuation, less the amount of cash or cash equivalents received in connection with a subsequent sale of such Designated Non-Cash Consideration.

 

“Disclosure Documents” means, collectively, all confidential information memoranda and related written materials prepared by or on behalf of the Loan Parties in connection with any Loan Document.

 

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

 

“Domestic Person” means any “United States person” under and as defined in Section 770l(a)(30) of the Code.

 

“E-Fax” means any system used to receive or transmit faxes electronically.

 

“Electronic Transmission” means each document, instruction, authorization, file, information and any other communication transmitted, posted or otherwise made or communicated by e-mail or E-Fax, or otherwise to or from an E-System or other equivalent service.

 

“Environment” means indoor air, ambient air, surface water, groundwater, drinking water, soil, surface and subsurface strata and natural resources, such as flora, fauna and wetlands.

 

 

“Environmental Laws” means all Requirements of Law and Permits relating to the regulation and protection of occupational health and safety and the Environment, including CERCLA, the SWDA, the Hazardous Materials Transportation Act (49 U.S.C. §§ 5101 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. §§ 136 et seq.), the Toxic Substances Control Act (15 U.S.C. §§ 2601 et seq.), the Clean Air Act (42 U.S.C. §§ 7401 et seq.), the Federal Water Pollution Control Act (33 U.S.C. §§ 1251 et seq.), the Occupational Safety and Health Act (29 U.S.C. §§ 651 et seq.), the Safe Drinking Water Act (42 U.S.C. §§ 300(f) et seq.) and those relating to the handling, treatment, transport, generation, storage, Release or threat of Release of Hazardous Materials, all regulations promulgated under any of the foregoing, and any environmental transfer of ownership, control, notification or approval statutes.

 

“Environmental Liabilities” means all Liabilities (including costs of Remedial Actions, natural resource damages and costs and expenses of investigation and feasibility studies) that may be imposed on, incurred by or asserted against any Group Member as a result of, or related to, any claim, suit, action, investigation, proceeding or demand by any Person, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law or otherwise, arising under any Environmental Law or in connection with any environmental, occupational health or safety condition or with any Release or threat of Release of Hazardous Materials.

 

“Equity Contribution Basket” means, on any date of determination, the cumulative amount of (A) cash proceeds from the IPO (which proceeds have been contributed as common equity to the capital of the Borrower and to the extent have not been used to repay the Obligations under the Original Credit Agreement) and (B) cash proceeds from the Sale (other than to the Borrower or any Subsidiary) of Qualified Capital Stock of Parent or Holdings after the Closing Date (which proceeds have been contributed as common equity to the capital of the Borrower), except, in each case, to the extent such proceeds constitute (x) proceeds of an issuance of Junior Capital that are used to make an Investment pursuant to clause (n) of Section 8.3 or (y) proceeds of any Stock issued to any employee, officer or director of Parent, Borrower, any Subsidiary of the Borrower or any direct or indirect parent of Parent; minus (i) the aggregate amount of all Investments made after the Closing Date pursuant to clause (g)(ii) of Section 8.3; minus (ii) the aggregate amount of all dividends made after the Closing Date and prior to such date of determination by applying a portion of the Equity Contribution Basket pursuant to clause (c) of Section 8.5; minus (iii) the aggregate amount of all prepayments of Subordinated Debt made after the Closing Date by applying a portion of the Equity Contribution Basket pursuant to clause (c) of Section 8.6; plus (iv) the aggregate amount of any Indebtedness (other than Junior Indebtedness) of the Borrower or any Subsidiary thereof issued after the Closing Date (other than Indebtedness issued to a Subsidiary), which has been converted into or exchanged for Stock of the Borrower or any direct or indirect parent of the Borrower; plus (v) the aggregate amount received by the Borrower or any Subsidiary in cash (and the fair market value (as determined in good faith by the Borrower) of property other than cash received by the Borrower or any Subsidiary) after the Closing Date from (A) the sale (other than to the Borrower or any Subsidiary) of the Stock of an Unrestricted Subsidiary, or (B) any dividend or other distribution by an Unrestricted Subsidiary; plus (vi) in the event any Unrestricted Subsidiary has been redesignated as a Subsidiary or has been merged, consolidated or amalgamated with or into, or transfers or conveys its assets to, or is liquidated into, the Borrower or any Subsidiary, the fair market value (as determined in good faith by the Borrower) of the Investments of the Borrower or any Subsidiary in such Unrestricted Subsidiary at the time of such redesignation, combination or transfer (or of the assets transferred or conveyed, as applicable).

 

“Equity Issuance” means any issuance by any Group Member of any equity interest, including pursuant to the exercise of options or warrants or pursuant to the conversion of any debt to equity.

 

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

 

 

“ERISA Affiliate” means, collectively, any Group Member, and any trade or business (whether or not incorporated) treated as a single employer with any Group Member within the meaning of Section 414(b), (c), (m) or (o) of the Code.

 

“ERISA Event” means the occurrence of any of the following: (a) a reportable event described in Section 4043(b) of ERISA (or, unless the 30-day notice requirement has been duly waived under the applicable regulations, Section 4043(c) of ERISA) with respect to a Title IV Plan, (b) the incurrence by any Group Member of any Liability with respect to the withdrawal of any ERISA Affiliate from a Title IV 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, (c) the incurrence by any Group Member of any Liability with respect to the complete or partial withdrawal of any ERISA Affiliate from any Multiemployer Plan, (d) the incurrence by any Group Member of any Liability with respect to the termination of a Title IV Plan or Multiemployer Plan, (e) any failure by any Title IV Plan to satisfy the minimum funding standard (within the meaning of Section 412 of the Code or Section 302 of ERISA) applicable to such Title IV Plan, whether or not waived (f) the receipt by any Group Member or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Title IV Plan or to appoint a trustee to administer any Title IV Plan, (g) the failure of any ERISA Affiliate to make any required contribution to any Title IV Plan or Multiemployer Plan when due, (h) the imposition of a lien under Section 302 or 4068 of ERISA on any property (or rights to property, whether real or personal) of any ERISA Affiliate, (i) the failure of a Benefit Plan (other than a Multiemployer Plan) or any trust thereunder intended to qualify for tax exempt status under Section 401 or 501 of the Code to qualify thereunder, except where such failure would not have a Material Adverse Effect, and (j) the receipt by any Group Member or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from any Group Member or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

 

“E-Signature” means the process of attaching to or logically associating with an Electronic Transmission an electronic symbol, encryption, digital signature or process (including the name or an abbreviation of the name of the party transmitting the Electronic Transmission) with the intent to sign, authenticate or accept such Electronic Transmission.

 

“E-System” means any electronic system, including Syndtrak™ and any other Internet or extranet-based site, whether such electronic system is owned, operated or hosted by the Administrative Agent, any of its Related Persons or any other Person, providing for access to data protected by passcodes or other security system.

 

“Eurodollar Base Rate” means, for any Interest Period, the highest of:

 

(a) the rate per annum equal to the rate determined by the Administrative Agent to be the offered rate that appears on the page of the LIBOR01 screen (or any successor thereto) that displays an average British Bankers Association Interest Settlement Rate for deposits in Dollars (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period, determined as of approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of such Interest Period, or

 

(b) if the rates referenced in the preceding subsection (a) are not available, the rate per annum determined by the Administrative Agent as the rate of interest (rounded upward to the next 1/100th of 1%) 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 relevant Loan being made, continued or converted and with a term equivalent to such Interest Period would be offered by the Administrative Agent’s London Branch to major banks in the offshore Dollar market at their request at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of such Interest Period.

 

 

“Eurodollar Rate” means, for any Interest Period with respect to any Eurodollar Rate Loan:

 

(a) the rate per annum equal to the rate determined by the Administrative Agent to be the offered rate that appears on the page of the LIBOR01 screen (or any successor thereto) that displays an average British Bankers Association Interest Settlement Rate for deposits in Dollars (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period, determined as of approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of such Interest Period, or

 

(b) if the rates referenced in the preceding subsection (b) are not available, the rate per annum determined by the Administrative Agent as the rate of interest (rounded upward to the next 1/100th of 1%) 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 Eurodollar Rate Loan being made, continued or converted by the Administrative Agent and with a term equivalent to such Interest Period would be offered by the Administrative Agent’s London Branch to major banks in the offshore Dollar market at their request at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of such Interest Period.

 

“Eurodollar Rate Loan” means any Loan that bears interest at a rate based on the Eurodollar Rate.

 

“Eurodollar Reserve Requirements” means, with respect to any Interest Period and for any Eurodollar Rate Loan, a rate per annum equal to the aggregate, without duplication, of the maximum rates (expressed as a decimal number) of reserve requirements in effect 2 Business Days prior to the first day of such Interest Period (including basic, supplemental, marginal and emergency reserves) under any regulations of the Federal Reserve Board or other Governmental Authority having jurisdiction with respect thereto dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “eurocurrency liabilities” in Regulation D of the Federal Reserve Board) maintained by a member bank of the United States Federal Reserve System.

 

“Event of Default” has the meaning specified in Section 9.1.

 

“Excess Cash Flow” means, for any Excess Cash Flow Period:

 

(a) Consolidated EBITDA of Borrower for such Excess Cash Flow Period; minus

 

(b) without duplication,

 

(i) any cash principal payment on the Loans during such Excess Cash Flow Period, to the extent that the Commitments are permanently reduced by the amount of such payment,

 

(ii) any cash principal payment, whether scheduled or otherwise, and whether mandatory or voluntary, made by the Borrower or any of its Subsidiaries during such Excess Cash Flow Period on any Capitalized Lease Obligation or other Indebtedness (other than with respect to voluntary payments, any Subordinated Debt and any unsecured Indebtedness) but only, if such Indebtedness may be reborrowed, to the extent such payment results in a permanent reduction in commitments thereof,

 

 

(iii) Capital Expenditures by the Borrower and the Subsidiaries on a Consolidated basis during such Excess Cash Flow Period that are paid in cash to the extent permitted hereunder to the extent not financed with the proceeds of Indebtedness other than the Loans,

 

(iv) the aggregate consideration paid in cash during such Excess Cash Flow Period in respect of Permitted Acquisitions and other Investments permitted hereunder to the extent not financed with the proceeds of Indebtedness other than the Loans (less any amounts received in respect thereof as a return of capital or utilizing the Equity Contribution Basket),

 

(v) Capital Expenditures that the Borrower or any Subsidiary becomes obligated to make, or that are committed to be made by the Borrower or any Subsidiary, during such Excess Cash Flow Period and that are paid in cash, to the extent permitted hereunder and to the extent not financed with the proceeds of Indebtedness other than the Loans, during the 180 day period immediately following the last day of such Excess Cash Flow Period in an aggregate amount not to exceed $5,000,000 for any Excess Cash Flow Period,

 

(vi) the Consolidated Interest Expense of Borrower for such Excess Cash Flow Period to the extent paid in cash,

 

(vii) the amount of any obligations for United States federal income taxes or other taxes measured by net income payable with respect to such period,

 

(viii) cash expenditures made in respect of Hedging Agreements during such Excess Cash Flow Period, to the extent not reflected in the computation of Consolidated EBITDA,

 

(ix) solely to the extent paid with internally generated cash, dividends or distributions or repurchases of its Stock permitted under this Agreement and paid in cash by the Borrower during such Excess Cash Flow Period, and dividends permitted under this Agreement and paid by any Subsidiary to any Person other than Parent, the Borrower or any of the Subsidiaries during such Excess Cash Flow Period, in each case pursuant to Section 8.5, other than pursuant to clause (c) of Section 8.5,

 

(x) amounts paid in cash during such Excess Cash Flow Period on account of (A) items that were accounted for as noncash reductions of Consolidated Net Income that increased Consolidated EBITDA and were included in Excess Cash Flow of the Borrower and its Subsidiaries in a prior Excess Cash Flow Period, and (B) reserves or accruals established in purchase accounting,

 

(xi) noncash items (A) that increased Consolidated Net Income, but were not deducted from Consolidated EBITDA pursuant to clause (b) of the definition of “Consolidated EBITDA”, for such Excess Cash Flow Period (excluding any such items which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period) and (B) in respect of which cash will be received in a future Cash Flow Period,

 

(xii) [reserved], and

 

(xiii) any increase in the Working Capital of Borrower during such period (measured as the excess of such Working Capital at the end of such period over such Working Capital at the beginning of such period); plus

 

 

(c) without duplication,

 

(i) to the extent included in the calculation of Consolidated EBITDA pursuant to clause (a)(i) of the definition thereof, any provision for United States federal income taxes or other taxes measured by net income,

 

(ii) [reserved],

 

(iii) amounts deducted from the calculation of “Excess Cash Flow” for the immediately preceding Excess Cash Flow Period pursuant to clause (b)(v) above,

 

(iv) cash payments received in respect of Hedging Agreements during such Excess Cash Flow Period to the extent not included in the computation of Consolidated EBITDA,

 

(v) any decrease in the Working Capital of Borrower during such Excess Cash Flow Period (measured as the excess of such Working Capital at the beginning of such Excess Cash Flow Period over such Working Capital at the end thereof), and

 

(vi) amounts received in cash during such Excess Cash Flow Period on account of items that were accounted for as noncash items that reduced Excess Cash Flow in a prior Excess Cash Flow Period.

 

“Excess Cash Flow Period” means each Fiscal Year of the Borrower commencing with Fiscal Year 2011.

 

“Executive Order” has the meaning specified in Section 4.19.

 

“Existing Lender” has the meaning set forth in the preamble hereto.

 

“Facility” means the $75,000,000 revolving credit facility consisting of the Commitments hereunder.

 

“Family Members” shall mean an individual’s spouse, siblings, children, or other lineal descendants of such individual.

 

“Federal Flood Insurance” means federally backed Flood Insurance available under the National Flood Insurance Program to owners of real property improvements located in special flood hazard areas in a community participating in the National Flood Insurance Program.

 

“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 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 charged to the Administrative Agent on such day on such transactions as determined by the Administrative Agent.

 

“Federal Reserve Board” means the Board of Governors of the United States Federal Reserve System and any successor thereto.

 

“Fee Letter” means any fee letter evidencing the obligations to pay any fee payable pursuant to Section 2.11(c).

 

 

“FEMA” means the Federal Emergency Management Agency, a component of the U.S. Department of Homeland Security that administers the National Flood Insurance Program.

 

“Financial Performance Covenants” means the covenants of the Borrower set forth in Sections 5.1 and 5.2.

 

“Financial Statement” means each financial statement delivered pursuant to Section 4.4 or 6.1.

 

“FIRREA” means the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended.

 

“Fiscal Quarter” means each 3 fiscal month period ending on or about April 30, July 31 or October 31 or on the Saturday closest to January 31.

 

“Fiscal Year” means the twelve fiscal month period ending on the Saturday closest to January 31.

 

“Flood Insurance” means, for any real property located in a special flood hazard area identified by FEMA, Federal Flood Insurance or private insurance that meets the requirements set forth by FEMA in its Mandatory Purchase of Flood Insurance Guidelines.

 

“Foreign Subsidiary” means any Subsidiary that is incorporated or organized under the laws of any jurisdiction other than the United States of America, any State thereof or the District of Columbia.

 

“Fund” means, collectively, CCMP Capital Investors II, L.P., CCMP Capital Investors (Cayman) II, L.P. and other affiliated co-investment partnerships.

 

“Fund Affiliate” means (i) each Affiliate of the Fund and (ii) any individual who is a partner or employee of the management companies with respect to the Fund.

 

“GAAP” means generally accepted accounting principles in the United States of America, as in effect from time to time, set forth in the FASB Accounting Standards Codification as of the date of determination. Subject to Section 1.3, all references to “GAAP” shall be to GAAP applied consistently with the principles used in the preparation of the Financial Statements described in Section 4.4(a).

 

“Governmental Authority” means any nation, sovereign or government, any state or other political subdivision thereof, any agency, authority, bureau, commission, department, body, or instrumentality thereof and any entity or authority exercising executive, legislative, taxing, judicial, regulatory or administrative functions of or pertaining to government, including any central bank, stock exchange, regulatory body, arbitrator, public sector entity, supra-national entity (including the European Union and the European Central Bank) and any self-regulatory organization (including the National Association of Insurance Commissioners).

 

“Group Members” means, collectively, the Borrower and its Subsidiaries.

 

“Group Members’ Accountants” means any nationally-recognized independent registered certified public accountants acceptable to the Arrangers.

 

“Guarantor” means (i) Parent, (ii) the Borrower, (iii) each Wholly Owned Subsidiary of the Borrower on the Closing Date that is not a Foreign Subsidiary and (iv) each Subsidiary of any Loan Party that has or enters into any Guaranty Obligation with respect to Obligations of Parent or any other Loan Party.

 

 

“Guaranty and Security Agreement” means a guaranty and security agreement, in substantially the form of Exhibit 1.1(3), among the Collateral Agent, the Administrative Agent, the Borrower and the Guarantors from time to time party thereto.

 

“Guaranty Obligation” means, as applied to any Person, any direct or indirect liability, contingent or otherwise, of such Person for any Indebtedness, lease, dividend or other obligation (the “primary obligation”) of another Person (the “primary obligor”), if the purpose or intent of such Person in incurring such liability, or the economic effect thereof, is to guarantee such primary obligation or provide support, assurance or comfort to the holder of such primary obligation or to protect or indemnify such holder against loss with respect to such primary obligation, including (a) the direct or indirect guaranty, endorsement (other than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of any primary obligation, (b) the incurrence of reimbursement obligations with respect to any letter of credit or bank guarantee in support of any primary obligation, (c) the existence of any Lien, or any right, contingent or otherwise, to receive a Lien, on the property of such Person securing any part of any primary obligation and (d) any liability of such Person for a primary obligation through any Contractual Obligation (contingent or otherwise) or other arrangement (i) to purchase, repurchase or otherwise acquire such primary obligation or any security therefor or to provide funds for the payment or discharge of such primary obligation (whether in the form of a loan, advance, stock purchase, capital contribution or otherwise), (ii) to maintain the solvency, working capital, equity capital or any balance sheet item, level of income or cash flow, liquidity or financial condition of any primary obligor to pay such primary obligation, (iii) to make take-or-pay or similar payments, if required, regardless of non-performance by any other party to any Contractual Obligation, (iv) to purchase, sell or lease (as lessor or lessee) any property, or to purchase or sell services, primarily for the purpose of enabling the primary obligor to satisfy such primary obligation or to protect the holder of such primary obligation against loss or (v) to supply funds to or in any other manner invest in, such primary obligor (including to pay for property or services irrespective of whether such property is received or such services are rendered); provided, that “Guaranty Obligations” shall not include (x) endorsements for collection or deposit in the ordinary course of business, (y) product warranties given in the ordinary course of business, or (z) customary and reasonable indemnity obligations in effect on the Closing Date or entered into in connection with any acquisition or disposition of assets permitted under this Agreement. The outstanding amount of any Guaranty Obligation shall equal the outstanding amount of the primary obligation so guaranteed or otherwise supported or, if lower, the stated maximum amount for which such Person may be liable under such Guaranty Obligation.

 

“Hazardous Material” means any chemical, substance, material, waste pollutant, contaminant or constituent in any form, including petroleum or any fraction thereof, asbestos and asbestos-containing material, toxic mold, polychlorinated biphenyls, radioactive substances, or infectious, bio-hazardous or other medical waste, regulated or which can give rise to liability under any Environmental Law.

 

“Hedging Agreement” means any Interest Rate Contract, foreign exchange, swap, option or forward contract, spot, cap, floor or collar transaction, any other derivative instrument and any other similar speculative or non-speculative transaction and any other similar agreement or arrangement designed to alter the risks of any Person arising from fluctuations in any underlying variable; provided, that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of Parent, any direct or indirect parent of Parent, the Borrower or any of the Subsidiaries shall be a Hedging Agreement.

 

“Holdings” means Francesca’s Holdings Corporation, a Delaware corporation.

 

 

“Immaterial Subsidiary” means, at any time, a Subsidiary of the Borrower that has total assets that are, together with the total assets of all other Immaterial Subsidiaries in the aggregate, less than the greater of (a) $7.5 million and (b) an amount equal to (i) $7.5 million multiplied by (ii) the ratio of (x) the amount of Consolidated Total Assets as of the end of the Fiscal Quarter immediately prior to the date of determination for which financial statements have been delivered pursuant to Section 6.1 to (y) the amount of Consolidated Total Assets as of October 30, 2010.

 

“Increased Amount Date” has the meaning specified in Section 2.20(a).

 

“Incremental Facility” has the meaning specified in Section 2.20(a).

 

“Incremental Lenders” has the meaning specified in Section 2.20(c).

 

“Incremental Loans” means the Incremental Term Loans and the Incremental Revolving Loans.

 

“Incremental Loan Commitments” has the meaning specified in Section 2.20(a).

 

“Incremental Revolving Commitments” has the meaning specified in Section 2.20(a).

 

“Incremental Revolving Facility” has the meaning specified in Section 2.20(b).

 

“Incremental Revolving Lender” has the meaning specified in Section 2.20(c).

 

“Incremental Revolving Loans” has the meaning specified in Section 2.20(b).

 

“Incremental Term Facility” has the meaning specified in Section 2.20(a).

 

“Incremental Term Lender” has the meaning specified in Section 2.20(c).

 

“Incremental Term Loans” has the meaning specified in Section 2.20(b).

 

“Incremental Term Loan Commitments” has the meaning specified in Section 2.20(a).

 

“Indebtedness” of any Person means, without duplication, any of the following, whether or not matured: (a) all indebtedness for borrowed money; (b) all obligations evidenced by notes, bonds, debentures or similar instruments, (c) the principal component of all obligations with respect to (i) letters of credit, bank guarantees or bankers’ acceptances, or (ii) surety, customs, reclamation or performance bonds (in each case not related to judgments or litigation) other than those entered into in the ordinary course of business, (d) all obligations to pay the deferred purchase price of property or services (other than current trade liabilities and current intercompany liabilities (but not any refinancings, extensions, renewals or replacements thereof) incurred in the ordinary course of business and maturing within 180 days after the incurrence thereof), (e) all obligations created or arising under any conditional sale or other title retention agreement, regardless of whether the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property, (f) all Capitalized Lease Obligations, (g) all obligations, whether or not contingent, to purchase, redeem, retire, defease or otherwise acquire for value, or pay any dividends or other amounts with respect to, or converted into or exchange for Indebtedness, any of its own Stock or Stock Equivalents (or any Stock or Stock Equivalent of a direct or indirect parent entity thereof) prior to the date that is 180 days after the Scheduled Termination Date, valued at, in the case of redeemable preferred Stock, the greater of the voluntary liquidation preference and the involuntary liquidation preference of such Stock plus accrued and unpaid dividends, (h) to the extent not already included in Indebtedness, all payments that are then required to be made (but have not been previously made) in respect of any Hedging Agreement based upon a termination (including an early termination) occurring on or prior to the date of determination, (i) all Indebtedness secured by any Lien on any property or asset owned or held by such Person regardless of whether the Indebtedness secured thereby shall have been assumed by that Person or is nonrecourse to the credit of such Person and (j) all Guaranty Obligations for obligations of any other Person constituting Indebtedness of such other Person; provided, that the items in each of clauses (a) through (j) above shall constitute “Indebtedness” of such Person solely to the extent, directly or indirectly, (x) such Person is liable, directly or indirectly, for any part of any such item, (y) any such item is secured by a Lien on such Person’s property or (z) any other Person has a right, contingent or otherwise, to cause such Person to become liable for any part of such item or to grant such a Lien (the amount of such Indebtedness attributable to such Person to be actual amount of such Indebtedness or, if such Indebtedness is non-recourse as to such Person, the lesser of the amount of such Indebtedness or the fair market value of the property securing such Indebtedness).

 

 

“Indemnified Matters” has the meaning specified in Section 11.4(a).

 

“Indemnitee” has the meaning specified in Section 11.4(a).

 

“Information” has the meaning specified in Section 11.13.

 

“Intellectual Property” means all rights, title and interests in or relating to intellectual property and industrial property arising under any Requirement of Law and all IP Ancillary Rights relating thereto, including all Copyrights, Patents, Trademarks, Internet Domain Names, Trade Secrets and IP Licenses.

 

“Interest Period” means, (a) with respect to any Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is made or converted to a Eurodollar Rate Loan or, if such Loan is continued, on the last day of the immediately preceding Interest Period therefor and, in each case, ending 1, 2, 3, or 6 months thereafter (or 9 or 12 months, if at the time of the relevant Eurodollar Rate Loan, all relevant Lenders provide written consent thereto), as selected by the Borrower pursuant hereto, and (b) with respect to any Secured Hedging Reimbursement Obligation, the period commencing on the date such Secured Hedging Reimbursement Obligation first becomes outstanding or, for all successive Interest Periods, on the last day of the immediately preceding Interest Period therefor and, in each case, ending 1 month thereafter; provided, that (v) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day, unless the result of such extension would be to extend such Interest Period into the next calendar month, in which case such Interest Period shall end on the immediately preceding Business Day, (w) 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 a calendar month, (x) the Borrower may not select any Interest Period ending after the Scheduled Termination Date, (y) the Borrower may not select any Interest Period in respect of Loans having an aggregate principal amount of less than $1,000,000 and (z) there shall be outstanding at any one time no more than 3 Interest Periods.

 

“Interest Rate Contracts” means all interest rate swap agreements, interest rate cap agreements, interest rate collar agreements and interest rate insurance.

 

“Internet Domain Names” means all rights, title and interests (and all related IP Ancillary Rights) arising under any Requirement of Law in or relating to Internet domain names.

 

“Investment” means, with respect to any Person, directly or indirectly, (a) to own, purchase or otherwise acquire, in each case whether beneficially or otherwise, any investment in, including any interest in, any Security of any other Person (other than any evidence of any Obligation), (b) to redeem, retire, purchase, acquire for value from any Person any Stock of such Person, (c) to purchase or otherwise acquire, whether in one transaction or in a series of transactions, all or a significant part of the property of any other Person or a business conducted by any other Person or all or substantially all of the assets constituting the business of a division, branch, brand or other unit operation of any other Person, (d) to incur, or to remain liable under, any Guaranty Obligation for Indebtedness of any other Person, to assume the Indebtedness of any other Person or to make, hold, purchase or otherwise acquire, in each case directly or indirectly, any deposit, loan, advance, commitment to lend or advance, or other extension of credit (including by deferring or extending the date of, in each case outside the ordinary course of business, the payment of the purchase price for Sales of property or services to any other Person, to the extent such payment obligation constitutes Indebtedness of such other Person), excluding deposits with financial institutions available for withdrawal on demand, prepaid expenses, accounts receivable and similar items created in the ordinary course of business or (e) to make, directly or indirectly, any contribution to the capital of any other Person.

 

 

“IP Ancillary Rights” means, with respect to any other Intellectual Property, as applicable, all foreign counterparts to, and all divisionals, reversions, continuations, continuations-in-part, reissues, reexaminations, renewals and extensions of, such Intellectual Property and all income, royalties, proceeds and Liabilities at any time due or payable or asserted under or with respect to any of the foregoing or otherwise with respect to such Intellectual Property, including all rights to sue or recover at law or in equity for any past, present or future infringement, misappropriation, dilution, violation or other impairment thereof, and, in each case, all rights to obtain any other IP Ancillary Right.

 

“IP License” means all Contractual Obligations (and all related IP Ancillary Rights), whether written or oral, granting any right title and interest in or relating to any Intellectual Property.

 

“IPO” means the underwritten initial public offering of the common stock of Holdings to be effected substantially concurrently with the Closing Date.

 

“IRS” means the Internal Revenue Service of the United States and any successor thereto.

 

“Issue” means, with respect to any Letter of Credit, to issue, extend the expiration date of, renew (including by failure to object to any automatic renewal on the last day such objection is permitted), increase the face amount of, or reduce or eliminate any scheduled decrease in the face amount of, such Letter of Credit, or to cause any Person to do any of the foregoing. The terms “Issued” and “Issuance” have correlative meanings.

 

“Joinder Agreement” has the meaning assigned to such term in Section 2.20(b).

 

“Joint Venture” means a single-purpose corporation, partnership, limited liability company, joint venture, or other legal arrangement (whether created by contract or conducted through a separate legal entity) now or hereafter formed by the Borrower or any of its Subsidiaries with another Person in order to conduct a common venture or enterprise with such Person.

 

“Junior Capital” means any Qualified Capital Stock of Parent and any Junior Indebtedness.

 

“Junior Indebtedness” means Indebtedness of Parent that (a) is unsecured, (b) is expressly subordinated to the prior payment in full in cash of the Obligations (and the related Guarantees) on terms reasonably satisfactory to the Administrative Agent, (c) provides that interest in respect of such Indebtedness is payable in kind or, at the option of the holder of such Indebtedness, in cash or Cash Equivalents, (d) has a final maturity date that is not earlier than the date that is 180 days after the Termination Date and has no scheduled payments of principal thereon (including pursuant to a sinking fund obligation) or mandatory redemption obligations prior to such final maturity date, and (e) is not subject to covenants, events of default and remedies that are less favorable to the Borrower, as the case may be, than the terms of the Senior Debt as reasonably determined by the Administrative Agent.

 

“L/C Cash Collateral Account” means any Cash Collateral Account (a) specifically designated as such by the Borrower in a notice to the Administrative Agent and (b) from and after the effectiveness of such notice, not containing any funds other than those required under the Loan Documents to be placed therein.

 

 

“L/C Issuer” means (a) KeyBank or any of its Subsidiaries or Affiliates and (b) each Person that hereafter becomes an L/C Issuer with the approval of, and pursuant to an agreement with and in form and substance satisfactory to, the Administrative Agent and the Borrower, in each case in their capacity as an L/C Issuer hereunder and together with their successors.

 

“L/C Obligations” means, for any Letter of Credit at any time, the sum of (a) the L/C Reimbursement Obligations at such time for such Letter of Credit and (b) the aggregate maximum undrawn face amount of such Letter of Credit outstanding at such time.

 

“L/C Reimbursement Agreement” has the meaning specified in Section 2.4(a).

 

“L/C Reimbursement Date” has the meaning specified in Section 2.4(e).

 

“L/C Reimbursement Obligation” means, for any Letter of Credit, the obligation of the Borrower to the L/C Issuer thereof, as and when matured, to pay all amounts drawn under such Letter of Credit.

 

“L/C Request” has the meaning specified in Section 2.4(b).

 

“L/C Sublimit” means $10,000,000.

 

“Lender” means, collectively, any financial institution or other Person that (a) is listed on the signature pages hereof as a “Lender” or (b) from time to time becomes a party hereto by execution of an Assignment, in each case together with its successors.

 

“Lender Insolvency Event” means that (i) a Lender or its Parent Company is determined or adjudicated to be insolvent by a Governmental Authority, or is generally unable to pay its debts as they become due, or admits in writing its inability to pay its debts as they become due, or makes a general assignment for the benefit of its creditors, or (ii) such Lender or its Parent Company is the subject of a bankruptcy, insolvency, reorganization, liquidation or similar proceeding, or a receiver, trustee, conservator, intervenor or sequestrator or the like has been appointed for such Lender or its Parent Company, or such Lender or its Parent Company has taken any action indicating its consent to or acquiescence in any such proceeding or appointment.

 

“Lender Party” means any Lender or the L/C Issuer.

 

“Lender Party Appointment Period” has the meaning assigned in Section 10.7(a).

 

“Letter of Credit” means any letter of credit Issued pursuant to Section 2.4.

 

“Liabilities” means all claims, actions, suits, judgments, damages, losses, liability, obligations, responsibilities, fines, penalties, sanctions, costs, fees, taxes, commissions, charges, disbursements and expenses, in each case of any kind or nature (including interest accrued thereon or as a result thereto and fees, charges and disbursements of financial, legal and other advisors and consultants), whether joint or several, whether or not indirect, contingent, consequential, actual, punitive, treble or otherwise.

 

 

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, hypothecation, assignment, easement, pledge, encumbrance, charge or security interest in or on such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, Capital Lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset, and (c) in the case of securities (other than securities representing an interest in a Joint Venture that is not a Subsidiary), any purchase option, call or similar right of a third party with respect to such securities to the extent that any such right is intended to have an effect equivalent to that of a security interest in such securities.

 

“Loan” means any loan made or deemed made by any Lender hereunder.

 

“Loan Documents” means, collectively, this Agreement, any Notes, the Guaranty and Security Agreement, any intellectual property security agreements, the Mortgages, the Agency Fee Letter, the Fee Letter, the L/C Reimbursement Agreements, the Secured Hedging Documents, the Secured Cash Management Agreements, and, when executed, each document executed by a Loan Party and delivered to the Administrative Agent, the Collateral Agent, any Lender or any L/C Issuer in connection with or pursuant to any of the foregoing or the Obligations, together with any modification of any term, or any waiver with respect to, any of the foregoing.

 

“Loan Party” means the Borrower and each Guarantor.

 

“Management Group” means the group consisting of (i) the directors, executive officers and other management personnel of the Borrower, Parent, any direct or indirect parent of Parent and their Subsidiaries, as the case may be, on the Closing Date, (ii) any new directors whose election by such boards of directors or whose nomination for election by the shareholders of the Borrower, Parent or any direct or indirect parent of Parent, as the case may be, was approved by a vote of a majority of the directors of the Borrower, Parent or any direct or indirect parent of Parent, as the case may be, then still in office who were either directors on the Closing Date or whose election or nomination was previously so approved, (iii) executive officers and other management personnel of the Borrower, Parent, any direct or indirect parent of Parent and their Subsidiaries, as the case may be, hired at a time when the directors on the Closing Date together with the directors so approved constituted a majority of the directors of the Borrower, Parent or any direct or indirect parent of Parent, as the case may be and (iv) any Family Member of any Person described in the foregoing clauses (i), (ii) and (iii) (or a Family Member of any such Person’s spouse, parent or sibling), a company, partnership or a trust established for the benefit of any of the foregoing or any personal representative, estate or executor under any will of any such Family Member or pursuant to the laws of intestate succession.

 

“Material Adverse Effect” means (a) a material adverse effect on the condition (financial or otherwise), business, operations or property of the Group Members, taken as a whole, (b) material impairment of the ability of any of the Loan Parties to timely perform its or their obligations under any Loan Document, or (c) material impairment of the legality, binding effect, validity or enforceability of any Loan Document or the rights and remedies of the Administrative Agent, the Collateral Agent, the Lenders and/or the other Secured Parties under any Loan Document.

 

“Maximum Lawful Rate” has the meaning specified in Section 2.9(d).

 

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

 

“Mortgage” means any mortgage, deed of trust or other document executed or required herein to be executed by any Loan Party and granting a security interest over owned real property in favor of the Collateral Agent as security for the Obligations, in form and substance reasonably satisfactory to the Collateral Agent.

 

 

“Mortgage Supporting Documents” means, with respect to any Mortgage for a parcel of owned real property, each document (including title policies or marked-up unconditional insurance binders, in such amounts and containing such endorsements (if available) as shall be reasonably required by the Administrative Agent, ALTA as-built surveys (in form and as to date that is sufficiently acceptable to the title insurer issuing title insurance to the Collateral Agent for such title insurer to deliver such endorsements (if available) and removing all survey exceptions to such title insurance as reasonably requested by the Administrative Agent), environmental assessments and reports, life of loan flood hazard determinations (with notice to Borrower), certificates, opinions, required consents, approvals or other instrument or document necessary to consummate the transaction, all in form and substance reasonably acceptable to the Administrative Agent, and evidence regarding recording and payment of fees, insurance premium and taxes) that the Administrative Agent may reasonably request, to create, register, perfect, maintain, evidence the existence, substance, form or validity of or enforce a valid lien on such parcel of owned real property in favor of the Collateral Agent for the benefit of the Secured Parties, subject only to Customary Permitted Liens and such other Liens as the Administrative Agent and the Collateral Agent may approve.

 

“Multiemployer Plan” means any multiemployer plan, as defined in Section 400l(a)(3) of ERISA, to which any ERISA Affiliate incurs or otherwise has any obligation or liability, contingent or otherwise.

 

“National Flood Insurance Program” means the program created by the U.S. Congress pursuant to the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973, as revised by the National Flood Insurance Reform Act of 1994, that mandates the purchase of flood insurance to cover real property improvements located in special flood hazard areas in participating communities and provides protection to property owners through a Federal insurance program.

 

“Net Income” means, with respect to any Person, the net income (loss) of such Person, determined in accordance with GAAP.

 

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

 

“Non-Funding Lender” has the meaning specified in Section 2.2(c).

 

“Non-U.S. Secured Party” means each Agent, each Lender, each L/C Issuer, each SPV and each participant, in each case that is not a Domestic Person.

 

“Note” means a promissory note of the Borrower, in substantially the form of Exhibit 2.14(e), payable to the order of a Lender in a principal amount equal to the amount of such Lender’s Commitment.

 

“Notice of Borrowing” has the meaning specified in Section 2.2(a).

 

“Notice of Conversion or Continuation” has the meaning specified in Section 2.10(b).

 

“Obligations” means, with respect to any Loan Party, all amounts, obligations, liabilities, covenants and duties of every type and description owing by such Loan Party to any Agent, any Lender, the L/C Issuer, any Arranger, any other Indemnitee, any participant, any SPV, in the case of any Secured Hedging Document, any Secured Hedging Counterparty therefor, or, in the case of any Secured Cash Management Agreement, any Cash Management Bank, in each case arising out of, under, or in connection with, any Loan Document, whether direct or indirect (regardless of whether acquired by assignment), absolute or contingent, due or to become due, whether liquidated or not, now existing or hereafter arising and however acquired, and whether or not evidenced by any instrument or for the payment of money, including (a) if such Loan Party is the Borrower, all Loans and L/C Obligations, (b) all interest, whether or not accruing after the filing of any petition in bankruptcy or after the commencement of any insolvency, reorganization or similar proceeding, and whether or not a claim for post-filing or post-petition interest is allowed in any such proceeding, (c) Secured Hedging Reimbursement Obligations, (d) obligations under any Secured Cash Management Agreement, and (e) all other fees, expenses (including fees, charges and disbursement of counsel), interest, commissions, charges, costs, disbursements, indemnities and reimbursement of amounts paid and other sums chargeable to such Loan Party under any Loan Document (including those payable to the L/C Issuer as described in Section 2.11).

 

 

“Original Credit Agreement” has the meaning set forth in the preamble hereto.

 

“Other Taxes” has the meaning specified in Section 2.17(c).

 

“Outstandings” means, at any time, the sum of, in each case to the extent outstanding at such time, (a) the aggregate principal amount of the Loans and (b) the L/C Obligations for all Letters of Credit.

 

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

 

“Parent Company” means, with respect to a Lender, the bank holding company (as defined in Regulation Y of the Federal Reserve Board), if any, of such Lender.

 

“Patents” means all rights, title and interests (and all related IP Ancillary Rights) arising under any Requirement of Law in or relating to letters patent and applications therefor.

 

“Patriot Act” means the USA Patriot Act of 2001 (31 U.S.C. 5318 et seq.).

 

“PBGC” means the United States Pension Benefit Guaranty Corporation and any successor thereto.

 

“Perfection Certificate” means a certificate in the form of Exhibit 1.1(4) or any other form approved by the Collateral Agent.

 

“Permit” means all permits, licenses, accreditations by Governmental Authority, franchises and other consents and approvals required by any Government Authority to lawfully operate the Business (including any pending applications for such permits, licenses, authorizations, registrations, franchises, consents and approvals).

 

“Permitted Acquisition” means any Proposed Acquisition satisfying each of the following conditions: (a) no Default shall have occurred and be continuing or would result therefrom; (b) all transactions related thereto shall be consummated in accordance with applicable laws; (c) any acquired or newly formed Subsidiary shall not be liable for any Indebtedness (except for Indebtedness permitted by Section 8.1); (d) the Administrative Agent shall have received reasonable advance notice of such Proposed Acquisition including a reasonably detailed description thereof at least 15 days prior to the consummation of such Proposed Acquisition (or such later date as may be agreed by the Administrative Agent) and on or prior to the date of such Proposed Acquisition, the Administrative Agent shall have received copies of the acquisition agreement and related Contractual Obligations and other documents (including financial information and analysis, environmental assessments and reports, opinions, certificates and lien searches) and information, in each case to the extent otherwise available and reasonably requested by the Administrative Agent; (e) after giving effect to such Proposed Acquisition, the Borrower shall be in compliance with the Financial Performance Covenants on a Pro Forma Basis as of the last day of the last Fiscal Quarter for which Financial Statements have been delivered hereunder, and the Borrower shall have delivered to the Administrative Agent a certificate of a Responsible Officer of the Borrower to such effect, together with all relevant financial information for such Permitted Acquisition, (f) in the case of the acquisition of the capital stock of another Person, either by tender offer or otherwise, the board of directors (or other comparable governing body) of such other Person shall have duly approved such acquisition at the time of the initial offer thereof, and (g) the Borrower shall satisfy its obligations under Section 7.10 with respect to the Proposed Acquisition Target and its Subsidiaries (and any assets acquired therefrom).

 

 

“Permitted Indebtedness” means any Indebtedness of any Group Member that is not prohibited by Section 8.1 or any other provision of any Loan Document.

 

“Permitted Investment” means any Investment of any Group Member that is not prohibited by Section 8.3 or any other provision of any Loan Document.

 

“Permitted Investors” means the Management Group.

 

“Permitted Lien” means any Lien on or with respect to the property of any Group Member that is not prohibited by Section 8.2 or any other provision of any Loan Document.

 

“Permitted Payment Restriction” means any consensual encumbrance or restriction (each, a “restriction”) on the ability of any Subsidiary to pay dividends or make any other distributions on its equity interest to the Borrower or a Subsidiary, which restriction satisfies all of the following conditions: (i) such restriction becomes effective only upon the occurrence of (x) specified events under its Constituent Documents or any joint venture or similar agreements or (y) an “event of default” with respect to Indebtedness (as defined in the agreement governing such Indebtedness) that was incurred by such Subsidiary in compliance with Section 8.1 and (ii) such restriction would not materially impair the Borrower’s ability to make scheduled payments of cash interest and to make required principal payments on the Loans, as determined in good faith by the Board of Directors of the Borrower whose determination shall be conclusive, provided that the Borrower shall reasonably promptly notify the Administrative Agent and Lenders from time to time after any such determination is made.

 

“Permitted Refinancing” means Indebtedness constituting a refinancing, extension, renewal, or replacement of Permitted Indebtedness that (a) has an aggregate outstanding principal amount (or accreted value, if applicable) not greater than the aggregate principal amount (or accreted value, if applicable) of such Permitted Indebtedness outstanding at the time of such refinancing or extension (plus unpaid accrued interest and premium thereon and reasonable and customary underwriting discounts, fees, commissions, and expenses), (b) has a weighted average maturity (measured as of the date of such refinancing or extension) and maturity no shorter than that of such Permitted Indebtedness, (c) is not secured by any property or any Lien other than those securing such Permitted Indebtedness or on terms less favorable to the Lenders than those of such Permitted Indebtedness, and (d) if the Permitted Indebtedness being refinanced, extended, renewed, replaced, defeased or refunded is subordinated in right of payment to the Obligations under this Agreement, such Permitted Refinancing shall be subordinated in right of payment to such Obligations on terms at least as favorable to the Lenders as those contained in the documentation governing the Permitted Indebtedness being refinanced, extended, renewed, replaced, defeased or refunded; provided, that, notwithstanding the foregoing, (x) the terms of such Permitted Indebtedness may be modified as part of such Permitted Refinancing if such modification would have been permitted pursuant to Section 8.11 and (y) no Guaranty Obligation for such Indebtedness shall constitute part of such Permitted Refinancing unless similar Guaranty Obligations with respect to such Permitted Indebtedness existed and constituted Permitted Indebtedness prior to such refinancing or extension.

 

 

“Permitted Tax Distributions” means, with respect to any taxable year (or portion thereof), dividends or distributions in amounts required for Parent or any direct or indirect parent of Parent, if applicable, to pay federal, state, local or foreign income taxes (as the case may be) imposed directly on Parent or such parent to the extent such income taxes are attributable to the income of the Borrower and its subsidiaries (including, without limitation, by virtue of Parent or such parent being the common parent of a consolidated or combined tax group of which the Borrower and/or its subsidiaries are members).

 

“Person” means any individual, partnership, corporation (including a business trust and a public benefit corporation), joint stock company, estate, association, firm, enterprise, trust, limited liability company, unincorporated association, joint venture and any other entity or Governmental Authority.

 

“Pledged Notes” means any promissory note, in form and substance reasonably satisfactory to the Administrative Agent and the Collateral Agent, issued to a Loan Party that is pledged to the Collateral Agent under the Guaranty and Security Agreement and is a “Pledged Debt Instrument” under the Guaranty and Security Agreement.

 

“Pricing Prospectus” has the meanings set forth in Section 3.1(c).

 

“Prime Rate” means the rate of interest per annum announced by Royal Bank from time to time as its prime commercial lending rate for United States Dollar loans in the United States for such day. The Prime Rate is not necessarily the lowest rate that Royal Bank is charging any corporate customer.

 

“Pro Forma Basis” means, as to any Person, for any events as described below that occur subsequent to the commencement of a period for which the financial effect of such events is being calculated, and giving effect to the events for which such calculation is being made, such calculation as will give pro forma effect to such events as if such events occurred on the first day of the four consecutive Fiscal Quarter period ended on or before the occurrence of such event (the “Reference Period”): (i) in making any determination of Consolidated EBITDA, pro forma effect shall be given to any asset disposition (other than dispositions of inventory) or any Permitted Acquisition involving consideration in excess of $1.0 million per transaction, or any discontinued operation (or any similar transaction or transactions that require a waiver or consent of the Required Lenders pursuant to Section 8.3, 8.4 or 8.7), in each case that occurred during the Reference Period (or, in the case of determinations made pursuant to the definition of the term “Permitted Acquisition” or Section 8.3(e)(iii), occurring during the Reference Period or thereafter and through and including the date upon which the respective Permitted Acquisition is consummated), (ii) in making any determination on a Pro Forma Basis, (x) all Indebtedness (including Indebtedness incurred or assumed and for which the financial effect is being calculated, whether incurred under this Agreement or otherwise, but excluding normal fluctuations in revolving Indebtedness incurred for working capital purposes not to finance any acquisition) incurred or permanently repaid during the Reference Period (or, in the case of determinations made pursuant to the definition of the term “Permitted Acquisition” or Section 8.3(e)(iii), occurring during the Reference Period or thereafter and through and including the date upon which the respective Permitted Acquisition is consummated) shall be deemed to have been incurred or repaid at the beginning of such period, and (y) Consolidated Interest Expense of such Person attributable to interest on any Indebtedness, for which pro forma effect is being given as provided in preceding clause (x), bearing floating interest rates shall be computed on a pro forma basis as if the rates that would have been in effect during the period for which pro forma effect is being given had been actually in effect during such periods, and (iii) in making any determination on a Pro Forma Basis, effect will be given to the Subsidiary Redesignation, if any, then being designated as well as any other Subsidiary Redesignation after the first day of the relevant Reference Period and on or prior to the date of the respective Subsidiary Redesignation then being designated.

 

 

Pro forma calculations made pursuant to the definition of the term “Pro Forma Basis” shall be determined in good faith by a Responsible Officer of the Borrower and, in respect of any asset disposition (other than dispositions of inventory) or any Permitted Acquisition involving consideration in excess of $1.0 million per transaction, or any discontinued operation (or any similar transaction or transactions that require a waiver or consent of the Required Lenders pursuant to Sections 8.3, 8.4 or 8.7), without duplication of the amounts added back to Consolidated EBITDA pursuant to clause (a)(iv) of the definition thereof, for any fiscal period ending on or prior to the first anniversary of the consummation of such asset acquisition, asset disposition or other similar transaction, may include adjustments (estimated on a good faith basis by the Borrower) to reflect operating expense reductions, reductions in force and other synergies reasonably expected to result from such asset acquisition, asset disposition or other similar transaction, for which substantially all of the steps necessary for the realization thereof have been taken or are reasonably anticipated by the Borrower to be taken in the next 12 month period following the consummation thereof; provided that the aggregate amount of the adjustments referred to above shall not exceed 10% of Consolidated EBITDA for such period (as calculated on a Pro Forma Basis prior to giving effect to the addition of any such amounts). On the date any such asset acquisition, asset disposition or other similar transaction is consummated, the Borrower shall deliver to the Administrative Agent a certificate of a Responsible Officer of the Borrower setting forth such demonstrable or additional operating expense reductions and other operating improvements or synergies and information and calculations supporting them in reasonable detail, based on historical results accounted for in accordance with GAAP and, to the extent applicable, reasonable assumptions that are specified in detail in the relevant Compliance Certificate, Financial Statement or other document provided to the Administrative Agent or any Lender in connection herewith.

 

“Projections” means those three-year financial projections delivered to the Administrative Agent in March, 2011.

 

“Property Loss Event” means, with respect to any property, any loss of or damage to such property or any taking of such property or condemnation thereof.

 

“Proposed Acquisition” means (a) any proposed acquisition that is consensual and approved by the board of directors or other similar governing body or Person(s) with regard to such Proposed Acquisition Target, of all or substantially all of the assets or Stock of any Proposed Acquisition Target by the Borrower or any Subsidiary of the Borrower (or by Parent to the extent such assets and Stock are transferred to the Borrower or any Subsidiary of the Borrower contemporaneously with such acquisition) or (b) any proposed merger of any Proposed Acquisition Target with or into the Borrower or any Subsidiary of the Borrower (and, in the case of a merger with the Borrower, with the Borrower being the surviving entity).

 

“Proposed Acquisition Target” means any Person or any brand, line of business, division, branch, operating division or other unit operation of any Person.

 

“Pro Rata Outstandings” of any Lender at any time, means the sum of (i) the outstanding principal amount of Loans owing to such Lender and (ii) the amount of the participation of such Lender in the L/C Obligations outstanding with respect to all Letters of Credit.

 

“Pro Rata Share” means, with respect to any Lender, the percentage obtained by dividing (a) the sum of the Commitments (or, if such Commitments are terminated, the Pro Rata Outstandings therein) of such Lender then in effect under the Facility by (b) the sum of the Commitments (or, if such Commitments are terminated, the Pro Rata Outstandings therein) of all Lenders then in effect under the Facility; provided, that, if there are no Commitments and no Pro Rata Outstandings, such Lender’s Pro Rata Share shall be determined based on the Pro Rata Share most recently in effect, after giving effect to any subsequent assignment and any subsequent non-pro rata payments of any Lender pursuant to Section 2.18.

 

 

“Purchase Money Indebtedness” means Indebtedness for the purchase price or cost of construction, repair or improvement of any property.

 

“Purchase Money Lien” means a Lien (x) existing on property at the time of its acquisition, repair or construction by any Person, (y) created on property contemporaneously with its acquisition or within 120 days of the acquisition or completion of construction, repair or improvement thereof to secure the purchase price or cost of construction, repair or improvement thereof, or (z)  existing on property of another Person at the time such other Person is consolidated with or merged into such Person and not created in contemplation thereof; provided, that such Lien shall attach solely to the property acquired, constructed, repaired or improved, and the principal amount of the Purchase Money Indebtedness secured by such Lien shall not exceed the purchase price of such property.

 

“Qualified Capital Stock” means any Stock of any Person that does not by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable) or upon the happening of any event (a) provide for scheduled payments of dividends in cash, (b) mature, require the repurchase thereof, become mandatorily redeemable (other than pursuant to customary provisions relating to redemption upon a change of control or sale of assets) pursuant to a sinking fund obligation or otherwise or become redeemable at the option of the holder thereof, in each case prior to the date that is 180 days after the Termination Date, (c) become convertible or exchangeable at the option of the holder thereof for Indebtedness or Stock that is not Qualified Capital Stock, or (d) contain any maintenance covenants, other covenants adverse to the Lenders or remedies (other than voting rights and, subject to clause (a) above, increases in dividends).

 

“Reference Period” has the meaning provided in the definition of Pro Forma Basis in this Section 1.1.

 

“Register” has the meaning specified in Section 2.14(b).

 

“Related Person” means, with respect to any Person, each Affiliate of such Person and each director, officer, employee, agent, partner, trustee, representative, attorney, accountant and each insurance, environmental, legal, financial and other advisor (including those retained in connection with the satisfaction or attempted satisfaction of any condition set forth in Article III) and other consultants and agents of or to such Person or any of its Affiliates, together with, if such Person is an Agent, each other Person or individual designated, nominated or otherwise mandated by or helping such Agent pursuant to and in accordance with Section 10.5 or any comparable provision of any Loan Document.

 

“Release” means any release, threatened release, spill, emission, leaking, pumping, pouring, emitting, emptying, escape, injection, deposit, disposal, discharge, dispersal, dumping, leaching or migration of Hazardous Material into or through the Environment, or from, into or through any structure or facility (except for any such structure or facility that is intended to contain or convey such Hazardous Material).

 

“Remedial Action” means all actions required to (a) clean up, remove, treat or in any other way address any Hazardous Material in the indoor or outdoor Environment, (b) prevent or minimize any Release so that a Hazardous Material does not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor Environment or (c) perform pre remedial studies and investigations and post-remedial monitoring and care with respect to any Hazardous Material.

 

 

“Required Lenders” means, at any time, Lenders having at such time in excess of 50% of the sum of the aggregate Commitments (or, if such Commitments are terminated, the Pro Rata Outstandings) then in effect; provided, that, if at any time there are only two Lenders (where a Lender and its Affiliates or Approved Funds count as one Lender), “Required Lenders” shall mean all Lenders.

 

“Requirements of Law” means, with respect to any Person, collectively, the common law and all federal, state, local, foreign, multinational or international laws, statutes, codes, treaties, standards, rules and regulations, guidelines, ordinances, orders, judgments, writs, injunctions, decrees (including administrative or judicial precedents or authorities) and the interpretation or administration thereof by, and other determinations, directives, requirements or requests of, any Governmental Authority, in each case whether or not having the force of law and that are applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

 

“Responsible Officer” means, with respect to any Person, any of the president, chief executive officer, chief financial officer, treasurer, assistant treasurer, controller, managing member or general partner of such Person but, in any event, with respect to financial matters, any such officer that is responsible for preparing the Financial Statements delivered hereunder and, with respect to the Corporate Chart and other documents delivered pursuant to Section 6.1(d), documents delivered on the Closing Date or the Amendment Effective Date and documents delivered pursuant to Section 7.10, the secretary or assistant secretary of such Person or any other officer responsible for maintaining the corporate and similar records of such Person.

 

“Restricted Payment” means (a) any dividend, return of capital, distribution or any other payment, whether direct or indirect (including through the use of Hedging Agreements, the making, repayment, cancellation or forgiveness of Indebtedness and similar Contractual Obligations) and whether in cash, Securities or other property, in each case on account of any Stock or Stock Equivalent of Parent, the Borrower or any of its Subsidiaries, in each case now or hereafter outstanding, including with respect to a claim for rescission of a Sale of such Stock or Stock Equivalent and (b) any redemption, retirement, sinking fund or similar payment, termination, defeasance, cancellation, purchase or other acquisition for value, whether direct or indirect (including through the use of Hedging Agreements, the making, repayment, cancellation or forgiveness of Indebtedness and similar Contractual Obligations), of any Stock or Stock Equivalent of any Group Member or of any direct or indirect parent entity of the Borrower, now or hereafter outstanding.

 

“S&P” means Standard & Poor’s Rating Services.

 

“Sale and Leaseback Transaction” means, with respect to any Person (the “obligor”), any Contractual Obligation or other arrangement with any other Person (the “counterparty”) consisting of a lease by such obligor of any property that, directly or indirectly, has been or is to be Sold by the obligor to such counterparty or to any other Person to whom funds have been advanced by such counterparty based on a Lien on, or an assignment of, such property or any obligations of such obligor under such lease.

 

“Scheduled Termination Date” means the fifth anniversary of the Amendment Effective Date.

 

“Secured Cash Management Agreements” means, collectively, any agreement to provide cash management services, including treasury, depository, overdraft, credit or debit card, electronic funds transfer and other cash management arrangements, that is entered into by and between the Borrower and any Cash Management Bank.

 

“Secured Hedging Counterparty” means Royal Bank or any other Person (other than any Group Member) that entered into a Hedging Agreement with the Borrower or has provided a Secured Hedging Support Document at the request of the Borrower at a time when such Person was an Agent, a Lender or an Affiliate of a Lender.

 

 

“Secured Hedging Documents” means, collectively, (a) any Hedging Agreement that (i) is entered into by the Borrower and any Secured Hedging Counterparty therefor, (ii) in the case of a Hedging Agreement not entered into with or provided or arranged by the Administrative Agent or an Affiliate of the Administrative Agent, is expressly identified as being a “Secured Hedging Document” hereunder in a joint notice from Borrower and such Person delivered to the Administrative Agent reasonably promptly after the execution of such Hedging Agreement, and (iii) meets the requirements of Section 8.1(f), and (b) any Secured Hedging Support Provision.

 

“Secured Hedging Reimbursement Obligation” means any obligation of the Borrower to make payments to any Secured Hedging Counterparty with respect to any Secured Hedging Support Provision.

 

“Secured Hedging Support Documents” means any document (a) entered into to provide credit enhancements for the benefit of the counterparty to an Interest Rate Contract, which credit enhancements are provided (i) solely to support the payment obligations of the Borrower under such Interest Rate Contract, and (ii) by Royal Bank or any other Person at a time when such Person is the Administrative Agent, a Lender or an Affiliate of a Lender, and (b) is expressly identified as being a “Secured Hedging Support Document” hereunder in a joint notice from such Loan Party and the Person providing such credit enhancements delivered to the Administrative Agent reasonably promptly after the execution or issuance of such document, unless such Person is the Administrative Agent or an Affiliate of the Administrative Agent at the time such credit enhancements are provided.

 

“Secured Hedging Support Provision” means any provision in any Secured Hedging Support Document, Sections 2.6(c), 2.9(a) and 2.9(c) and any other provision of this Agreement or any Loan Document to the extent applicable to any Secured Hedging Reimbursement Obligation, any Secured Hedging Support Document or affecting the rights or duties of, or any payment to, any Secured Hedging Counterparty with respect to any Secured Hedging Support Document.

 

“Secured Parties” means the Lenders, the L/C Issuer, each Agent, the Arrangers, any Secured Hedging Counterparty, each other Indemnitee and any other holder of any Obligation of any Loan Party.

 

“Securitization” means, with respect to any Lender, a public or private offering by such Lender or any of its Affiliates or their respective successors and assigns, of Securities that represent an interest in, or that are collateralized, in whole or in part, by, the Loans and the Loan Documents.

 

“Security” means all Stock, Stock Equivalents, voting trust certificates, bonds, debentures, instruments and other evidence of Indebtedness, whether or not secured, convertible or subordinated, all certificates of interest, share or participation in, all certificates for the acquisition of, and all warrants, options and other rights to acquire, any Security.

 

“Sell” means, with respect to any property, to sell, convey, transfer, assign, license, lease, exchange or otherwise dispose of, any interest therein or to permit any Person to acquire any such interest, including, in each case, through a Sale and Leaseback Transaction or through a sale, factoring at maturity, collection of or other disposal, with or without recourse, of any notes or accounts receivable. Conjugated forms thereof and the noun “Sale” have correlative meanings.

 

“Senior Debt” of any Person means Consolidated Total Debt minus Consolidated Total Debt that is Subordinated Debt, in each case of such Person and its Subsidiaries on a Consolidated basis.

 

 

“Solvent” means, with respect to any Person as of any date of determination, that, as of such date, (a) the value of the assets of such Person (both at fair value and present fair saleable value) is greater than the total amount of liabilities (including contingent and unliquidated liabilities) of such Person, (b) such Person is able to pay all liabilities (including contingent and unliquidated liabilities) of such Person as such liabilities become absolute and matured, (c) such person is generally paying its debts and liabilities as they become due, including in the usual course of business or affairs of such Person, (d) such Person does not have unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted following the Closing Date (including such businesses reflected in the Projections and the most recent business plans and forecasts required to be delivered pursuant to Section 6.1(g)) and (e) in the event of an amendment, modification or other change in the Bankruptcy Code or any other applicable law relating to fraudulent transfers and conveyances after the Closing Date, such Person is not “insolvent” within the meaning given that term and similar terms under the Bankruptcy Code or any other applicable laws relating to fraudulent transfers and conveyances, as so amended, modified or changed. In computing the amount of contingent or unliquidated liabilities at any time, such liabilities shall be computed at the amount that, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent or unliquidated liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5).

 

“Specified Stock Repurchase” has the meaning assigned in Section 8.5(e).

 

“SPV” means any special purpose funding vehicle identified as such in a writing by any Lender to the Administrative Agent.

 

“Stock” means all shares of capital stock (whether denominated as common stock or preferred stock), equity interests, beneficial, partnership or membership interests, joint venture interests, participations or other ownership or profit interests in or equivalents (regardless of how designated) of or in a Person (other than an individual), whether voting or non-voting.

 

“Stock Equivalents” means all securities convertible into or exchangeable for Stock or any other Stock Equivalent and all warrants, options or other rights to purchase, subscribe for or otherwise acquire any Stock or any other Stock Equivalent, whether or not presently convertible, exchangeable or exercisable.

 

“Subordinated Debt” means any Indebtedness that is subordinated to the payment in full of the Obligations on terms and conditions reasonably satisfactory to the Administrative Agent.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership, joint venture, limited liability company, association or other entity, the management of which is, directly or indirectly, controlled by, or of which an aggregate of more than 50% of the outstanding Voting Stock is, at the time, owned or controlled directly or indirectly by, such Person or one or more Subsidiaries of such Person. Unless otherwise specified “Subsidiary” refers to a Subsidiary of the Borrower.

 

“Subsidiary Redesignation” has the meaning provided in the definition of Unrestricted Subsidiary in this Section 1.1.

 

“Substitute Lender” has the meaning specified in Section 2.18(a).

 

“SWDA” means the Solid Waste Disposal Act (42 U.S.C. §§ 6901 et seq.).

 

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

 

 

“Tax Affiliate” means (a) the Borrower and its Subsidiaries and (b) any Affiliate of the Borrower with which the Borrower or any of its Subsidiaries files or is eligible to file consolidated, combined or unitary tax returns (or on whose consolidated, combined or unitary tax return the income of the Borrower or any of its Subsidiaries is included).

 

“Tax Returns” has the meaning specified in Section 4.8.

 

“Taxes” has the meaning specified in Section 2.17(a).

 

“Termination Date” shall mean the earliest of (a) Scheduled Termination Date, (b) the date of termination of the Commitments pursuant to Section 2.5 or 9.2 and (c) the date on which the Obligations become due and payable pursuant to Section 9.2.

 

“Title IV Plan” means a pension plan subject to Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, other than a Multiemployer Plan, to which any ERISA Affiliate incurs or otherwise has any obligation or liability, contingent or otherwise.

 

“Total Consideration” means, with respect to any Permitted Acquisition, all cash and non-cash consideration, including the amount of Indebtedness assumed, the maximum amount payable in connection with any deferred purchase price obligation (including any earn-out obligation) and the value of any capital stock issued to the seller or sellers (other than capital stock of Holdings or the net cash proceeds of the issuance by Holdings of shares of capital stock used to fund such Permitted Acquisition).

 

“Total Secured Debt” means, at any date, the aggregate principal amount of Consolidated Total Debt outstanding at such date that consists of, without duplication, (i) Capitalized Lease Obligations and (ii) other Indebtedness (other than Indebtedness in respect of the Facility) that in each case is then secured by Liens on property or assets of the Borrower or its Subsidiaries (other than property or assets held in a defeasance or similar trust or arrangement for the benefit of the Indebtedness secured thereby).

 

“Total Secured Leverage Ratio” means, on any date, the ratio of (a) Total Secured Debt as of such date to (b) Consolidated EBITDA for the period of four consecutive fiscal quarters of the Borrower most recently most recently ended as of such date, all determined on a Consolidated basis in accordance with GAAP; provided that Consolidated EBITDA shall be determined on a Pro Forma Basis.

 

“Trademarks” means all rights, title and interests (and all related IP Ancillary Rights) arising under any Requirement of Law in or relating to trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, logos and other source or business identifiers and, in each case, all goodwill associated therewith, all registrations and recordations thereof and all applications in connection therewith.

 

“Trade Secrets” means all right, title and interest (and all related IP Ancillary Rights) arising under any Requirement of Law in or relating to trade secrets.

 

“UCC” means the Uniform Commercial Code of any applicable jurisdiction and, if the applicable jurisdiction shall not have any Uniform Commercial Code, the Uniform Commercial Code as in effect in the State of New York.

 

“Unfunded Current Liability” of any Title IV Plan means the amount, if any, as of the most recent valuation date for the Title IV Plan, by which the present value of the Title IV Plan’s benefit liabilities, determined in accordance with actuarial assumptions at such time consistent with those prescribed by Section 412 and 430 of the Code and Section 302 and 303 of ERISA, exceeds the fair market value of all plan assets allocable to such liabilities under Title IV of ERISA.

 

 

“United States” means the United States of America.

 

“Unrestricted Subsidiary” shall mean any Subsidiary of the Borrower that is acquired or created after the Closing Date and designated by the Borrower as an Unrestricted Subsidiary hereunder by written notice to the Administrative Agent; provided, that the Borrower shall only be permitted to so designate a new Unrestricted Subsidiary after the Closing Date and so long as (a) no Default exists or would result therefrom, (b) the Borrower shall be in compliance on a Pro Forma Basis with the Financial Performance Covenants as of the last day of the last Fiscal Quarter for which Financial Statements have been delivered hereunder after giving effect to such designation, (c) at the time of such designation neither the Borrower nor any Subsidiary provides any guarantee or credit support of any kind, including any undertaking, guarantee, indemnity, agreement or instrument that would constitute Indebtedness, of any Indebtedness of such Unrestricted Subsidiary or is directly or indirectly liable on such Indebtedness, as a guarantor or otherwise and no Indebtedness of such Unrestricted Subsidiary contains a default that would permit, upon notice, lapse of time or both, any holder of any Indebtedness of Borrower or any Subsidiary to declare a default under such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity and (d) such Unrestricted Subsidiary shall be capitalized (to the extent capitalized by the Borrower or any of its Subsidiaries) through Investments as permitted by, and in compliance with, Section 8.3(g), with any assets owned by such Unrestricted Subsidiary at the time of the initial designation thereof to be treated as Investments pursuant to Section 8.3(g); and provided, further that at the time of the acquisition or creation of, and the initial Investment by the Borrower or any of its Subsidiaries in, such Subsidiary, the Borrower shall designate such entity as an Unrestricted Subsidiary in a written notice to the Administrative Agent. The Borrower may designate any Unrestricted Subsidiary to be a Subsidiary for purposes of this Agreement (each, a “Subsidiary Redesignation”); provided, that (i) no Default then exists or would occur as a consequence of any such Subsidiary Redesignation (including, but not limited to, under Sections 8.1 and 8.2), (ii) calculations are made by the Borrower of compliance with the Financial Performance Covenants for the relevant Reference Period, on a Pro Forma Basis as if the respective Subsidiary Redesignation (as well as all other Subsidiary Redesignations theretofore consummated after the first day of such Reference Period) had occurred on the first day of such Reference Period, and such calculations shall show that such Financial Performance Covenants would have been complied with if the Subsidiary Redesignation had occurred on the first day of such Reference Period, (iii) based on good faith projections prepared by the Borrower for the period from the date of the respective Subsidiary Redesignation to the date that is one year thereafter, the level of financial performance measured by the Financial Performance Covenants shall be better than or equal to such level as would be required to provide that no Default would exist under the Financial Performance Covenants through the date that is one year from the date of the respective Subsidiary Redesignation, (iv) at the time of and immediately after giving effect to such Redesignation, all representations and warranties contained herein and in the other Loan Documents shall be true and correct in all material respects (provided that if any representation or warranty is by its terms qualified by concepts of materiality, such representation shall be true and correct in all respects) on and as of such date with the same effect as though such representations and warranties had been made on and as of such date, except to the extent such representations and warranties expressly related to an earlier date (in which case such representations and warranties shall have been true and correct in all material respects (or true and correct in all respects, as applicable) as of such earlier date), (v) the Borrower shall have delivered to the Administrative Agent an officer’s certificate executed by a Responsible Officer of the Borrower, certifying to the best of such officer’s knowledge, compliance with the requirements of preceding clauses (i) through (iv), inclusive, and containing the calculations required by the preceding clauses (ii) and (iii). Except for purposes of Article IV and Sections 6.2, 6.8, 7.2 and 11.4 and the definition of the term “Unrestricted Subsidiary” above, an Unrestricted Subsidiary shall not be deemed to be a Subsidiary of the Borrower or any of its Subsidiaries for purposes of this Agreement.

 

 

“Unused Commitment Fee” has the meaning specified in Section 2.11(a).

 

“U.S. Secured Party” means each Agent, each Lender, each L/C Issuer, each SPV and each participant, in each case that is a Domestic Person.

 

“Voting Stock” means Stock of any Person having ordinary power to vote in the election of members of the board of directors, managers, trustees or other controlling Persons, of such Person (irrespective of whether, at the time, Stock of any other class or classes of such entity shall have or might have voting power by reason of the occurrence of any contingency).

 

“Wholly Owned Subsidiary” of any Person means any Subsidiary of such Person, all of the Stock of which (other than nominal holdings and director’s qualifying shares) is owned by such Person, either directly or through one or more Wholly Owned Subsidiaries of such Person.

 

“Withdrawal Liability” means, at any time, any liability incurred (whether or not assessed) by any ERISA Affiliate and not yet satisfied or paid in full at such time with respect to any Multiemployer Plan pursuant to Section 4201 of ERISA.

 

“Working Capital” means, for any Person at any date, its Consolidated Current Assets at such date minus its Consolidated Current Liabilities at such date; provided, that for purposes of calculating Excess Cash Flow, increases or decreases in Working Capital shall be calculated without regard to any changes in Consolidated Current Assets or Consolidated Current Liabilities as a result of (a) any reclassification in accordance with GAAP of assets or liabilities, as applicable, between current and non-current, (b) the effects of purchase accounting, or (c) the effect of fluctuations in the amount of accrued or contingent obligations under Hedging Agreements.

 

Section 1.2        UCC Terms. The following terms have the meanings given to them in the applicable UCC: “deposit account”, “entitlement holder”, “entitlement order”, “equipment”, “goods”, “instruments”, “inventory” and “securities account”.

 

Section 1.3        Accounting Terms and Principles. (a) GAAP. All accounting determinations required to be made pursuant hereto shall, unless expressly otherwise provided herein, be made in accordance with GAAP. Notwithstanding anything to the contrary in the foregoing or elsewhere in this Agreement, no change in the accounting principles used in the preparation of any Financial Statement hereafter adopted by Parent or the Borrower shall be given effect if such change or application would affect a calculation that measures compliance with, or otherwise affect compliance with, any provision of Article V or VIII unless the Borrower, the Administrative Agent and the Required Lenders agree to modify such provisions to reflect such changes in GAAP and, unless such provisions are modified, all Financial Statements, Compliance Certificates and similar documents provided hereunder shall be provided together with a reconciliation between the calculations and amounts set forth therein before and after giving effect to such change in GAAP.

 

(b) Pro Forma. All components of financial calculations made to determine compliance with Article V shall be adjusted on a Pro Forma Basis.

 

 

Section 1.4        Payments. The Administrative Agent may set up standards and procedures to determine or redetermine the equivalent in Dollars of any amount expressed in any currency other than Dollars and otherwise may, but shall not be obligated to, rely on any determination made by any Loan Party or any L/C Issuer. Any such determination or redetermination by the Administrative Agent shall be conclusive and binding for all purposes, absent manifest error. No determination or redetermination by any Secured Party or Loan Party and no other currency conversion shall change or release any obligation of any Loan Party or of any Secured Party (other than the Administrative Agent and its Related Persons) under any Loan Document, each of which agrees to pay separately for any shortfall remaining after any conversion and payment of the amount as converted. The Administrative Agent may round up or down, and may set up appropriate mechanisms to round up or down, any amount hereunder to nearest higher or lower amounts and may determine reasonable de minimis payment thresholds.

 

Section 1.5        Interpretation. (a) Certain Terms. Except as set forth in any Loan Document, all accounting terms not specifically defined herein shall be construed in accordance with GAAP (except for the term “property”, which shall be interpreted as broadly as possible, including, in any case, cash, Securities, other assets, rights under Contractual Obligations and Permits and any right or interest in any property). The terms “herein”, “hereof” and similar terms refer to this Agreement as a whole. In the computation of periods of time from a specified date to a later specified date in any Loan Document, the term “from” means “from and including” and the words “to” and “until” each mean “to but excluding” and the word “through” means “to and including.” In any other case, the term “including” when used in any Loan Document means “including without limitation.” The term “documents” means all writings, however evidenced and whether in physical or electronic form, including all documents, instruments, agreements, notices, demands, certificates, forms, financial statements, opinions and reports. The term “incur” means incur, create, make, issue, assume or otherwise become directly or indirectly liable in respect of or responsible for, in each case whether directly or indirectly, and the terms “incurrence” and “incurred” and similar derivatives shall have correlative meanings.

 

(b) Certain References. Unless otherwise expressly indicated, references (i) in this Agreement to an Exhibit, Schedule, Article, Section or clause refer to the appropriate Exhibit or Schedule to, or Article, Section or clause in, this Agreement and (ii) in any Loan Document, to (A) any agreement shall include, without limitation, all exhibits, schedules, appendixes and annexes to such agreement and, unless the prior consent of any Secured Party required therefor is not obtained, any modification to any term of such agreement, (B) any statute shall be to such statute as modified from time to time and to any successor legislation thereto, in each case as in effect at the time any such reference is operative and (C) any time of day shall be a reference to New York time. Titles of articles, sections, clauses, exhibits, schedules and annexes contained in any Loan Document are without substantive meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto. Unless otherwise expressly indicated, the meaning of any term defined (including by reference) in any Loan Document shall be equally applicable to both the singular and plural forms of such term.

 

ARTICLE II

THE FACILITY

 

Section 2.1        The Commitments. Pursuant to the Original Credit Agreement, the Lenders, severally and not jointly, provided a commitment for revolving loans and letters of credit and on the date hereof. On the terms and subject to the conditions contained in this Agreement, each Lender severally, but not jointly, agrees to make loans in Dollars (each a “Loan”) to the Borrower from time to time on any Business Day during the period from the date hereof until but excluding the Business Day preceding the Termination Date in an aggregate principal amount at any time outstanding for all such loans by such Lender not to exceed such Lender’s Commitment; provided, that at no time shall any Lender be obligated to make a Loan in excess of such Lender’s Pro Rata Share of the amount by which the then effective Commitments exceeds the aggregate Outstandings at such time. Within the limits set forth in the first sentence of this paragraph, amounts of Loans repaid may be reborrowed under this Section 2.1.

 

 

Section 2.2        Borrowing Procedures. (a) Notice From the Borrower. Each Borrowing shall be made on notice given by the Borrower to the Administrative Agent not later than (i) 12:00 p.m. on the Business Day prior to the date of the proposed Borrowing, in the case of a Borrowing of Base Rate Loans and (ii) 12:00 p.m. on the third Business Day prior to the date of the proposed Borrowing, in the case of a Borrowing of Eurodollar Rate Loans. Each such notice may be made in a writing substantially in the form of Exhibit 2.2(a) (a “Notice of Borrowing”) duly completed or by telephone if confirmed promptly, but in any event within one Business Day and prior to such Borrowing, with such a Notice of Borrowing. Loans shall be made as Base Rate Loans unless, outside of a suspension period pursuant to Section 2.15, the Notice of Borrowing specifies that all or a portion thereof shall be Eurodollar Rate Loans. Each Borrowing shall be in an aggregate amount of not less than $1,000,000 or an integral multiple of $100,000 in excess thereof.

 

(b)  Notice to Each Lender. The Administrative Agent shall give to each Lender prompt notice of the Administrative Agent’s receipt of a Notice of Borrowing and, if Eurodollar Rate Loans are properly requested in such Notice of Borrowing, prompt notice of the applicable interest rate. Each Lender shall, make available to the Administrative Agent at its address referred to in Section 11.11 in immediately available funds not later than 1:00 p.m. on the Business Day specified in the applicable Notice of Borrowing, such Lender’s Pro Rata Share of such proposed Borrowing. Upon satisfaction (or waiver) (i) on the Amendment Effective Date, of the applicable conditions set forth in Section 3.1 and (ii) on the Amendment Effective Date and any time thereafter, of the applicable conditions set forth in Section 3.2, the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of the Administrative Agent 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 Borrower.

 

(c)  Non-Funding Lenders. Unless the Administrative Agent shall have received notice from a Lender prior to the date such Lender is required to make any payment hereunder with respect to any Loan or any participation in any Letter of Credit that such Lender will not make such payment (or any portion thereof) available to the Administrative Agent, the Administrative Agent may assume that such Lender has made such payment available to the Administrative Agent on the date such payment is required to be made in accordance with this Article II and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. The Borrower agrees to repay to the Administrative Agent on demand such amount (until repaid by such Lender) with interest thereon for each day from and including the date such amount is made available to the Borrower to but excluding the date such amount is repaid to the Administrative Agent, at the interest rate applicable to the Obligation that would have been created when the Administrative Agent made available such amount to the Borrower had such Lender made a corresponding payment available; provided, that such payment shall not relieve such Lender of any obligation it may have to the Borrower or any L/C Issuer. In addition, any Lender that shall not have made available to the Administrative Agent any portion of any payment described above (any such Lender, a “Non-Funding Lender”) agrees to pay such amount to the Administrative Agent on demand together with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date such amount is repaid to the Administrative Agent, at the Federal Funds Rate for the first Business Day and thereafter (i) in the case of a payment in respect of a Loan, at the interest rate applicable at the time to such Loan and (ii) otherwise, at the interest rate applicable to Base Rate Loans. Such repayment shall then constitute the funding of the corresponding Loan (including any Loan deemed to have been made hereunder with such payment) or participation. The existence of any Non-Funding Lender shall not relieve any other Lender of its obligations under any Loan Document, but no other Lender shall be responsible for the failure of any Non-Funding Lender to make any payment required under any Loan Document.

 

 

Section 2.3        [Reserved].

 

Section 2.4        Letters of Credit. (a) Commitment and Conditions. On the terms and subject to the conditions contained herein, each L/C Issuer agrees to Issue, at the request of the Borrower, in accordance with such L/C Issuer’s usual and customary business practices, and for the account of the Borrower (or, as long as the Borrower remains responsible for the payment in full of all amounts drawn thereunder and related fees, costs and expenses, for the account of any Group Member), Letters of Credit (denominated in Dollars) from time to time on any Business Day during the period from the Closing Date through the earlier of the Termination Date and five Business Days prior to the Scheduled Termination Date, provided that no L/C Issuer shall be obligated to Issue any Letter of Credit and no Lender shall be obligated to participate in any Letter of Credit if after giving effect to such Issuance, (x) the aggregate Outstandings would exceed the aggregate Commitments, (y) the L/C Obligations for all Letters of Credit would exceed the L/C Sublimit, or (z) the Outstandings of any Lender would exceed such Lender’s Commitment. Within the foregoing limits, and subject to the terms and conditions hereof, the Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower 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.

 

(b)  An L/C Issuer shall be under no obligation to Issue any Letter of Credit if:

 

(i)        any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such L/C Issuer from Issuing such Letter of Credit, or any Law applicable to such L/C Issuer or any directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or direct that such L/C Issuer refrain from, the Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such L/C Issuer with respect to such Letter of Credit any restriction, reserve or capital requirement (for which such L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon such L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date (for which such L/C Issuer is not otherwise compensated hereunder);

 

(ii)        the expiration date of such Letter of Credit is more than one year after the date of Issuance thereof;

 

(iii)        the expiration date of such Letter of Credit is later than five Business prior to the Scheduled Termination Date;

 

(iv)        the Issuance of such Letter of Credit would violate any Laws binding upon such L/C Issuer;

 

(v)        the Letter of Credit is to be denominated in a currency other than Dollars; or

 

(vi)        (A) any fee due in connection with, and on or prior to, such Issuance has not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such L/C Issuer or (C) such L/C Issuer shall not have received, each in form and substance reasonably acceptable to it and duly executed by the Borrower (and, if such Letter of Credit is Issued for the account of any other Group Member, the Borrower as well as such Group Member), the documents that such L/C Issuer generally uses in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit (collectively, the “L/C Reimbursement Agreement”).

 

 

(c)  An L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) such L/C Issuer would have no obligation at such time to Issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

 

For each such Issuance, the applicable L/C Issuer may, but shall not be required to, determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied or waived in connection with the Issuance of any Letter of Credit; provided, that no Letter of Credit shall be Issued during the period starting on the first Business Day after the receipt by such L/C Issuer of notice from the Administrative Agent or the Required Lenders that any condition precedent contained in Section 3.2 is not satisfied and ending on the date all such conditions are satisfied or duly waived. If any Lender becomes, and during the period remains, a Defaulting Lender, if any Letter of Credit is at the time outstanding, the L/C Issuer may (except, in the case of a Defaulting Lender, to the extent the obligations of such Defaulting Lender in respect of such Letter of Credit have been fully reallocated pursuant to Section 2.19(a)), by notice to the Borrower and such Defaulting Lender through the Administrative Agent, require the Borrower to Cash Collateralize the obligations of the Borrower to the L/C Issuer in respect of such Letter of Credit in an amount at least equal to the aggregate amount of the unreallocated obligations (contingent or otherwise) of such Defaulting Lender in respect thereof.

 

(d)  Procedures for Issuance; Auto-Renewal Letters of Credit.

 

(i)        The Borrower shall give the relevant L/C Issuer and the Administrative Agent a notice of any requested issuance or amendment of any Letter of Credit (an “L/C Request”), which shall be effective only if received by such L/C Issuer and the Administrative Agent not later than 12:00 noon on the third Business Day prior to the date of such requested issuance; or, such later date and time as the relevant L/C Issuer may agree in a particular instance in its sole discretion. In the case of a request for an initial issuance of a Letter of Credit, such L/C Request shall specify in form and detail reasonably satisfactory to the relevant L/C 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; and (f) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder. In the case of a request for an amendment of any outstanding Letter of Credit, such L/C Request shall specify in form and detail reasonably satisfactory to the relevant L/C Issuer (1) the Letter of Credit to be amended; (2) the proposed date of amendment thereof (which shall be a Business Day); and (3) the nature of the proposed amendment.

 

(ii)        Promptly after receipt of any such notice, the relevant L/C Issuer will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such notice from the Borrower and, if not, such L/C Issuer will provide the Administrative Agent with a copy thereof. Upon receipt by the relevant L/C Issuer of confirmation from the Administrative Agent that the requested Issuance or amendment is permitted in accordance with the terms hereof, then, subject to the terms and conditions hereof, such L/C Issuer shall, on the requested date, Issue a Letter of Credit for the account of the Borrower or such Subsidiary, as the case may be, or enter into the applicable amendment, as the case may be. Immediately upon the Issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees, to acquire from the relevant L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Pro Rata Share times the amount of such Letter of Credit.

 

 

(iii)        If the Borrower so requests in any applicable L/C Request, the relevant L/C Issuer shall agree to Issue a Letter of Credit that has automatic renewal provisions; provided, that, any such Letter of Credit must permit the relevant L/C Issuer to prevent any such renewal at least once in each twelve-month period (commencing with the date of Issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day in each such twelve-month period to be agreed upon at the time such Letter of Credit is Issued. Unless otherwise directed by the relevant L/C Issuer, the Borrower shall not be required to make a specific request to the relevant L/C Issuer for any such renewal. Once an auto-renewal Letter of Credit has been issued, the applicable Lenders shall be deemed to have authorized (but may not require) the relevant L/C Issuer to permit the renewal of such Letter of Credit at any time to an expiry date not later than five Business days prior to the Scheduled Termination Date; provided, that, the relevant L/C Issuer shall not permit any such renewal if the relevant L/C Issuer has determined that it would have no obligation at such time to Issue such Letter of Credit in its renewed form under the terms hereof.

 

(e)  Reporting Obligations of L/C Issuers. Each L/C Issuer agrees to provide the Administrative Agent (which, after receipt, the Administrative Agent shall provide to each Lender), in form and substance satisfactory to the Administrative Agent, each of the following on the following dates: (i) (A) on or prior to any Issuance of any Letter of Credit by such L/C Issuer, (B) promptly following any drawing under any such Letter of Credit or (C) promptly following any payment (or failure to pay when due) by the Borrower of any related L/C Reimbursement Obligation, notice thereof, which shall contain a reasonably detailed description of such Issuance, drawing or payment and (ii) upon the request of the Administrative Agent (or any Lender through the Administrative Agent), copies of any Letter of Credit Issued by such L/C Issuer and any related L/C Reimbursement Agreement and such other documents and information as may reasonably be requested by the Administrative Agent.

 

(f)  Reimbursement Obligations of the Borrower. The Borrower agrees to pay to the L/C Issuer of any Letter of Credit each L/C Reimbursement Obligation owing with respect to such Letter of Credit no later than the first Business Day after the Borrower receives notice from such L/C Issuer that payment has been made under such Letter of Credit or that such L/C Reimbursement Obligation is otherwise due (the “L/C Reimbursement Date”) with interest thereon computed as set forth in clause (i) below. In the event that any L/C Issuer incurs any L/C Reimbursement Obligation not repaid by the Borrower as provided in this clause (e) (or any such payment by the Borrower is rescinded or set aside for any reason), such L/C Issuer shall promptly notify the Administrative Agent of such failure (and, upon receipt of such notice, the Administrative Agent shall forward a copy to each Lender) and, irrespective of whether such notice is given, such L/C Reimbursement Obligation shall be payable on demand by the Borrower with interest thereon computed (i) from and including the date on which such L/C Reimbursement Obligation arose to the L/C Reimbursement Date but excluding the date such payment is made in full, at the interest rate applicable during such period to the Loans that are Base Rate Loans, and (ii) thereafter until payment in full, at the interest rate applicable during such period to past due Loans that are Base Rate Loans.

 

(g)  Reimbursement Obligations of the Lenders. Upon receipt of the notice described in clause (e) above from the Administrative Agent, each Lender shall pay to the Administrative Agent for the account of such L/C Issuer its Pro Rata Share of such L/C Reimbursement Obligation. By making such payment (other than during the continuation of an Event of Default under Section 9.1(e)), such Lender shall be deemed to have made a Loan to the Borrower, which, upon receipt thereof by such L/C Issuer, the Borrower shall be deemed to have used in whole to repay such L/C Reimbursement Obligation. Any such payment that is not deemed a Loan shall be deemed a funding by such Lender of its participation in the applicable Letter of Credit and the L/C Obligation in respect of the related L/C Reimbursement Obligations. Such participation shall not otherwise be required to be funded. Following receipt by any L/C Issuer of any payment from any Lender pursuant to this clause (f) with respect to any portion of any L/C Reimbursement Obligation, such L/C Issuer shall promptly pay over to such Lender all payments received by such L/C Issuer with respect to such portion of such L/C Reimbursement Obligation.

 

 

(h)  Obligations Absolute. The obligation of the Borrower to reimburse the relevant L/C Issuer for each drawing under each Letter of Credit Issued by it 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 agreement or instrument relating thereto;

 

(ii)        the existence of any claim, counterclaim, setoff, defense or other right that any Loan Party 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 relevant L/C 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 relevant L/C 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 relevant L/C 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 bankruptcy or insolvency proceeding;

 

(v)        any exchange, release or nonperfection of any Collateral, or any release or amendment or waiver of or consent to departure from the Guaranty and Security Agreement or any other guarantee, for all or any of the Obligations of any Loan Party in respect of such Letter of Credit;

 

(vi)        any loss or delay, including in the transmission of any document; or

 

(vii)        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, any Loan Party;

 

provided, that, the foregoing shall not excuse any L/C Issuer from liability to the Borrower to the extent of any direct damages (as opposed to consequential, punitive or special damages, claims in respect of which are waived by the Borrower to the extent permitted by applicable Law) suffered by the Borrower to the extent such damages are determined by a final non-appealable judgment of a court of competent jurisdiction to have been caused by such L/C Issuer’s gross negligence, willful misconduct or breach in bad faith of any Loan Document when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof.

 

 

(i)  Conflict with L/C Request. Notwithstanding anything else to the contrary in any L/C Request, in the event of any conflict between the terms hereof and the terms of any L/C Request, the terms hereof shall control.

 

(j)  Addition of an L/C Issuer. A Lender (or any of its Subsidiaries or affiliates) may become an additional L/C Issuer hereunder pursuant to a written agreement among the Borrower, the Administrative Agent and such Lender. The Administrative Agent shall notify the Lenders of any such additional L/C Issuer.

 

Section 2.5        Reduction and Termination of the Commitments. (a) Optional. The Borrower may, upon at least two (2) Business Days’ prior notice to the Administrative Agent, terminate in whole or reduce in part ratably any unused portion of the Commitments; provided, that each partial reduction shall be in an aggregate amount that is an integral multiple of $1,000,000.

 

(b)  Mandatory. All outstanding Commitments shall terminate on the Scheduled Termination Date.

 

Section 2.6        Repayment of Obligations. (a) The Borrower shall repay the entire unpaid principal amount of the Loans on the Scheduled Termination Date.

 

(b)  The Borrower promises to pay to the Secured Hedging Counterparty under any Secured Hedging Support Document an amount equal to the amount of any payment made by such Secured Hedging Counterparty under such Secured Hedging Support Document within one Business Day after the date such payment by such Secured Hedging Counterparty is made.

 

Section 2.7        Optional Prepayments. The Borrower may prepay to the Administrative Agent, with one Business Day notice, the outstanding principal amount of any Loan in whole or in part at any time (together with any breakage costs that may be owing pursuant to Section 2.16(a) after giving effect to such prepayment); provided, that each partial prepayment that is not of the entire outstanding amount under the Facility shall be in an aggregate amount that is an integral multiple of $1,000,000. Any payments made to the Administrative Agent pursuant to this Section 2.7 shall be applied to the Obligations in accordance with Section 2.12.

 

Section 2.8        [Reserved].

 

Section 2.9        Interest. (a) Rate. All Loans and the outstanding amount of all other Obligations shall bear interest, in the case of Loans, on the unpaid principal amount thereof from the date such Loans are made and, in the case of such other Obligations, from the date such other Obligations are due and payable until, in all cases, paid in full, except as otherwise provided in clause (c) below, as follows: (i) in the case of Base Rate Loans, at a rate per annum equal to the sum of the Base Rate and the Applicable Margin, each as in effect from time to time, (ii) in the case of Eurodollar Rate Loans, at a rate per annum equal to the sum of the Eurodollar Rate and the Applicable Margin, each as in effect for the applicable Interest Period, and (iii) in the case of other Obligations (other than Secured Hedging Reimbursement Obligations and other Obligations owing under any Secured Hedging Document), at a rate per annum equal to the sum of the Base Rate and the Applicable Margin for Loans that are Base Rate Loans, each as in effect from time to time.

 

 

(b)  Payments. Interest accrued shall be payable in arrears (i) if accrued on the principal amount of any Loan, (A) at maturity (whether by acceleration or otherwise), (B)(1) if such Loan is a Base Rate Loan, on the last day of each calendar quarter commencing on the first such day following the making of such Loan, (2) if such Loan is a Eurodollar Rate Loan, on the last day of each Interest Period applicable to such Loan, upon any prepayment of such Loan or termination of the applicable Interest Period and, if applicable, on each date during such Interest Period occurring every 3 months from the first day of such Interest Period, and (ii) if accrued on any other Obligation, on demand from any applicable counterparty after the time such Obligation is due and payable (whether by acceleration or otherwise).

 

(c)  Default Interest. Notwithstanding the rates of interest specified in clause (a) above or elsewhere in any Loan Document, effective immediately upon (A) the occurrence of any Event of Default under Section 9.1(a) or (e) or (B) the delivery of a notice by the Required Lenders to the Borrower during the continuance of any other Event of Default and, in each case, for as long as such Event of Default shall be continuing, the unpaid balance of all Obligations (including any Obligation that bears interest by reference to the rate applicable to any other Obligation) then outstanding shall bear interest at a rate that is 2% per annum in excess of the interest rate applicable to such Obligations from time to time, payable on demand or, in the absence of demand, on the date that would otherwise be applicable.

 

(d)  Savings Clause. Anything herein to the contrary notwithstanding, the obligations of the Borrower hereunder shall be subject to the limitation that payments of interest shall not be required, for any period for which interest is computed hereunder, to the extent (but only to the extent) that contracting for or receiving such payment by the respective Lender would be contrary to the provisions of any law applicable to such Lender limiting the highest rate of interest which may be lawfully contracted for, charged or received by such Lender, and in such event the Borrower shall pay such Lender interest at the highest rate permitted by applicable law (“Maximum Lawful Rate”); provided, however, that if at any time thereafter the rate of interest payable hereunder is less than the Maximum Lawful Rate, the Borrower shall continue to pay interest hereunder at the Maximum Lawful Rate until such time as the total interest received by the Administrative Agent, on behalf of Lenders, is equal to the total interest that would have been received had the interest payable hereunder been (but for the operation of this paragraph) the interest rate payable since the Amendment Effective Date as otherwise provided in this Agreement.

 

Section 2.10        Conversion and Continuation Options.(a) Option. The Borrower may elect (i) in the case of any Eurodollar Rate Loan, (A) to continue such Eurodollar Rate Loan or any portion thereof for an additional Interest Period on the last day of the Interest Period applicable thereto and (B) to convert such Eurodollar Rate Loan or any portion thereof into a Base Rate Loan at any time on any Business Day, subject to the payment of any breakage costs required by Section 2.16(a), and (ii) in the case of Base Rate Loans, to convert such Base Rate Loans or any portion thereof into Eurodollar Rate Loans at any time on any Business Day upon 3 Business Days’ prior notice; provided, that, (x) for each Interest Period, the aggregate amount of Eurodollar Rate Loans having such Interest Period must be in an aggregate amount of not less than $1,000,000 or an integral multiple of $100,000 in excess thereof and (y) no conversion in whole or in part of Base Rate Loans to Eurodollar Rate Loans and no continuation in whole or in part of Eurodollar Rate Loans shall be permitted at any time at which (1) a Default or an Event of Default shall be continuing or (2) such continuation or conversion would be made during a suspension imposed by Section 2.15.

 

(b)  Procedure. Each such election shall be made by giving the Administrative Agent at least 3 Business Days’ prior notice in substantially the form of Exhibit 2.10(b) (a “Notice of Conversion or Continuation”) duly completed. The Administrative Agent shall promptly notify each Lender of its receipt of a Notice of Conversion or Continuation and of the options selected therein. If the Administrative Agent does not receive a timely Notice of Conversion or Continuation from the Borrower containing a permitted election to continue or convert any Eurodollar Rate Loan, then, upon the expiration of the applicable Interest Period, such Loan shall be automatically converted to a Base Rate Loan. Each partial conversion or continuation shall be allocated ratably among the Lenders in accordance with their Pro Rata Share.

 

 

Section 2.11        Fees. (a) Unused Commitment Fee. The Borrower agrees to pay to each Lender a commitment fee on the actual daily amount by which the Commitment of such Lender exceeds its Pro Rata Share of the sum of (i) the aggregate outstanding principal amount of Loans and (ii) the outstanding amount of the L/C Obligations for all Letters of Credit (the “Unused Commitment Fee”) from the date hereof through the Termination Date at a rate per annum equal to the Applicable Margin, payable in arrears (x) on the last day of each calendar quarter and (y) on the Scheduled Termination Date (or, if earlier, the date of termination of the Commitments).

 

(b)  Letter of Credit Fees. The Borrower agrees to pay, with respect to all Letters of Credit issued by any L/C Issuer, (i) to such L/C Issuer, for its own account, (A) on the last day of each calendar quarter and on the Termination Date, a fronting fee in respect of each Letter of Credit issued by such L/C Issuer for the period from and including the date of issuance of such Letter of Credit to and including the termination of such Letter of Credit, computed at a rate equal to 1/4 of 1% per annum of the daily average stated amount of such Letter of Credit, plus (B) in connection with the issuance, amendment or transfer of any such Letter of Credit or any payment or disbursement made by an L/C Issuer pursuant to a Letter of Credit, the Borrower shall pay directly to each L/C Issuer the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of such L/C Issuer, such customary fees and standard costs and charges being due and payable within five (5) Business Days of demand and are nonrefundable, and (ii) to the Administrative Agent, for the benefit of the Lenders according to their Pro Rata Shares, a fee accruing at a rate per annum equal to the Applicable Margin for Loans that are Eurodollar Rate Loans on the maximum undrawn face amount of such Letters of Credit, payable in arrears (A) on the last day of each calendar quarter, ending after the issuance of such Letter of Credit and (B) on the Termination Date; provided, that the fee payable under this clause (ii) shall be increased by 2% per annum and shall be payable, in addition to being payable on any date it is otherwise required to be paid hereunder, on demand effective immediately upon (x) the occurrence of any Event of Default under Section 9.1(a) or (e) or (y) the delivery of a notice by the Required Lenders to the Borrower during the continuance of any other Event of Default and, in each case, for as long as such Event of Default shall be continuing.

 

(c)  Additional Fees. The Borrower has agreed to pay to the Administrative Agent, the Syndication Agent and the Arrangers additional fees as agreed from time to time in writing.

 

(d)  Anything herein to the contrary notwithstanding, during such period as a Lender is a Defaulting Lender, such Defaulting Lender will not be entitled to any fees accruing during such period pursuant to Sections 2.11(a) and 2.11(b) (without prejudice to the rights of the Lenders other than Defaulting Lenders in respect of such fees), provided that in the case of a Defaulting Lender that was or is a Lender (x) to the extent that a portion of the obligations of such Defaulting Lender in respect of outstanding Letters of Credit is reallocated to the Non-Defaulting Lenders pursuant to Section 2.19(a), such fees that would have accrued for the benefit of such Defaulting Lender will instead accrue for the benefit of and be payable to such Non-Defaulting Lenders, pro rata in accordance with their respective Commitments, and (y) to the extent any portion of such obligations of such Defaulting Lender cannot be so reallocated, such fees will instead accrue for the benefit of and be payable to the L/C Issuer as its interests appear (and the pro rata payment provisions of Section 2.12(d) will automatically be deemed adjusted to reflect the provisions of this Section 2.11).

 

Section 2.12        Application of Payments. (a) Application of Voluntary Prepayments. Unless otherwise provided in this Section 2.12 or elsewhere in any Loan Document, all payments and any other amounts received by the Administrative Agent from or for the benefit of the Borrower (including optional prepayments pursuant to Section 2.7) shall be applied to repay the Obligations as the Borrower designates.

 

 

(b)  Application of Payments During an Event of Default. Each of Parent and the Borrower hereby irrevocably waives, and agrees to cause each Loan Party and each other Group Member to waive, the right to direct the application during the continuance of an Event of Default of any and all payments in respect of any Obligation and any proceeds of Collateral and agrees that, notwithstanding the provisions of clause (a) above, the Administrative Agent may, and, upon either (A) the direction of the Required Lenders or (B) the termination of any Commitment or the acceleration of any Obligation pursuant to Section 9.2, shall, apply all payments in respect of any Obligation, all funds on deposit in any Cash Collateral Account and all other proceeds of Collateral (i) first, to pay Obligations in respect of any cost or expense reimbursements, fees or indemnities then due to the Administrative Agent and the Collateral Agent in such capacities, (ii) second, to pay Obligations in respect of any cost or expense reimbursements, fees or indemnities then due to the Lenders and the L/C Issuer, (iii) third, to pay interest then due and payable in respect of the Loans and L/C Reimbursement Obligations and interest then due and payable in respect of any amount owing under any Secured Hedging Document or Secured Cash Management Agreement, (iv) fourth, to repay the outstanding principal amounts of the Loans and L/C Reimbursement Obligations, to provide cash collateral for Letters of Credit in the manner and to the extent described in Section 9.4 and to pay amounts, other than interest, owing with respect to Secured Hedging Documents and Secured Cash Management Agreements, and (v) fifth, to the ratable payment of all other Obligations.

 

(c)  Application of Payments Generally. All payments that would otherwise be allocated to the Lenders pursuant to this Section 2.12 shall instead be allocated first, to repay interest on any portion of the Loans that the Administrative Agent may have advanced on behalf of any Lender and on any L/C Reimbursement Obligation for which the Administrative Agent or, as the case may be, the L/C Issuer has not then been reimbursed by such Lender or the Borrower, second to pay the outstanding principal amount of the foregoing obligations and third, to repay the Loans. All repayments of any Loans shall be applied first, to repay such Loans outstanding as Base Rate Loans and then, to repay such Loans outstanding as Eurodollar Rate Loans, with those Eurodollar Rate Loans having earlier expiring Interest Periods being repaid prior to those having later expiring Interest Periods. If sufficient amounts are not available to repay all outstanding Obligations described in any priority level set forth in this Section 2.12, the available amounts shall be applied, unless otherwise expressly specified herein, to such Obligations ratably based on the proportion of the Secured Parties’ interest in such Obligations. Each payment by Borrower of interest in respect of the Loans shall be applied to the amounts of such obligations owing to the Lenders pro rata according to the respective amounts then due and owing to the Lenders. Each payment by Borrower on account of principal of the Loans shall be made pro rata according to the respective outstanding principal amounts of the Loans then held by the Lenders. Any priority level set forth in this Section 2.12 that includes interest shall include all such interest, whether or not accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization or similar proceeding, and whether or not a claim for post-filing or post-petition interest is allowed in any such proceeding.

 

Section 2.13        Payments and Computations. (a) Procedure. The Borrower shall make each payment under any Loan Document not later than 2:00 p.m. on the day when due to the Administrative Agent by wire transfer to the following account (or at such other account or by such other means to such other address as the Administrative Agent shall have notified the Borrower in writing within a reasonable time prior to such payment) in immediately available Dollars without condition or deduction for any counterclaim, defense, recoupment or setoff:

 

 

ABA No. 021-000021

Account Number: 920-1033363
For further credit to A/C 293-7464, Transit 01269

RBCCM Agency Services, New York

Account Name: Royal Bank of Canada, New York

Reference: Francesca's Collections, Inc

 

The Administrative Agent shall promptly thereafter cause to be distributed immediately available funds relating to the payment of principal, interest or fees to the Lenders, in accordance with the application of payments set forth in Section 2.12. The Lenders shall make any payment under any Loan Document in immediately available Dollars and without setoff or counterclaim. Each Lender shall make each payment for the account of any L/C Issuer required pursuant to Section 2.4 (A) if the notice or demand therefor was received by such Lender prior to 2:00 p.m. on any Business Day, on such Business Day and (B) otherwise, on the Business Day following such receipt. Payments received by the Administrative Agent after 2:00 p.m. shall be deemed to be received on the next Business Day.

 

(b)  Computations of Interests and Fees. All computations of interest for Base Rate Loans shall be made by on the basis of a year of three hundred and sixty-five (365) days or three hundred and sixty-six (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 three hundred and sixty (360) day year and actual days elapsed. Interest shall accrue on each Loan for the day on which such Loan is made, and shall not accrue on such Loan, or any portion thereof, for the day on which such Loan or such portion is paid; provided that any such Loan that is repaid on the same day on which it is made shall, subject to Section 2.12(a), bear interest for one (1) day. Each determination of an interest rate or the amount of a fee hereunder shall be made by the Administrative Agent (including determinations of a Eurodollar Rate or Base Rate in accordance with the definitions of “Eurodollar Rate” and “Base Rate”, respectively) or, if applicable in the case of the Eurodollar Rate used to determine interest on Secured Hedging Reimbursement Obligations, the applicable Secured Hedging Counterparty shall be conclusive and binding for all purposes, absent manifest error.

 

(c)  Payment Dates. Whenever any payment hereunder shall be stated to be due on a day other than a Business Day, the due date for such payment shall be extended to the next succeeding Business Day without any increase in such payment as a result of additional interest or fees; provided, that such interest and fees shall continue accruing as a result of such extension of time.

 

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

 

 

Section 2.14        Evidence of Debt. (a) Records of Lenders. Each Lender shall maintain in accordance with its usual practice accounts evidencing Indebtedness of the Borrower to such Lender resulting from each Loan of such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement (the “Participant Register”). In addition, each Lender having sold a participation in any of its Obligations or having identified an SPV as such to the Administrative Agent, acting as a non-fiduciary agent of the Borrower solely for this purpose and solely for tax purposes, shall establish and maintain at its address referred to in Section 11.11 (or at such other address as such Lender shall notify the Borrower) a record of ownership, in which such Lender shall register by book entry (A) the name and address of each such participant and SPV (and each change thereto, whether by assignment or otherwise) and (B) the principal amounts (and related interest amounts), rights, interest or obligation of each such participant and SPV in any Obligation, in any Commitment and in any right to receive any payment hereunder. Each Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.

 

(b)  The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at its address referred to in Section 11.11 a copy of each Assignment delivered to it and a register for the recordation of the names and addressed of the Lenders and the Commitments of, and principal amounts (and related interest amounts) of the Loans, L/C Reimbursement Obligations (specifying the Unreimbursed Amounts), owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, absent manifest error, and the Borrowers, the Agents and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrowers, any Agent and any Lender, at any reasonable time and from time to time upon reasonable prior notice (but no Lender shall be entitled to view any information in the Register except such information contained therein with respect to the of Obligations owing to such Lender).

 

(c)  Registered Obligations. Notwithstanding anything to the contrary contained in this Agreement, the Loans (including any Notes evidencing such Loans and the corresponding obligations to participate in L/C Obligations) and the L/C Reimbursement Obligations are registered obligations, the right, title and interest of the Lenders and the L/C Issuer and their assignees in and to such Loans or L/C Reimbursement Obligations, as the case may be, shall be transferable only upon notation of such transfer in the Register and no assignment thereof shall be effective until recorded therein. This Section 2.14 and Section 11.2 shall be construed so that the Loans and L/C Reimbursement Obligations are at all times maintained in “registered form” within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Code and any related regulations (and any successor provisions).

 

(d)  Standard of Evidence. The entries made in the Register and in the accounts maintained pursuant to clauses (a) and (b) above shall, to the extent permitted by applicable Requirements of Law, be conclusive (absent manifest error) of the existence and amounts of the obligations recorded therein; provided, that no error or omission in such account and no failure of any Lender or the Administrative Agent to maintain any such account shall affect the obligations of any Loan Party to repay the Loans in accordance with their terms and no Lender or Administrative Agent shall be liable for any such errors or omissions. In addition, the Loan Parties, the Administrative Agent, the Lenders and the L/C Issuer shall treat each Person whose name is recorded in the Register as a Lender or L/C Issuer, as applicable, for all purposes of this Agreement notwithstanding notice to the contrary. Information contained in the Register with respect to any Lender or any L/C Issuer shall be available for access by the Borrower, the Administrative Agent, such Lender or such L/C Issuer at any reasonable time and from time to time upon reasonable prior notice. No Lender or L/C Issuer shall, in such capacity, have access to or be otherwise permitted to review any information in the Register other than information with respect to such Lender or L/C Issuer unless otherwise agreed by the Administrative Agent.

 

 

(e)  Notes. Upon any Lender’s request, the Borrower shall promptly execute and deliver Notes to such Lender evidencing the Loans of such Lender and substantially in the form of Exhibit 2.14(e); provided, that only one Note shall be issued to each Lender, except (i) to an existing Lender exchanging existing Notes to reflect changes in the Register relating to such Lender, in which case the new Notes delivered to such Lender shall be dated the date of the original Notes and (ii) in the case of loss, destruction or mutilation of existing Notes and similar circumstances. Each Note, if issued, shall only be issued as means to evidence the right, title or interest of a Lender or a registered assignee in and to the related Loan, as set forth in the Register, and in no event shall any Note be considered a bearer instrument or obligation.

 

Section 2.15        Suspension of Eurodollar Rate Option. Notwithstanding any provision to the contrary in this Article II, the following shall apply:

 

(a)  Interest Rate Unascertainable or Inadequate. In the event that (A) the Administrative Agent determines that adequate and reasonable means do not exist for ascertaining the applicable interest rates by reference to which the Eurodollar Rate is determined or (B) the Required Lenders notify the Administrative Agent that the Eurodollar Rate for any Interest Period will not adequately reflect the cost to the Lenders of making or maintaining such Loans for such Interest Period, the Administrative Agent shall promptly so notify the Borrower and the Lenders, whereupon the obligation of each Lender to make or to continue Eurodollar Rate Loans shall be suspended as provided in clause (c) below until the Administrative Agent shall notify the Borrower that the Required Lenders have determined that the circumstances causing such suspension no longer exist.

 

(b)  Illegality. If any Lender determines that the introduction of, or any change in or in the interpretation of, any Requirement of Law after the date of this Agreement shall make it unlawful, or any Governmental Authority shall assert that it is unlawful, for any Lender or its applicable lending office to make Eurodollar Rate Loans or to continue to fund or maintain Eurodollar Rate Loans, then, on notice thereof and demand therefor by such Lender to the Borrower through the Administrative Agent, the obligation of such Lender to make or to continue Eurodollar Rate Loans shall be suspended as provided in clause (c) below until such Lender shall, through the Administrative Agent, notify the Borrower that it has determined that it may lawfully make Eurodollar Rate Loans.

 

(c)  Effect of Suspension. If the obligation of any Lender to make or to continue Eurodollar Rate Loans is suspended, (A) the obligation of such Lender to convert Base Rate Loans into Eurodollar Rate Loans shall be suspended, (B) such Lender shall make a Base Rate Loan at any time such Lender would otherwise be obligated to make a Eurodollar Rate Loan, (C) the Borrower may revoke any pending Notice of Borrowing or Notice of Conversion or Continuation to make or continue any Eurodollar Rate Loan or to convert any Base Rate Loan into a Eurodollar Rate Loan and (D) each Eurodollar Rate Loan of such Lender shall automatically and immediately (or, in the case of any suspension pursuant to clause (a) above, on the last day of the current Interest Period thereof) be converted into a Base Rate Loan.

 

Section 2.16        Breakage Costs; Increased Costs; Capital Requirements. (a) Breakage Costs. The Borrower shall compensate each Lender, upon demand from such Lender to such Borrower (with copy to the Administrative Agent), for all Liabilities (including, in each case, those incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to prepare to fund, to fund or to maintain the Eurodollar Rate Loans of such Lender to the Borrower but excluding any loss of the Applicable Margin on the relevant Loans) that such Lender may incur (A) to the extent, for any reason other than solely by reason of such Lender being a Defaulting Lender, a proposed Borrowing, conversion into or continuation of Eurodollar Rate Loans does not occur on a date specified therefor in a Notice of Borrowing or a Notice of Conversion or Continuation or in a similar request made by telephone by the Borrower, (B) to the extent any Eurodollar Rate Loan is paid (whether through a scheduled or optional prepayment) or converted to a Base Rate Loan (including because of Section 2.15) on a date that is not the last day of the applicable Interest Period or (C) as a consequence of any failure by the Borrower to repay Eurodollar Rate Loans when required by the terms hereof. For purposes of this clause (a), each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it using a matching deposit or other borrowing in the London interbank market.

 

 

(b)  Increased Costs. If at any time any Lender or L/C Issuer determines that, after the date hereof, the adoption of, or any change in or in the interpretation, application or administration of, or compliance with, any Requirement of Law (other than any imposition or increase of Eurodollar Reserve Requirements) from any Governmental Authority shall have the effect of (i) increasing the cost to such Lender of making, funding or maintaining any Eurodollar Rate Loan or to agree to do so or of participating, or agreeing to participate, in extensions of credit, (ii) increasing the cost to such L/C Issuer of Issuing or maintaining any Letter of Credit or of agreeing to do so or (iii) imposing any other cost to such Lender or L/C Issuer with respect to compliance with its obligations under any Loan Document, (other than, in each case, with respect to all taxes (including Indemnified Taxes and Other Taxes) which shall be governed by Section 2.17), then, upon demand by such Lender or L/C Issuer (with copy to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender or L/C Issuer amounts sufficient to compensate such Lender or L/C Issuer for such increased cost.

 

(c)  Increased Capital Requirements. If at any time any Lender or L/C Issuer determines that, after the date hereof, the adoption of, or any change in or in the interpretation, application or administration of, or compliance with, any Requirement of Law (other than any imposition or increase of Eurodollar Reserve Requirements) from any Governmental Authority regarding capital adequacy, reserves, special deposits, compulsory loans, insurance charges against property of, deposits with or for the account of, Obligations owing to, or other credit extended or participated in by, any Lender or L/C Issuer or any similar requirement (in each case other than any imposition or increase of Eurodollar Reserve Requirements) shall have the effect of reducing the rate of return on the capital of such Lender or L/C Issuer (or any corporation controlling such Lender or L/C Issuer) as a consequence of its obligations under or with respect to any Loan Document or Letter of Credit to a level below that which, taking into account the capital adequacy policies of such Lender, L/C Issuer or corporation, such Lender, L/C Issuer or corporation could have achieved but for such adoption or change, then, upon demand from time to time by such Lender or L/C Issuer (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender or L/C Issuer amounts sufficient to compensate such Lender or L/C Issuer for such reduction.

 

(d)  Compensation Certificate. Each demand for compensation under this Section 2.16 shall be accompanied by a certificate of the Lender or L/C Issuer claiming such compensation, setting forth the amounts to be paid hereunder, which certificate shall be conclusive, binding and final for all purposes, absent manifest error. In determining such amount, such Lender or L/C Issuer may use any reasonable averaging and attribution methods.

 

 

Section 2.17        Taxes. (a) Payments Free and Clear of Taxes. Each payment to any Secured Party by or on account of any obligation of any Loan Party hereunder or under any Loan Document shall be made free and clear of all present or future taxes, levies, imposts, duties, deductions, assessments, withholdings or other charges imposed by any Governmental Authority and all interest. additions to tax or penalties with respect thereto (and without deduction for any of them) (collectively, the “Taxes”) other than for (i) Taxes measured by net income (including branch profits taxes and other similar taxes) and franchise taxes imposed in lieu of net income taxes, in each case imposed on any Secured Party by the United States or as a result of a present or former connection between such Secured Party and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than such connection arising solely from such recipient having executed, delivered, become a party to, performed its obligations or received a payment under, received or perfected a security interest under, engaged in any other transaction pursuant to, or enforced, any Loan Document or any Secured Hedging Support Document), (ii) Taxes that are directly attributable to the failure by any Secured Party to deliver the documentation required to be delivered pursuant to clause (f) below, or (iii) in the case of a Secured Party making a Loan to the Borrower, any withholding tax (including any backup withholding tax) that is imposed by the United States federal government (or a jurisdiction as a result of such Secured Party being organized or having its principal office or its applicable lending office in such jurisdiction or as a result of such Secured Party engaging in a trade or business in such jurisdiction for tax purposes, other than a trade or business deemed to arise by virtue of entering into this Agreement, any other Loan Document or any of the transactions contemplated under such documents) and is imposed pursuant to any Requirement of Law in effect at the time such Secured Party acquires the applicable interest in such Loan (or designates a new lending office), except to the extent that such Secured Party (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from a Secured Party with respect to such withholding tax pursuant to this Section 2.17(a) or Section 2.17(d) (all such non-excluded Taxes being hereinafter referred to as “Indemnified Taxes”).

 

(b)  Gross-Up. If any Indemnified Taxes or Other Taxes shall be required by law to be deducted by any Secured Party or other applicable withholding agent from or in respect of any amount payable under any Loan Document to any Secured Party (i) such amount shall be increased by the applicable Loan Party as necessary to ensure that, after all required deductions for Indemnified Taxes or Other Taxes are made (including deductions applicable to any increases to any amount under this Section 2.17), such Secured Party receives the amount it would have received had no such deductions been made, (ii) the applicable withholding agent shall make such deductions, (iii) the applicable withholding agent shall timely pay the full amount deducted to the relevant taxing authority or other authority in accordance with applicable Requirements of Law and (iv) if a Loan Party is the applicable withholding agent, as soon as practicable after such payment is made, such Loan Party shall deliver to the Administrative Agent an original or certified copy of a receipt evidencing such payment.

 

(c)  Other Taxes. In addition, the Borrower agrees to pay, and authorizes the Administrative Agent to pay on behalf of the Borrower, any present or future stamp, documentary, excise or property or similar Taxes imposed by any applicable Requirement of Law or Governmental Authority (including by reason of any delay in payment thereof), in each case arising from any payment made hereunder or under any other Loan Document or from the execution, delivery, registration of, or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document or any transaction contemplated therein (collectively, “Other Taxes”). As soon as practicable after the date of any payment of Other Taxes by any Loan Party, the Borrower shall furnish to the Administrative Agent, at its address referred to in Section 11.11, the original or a certified copy of a receipt evidencing payment thereof.

 

 

(d)  Indemnification. The Borrower shall indemnify and hold harmless, within 30 days after receipt of demand therefor (with a copy to the Administrative Agent), each Secured Party for all Indemnified Taxes and Other Taxes (including any Indemnified Taxes and Other Taxes imposed by any jurisdiction on amounts payable under this Section 2.17) paid by such Secured Party and any Liabilities arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally asserted by the relevant Governmental Authority. A certificate of the Secured Party (or of the Administrative Agent on behalf of such Secured Party) claiming any compensation under this Section 2.17(d), setting forth the amounts to be paid thereunder, together with reasonable supporting documentation of the imposition of such Indemnified Tax or Other Tax, shall be delivered to the Borrower with copy to the Administrative Agent, and shall be conclusive absent manifest error. In determining such amount, the Administrative Agent and such Secured Party may use any reasonable averaging and attribution methods. If the Borrower reasonably believes that any such Indemnified Taxes or Other Taxes have been incorrectly imposed, the Borrower may request that the relevant Secured Party contest such imposition by the relevant Governmental Authority at the Borrower’s expense (so long as such efforts would not, in the sole determination of such Secured Party, result in any unreimbursed costs or expenses or be otherwise materially disadvantageous to it) and, if such Secured Party successfully contests such imposition and receives a refund therefor, such Secured Party shall use such refund to reimburse the Borrower for the amount of such Indemnified Taxes or Other Taxes paid by the Borrower to the extent provided by Section 2.17(g); provided, that the Borrower shall not be relieved from its reimbursement and indemnification obligations under this Section 2.17(d) during any such contest. Any amounts payable under this Section 2.17(d) shall be paid within 10 business days after written demand is made by a Secured Party.

 

(e)  Mitigation. Any Lender claiming any additional amounts payable pursuant to this Section 2.17 shall use its reasonable efforts (consistent with its internal policies and Requirements of Law) to change the jurisdiction of its applicable lending office if such a change would reduce any such additional amounts (or any similar amount that may thereafter accrue) and would not, in the reasonable determination of such Lender, result in any unreimbursed costs or expenses or be otherwise materially disadvantageous to such Lender.

 

(f)  Tax Forms. Each Secured Party shall, at such times as are reasonably requested by Borrower or the Administrative Agent, provide Borrower and the Administrative Agent with any documentation prescribed by law, or reasonably requested by Borrower or the Administrative Agent, certifying as to any entitlement of such Secured Party to an exemption from, or reduction in, any withholding Tax with respect to any payments to be made to such Secured Party under the Loan Documents. Unless the Borrower and the Administrative Agent have received forms or other documents satisfactory to it indicating that payments under any Loan Document to or for a Secured Party are not subject to withholding tax or are subject to such Tax at a rate reduced by an applicable tax treaty, the Borrower, Administrative Agent or other applicable withholding agent shall withhold amounts required to be withheld by applicable law from such payments at the applicable statutory rate.

 

Without limiting the generality of the foregoing:

 

(i)        Each Secured Party that is a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement two properly completed and duly signed original copies of Internal Revenue Service Form W-9 (or any successor form) certifying that such Secured Party is exempt from U.S. federal backup withholding.

 

(ii)        Each Lender that is not a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement (and from time to time thereafter when required by law or upon the reasonable request of Borrower or the Administrative Agent) whichever of the following is applicable:

 

(I)         two duly completed copies of Internal Revenue Service Form W-8BEN (or any successor forms) claiming eligibility for benefits of an income tax treaty to which the United States of America is a party,

 

(II)        two duly completed copies of Internal Revenue Service Form W-8ECI (or any successor forms),

 

 

(iii)        (III)        in the case of a Secured Party claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate, in substantially the form of Exhibit 2.17(f) (any such certificate a “United States Tax Compliance Certificate”), or any other form approved by the Administrative Agent, to the effect that such Secured Party is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of Borrower 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 that no payments in connection with the Loan Documents are effectively connected with such Secured Party’s conduct of a U.S. trade or business and (y) two duly completed copies of Internal Revenue Service Form W-8BEN (or any successor forms),

 

(iv)        (IV)        to the extent a Secured Party is not the beneficial owner (for example, where the Secured Party is a partnership, or is a Secured Party that has granted a participation), Internal Revenue Service Form W-8IMY (or any successor forms) of the Secured Party, accompanied by a Form W-8ECI, W-8BEN, United States Tax Compliance Certificate, Form W-9, Form W-8IMY (or other successor forms) or any other required information from each beneficial owner, as applicable (provided that, if the Secured Party is a partnership (and not a participating Secured Party) and one or more beneficial owners are claiming the portfolio interest exemption, the United States Tax Compliance Certificate shall be provided by such Secured Party on behalf of such beneficial owner(s)), or

 

(V)        any other form prescribed by applicable requirements of U.S. federal income tax law as a basis for claiming exemption from or a reduction in U.S. federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable requirements of law to permit Borrower and the Administrative Agent to determine the withholding or deduction required to be made.

 

Each Secured Party shall, from time to time after the initial delivery by such Secured Party of the forms described above, whenever a lapse in time, change in such Secured Party’s circumstances or change in applicable law renders such forms, certificates or other evidence so delivered expired, invalid, obsolete or inaccurate, promptly (1) deliver to Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) renewals, amendments or additional or successor forms, properly completed and duly executed by such Secured Party, together with any other certificate or statement of exemption required in order to confirm or establish such Secured Party’s status or that such Secured Party is entitled to an exemption from or reduction in U.S. federal withholding tax or (2) notify Administrative Agent and Borrower of its inability to deliver any such forms, certificates or other evidence.

 

Notwithstanding any other provision of this clause (f), a Secured Party shall not be required to deliver any form that such Secured Party is not legally eligible to deliver.

 

(g)  [Reserved].

 

(h)  For the avoidance of doubt, any payments made by the Administrative Agent to any Lender shall be treated as payments made by the applicable Loan Party.

 

(i)   Solely for purposes of this Section 2.17, the term “Loan Documents” shall not include the Secured Hedging Support Documents, the tax gross-up and tax indemnity obligations for which (if any) shall be addressed in such documents.

 

 

Section 2.18        Substitution of Lenders. (a) Substitution Right. In the event that any Lender that is not an Affiliate of the Administrative Agent (an “Affected Lender”), (i) makes a claim under clause (b) (Increased Costs) or (c) (Increased Capital Requirements) of Section 2.16, (ii) notifies the Borrower pursuant to Section 2.15(b) (Illegality) that it becomes illegal for such Lender to continue to fund or make any Eurodollar Rate Loan, (iii) makes a claim for payment pursuant to Section 2.17(b) or (d), (iv) becomes a Defaulting Lender, or (v) does not consent to any amendment, waiver or consent to any Loan Document for which the consent of the Required Lenders has been obtained but that requires the consent of other Lenders, the Borrower may substitute for such Affected Lender any Lender or any Affiliate or Approved Fund of any Lender or any other Person acceptable (which acceptance shall not be unreasonably withheld or delayed) to the Administrative Agent and L/C Issuer (in each case, a “Substitute Lender”); provided that in the case of any such substitution resulting from a claim for compensation under Section 2.16 (b) or (c) or payments required to be made pursuant to Section 2.17 (b) or (d), such substitution is reasonably expected to result in a reduction in such compensation or payments. Notwithstanding the foregoing, with respect to a Lender that is a Defaulting Lender, the Borrower may obtain a Substitute Lender and execute an Assignment on behalf of such Defaulting Lender at any time and without prior notice to such Defaulting Lender and cause its Loans and Commitments to be sold and assigned at par.

 

(b)  Procedure. To substitute such Affected Lender, the Borrower shall deliver a notice to the Administrative Agent and such Affected Lender. The effectiveness of such substitution shall be subject to the delivery to the Administrative Agent by the Borrower (or, as may be applicable, by the Substitute Lender) of (i) payment for the account of such Affected Lender, of, to the extent accrued through, and outstanding on, the effective date for such substitution, all Obligations owing to such Affected Lender (including those that will be owed because of such payment and all Obligations that would be owed to such Lender if it was solely a Lender in the Facility), (ii) in the case of a payment in full of the Obligations owing to such Affected Lender in the Facility, payment of any amount that, after giving effect to the termination of the Commitment of such Affected Lender, is required to be paid pursuant to Section 2.11 (as if such date was the Termination Date), and (iii) (A) payment of the assignment fee set forth in Section 11.2(c), and (B) an assumption agreement in form and substance satisfactory to the Administrative Agent whereby the Substitute Lender shall, among other things, agree to be bound by the terms of the Loan Documents and assume the Commitment of the Affected Lender.

 

(c)  Effectiveness. Upon satisfaction of the conditions set forth in clause (b) above, the Administrative Agent shall record such substitution or payment in the Register, whereupon (i) in the case of any payment in full in the Facility, such Affected Lender’s Commitments in the Facility shall be terminated and (ii) in the case of any substitution in the Facility, (A) the Affected Lender shall sell and be relieved of, and the Substitute Lender shall purchase and assume, all rights and claims of such Affected Lender under the Loan Documents with respect to the Facility, except that the Affected Lender shall retain such rights expressly providing that they survive the repayment of the Obligations and the termination of the Commitments, (B) the Substitute Lender shall become a “Lender” hereunder having a Commitment in the Facility in the amount of such Affected Lender’s Commitment in the Facility and (C) the Affected Lender shall execute and deliver to the Administrative Agent an Assignment to evidence such substitution and deliver any Note in its possession with respect to the Facility; provided, that the failure of any Affected Lender to execute any such Assignment or deliver any such Note shall not render such sale and purchase (or the corresponding assignment) invalid.

 

Section 2.19        Defaulting Lenders.

 

(a)  Reallocation of Defaulting Lender Commitment, Etc. If a Lender becomes, and during the period it remains, a Defaulting Lender, the following provisions shall apply with respect to any obligations of such Defaulting Lender in respect of outstanding Letters of Credit:

 

(i)        the obligations of such Defaulting Lender in respect of outstanding Letters of Credit will, subject to the limitation in the proviso below, automatically be reallocated (effective on the day such Lender becomes a Defaulting Lender) among the Non-Defaulting Lenders pro rata in accordance with their respective Commitments; provided that (a) no Default or Event of Default shall be continuing at the time of such reallocation, (b) the sum of each Non-Defaulting Lender’s total obligations in respect of outstanding Loans and Letters of Credit may not in any event exceed the Commitment of such Non-Defaulting Lender as in effect at the time of such reallocation and (c) neither such reallocation nor any payment by a Non-Defaulting Lender pursuant thereto will constitute a waiver or release of any claim the Borrower, the Administrative Agent, the L/C Issuer or any other Lender may have against such Defaulting Lender or cause such Defaulting Lender to be a Non-Defaulting Lender;

 

 

(ii)        to the extent that any portion (the “unreallocated portion”) of the Defaulting Lender’s obligations in respect of outstanding Letters of Credit cannot be so reallocated, by reason of the proviso in clause (i) above, the Borrower will, not later than five Business Days after demand by the Administrative Agent (at the direction of the L/C Issuer), Cash Collateralize the obligations of the Borrower to the L/C Issuer in respect of such Letters of Credit in an amount at least equal to the aggregate amount of the unreallocated portion of such Defaulting Lender’s obligations in respect thereof; and

 

(iii)        any amount paid by the Borrower for the account of a Defaulting Lender under this Agreement (whether on account of principal, interest, fees, indemnity payments or other amounts) will not be paid or distributed to such Defaulting Lender, but will instead be retained by the Administrative Agent in a segregated non-interest bearing account until (subject to Section 2.19(d)) the termination of the Commitments and payment in full of all obligations of the Borrower hereunder and will be applied by the Administrative Agent, to the fullest extent permitted by law, to the making of payments from time to time in the following order of priority: first to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent under this Agreement, second to the payment of any amounts owing by such Defaulting Lender to the L/C Issuer under this Agreement, third to the payment of post-default interest and then current interest due and payable to the Lenders hereunder other than Defaulting Lenders, ratably among them in accordance with the amounts of such interest then due and payable to them, fourth to the payment of fees then due and payable to the Non-Defaulting Lenders hereunder, ratably among them in accordance with the amounts of such fees then due and payable to them, fifth to pay principal and unreimbursed Letter of Credit participations funded by, and then due and payable to, the Non-Defaulting Lenders hereunder ratably in accordance with the amounts thereof then due and payable to them, sixth to the ratable payment of other amounts then due and payable to the Non-Defaulting Lenders, and seventh after the termination of the Commitments and payment in full of all obligations of the Borrower hereunder, to pay amounts owing under this Agreement to such Defaulting Lender or as a court of competent jurisdiction may otherwise direct.

 

(b)        Right to Give Drawdown Notices. In furtherance of the foregoing, if any Lender becomes, and during the period it remains, a Defaulting Lender, the L/C Issuer is hereby authorized by the Borrower (which authorization is irrevocable and coupled with an interest) to give, in its discretion, through the Administrative Agent, Notices of Borrowing pursuant to Section 2.2 in such amounts and in such times as may be required to (i) reimburse an outstanding L/C Reimbursement Obligation and/or (ii) Cash Collateralize the obligations of the Borrowers in respect of outstanding Letters of Credit in an amount at least equal to the aggregate amount of the obligations (contingent or otherwise) of such Defaulting Lender in respect of such Letter of Credit.

 

 

 

(c)  Termination of Defaulting Lender Commitment. The Borrower may terminate the unused amount of the Commitment of a Defaulting Lender upon not less than three Business Days’ prior notice to the Administrative Agent (which will promptly notify the Lenders thereof), and in such event the provisions of Section 2.19(a)(iii) will apply to all amounts thereafter paid by the Borrower for the account of such Defaulting Lender that is a Lender under this Agreement (in each case whether on account of principal, interest, fees, indemnity or other amounts), provided that such termination will not be deemed to be a waiver or release of any claim the Borrower, the Administrative Agent, the L/C Issuer or any Lender may have against such Defaulting Lender.

 

(d)  Cure. If the Borrower, the Administrative Agent and the L/C Issuer agree in writing in their discretion that a Lender that is a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any amounts then held in the segregated account referred to in Section 2.19(a)), such Lender will, to the extent applicable, purchase such portion of outstanding Loans of the other Lenders and/or make such other adjustments as the Administrative Agent may determine to be necessary to cause each Lender’s obligations in respect of outstanding Loans and Letters of Credit to be on a pro rata basis in accordance with their respective Commitments, whereupon such Lender will cease to be a Defaulting Lender and will be a Non-Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while such Lender was a Defaulting Lender; and provided further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Non-Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender’s having been a Defaulting Lender.

 

Section 2.20         Increase of Commitments and Incremental Term Loans. (a) On or before the Termination Date, the Borrower may by written notice to the Administrative Agent elect to request the establishment of (i) incremental term loan facilities (each, an “Incremental Term Facility”, and the commitments thereunder the “Incremental Term Loan Commitments”) and/or (ii) incremental revolving credit commitments (each, an “Incremental Revolving Facility” and, together with the Incremental Term Facilities, the “Incremental Facilities”; and the commitments thereunder, the “Incremental Revolving Commitments” and, together with the Incremental Term Loan Commitments, collectively, the “Incremental Loan Commitments”). Subject to the terms and conditions set forth in this Section 2.20 and to the conditions precedent to each Loan set forth in Section 3.2 hereto, the Incremental Facilities shall be, in the case of any Incremental Term Facility, funded, or in the case of any Incremental Revolving Facility, available on the relevant Increased Amount Date; provided that (x) the aggregate amount of all Incremental Facilities shall not exceed the aggregate principal amount of $25,000,000 minus the aggregate amount of Indebtedness incurred pursuant to Section 8.1(s) in excess of $125,00,000 outstanding on the respective Incremental Amount Date and (y) each Incremental Facility shall be in an amount equal to at least $5,000,000. Each such notice shall specify the date (each, an “Increased Amount Date”) on which the Borrower proposes that the Incremental Loan Commitments shall be effective, which shall be a date not less than five (5) Business Days after the date on which such notice is delivered to the Administrative Agent; provided that any Lender offered or approached to provide all or a portion of any Incremental Loan Commitments may elect or decline, in its sole discretion, to provide such Incremental Loan Commitments.

 

  

(b)          Such Incremental Loan Commitments shall become effective as of the applicable Increased Amount Date; provided that (i) no Default or Event of Default shall exist on such Increased Amount Date before or after giving effect to such Incremental Loan Commitments and any Borrowings on such date; (ii) after giving effect to such Incremental Loan Commitments and any Borrowings on such date each of the conditions set forth in Section 3.2 shall be satisfied; (iii) the Consolidated Total Lease Adjusted Leverage Ratio after giving effect to such Incremental Loan Commitments, any Borrowings and use of proceeds thereof on such date on a Pro Forma Basis shall not exceed 3.50:1.00; provided, that, for purposes of the calculations set forth in clause (iii), such calculations with respect to Incremental Revolving Credit Commitments (the Loans thereunder, “Incremental Revolving Loans”) shall assume a borrowing of the maximum amount of Loans available under such Incremental Revolving Credit Commitment and any other Incremental Revolving Credit Commitments previously made pursuant to this Section 2.20); (iv) the Incremental Loans shall share ratably in the Collateral; (v) except to the extent that the applicable Joinder Agreement otherwise provides, the Incremental Loans that are term loans (“Incremental Term Loans”) shall share ratably in any mandatory prepayments of any existing Term Loans; (vi) the maturity date of any Loan under such Incremental Facility shall not be earlier than the Termination Date; (vii) the Weighted Average Life to Maturity applicable to any Incremental Term Facility shall be equal to or greater than Weighted Average Life to Maturity of any existing Term Loan Facility; (viii) in the case of any increase in revolving commitments and loans, the terms and provisions thereof shall be identical to those of the existing Commitments and Loans, respectively; (ix) in the case of any increase in term loans, all terms and documentation with respect to any Incremental Term Facility (A) shall be reasonably acceptable to the Administrative Agent, (B) will be as agreed between the Borrower and the Incremental Term Lenders providing such Incremental Loans and (C) all other terms (other than initial borrowing conditions, amortization prior to maturity, pricing and upfront fees and other economic terms) shall be substantially identical to the Facility (in the reasonable discretion of the Administrative Agent) or otherwise reasonably acceptable to the Administrative Agent; (x) such Incremental Loans or Incremental Loan Commitments shall be effected pursuant to one or more joinder agreements executed and delivered by the Borrower, the Administrative Agent and one or more Incremental Lenders and setting forth the terms applicable to such Incremental Loans and Incremental Loan Commitments (each, a “Joinder Agreement”); (xi) the Incremental Loans shall rank pari passu in right of payment and security to the Facility; (xii) the Borrower shall deliver or cause to be delivered any customary legal opinions or other documents reasonably requested by the Administrative Agent in connection with any such transaction, including any supplements or amendments to the Security Documents providing for such Incremental Loans to be secured thereby and, if applicable, a Notice of Borrowing; and (xiii) if the interest rate applicable to the Incremental Loans under any Incremental Facility shall be higher than the corresponding interest rate on the Facility by 0.50% or more, then the interest rate applicable to the Facility shall be increased to a level that is not less than 0.50% below such Incremental Facility (in each case, calculated for both the Incremental Loans and the Facility, in each case, inclusive of any original issue discount and upfront fees (with original issue discount being equated to interest based on an assumed four-year life to maturity with respect to the Facility and, if the relevant Incremental Facility will have a maturity of less than four years, then based on the actual maturity for such Incremental Facility)); provided that in determining interest rates applicable to the existing Loans or the applicable Incremental Facility, (x) customary arrangement or commitment fees payable in connection with the Facility or to one or more arrangers (or their affiliates) of the applicable Incremental Facility shall be excluded and (y) if the Eurodollar Rate in respect of such Incremental Facility includes a floor, such increased amount shall be equated to interest margin for purposes of determining any increase to the applicable interest margin under the Facility. For the avoidance of doubt, the rate of interest and the amortization schedule (if applicable) of any Incremental Loan Commitments shall be determined by the Borrower and the applicable Incremental Lenders and shall be set forth in the applicable Joinder Agreement.

 

(c)          On any Increased Amount Date on which any Incremental Revolving Commitment or Incremental Term Loan Commitment becomes effective, subject to the foregoing terms and conditions, each lender with an Incremental Revolving Commitment (each, an “Incremental Revolving Lender”) or an Incremental Term Loan Commitment (each, an “Incremental Term Lender” and together with the Incremental Revolving Lenders, collectively, the “Incremental Lenders”), to the extent not already a Lender, shall become a Lender hereunder with respect to such Incremental Loan Commitment; provided that any financial institution that becomes an Incremental Lender that is not already a Lender hereunder shall be reasonably satisfactory to the Administrative Agent and the Borrower and, with respect to any Incremental Revolving Lender , to the L/C Issuer.

 

 

(d)          Each of the parties hereto hereby agrees that the Administrative Agent may take any and all action as may be reasonably necessary to ensure that, upon the effectiveness of any Incremental Revolving Commitments, (i) all Loans made under such Incremental Revolving Commitments are included in each Borrowing of outstanding Loans on a pro rata basis and (ii) the Lender providing such Incremental Revolving Commitment shares ratably in the aggregate pro rata Outstandings under the Facility.

 

ARTICLE III

CONDITIONS TO EFFECTIVENESS AND TO LOANS AND LETTERS OF CREDIT

 

Section 3.1           Conditions to Effectiveness. This Second Amended and Restated Credit Agreement shall become effective as of the Amendment Effective Date if, on or before the Amendment Effective Date, the following conditions have been satisfied:

 

(a) the Administrative Agent shall have received:

 

(i)          counterparts of this Agreement executed by the Lenders, the Borrower and each Guarantor;

 

(ii)         a certificate of the secretary, assistant secretary, or other similar officer of each Loan Party certifying (A) as to the names and signatures of each officer of such Loan Party authorized to execute and deliver any Loan Document, (B) that the Constituent Documents of such Loan Party attached to such certificate are complete and correct copies of such Constituent Documents as in effect on the date of such certification and (C) as to the resolutions of such Loan Party’s board of directors or other appropriate governing body approving and authorizing the execution, delivery and performance of this Agreement and each Loan Document to which such Loan Party is a party;

 

(iii)        duly executed favorable opinions of counsel to the Loan Parties in New York, Delaware and Texas, each addressed to the Agents, the Arrangers, the L/C Issuer and the Lenders and addressing such matters as the Administrative Agent may reasonably request and in form and substance reasonably satisfactory to the Administrative Agent;

 

(iv)        a certificate, dated as of the Amendment Effective Date, of the secretary, assistant secretary, or other similar officer of each Loan Party certifying compliance with the conditions precedent set forth in Sections 3.2(b) and (c); and

 

(v)         evidence that the Loan Parties shall have taken or caused to be taken such actions, including with respect to filings or recordings, reasonably requested by the Administrative Agent in connection with this Agreement;

 

(b) Since December 31, 2012, there shall not have occurred any Material Adverse Effect;

 

(c) substantially concurrently with the Amendment Effective Date, the Borrower shall have paid, in full, all amounts of principal, interest and fees owing to each Departing Lender under, and in compliance with the terms of, the Original Credit Agreement;

 

 

(d) the Borrower shall have paid, in full, all amounts of fees owing to each Lender in respect of the Revolving Credit Facility (as defined in the Original Credit Agreement) in compliance with the terms of the Original Credit Agreement; and

 

(e)  There shall have been paid to the Administrative Agent, for the respective accounts of the Agents, the Arrangers, the L/C Issuer and the Lenders, as the case may be, all fees and all reimbursements of costs or expenses, in each case due and payable under any Loan Document on or before the Amendment Effective Date, with such invoices received subsequent to the Amendment Effective Date to be paid reasonably promptly.

 

Section 3.2           Conditions Precedent to Each Loan and Letter of Credit. The obligation of each Lender on any date (including the Amendment Effective Date) to make any Loan and of the L/C Issuer on any date (including the Amendment Effective Date) to Issue any Letter of Credit is subject to the satisfaction of each of the following conditions precedent:

 

(a)  Request. The Administrative Agent (and, in the case of any Issuance, the relevant L/C Issuer) shall have received, to the extent required by Article II, a written, timely and duly executed and completed Notice of Borrowing or L/C Request, as applicable.

 

(b)  Representations and Warranties. At the time of and immediately after giving effect to such Loan or, as applicable, such Issuance, the representations and warranties set forth in Article IV and in the other Loan Documents shall be true and correct in all material respects (provided that if any representation or warranty is by its terms qualified by concepts of materiality, such representation shall be true and correct in all respects) on and as of such date with the same effect as though made on such date, except to the extent such representations and warranties expressly related to an earlier date (in which case such representations and warranties shall have been true and correct in all material respects (provided that if any representation or warranty is by its terms qualified by concepts of materiality, such representation shall be true and correct in all respects) as of such earlier date).

 

(c)  No Defaults. At the time of and immediately after giving effect to such Loan or, as applicable such Issuance, no Default shall be continuing.

 

The representations and warranties set forth in any Notice of Borrowing or L/C Request (or any certificate delivered in connection therewith) shall be deemed to be made again on and as of the date of the relevant Loan or Issuance and the acceptance of the proceeds thereof or of the delivery of the relevant Letter of Credit.

 

Section 3.3           Defaulting Lenders. In addition to the other conditions precedent herein set forth, if any Lender becomes, and during the period it remains, a Defaulting Lender, the L/C Issuer will not be required to issue any Letter of Credit or to amend any outstanding Letter of Credit unless the L/C Issuer is satisfied that any exposure that would result therefrom is eliminated or fully covered by the Commitments of the Non-Defaulting Lenders or by Cash Collateralization or a combination thereof satisfactory to the L/C Issuer.

 

Section 3.4           Determinations of Initial Borrowing Conditions. For purposes of determining compliance with the conditions specified in Section 3.1, each Lender shall be deemed to be satisfied with each document and each other matter required to be satisfactory to such Lender unless, prior to the Amendment Effective Date, the Administrative Agent receives notice from such Lender specifying such Lender’s objections and such Lender has not made available its Pro Rata Share of any Borrowing scheduled to be made on the Amendment Effective Date.

 

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

 

To induce the Lenders, the L/C Issuer and each Agent to enter into the Loan Documents, each of Parent and the Borrower (and, to the extent set forth in any other Loan Document, each other Loan Party) represents and warrants to each of them each of the following on and as of the Amendment Effective Date, the date of each Borrowing and the date of each Issuance of a Letter of Credit:

 

Section 4.1           Corporate Existence; Compliance with Law. Each Group Member (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) is duly qualified to do business as a foreign entity and in good standing under the laws of each jurisdiction where such qualification is necessary, except where the failure to be so qualified or in good standing would not, in the aggregate, reasonably be expected to have a Material Adverse Effect, (c) has all requisite power and authority to own, pledge, mortgage and operate its property, to lease or sublease any property it operates under lease or sublease and to conduct its business as now or currently proposed to be conducted, except where the failure to have such power or authority would not reasonably be expected to have a Material Adverse Effect, (d) is in compliance with its Constituent Documents, (e) is in compliance with all applicable Requirements of Law (other than Environmental Laws, which are subject to Section 4.14), except where the failure to be in compliance would not reasonably be expected to have a Material Adverse Effect and (f) has made all necessary registrations and filings with, and has given all necessary notices to, each Governmental Authority having jurisdiction, to the extent required for such ownership, lease, sublease, operation, occupation or conduct of business, including reimbursement by each Governmental Authority, except where the failure to make such filings or give such notices would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

Section 4.2           Loans. (a) Power and Authority. The execution, delivery and performance by each Loan Party of the Loan Documents to which it is a party and the consummation of the transactions contemplated therein (i) are within such Loan Party’s corporate or similar powers and, at the time of execution thereof, have been duly authorized by all necessary corporate and similar action (including, if applicable, consent of holders of its Securities), (ii) do not (A) contravene such Loan Party’s Constituent Documents, (B) violate any applicable Requirement of Law, (C) conflict with, contravene, constitute a default or breach under, or result in or permit the termination or acceleration of, any Contractual Obligation of any Loan Party or any of its Subsidiaries (including other Loan Documents) or any order, judgment or decree of any Governmental Authority, other than those that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect or (D) result in the imposition of any Lien (other than a Permitted Lien) upon any property of any Loan Party or any of its Subsidiaries and (iii) do not require any Permit of, or filing with, any Governmental Authority or any consent of, or notice to, any Person, other than (A) the filing of UCC financing statements, (B) filings with the United States Copyright Office and comparable offices in foreign jurisdictions and equivalent filings in foreign jurisdictions, (C) recordation of the Mortgages, if any, (D) such as have been made or obtained and are in full force and effect, (E) those as to which the failure to be obtained or made would not, in the aggregate, reasonably be expected to have a Material Adverse Effect, and (F) filings or other actions listed on Schedule 4.2.

 

(b)  Due Execution and Delivery. From and after its delivery to the Administrative Agent, each Loan Document has been duly executed and delivered to the other parties thereto by each Loan Party party thereto, is the legal, valid and binding obligation of such Loan Party and is enforceable against such Loan Party in accordance with its terms, subject to (i) the effects of bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other similar laws affecting creditors’ rights generally, (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (iii) any implied covenants of good faith and fair dealing.

 

 

Section 4.3           Subsidiaries. (a) Set forth on Schedule 4.3 is a complete and accurate list showing, as of the Amendment Effective Date, for each Group Member and each joint venture of any of them, its jurisdiction of organization, the number of shares of each class of Stock authorized (if applicable), the number outstanding on the Amendment Effective Date and the number and percentage of the outstanding shares of each such class owned (directly or indirectly) by Parent. All outstanding Stock of each of them has been validly issued, is fully paid and non-assessable (to the extent applicable) and is owned beneficially and of record by a Group Member (or, in the case of the Borrower, Parent) free and clear of all Liens other than the security interests created by the Loan Documents and, in the case of joint ventures, Permitted Liens. There are no Stock Equivalents with respect to the Stock of any Group Member or any Subsidiary of any Group Member or any joint venture of any of them, as of the Amendment Effective Date, except as set forth on Schedule 4.3.

 

(b)          As of the Amendment Effective Date, there are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments (other than stock options in Parent or any direct or indirect parent of Parent granted to employees or directors and directors’ qualifying shares in Parent or any direct or indirect parent of Parent) of any nature relating to any Stock of Parent, the Borrower or any of the Subsidiaries, except as set forth on Schedule 4.3.

 

Section 4.4           Financial Statements. (a) Each of (i) the audited Consolidated balance sheet of the Borrower as at January 31, 2013 and the related Consolidated statements of income and cash flows of the Borrower for the Fiscal Year then ended, certified by BDO Seidman, LLP and (ii) subject to the absence of footnote disclosure and normal recurring year-end audit adjustments, the unaudited Consolidated balance sheets of the Borrower as at April 30, 2013 and the related Consolidated statements of income and cash flows of the Borrower for the six months then ended, copies of each of which have been furnished to the Administrative Agent, fairly present in all material respects the Consolidated financial position, results of operations and cash flow of the Borrower as at the dates indicated and for the periods indicated in accordance with GAAP.

 

(b) None of the Borrower or its Subsidiaries has any material liability or other obligation (including Guaranty Obligations), contingent liabilities and liabilities for taxes, or any long-term leases or unusual forward or long-term commitments that are not reflected in the financial statements referred to in clause (a)(i). During the period from December 31, 2012 to and including the Amendment Effective Date there has been no disposition or acquisition by the Borrower or any of the Subsidiaries of any material part of its business or property that is not reflected in the financial statements referred to in clause (a)(i) above.

 

(c) The unaudited pro forma Consolidated balance sheet of the Borrower delivered to the Administrative Agent on or prior to the Amendment Effective Date has been prepared as of April 30, 2013, the Consolidated financial condition of the Borrower, and the assumptions expressed therein are reasonable based on the information available to the Borrower at such date and on the Amendment Effective Date(it being understood that such assumptions are based on good faith estimates of certain items and the actual amount of such items on the Amendment Effective Date is subject to change).

 

Section 4.5           Material Adverse Effect. Since January 31, 2013, there have been no events, circumstances, or developments that would, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

 

Section 4.6           Solvency. Both immediately before and immediately after giving effect to (a) the Loans and Letters of Credit made or Issued on or prior to the date this representation and warranty is made, (b) the disbursement and use of the proceeds of such Loans and (c) the payment and accrual of all transaction costs in connection with the foregoing, both the Loan Parties taken as a whole and each Loan Party (other than any Immaterial Subsidiary) individually are Solvent.

 

Section 4.7           Litigation. There are no pending (or, to the knowledge of Parent and any Group Member, threatened in writing) actions, investigations, suits, proceedings or arbitrations, affecting Parent or any of its Subsidiaries or any property of Parent or any of its Subsidiaries at law or at equity, or with, by or before any Governmental Authority that involve the Obligations, the Loan Documents, the Letters of Credit and the other transactions contemplated therein, or that would reasonably be expected to have, in the aggregate, a Material Adverse Effect. No Group Member is subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of any court or any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

 

Section 4.8           Taxes. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, all federal, state, local and foreign income and other tax returns, reports and statements (collectively, the “Tax Returns”) required to be filed by each Tax Affiliate have been timely filed with the appropriate Governmental Authorities in all jurisdictions in which such Tax Returns are required to be filed, all such Tax Returns are true and correct in all respects, and each Tax Affiliate has timely paid all taxes reflected therein or otherwise due and payable (including in its capacity as a withholding agent) except for those taxes which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves are maintained on the books of the appropriate Tax Affiliate in accordance with GAAP. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, no Tax Return filed by any Tax Affiliate is under audit or examination by any Governmental Authority and no notice of such an audit or examination or any assertion of any claim for Taxes has been given or made by any Governmental Authority to any Tax Affiliate.

 

Section 4.9           Margin Regulations. Neither Parent nor any Group Member (i) owns, and no proceeds of any Loan or other extensions of credit hereunder will be used for the purpose of buying or carrying, margin stock (within the meaning of Regulation U of the Federal Reserve Board) or (ii) is engaged principally, or as one of its important activities, in the business of extending credit to others for the purpose of purchasing or carrying any such margin stock in contravention of the provisions of the regulations of the Federal Reserve Board, including Regulation U or X of the Federal Reserve Board. No Group Member owns any margin stock.

 

Section 4.10         No Burdensome Obligations; No Defaults. Neither Parent nor any Group Member is a party to any Contractual Obligation, nor does any Group Member have Constituent Documents containing obligations, and, to the knowledge of any Group Member, there are no applicable Requirements of Law, in each case the compliance with which would reasonably be expected to have, in the aggregate, a Material Adverse Effect. No Group Member (and, to the knowledge of each Group Member, no other party thereto) is in default under or with respect to any Contractual Obligation of any Group Member, other than those that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

 

Section 4.11         Investment Company Act. No Group Member (i) is a “registered investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company” as such terms are defined in, or subject to regulation under, the Investment Company Act of 1940 or (ii) is subject to regulation under the Federal Power Act or under any other federal or state statute or regulation which may limit its ability to incur Indebtedness or which may otherwise render all or any portion of the Obligations unenforceable.

 

Section 4.12         Labor Matters. There are no strikes, work stoppages, slowdowns or lockouts existing, pending (or, to the knowledge of any Group Member, threatened) against or involving any Group Member, except for those that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as set forth on Schedule 4.12, as of the Amendment Effective Date, (a) there is no collective bargaining or similar agreement with any union, labor organization, works council or similar representative covering any employee of any Group Member, (b) no petition for certification or election of any such representative is existing or pending with respect to any employee of any Group Member and (c) no such representative has sought certification or recognition with respect to any employee of any Group Member.

 

Section 4.13         ERISA. Schedule 4.13 sets forth, as of the Amendment Effective Date, a complete and correct list of, and that separately identifies, (a) all Title IV Plans, (b) all Multiemployer Plans and (c) all material Benefit Plans. Except for those that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect, (i) each Benefit Plan is in compliance with applicable provisions of ERISA, the Code and other Requirements of Law, (ii) there are no existing or pending (or to the knowledge of any Group Member, threatened) claims (other than routine claims for benefits in the normal course), sanctions, actions, lawsuits or other proceedings or investigations involving any Benefit Plan to which any Group Member incurs or otherwise has or would be reasonably likely to have an obligation or any Liability, (iii) no ERISA Event has occurred or, to the knowledge of any Group Member, is reasonably expected to occur, (iv) as of the Amendment Effective Date, no ERISA Event has occurred in connection with which obligations and liabilities (contingent or otherwise) of any ERISA Affiliate remain outstanding, (v) no Title IV Plan has an Unfunded Current Liability in excess of $1,000,000 million, and (vi) no ERISA Affiliate would have any Withdrawal Liability as a result of a complete withdrawal from any Multiemployer Plan on the date this representation is made.

 

Section 4.14         Environmental Matters. Except as set forth on Schedule 4.14, (a) the operations, property and facilities of each Group Member are and have been in compliance with all applicable Environmental Laws, including obtaining, maintaining and complying with all Permits required by any applicable Environmental Law, other than non-compliances that, in the aggregate, would not reasonably be expected to have a Material Adverse Effect, (b) no Group Member is party to, and no Group Member and no property or facility currently (or to the knowledge of any Group Member previously) owned, leased, operated, controlled or otherwise occupied by or for any Group Member is subject to or the subject of, any Contractual Obligation or any pending (or, to the knowledge of any Group Member, threatened) order, action, investigation, suit, proceeding, audit, claim, demand, dispute or notice of violation or of potential liability or similar written notice under or pursuant to any Environmental Law other than those that, in the aggregate, would not reasonably be expected to have a Material Adverse Effect, (c) no Lien in favor of any Governmental Authority securing, in whole or in part, Environmental Liabilities has attached to any asset currently owned by any Group Member and, to the knowledge of any Group Member, no facts, circumstances or conditions exist that would reasonably be expected to result in any such Lien attaching to any such assets, (d) no Group Member has caused or suffered to occur a Release or threat of Release of Hazardous Materials at, on, under or from any property or facility currently owned, leased, operated or controlled by any Group Member and each such property and facility is free of contamination by any Hazardous Materials except for such Release or contamination that could not reasonably be expected to have, in the aggregate, a Material Adverse Effect, (e) each Group Member has made available to the Administrative Agent copies of all existing material environmental reports, reviews and audits and all material documents pertaining to actual or potential material Environmental Liabilities, in each case to the extent such reports, reviews, audits and documents are in its possession, custody or control, and (f) no Group Member has caused the Release of any Hazardous Materials or is otherwise liable for any Remedial Action at any property owned or operated by any third-party, except for such Release or Remedial Action that could not reasonably be expected to have, in the aggregate, a Material Adverse Effect.

 

 

 

Section 4.15         Intellectual Property. Each Group Member owns or possesses, or is licensed to use, all Intellectual Property necessary for the present conduct of its business, without any conflict (of which the Borrower has been notified in writing) with the rights of others, and free from any burdensome restrictions on the present conduct of the Business, except where such conflicts and restrictions would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

Section 4.16         Title; Real Property. (a) Each Group Member has good and marketable fee simple title to or valid leasehold interests in, or easements or other limited property interests in, all its real properties (including all owned real property subject to a Mortgage) except, with regards to owned real property, for defects in title that do not materially (x) interfere with its ability to conduct its business as currently conducted or to utilize such properties and assets for their intended purposes or (y) impair the value of such properties and assets and owns all personal property that is purported to be owned by it, and except where the failure to have such title would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, and none of such properties is subject to any Liens, except for Permitted Liens. Each Group Member has valid title to, or leases or other rights to use, its personal property, except for such failures as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except for the Lien granted to the Collateral Agent pursuant to the Loan Documents and other Permitted Liens, each Group Member owns their respective personal property free and clear of any and all Liens of others.

 

(b) No Casualty Event. Neither the Borrower nor any of its Subsidiaries has received any notice of, nor has any knowledge of, the occurrence or pendency of any Property Loss Event affecting all or any portion of its property. No Mortgage encumbers improved real property that is located in an area that has been identified by the Secretary of Housing and Urban Development as an area having special flood hazards within the meaning of the National Flood Insurance Act of 1968 unless flood insurance available under such Act has been obtained in accordance (and to the extent required by) with Section 7.5.

 

(c) Mortgages. Each Mortgage is effective to create, in favor of the Collateral Agent, for its benefit and the benefit of the Secured Parties, a legal, valid and enforceable first priority Lien on, and security interest in, all of the applicable Loan Party’s right, title and interest in and to the owned real property encumbered by such Mortgage and the proceeds thereof, subject only to Permitted Liens or other Liens acceptable to the Administrative Agent and the Collateral Agent, and when the Mortgages are filed in the applicable offices specified on Schedule 6 to the Perfection Certificate (or, in the case of any Mortgage executed and delivered after the date hereof in accordance with the provisions of Section 7.10, when such Mortgage is filed in the offices specified in the local counsel opinion delivered with respect thereto in accordance with the provisions of Section 7.10), such Mortgage shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Party in the real property encumbered by a Mortgage and the proceeds thereof, in each case prior and superior in right to any other person, other than Liens permitted by such Mortgage.

 

(d) Set forth on Schedule 4.16 is, as of the Amendment Effective Date, (i) a complete and accurate list of all real property owned in fee simple by any Group Member or in which any Group Member owns a leasehold interest setting forth, for each such real property, the current street address (including, where applicable, county, state and other relevant jurisdictions), the record owner thereof (for any such owned real property) and (ii) for each such owned real property that the Administrative Agent has requested be subject to a Mortgage or that is otherwise material to the business of any Group Member, each Contractual Obligation by any Group Member, whether contingent or otherwise, to Sell such real property.

 

 

Section 4.17         Full Disclosure. The information (other than projections, estimates and information of a general economic nature) prepared or furnished by or on behalf of any Group Member in connection with any Loan Document (including the information contained in any Financial Statement or Disclosure Document) or the consummation of any other transaction contemplated therein, when taken as a whole as of the Amendment Effective Date (or the Closing Date with respect to the Projections), does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein, in light of the circumstances when made, not misleading. The Projections and estimates and information of a general economic nature prepared by or on behalf of any Group Member or any of its representatives and that have been made available to any Lenders or any Agent in connection with any Loan Document (i) have been prepared in good faith based upon assumptions believed by the Borrower to be reasonable as of the date thereof for the periods set forth therein (it being understood that actual results may vary materially from the Projections), (ii) as of the date such Projections, estimates and information were furnished to the Lenders and as of the Closing Date, reflect the contemplated related estimates by the Borrower of the future Consolidated financial performance of the Borrower and the other information projected therein for the periods set forth therein and (iii) as of the Amendment Effective Date, have not been modified in any material respect by the Borrower.

 

Section 4.18         Permits. The Group Members hold all Permits required to conduct the Business as it is now being conducted. All Permits are valid, in force and effect, and unimpaired, except for such Permits, the absence of which would not reasonably be expected to have a Material Adverse Effect.

 

Section 4.19         Anti-Terrorism Laws. No Loan Party or any of its Affiliates or principals is in violation of any Requirement of Law relating to terrorism, sanctions or money laundering (collectively, “Anti-Terrorism Laws”), including Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001 (the “Executive Order”), and the Patriot Act. No part of the proceeds of the Loans will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

 

Section 4.20         Insurance. Set forth on Schedule 4.20 is, as of the Amendment Effective Date, a complete and accurate, in all material respects, list of all material insurance policies maintained by each Loan Party, as well as a listing of the deductibles, coverage limits and term of each such policy.

 

ARTICLE V

FINANCIAL COVENANTS

 

As of the dates and during the periods set forth below, the Borrower (and, to the extent set forth in any other Loan Document, each other Loan Party) agrees with the Lenders, the L/C Issuer and each Agent to each of the following, as long as any Obligation or any Commitment remains outstanding:

 

Section 5.1           Maximum Consolidated Total Lease Adjusted Leverage Ratio. The Borrower shall not have, on the last day of any Fiscal Quarter, a Consolidated Total Lease Adjusted Leverage Ratio greater than 4.25 to 1.00.

 

 

Section 5.2           Maximum Capital Expenditures. The Borrower shall not permit Capital Expenditures for the Group Members to exceed the Capital Expenditure Limitation for any Fiscal Year; provided, that, in the event the Borrower does not expend the entire Capital Expenditure Limitation in any Fiscal Year, the Borrower may carry forward for expenditure during the next succeeding two Fiscal Years an amount equal to the lesser of (x) such unexpended portion of the Capital Expenditure Limitation for such Fiscal Year and (y) 50% of the Capital Expenditure Limitation for such Fiscal Year.

 

ARTICLE VI

REPORTING COVENANTS

 

The Borrower (and, to the extent set forth in any other Loan Document, each other Loan Party) agrees with the Lenders, the L/C Issuer and each Agent to each of the following, as long as any Obligation or any Commitment remains outstanding:

 

Section 6.1           Financial Statements. The Borrower shall deliver to the Administrative Agent each of the following:

 

(a) Quarterly Reports. As soon as available, and in any event within 50 days after the end of each of the first three Fiscal Quarters of each Fiscal Year, commencing with the Fiscal Quarter ending July 31, 2011, the Consolidated unaudited balance sheet of the Borrower as of the close of such Fiscal Quarter and related Consolidated statements of income and cash flow for such Fiscal Quarter and that portion of the Fiscal Year ending as of the close of such Fiscal Quarter, setting forth in comparative form the figures for the corresponding period in the prior Fiscal Year and the corresponding portion of the previous Fiscal Year, all in reasonable detail, in each case certified by a Responsible Officer of the Borrower as fairly presenting in all material respects the Consolidated financial position, results of operations and cash flow of the Borrower as at the dates indicated and for the periods indicated in accordance with GAAP (subject to the absence of footnote disclosure and normal year-end audit adjustments) (it being understood that the delivery by the Borrower of quarterly reports on Form 10-Q of Holdings and its consolidated subsidiaries shall satisfy the requirements of this Section 6.1(a) to the extent such quarterly reports include the information specified therein).

 

(b) Annual Reports. As soon as available, and in any event within 100 days after the end of each Fiscal Year, the Consolidated balance sheet of the Borrower as of the end of such year and related Consolidated statements of income, stockholders’ equity and cash flow for such Fiscal Year, each prepared in accordance with GAAP, together with the following: (i) an opinion by the Group Members’ Accountants that (x) such Consolidated Financial Statements fairly present in all material respects the Consolidated financial position, results of operations and cash flow of the Borrower as at the dates indicated and for the periods indicated therein in accordance with GAAP without qualification with respect to going concern or scope of audit or any like qualifications, and (y) in the course of the regular audit of the businesses of the Borrower and its Subsidiaries, which audit was conducted in accordance with the standards of the United States’ Public Company Accounting Oversight Board (or any successor entity), such Group Members’ Accountants have obtained no knowledge that a Default in respect of the Financial Performance Covenants is continuing or, if in the opinion of such Group Members’ Accountants such a Default is continuing, a statement as to the nature thereof (which statement may be limited to accounting matters and may disclaim responsibility for legal interpretations); and (ii) a summary of such financial statements setting forth in comparative form the corresponding figures for the prior Fiscal Year, certified by a Responsible Officer of the Borrower as fairly presenting in all material respects the Consolidated financial position, results of operations and cash flow of the Borrower for such Fiscal Year in accordance with GAAP (it being understood that the delivery by the Borrower of annual reports on Form 10-K of Holdings and its consolidated subsidiaries shall satisfy the requirements of this Section 6.1(b) to the extent such annual reports include the information specified therein).

 

 

(c) Compliance Certificate. Together with each delivery of any Financial Statements pursuant to clause (a) or (b) above, a Compliance Certificate duly executed by a Responsible Officer of the Borrower that, among other things, (i) for each Fiscal Quarter, shows in reasonable detail the calculations used in determining the Consolidated Total Lease Adjusted Leverage Ratio, (ii) shows in reasonable detail the calculation of the ratio of (x) the amount of Consolidated Total Assets at the end of the applicable Fiscal Quarter to (y) the amount of Consolidated Total Assets as of October 30, 2010, and (iii) states that no Default is continuing as of the date of delivery of such Compliance Certificate or, if a Default is continuing, states the nature thereof and the action that the Borrower proposes to take with respect thereto.

 

(d) Corporate Chart and Other Collateral Updates. As part of the Compliance Certificate delivered pursuant to clause (c) above for Financial Statements delivered pursuant to clause (b) above, each in form and substance satisfactory to the Administrative Agent, a certificate by a Responsible Officer of the Borrower that (i) the Corporate Chart attached thereto (or the last Corporate Chart delivered pursuant to this clause (d)) is correct and complete as of the date of such Compliance Certificate, (ii) the Loan Parties have delivered all documents (including updated schedules as to the acquisition of Intellectual Property or real property) they are required to deliver pursuant to any Loan Document on or prior to the date of delivery of such Compliance Certificate and (iii) complete and correct copies of all documents modifying any term of any Constituent Document of any Group Member or Joint Venture thereof on or prior to the date of delivery of such Compliance Certificate have been delivered to the Administrative Agent or are attached to such certificate.

 

(e) Intercompany Loan Balances. Together with each delivery of any Compliance Certificate pursuant to clause (c) above, a summary of the outstanding balances of all intercompany Indebtedness as of the last day of the Fiscal Quarter covered by such Financial Statement, certified as complete and correct by a Responsible Officer of the Borrower as part of the Compliance Certificate delivered in connection with such Financial Statements.

 

(f)  Audit Reports, Management Letters, Etc. Together with each delivery of any Financial Statement for any Fiscal Year pursuant to clause (b) above, copies of each final management letter, audit report or similar letter or report from any independent registered certified public accountant (including the Group Members’ Accountants) in connection with such Financial Statements or any audit thereof (excluding any reports the delivery of which to the Administrative Agent is prohibited by such certified public accountants) and submitted to any Group Member (or such Group Member’s board of directors), each certified to be complete and correct copies by a Responsible Officer of the Borrower as part of the Compliance Certificate delivered in connection with such Financial Statements.

 

(g) Additional Projections. As soon as available, and in any event not later than 30 days after the end of each Fiscal Year, (i) the annual business plan of the Group Members for the Fiscal Year next succeeding such Fiscal Year and (ii) forecasts prepared by management of the Borrower (A) for each Fiscal Quarter in such next succeeding Fiscal Year and (B) for each other succeeding Fiscal Year through the Fiscal Year containing the Scheduled Termination Date, in each case including in such forecasts (x) a projected year-end Consolidated balance sheet, income statement and statement of cash flows, (y) a statement of all of the material assumptions on which such forecasts are based and (z) substantially the same type of financial information as that contained in the Projections, accompanied by the statement of a Responsible Officer of the Borrower to the effect that such forecasts have been prepared in good faith based upon assumptions believed by the Borrower to be reasonable as of the date thereof for the periods set forth therein, (it being understood that actual results may vary materially from the Projections) and, promptly when available, any significant revisions of such business plan or forecasts.

 

 

(h) Management Discussion and Analysis. Together with each delivery of any Compliance Certificate pursuant to clause (c) above, a summary narrative discussion and analysis of the financial condition and results of operations of the Group Members for the Fiscal Year (or the portion of the Fiscal Year then elapsed) and the previous Fiscal Year (or the corresponding period in the previous Fiscal Year) (it being understood that the delivery by the Borrower of quarterly reports on Form 10-Q or annual reports on Form 10-K, as applicable, of Holdings and its consolidated subsidiaries shall satisfy the requirements of this Section 6.1(h) to the extent such reports include the information specified therein).

 

(i)  Insurance. Together with each delivery of any Financial Statements for any Fiscal Year pursuant to clause (b) above, certified as complete and correct by a Responsible Officer of the Borrower as part of the Compliance Certificate delivered in connection with such Financial Statements, a report summarizing the insurance coverage (specifying type, amount and carrier) in effect for the Borrower and each Loan Party and its Subsidiaries and containing such additional information as the Administrative Agent may reasonably specify.

 

(j)  Statements of Reconciliation after Change in Accounting Principles. If, as a result of any change in accounting principles and policies from those used in the preparation of the financial statements delivered pursuant to Section 3.1(d) of the Original Credit Agreement, the consolidated financial statements of Parent and its Subsidiaries delivered pursuant to Section 6.1(a) or 6.1(b) will differ in any material respect from the consolidated financial statements that would have been delivered pursuant to such subdivisions had no such change in accounting principles and policies been made, then, together with the first delivery of such financial statements after such change, one or more statements of reconciliation for all such prior financial statements in form and substance satisfactory to Administrative Agent.

 

Section 6.2           Other Events. The Borrower shall give the Administrative Agent notice of each of the following (which may be made by telephone if promptly confirmed in writing) promptly after any Responsible Officer of the Borrower obtains actual knowledge of it: (a)(i) any Default and (ii) any event that would reasonably be expected to have a Material Adverse Effect, specifying, in each case, the nature and anticipated effect thereof and any action proposed to be taken in connection therewith, (b) the commencement of, or any material developments in, any action, investigation, suit, proceeding, audit, claim, demand, order or dispute with, by or before any Governmental Authority affecting any Group Member or any property of any Group Member which (i) if adversely determined would reasonably be expected to have a Material Adverse Effect or (ii) seeks to enjoin or otherwise prevent the consummation of, or to recover any damages or obtain relief as a result of, the transactions contemplated by this Agreement, (c) the acquisition of any material real property by any Loan Party, and (d) any notice of any loss of any material permit, accreditation, approval, authorization, license or franchise.

 

Section 6.3           Copies of Notices and Reports. The Borrower shall promptly deliver to the Administrative Agent copies of each of the following: (a) all reports that the Borrower transmits to its security holders generally, (b) all periodic reports, proxy statements and other documents that Holdings or any Loan Party files with the Securities and Exchange Commission, the Financial Industry Regulatory Authority, any securities exchange or any Governmental Authority exercising similar functions, (c) all press releases not made available directly to the general public and (d) any material document transmitted or received pursuant to, or in connection with, any Contractual Obligation governing Indebtedness in an aggregate principal amount in excess of $3.0 million of any Group Member.

 

 

 

Section 6.4           [Reserved].

 

Section 6.5           ERISA Matters. The Borrower shall give the Administrative Agent promptly, and in any event within 10 days, after any Responsible Officer of any Group Member knows (a) of any filing by any Group Member or ERISA Affiliate of any notice of intent to terminate any Title IV Plan, if such termination would require material additional contributions to be considered a standard termination under Section 4041(b) of ERISA, a copy of such notice, (b) that a request for a minimum funding standard waiver under Section 412 of the Code or Section 302 of ERISA has been filed with respect to any Title IV Plan or Multiemployer Plan (x) maintained or contributed to by any Group Member, or (y) maintained or contributed to by any other ERISA Affiliate if the aggregate underfunding of such plan would be reasonably likely to result in a material liability of any Group Member, or (c) that an ERISA Event has occurred that would reasonably be expected to result in material liability to a Group Member, in any such case, a notice (which may be made by telephone if promptly confirmed in writing) describing such ERISA Event or notice, waiver request and any action that such Group Member or ERISA Affiliate proposes to take with respect thereto, together with a copy of any notice filed by such Group Member or ERISA Affiliate with the PBGC or the IRS pertaining thereto.

 

Section 6.6           Environmental Matters. (a) The Borrower shall provide the Administrative Agent notice of each of the following (which may be made by telephone if promptly confirmed by the Borrower in writing) promptly after any Responsible Officer of any Group Member knows or has reason to know of it (and, upon reasonable request of the Administrative Agent, documents and information in connection therewith): (i)(A) unpermitted material Releases, (B) the receipt by any Group Member of any notice of violation of or potential liability or similar notice under, or the existence of any condition that would reasonably be expected to result in violations of or liabilities under, any Environmental Law or (C) the commencement of, or any material change to, any action, investigation, suit, proceeding, audit, claim, demand, dispute alleging a violation of or liability under any Environmental Law, that, for each of clauses (A), (B) and (C) above (and, in the case of clause (C), if adversely determined), in the aggregate for each such clause, would reasonably be expected to result in Environmental Liabilities in excess of $500,000, (ii) the receipt by any Group Member of notification that any property of any Group Member is subject to any Lien in favor of any Governmental Authority securing, in whole or in part, Environmental Liabilities and (iii) any proposed acquisition or lease of real property (except as part of any Permitted Acquisition) if such acquisition or lease would have a reasonable likelihood of resulting in aggregate Environmental Liabilities in excess of $500,000.

 

(b) Upon request of the Administrative Agent, the Borrower shall provide the Administrative Agent a report containing an update as to the status of any material environmental, health or safety compliance, hazard or liability issue identified in any document delivered to any Secured Party pursuant to any Loan Document or as to any condition reasonably believed by the Administrative Agent to result in material Environmental Liabilities.

 

Section 6.7           Labor Matters. The Borrower shall give the Administrative Agent notice of (i) each of the following (which may be made by telephone if promptly confirmed by the Borrower in writing) promptly after, and in any event within 30 days after any Responsible Officer of any Group Member knows or has reason to know of it: any strikes, work stoppages, slowdowns, lockouts or other labor disputes existing, pending (or, to the knowledge of any Group Member, threatened) against or involving any Group Member, except for those that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect and (ii) if not set forth on Schedule 4.12, (a) any collective bargaining or similar agreement with any union, labor organization, works council or similar representative covering any employee of any Group Member, (b) any petition for certification or election of any such representative existing or pending with respect to any employee of any Group Member and (c) any such representative seeking certification or recognition with respect to any employee of any Group Member.

 

 

Section 6.8           Other Information. (a) The Borrower shall provide the Administrative Agent with such other documents and information with respect to the business, property, condition (financial or otherwise), legal, financial or corporate or similar affairs or operations of any Group Member as the Administrative Agent (or any Lender or the Collateral Agent through the Administrative Agent) may from time to time reasonably request (including with respect to the reasons for any significant variations from the Projections for any period for which Financial Statements are delivered pursuant to clauses (a) and (b) of Section 6.1).

 

(b) Borrower will furnish to the Collateral Agent prompt written notice of any change (i) in any Loan Party’s corporate name, (ii) in any Loan Party’s identity or corporate structure, (iii) in any Loan Party’s jurisdiction of organization or (iv) in any Loan Party’s Federal Taxpayer Identification Number or state organizational identification number. Borrower agrees not to effect or permit any change referred to in the preceding sentence unless all filings have been made under the UCC or otherwise that are required in order for the Collateral Agent to continue at all times following such change to have a valid, legal and perfected security interest in all the Collateral as contemplated in the Loan Documents. Borrower also agrees promptly to notify the Collateral Agent if any material portion of the Collateral is damaged or destroyed.

 

(c) Each year, at the time of delivery of annual financial statements with respect to the preceding Fiscal Year pursuant to Section 6.1(b), Borrower shall deliver to the Collateral Agent a certificate of its Responsible Officer (i) either confirming that there has been no change in such information since the date of the Perfection Certificate delivered on the Closing Date or the date of the most recent certificate delivered pursuant to this Section and/or identifying such changes and (ii) certifying that all UCC financing statements (including fixture filings, as applicable) and all supplemental intellectual property security agreements or other appropriate filings, recordings or registrations, have been filed of record in each governmental, municipal or other appropriate office in each jurisdiction identified pursuant to clause (i) above (or in such Perfection Certificate) to the extent necessary to effect, protect and perfect the security interests under the Loan Documents for a period of not less than 18 months after the date of such certificate (except as noted therein with respect to any continuation statements to be filed within such period).

 

ARTICLE VII

AFFIRMATIVE COVENANTS

 

The Borrower (and, to the extent set forth in any other Loan Document, each other Loan Party) agrees with the Lenders, the L/C Issuer and each Agent to each of the following, as long as any Obligation or any Commitment remains outstanding:

 

Section 7.1           Maintenance of Corporate Existence. The Borrower shall cause each Group Member to (a) preserve and maintain its legal existence, except in the consummation of transactions expressly permitted by Sections 8.4 and 8.7 and (b) preserve and maintain its rights (charter and statutory), privileges, franchises and Permits necessary or desirable in the conduct of its business, except in the case of this clause (b), where the failure to do so would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

 

Section 7.2           Compliance with Laws, Etc. The Borrower shall cause each Group Member to comply with all applicable Requirements of Law, Contractual Obligations, and Permits, except for such failures to comply that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect. The Borrower shall cause each Group Member to maintain or obtain all qualifications and Permits now held or hereafter required to be held by such Group Member the loss, suspension or revocation of which, or failure to obtain or renew which, would reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.

 

 

 

Section 7.3           Payment of Obligations. Parent shall, and the Borrower shall cause each Group Member to, (i) pay or discharge before they become delinquent (a) all material claims, Taxes, assessments, charges and levies imposed by any Governmental Authority and (b) all other lawful claims that if unpaid would, by the operation of applicable Requirements of Law, become a Lien upon any property of any Group Member, except, in each case, for those whose amount or validity is being contested in good faith by proper proceedings diligently conducted and for which adequate reserves are maintained on the books of such Group Member in accordance with GAAP, (ii) perform all obligations under any Contractual Obligation by which Parent or such Group Member or any of its Subsidiaries is bound, or to which it or any of its properties is subject, except where the failure to perform would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect and (iii) except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, timely file all tax returns.

 

Section 7.4           Maintenance of Property. The Borrower shall cause each Group Member to maintain and preserve (a) in good working order and condition all of its property necessary in the conduct of its business and (b) all rights, permits, licenses, approvals and privileges (including all Permits) necessary, used or useful, whether because of its ownership, lease, sublease or other operation or occupation of property or other conduct of its business, and shall make all necessary or appropriate filings with, and give all required notices to, Government Authorities, except for such failures to maintain and preserve the items set forth in clauses (a) and (b) above that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

Section 7.5           Maintenance of Insurance. The Borrower shall cause each Group Member to (a) maintain or cause to be maintained in full force and effect all policies of insurance of any kind with respect to the property and businesses of such Group Member (including, if applicable, policies of life, fire, theft, product liability, public liability, Flood Insurance, property damage, other casualty, employee fidelity, workers’ compensation, business interruption and employee health and welfare insurance) with financially sound and reputable insurance companies or associations (in each case that are not Affiliates of the Borrower) of a nature and providing such coverage and deductibles (including replacement value casualty insurance) as is customarily carried by businesses of the size and character of the business of such Group Members and operating in the same or similar locations as the Group Members, (b) maintain or cause to be maintained in full force and effect Flood Insurance with financially sound and reputable insurance companies or associations (in each case that are not Affiliates of the Borrower) and (c) cause all such insurance relating to any property or business of any Loan Party to name the Administrative Agent and the Collateral Agent on behalf of the Secured Parties as additional insured or loss payee, as appropriate, in form and substance reasonably acceptable to Administrative Agent and, to the extent available, to provide that no cancellation, material addition in amount or material change in coverage shall be effective until after 10 days’ notice thereof to the Administrative Agent and the Collateral Agent. Notwithstanding the requirement in subsection (a) above, except to the extent required by any Requirement of Law, Federal Flood Insurance shall not be required for (x) real property not located in a special flood hazard area, or (y) real property located in a special flood hazard area in a community that does not participate in the National Flood Insurance Program.

 

Section 7.6           Keeping of Books. The Borrower shall cause each Group Member to keep proper books of record and account, in which full, true and correct entries shall be made in accordance with GAAP and all other applicable Requirements of Law of all financial transactions and the assets and business of such Group Member.

 

 

Section 7.7           Access to Books and Property. The Borrower shall cause each Group Member to permit the Administrative Agent, any Arranger and any Related Person of the Administrative Agent or any Arranger and, upon the occurrence of an Event of Default, the Lenders, as often as reasonably requested, at any reasonable time during normal business hours and with reasonable advance notice (except that, during the continuance of an Event of Default, no such notice shall be required) to (a) visit and inspect the property of such Group Member and examine and make copies of and abstracts from, the corporate (and similar), financial, operating and other books and records of such Group Member, (b) discuss the affairs, finances and accounts of such Group Member with any officer or director of such Group Member, and (c) communicate directly with any registered certified public accountants of such Group Member (subject to reasonable and customary requirements of confidentiality, including requirements imposed by law and reasonable and customary requirements imposed by contract). The Borrower shall cause each Group Member to authorize its respective registered certified public accountants to communicate directly with the Administrative Agent, the Arrangers, the Lenders and their Related Persons and to disclose to the Administrative Agent, the Arrangers, the Lenders and their Related Persons all financial statements and other documents and information as they might have and the Administrative Agent, any Arranger or any Lender reasonably requests with respect to such Group Member. Prior to the occurrence of an Event of Default, the Borrower shall only be obligated to pay or reimburse the reasonable fees, costs and expenses of the Administrative Agent and Arrangers associated with one annual visit and inspection.

 

Section 7.8           Environmental. The Borrower shall cause each Group Member to comply with, and maintain its property and facilities, whether owned, leased, subleased, operated, occupied or otherwise controlled, in compliance with, all applicable Environmental Laws (including by implementing any Remedial Action necessary to achieve such compliance or that is required by any Governmental Authority) except for failures to comply that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect. Without limiting the foregoing, if an Event of Default is continuing or if the Administrative Agent at any time has a reasonable basis to believe that there exist violations of Environmental Laws by any Group Member or that there exist any Environmental Liabilities, in each case, that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, then the Borrower shall cause each Group Member to, promptly upon receipt of a request from the Administrative Agent, cause the performance of, and allow the Administrative Agent and its Related Persons access to any property or facility which is the subject of such Event of Default or belief for the purpose of conducting, such environmental audits and assessments, including sampling of soil, surface water, groundwater or other environmental media, and cause the preparation of such reports, in each case as the Administrative Agent may from time to time reasonably request. Such audits, assessments and reports, to the extent not conducted by the Administrative Agent or any of its Related Persons, shall be conducted and prepared by reputable environmental consulting firms reasonably acceptable to the Administrative Agent and shall be in form and substance reasonably acceptable to the Administrative Agent.

 

Section 7.9           Use of Proceeds. The proceeds of the Loans shall be used by the Borrower (and, to the extent distributed to them by the Borrower, each other Group Member) solely (i) for working capital and general corporate purposes, (ii) to refinance existing indebtedness, (iii) to make Permitted Investments (including Permitted Acquisitions) and capital expenditures and (iv) to make permitted Restricted Payments in connection with the Specified Stock Repurchase. No portion of the proceeds of any Loan shall be used in any manner that causes or might cause such Loan or application of such proceeds to violate Regulation T, Regulation U or Regulation X of the Federal Reserve Board of any other regulation thereof.

 

 

Section 7.10         Additional Collateral and Guaranties. To the extent not delivered to the Administrative Agent on or before the Closing Date (including in respect of after-acquired property and Persons that become Subsidiaries of any Loan Party after the Closing Date), the Borrower shall cause each Group Member to promptly (and in any event within 30 days of acquisition or formation thereof) do each of the following, unless otherwise agreed by the Administrative Agent:

 

(a) deliver to the Administrative Agent such modifications to the terms of the Loan Documents (or, to the extent applicable as determined by the Administrative Agent or the Collateral Agent, such other documents), in each case in form and substance reasonably satisfactory to the Administrative Agent and as the Administrative Agent deems necessary or advisable in order to ensure the following:

 

(i)          each Wholly Owned Subsidiary of any Loan Party that is not a Foreign Subsidiary shall guaranty, as primary obligor and not as surety, the payment of the Obligations of the Borrower;

 

(ii)         each Subsidiary of any Loan Party that has or enters into any Guaranty Obligation with respect to Indebtedness of any Loan Party shall guaranty, as primary obligor and not as surety, the payment of the Obligations of the Borrower;

 

(iii)        so long as the relevant Permitted Acquisition shall occur, each Proposed Acquisition Target with regard to such Permitted Acquisition and each Subsidiary thereof shall guaranty, as primary obligor and not as surety, the payment of the Obligations of the Borrower; and

 

(iv)        each Loan Party (including any Person required to become a Guarantor pursuant to clause (i), (ii) or (iii) above) shall effectively grant to the Collateral Agent, for the benefit of the Secured Parties, a valid and enforceable security interest in all of its owned property constituting Collateral as security for the Obligations of such Loan Party;

 

provided, that, unless the Borrower and the Administrative Agent otherwise agree, in no event shall (x) the Loan Parties, individually or collectively, be required to pledge in excess of 66% of the outstanding Voting Stock of any Foreign Subsidiary, or (y) a security interest be required to be granted in any property of any Foreign Subsidiary as security for any Obligation;

 

(b) deliver to the Collateral Agent all documents representing all Stock, Stock Equivalents and other Securities pledged pursuant to the documents delivered pursuant to clause (a) above, together with undated powers or endorsements duly executed in blank;

 

(c) deliver to the Administrative Agent (x) upon its request an appraisal complying with FIRREA (so long as it is reasonably determined by the Administrative Agent in consultation with the Borrower that such an appraisal is required pursuant to the terms of FIRREA), (y) within 30 days of receipt of notice from the Collateral Agent that any fee interest in real property of the Loan Parties is located in a Special Flood Hazard Area, evidence, which may be in the form of a flood insurance certificate, of Federal Flood Insurance as required by Section 7.5, and (z) upon request of the Administrative Agent, deliver to it within 60 days of such request (or such longer period as the Administrative Agent may agree to) a Mortgage on any owned real property with a value at the time of acquisition in excess of $2.0 million, located in the United States, and owned by any Loan Party, together with all Mortgage Supporting Documents relating thereto;

 

 

(d) take all other actions necessary to ensure the validity or continuing validity of any guaranty for any Obligation or any Lien securing any Obligation, to perfect, maintain, evidence or enforce any Lien securing any Obligation or to ensure such Liens have the same priority as that of the Liens on similar Collateral set forth in the Loan Documents executed on the Closing Date, including the filing of UCC financing statements in such jurisdictions as may be required by the Loan Documents or applicable Requirements of Law or as the Administrative Agent or the Collateral Agent may otherwise reasonably request; and

 

(e) deliver to the Administrative Agent, the Collateral Agent and the Lender Parties (i) an updated Perfection Certificate with respect to any new Guarantor, (ii) all documents set forth in Sections 3.1(a)(iv) and (v) as applicable with respect to each new Guarantor and (iii) if requested by the Administrative Agent, legal opinions relating to the matters described in clauses (a) and (b) of this Section 7.10 and the Mortgages described in clause (c) of this Section 7.10, which opinions shall be as reasonably required by, and in form and substance and from counsel reasonably satisfactory to, the Administrative Agent.

 

The requirements of this Section 7.10: (i) need not be satisfied with respect to any real property held by the Borrower or any of its Subsidiaries as a lessee under a lease; (ii) do not apply to any Stock (other than Stock of any domestic Wholly Owned Subsidiary) acquired after the Closing Date in accordance with this Agreement if, and to the extent that, and for so long as, (A) doing so would violate applicable law or a Contractual Obligation binding on such Stock, and (B) such law or Contractual Obligation existed at the time of the acquisition thereof and was not created or made binding on such Stock in contemplation of or in connection with the acquisition of such Subsidiary, (iii) do not apply to any assets acquired after the Closing Date, to the extent that, and for so long as, taking such actions would violate a Contractual Obligation binding on such assets that existed at the time of the acquisition thereof and was not created or made binding on such assets in contemplation or in connection with the acquisition of such assets (except in the case of assets acquired with Indebtedness permitted pursuant to Section 8.1(c) that is secured by a Lien permitted pursuant to Section 8.2(d)); provided, that, in the case of clauses (ii) and (iii), upon the reasonable request of the Administrative Agent or the Collateral Agent, the Borrower shall, and shall cause any applicable Subsidiary to, use commercially reasonable efforts to have waived or eliminated any such Contractual Obligation (other than a Contractual Obligation of the type described in such clauses (ii) and (iii) in respect of the Stock or assets of a Joint Venture) and (iv) with respect to clause (a)(iii) above only, do not apply to any Foreign Subsidiary acquired after the Closing Date by any Loan Party.

 

ARTICLE VIII

NEGATIVE COVENANTS

 

The Borrower (and, to the extent set forth in any other Loan Document, each other Loan Party) agrees with the Lenders, the L/C Issuer and each Agent to each of the following, as long as any Obligation or any Commitment remains outstanding:

 

Section 8.1           Indebtedness. The Borrower shall cause each Group Member not to directly or indirectly incur or otherwise remain liable with respect to or responsible for any Indebtedness except for the following:

 

(a) the Obligations;

 

(b) Indebtedness existing on the date hereof and set forth on Schedule 8.1, together with any Permitted Refinancing of any Indebtedness permitted hereunder in reliance upon this clause (b);

 

 

(c) Indebtedness consisting of Capitalized Lease Obligations (other than with respect to a lease entered into as part of a Sale and Leaseback Transaction) and Purchase Money Indebtedness, in each case incurred by any Group Member to finance the acquisition, repair, lease, improvement or construction of fixed or capital assets of such Group Member, together with any Permitted Refinancing of any Indebtedness permitted hereunder in reliance upon this clause (c); provided, that (i) the aggregate outstanding principal amount of all such Indebtedness incurred under this clause (c) shall not exceed the greater of (A) $10.0 million and (B) an amount equal to (1) $10.0 million multiplied by (2) the ratio of (x) the amount of Consolidated Total Assets as of the end of the Fiscal Quarter immediately prior to the date of such incurrence for which financial statements have been delivered pursuant to Section 6.1 to (y) the amount of Consolidated Total Assets as of October 30, 2010 and (ii) such Indebtedness is incurred prior to or within 120 days after the acquisition, lease, repair, improvement, or construction of the respective asset;

 

(d) Capitalized Lease Obligations arising under Sale and Leaseback Transactions permitted hereunder in reliance upon Section 8.4(b)(ii);

 

(e) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary to the Borrower or any other Subsidiary, provided, that (i) Indebtedness of any Subsidiary that is not a Loan Party to any Loan Party shall be subject to Section 8.3(e) (including, without limitation, the requirement that such Indebtedness be evidenced by Pledged Notes pledged by such Loan Party as Collateral pursuant to the Guaranty and Security Agreement), and (ii) Indebtedness of the Borrower to any Subsidiary and Indebtedness of any other Loan Party to any Subsidiary that is not a Loan Party shall be subordinated to the Obligations on terms reasonably satisfactory to the Administrative Agent;

 

(f)  obligations under Hedging Agreements and Secured Hedging Documents entered into for the sole purpose of hedging in the normal course of business and consistent with industry practices, and customary obligations entered into in connection with accelerated stock repurchase programs otherwise permitted hereunder;

 

(g) (i) Guaranty Obligations of any Group Member that is a Loan Party with respect to Indebtedness permitted hereunder of any other Group Member that is a Loan Party and (ii) Guaranty Obligations of any Group Member that is not a Loan Party with respect to Indebtedness permitted hereunder of any other Group Member;

 

(h) [reserved];

 

(i)  Indebtedness owed to (including obligations in respect of letters of credit or bank guarantees or similar instruments for the benefit of) any Person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance to the Borrower or any Subsidiary, pursuant to reimbursement or indemnification obligations to such Person (in each case other than for an obligation for money borrowed), provided that upon the incurrence of Indebtedness with respect to reimbursement obligations regarding workers’ compensation claims, such obligations are reimbursed not later than 30 days following such incurrence;

 

(j)  Indebtedness in respect of performance bonds, bid bonds, appeal bonds, surety bonds, financial assurances and completion guarantees and similar obligations, in each case provided in the ordinary course of business (in each case other than for an obligation for money borrowed), including those incurred to secure health, safety and environmental obligations in the ordinary course of business;

 

(k) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business or other cash management services in the ordinary course of business, provided, that (x) such Indebtedness (other than credit or purchase cards) is extinguished within ten Business Days of its incurrence, and (y) such Indebtedness in respect of credit or purchase cards is extinguished within 60 days from its incurrence;

 

 

(l)  (i) Indebtedness of a Subsidiary acquired after the Amendment Effective Date or a Person merged into or consolidated with the Borrower or any Subsidiary after the Amendment Effective Date and Indebtedness assumed in connection with the acquisition of assets, which Indebtedness in each case, exists at the time of such acquisition, merger or consolidation and is not created in contemplation of such event, and where such acquisition, merger or consolidation is permitted by this Agreement, and (ii) any Permitted Refinancing incurred to refinance such Indebtedness; provided, that (x) the aggregate outstanding principal amount of such Indebtedness incurred under this clause (l) at the time of, and after giving effect to, such acquisition, merger or consolidation, such assumption, or such incurrence, as applicable, shall not exceed the greater of (A) $10.0 million and (B) an amount equal to (1) $10.0 million multiplied by (2) the ratio of (I) the amount of Consolidated Total Assets as of the end of the Fiscal Quarter immediately prior to the date of such acquisition, merger or consolidation, such assumption or such incurrence, as applicable, for which financial statements have been delivered pursuant to Section 6.1 to (II) the amount of Consolidated Total Assets as of October 30, 2010 and (y) the Borrower shall be in compliance on a Pro Forma Basis with the Financial Performance Covenants as of the last day of the last Fiscal Quarter for which Financial Statements have been delivered hereunder after giving effect to such Indebtedness;

 

(m)  other Indebtedness of the Borrower or any Subsidiary, in an aggregate outstanding principal amount that at the time of, and after giving effect to, the incurrence thereof, would not exceed $15,000,000;

 

(n) Indebtedness arising from agreements of the Borrower or any Subsidiary providing for indemnification, adjustment of purchase or acquisition price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary otherwise permitted under this Agreement, other than Guaranty Obligations with respect to Indebtedness incurred by any Person acquiring all or any portion of such business, assets or a Subsidiary for the purpose of financing such acquisition;

 

(o) Indebtedness consisting of the financing of insurance premiums in the ordinary course of business and other than for an obligation for money borrowed;

 

(p) all premium (if any), interest (including post-petition interest), fees, expenses, charges and additional or contingent interest on obligations described in and permitted by clauses (a) through (n) above;

 

(q) Indebtedness consisting of Junior Capital; provided, that after giving effect to the incurrence thereof, the Borrower shall be in compliance on a Pro Forma Basis with the Financial Performance Covenants as of the last day of the last Fiscal Quarter for which Financial Statements have been delivered hereunder after giving effect to such Indebtedness;

 

(r)  Unsecured Indebtedness; provided, that after giving effect to the incurrence thereof, the Borrower shall have a Consolidated Total Lease Adjusted Leverage Ratio not exceeding 4.00:1.00 calculated on a Pro Forma Basis; and

 

 

(s) Secured Indebtedness in an aggregate outstanding principal amount not in excess of $150,000,000 minus the aggregate amount of Incremental Facilities incurred pursuant to Section 2.20, which may be secured on a pari passu basis to the Facility subject to intercreditor documentation customary for pari passu facilities and reasonably acceptable to the Administrative Agent; provided, that (i) after giving effect to the incurrence thereof, the Borrower shall have a Consolidated Total Lease Adjusted Leverage Ratio not exceeding 3.50:1.00 calculated on a Pro Forma Basis, (ii) no Default or Event of Default shall exist before or after the incurrence of such Indebtedness; (iii) the maturity date of such Indebtedness shall not be earlier than the Termination Date; (iv) such Indebtedness shall not require scheduled amortization greater than 1% per annum of the original principal amount of such Indebtedness and (v) the restrictive covenants and events of default under such Indebtedness shall not be more restrictive to the Loan Parties in any material respect, than the terms of the Facility unless the Lenders under the Facility also receive the benefit of the more restrictive terms.

 

Section 8.2           Liens. No Group Member shall incur, maintain or otherwise suffer to exist any Lien upon or with respect to any of its property, whether now owned or hereafter acquired, or assign any right to receive income or profits, except for the following:

 

(a) Liens created pursuant to any Loan Document;

 

(b) Customary Permitted Liens of Group Members;

 

(c) Liens existing on the date hereof and either set forth on Schedule 8.2 or, to the extent not listed in Schedule 8.2, where such Liens secure obligations not exceeding $150,000 in the aggregate; provided, that such Liens shall secure only those obligations that they secure on the Amendment Effective Date (and extensions, renewals and refinancings of such obligations permitted by Section 8.1(b)) and shall not subsequently apply to any other property or assets of the Borrower or any Subsidiary;

 

(d) Purchase Money Liens on the property of the Borrower or any of its Subsidiaries securing Indebtedness permitted hereunder in reliance upon Section 8.1(c); provided, that (i) such Liens exist prior to the acquisition of, or attach substantially simultaneously with, or within 120 days after, the acquisition, repair, improvement or construction of, such property financed, whether directly or through a Permitted Refinancing, by such Indebtedness, and (ii) such Liens do not extend to any property of any Group Member other than the property (and proceeds thereof) acquired or built, or the improvements or repairs, financed, whether directly or through a Permitted Refinancing, by such Indebtedness (other than to accessions to such equipment or other property or improvements but not to other parts of the property to which any such improvements are made); and provided, further, that individual financings of equipment provided by a single lender may be cross-collateralized to other financings of equipment provided solely by such lender;

 

(e) Liens on the property of the Borrower or any of its Subsidiaries securing the Permitted Refinancing of any Indebtedness secured by any Lien on such property permitted hereunder in reliance upon clause (c) or (d) above or this clause (e) without any change in the property subject to such Liens; provided, that (i) if the Indebtedness subject to such Permitted Refinancing is secured by any collateral (whether equally and ratably with, or junior to, the Secured Parties or otherwise), such Permitted Refinancing may be secured by such collateral (including in respect of Indebtedness of any Group Member (other than a Loan Party) that is otherwise permitted under this Agreement, any collateral owned by such Group Member pursuant to after-acquired property clauses contained in the agreement governing such Indebtedness being refinanced as in effect at the time of the incurrence of such Indebtedness, to the extent any such collateral secured such Indebtedness) on terms no less favorable to the Secured Parties than those contained in the documentation governing the Indebtedness being Refinanced and (ii) if the Lien securing such Indebtedness subject to such Permitted Refinancing is subordinated to the Lien securing the Obligations under this Agreement, such Lien shall be subordinated to the Liens securing the Obligations on terms at least as favorable to the Lenders as those contained in the documentation governing the Lien securing such Indebtedness subject to such Permitted Refinancing;

 

 

(f)  any Lien on any property or asset of the Borrower or any Subsidiary securing Indebtedness or Permitted Refinancing Indebtedness permitted by clause (l) of Section 8.1, provided, that such Lien (i) does not apply to any other property or assets of the Borrower or any of the Subsidiaries not securing such Indebtedness at the date of the acquisition of such property or asset (other than after acquired property subjected to a Lien securing Indebtedness and other obligations incurred prior to such date and which Indebtedness and other obligations are permitted hereunder that require a pledge of after acquired property, it being understood that such requirement shall not be permitted to apply to any property to which such requirement would not have applied but for such acquisition), (ii) such Lien is not created in contemplation of or in connection with such acquisition, and (iii) in the case of a Lien securing Permitted Refinancing, if the Indebtedness being refinanced is secured by any collateral (whether equally and ratably with, or junior to, the Secured Parties or otherwise), such Permitted Refinancing may be secured by such collateral (including in respect of Indebtedness of any Group Member (other than a Loan Party) that is otherwise permitted under this Agreement only, any collateral owned by such Group Member pursuant to after-acquired property clauses contained in the agreement governing such Indebtedness being refinanced as in effect at the time of the incurrence of such Indebtedness, to the extent any such collateral secured such Indebtedness) on terms no less favorable to the Secured Parties than those contained in the documentation governing the Indebtedness being Refinanced;

 

(g) Liens on any property of the Borrower or any of its Subsidiaries securing any of their Indebtedness or their other liabilities; provided, that (i) such property shall not have an aggregate value of more than $1.0 million at any time, (ii) the aggregate outstanding principal amount of all such Indebtedness and other liabilities shall not exceed $1.0 million at any time and (iii) such Liens shall be subordinated to the Liens securing the Obligations on customary terms pursuant to an intercreditor agreement reasonably satisfactory to the Administrative Agent;

 

(h) Liens arising out of capitalized lease transactions permitted under Section 8.4(b)(ii) securing Indebtedness permitted hereunder in reliance upon Section 8.1(d), so long as such Liens attach only to the property sold and being leased in such transaction and any accessions thereto or proceeds thereof and related property; and

 

(i)  Liens securing Indebtedness permitted under Section 8.1(s).

 

Section 8.3           Investments. The Borrower shall cause each Group Member not to make or maintain, directly or indirectly, any Investment except for the following:

 

(a) Investments existing on the date hereof and set forth on Schedule 8.3;

 

(b) Investments in cash and Cash Equivalents;

 

(c) (i) endorsements for collection or deposit in the ordinary course of business consistent with past practice, (ii) extensions of trade credit arising or acquired in the ordinary course of business and (iii) Investments received in settlements in the ordinary course of business of such extensions of trade credit;

 

(d) Investments made as part of a Permitted Acquisition;

 

 

(e) Investments by (i) any Loan Party (other than Parent) in any other Loan Party (other than Parent), (ii) [reserved], or (iii) (x) any Loan Party in any Group Member that is not a Loan Party or (y) any Group Member in any Joint Venture; provided, that (A) any Investment consisting of loans or advances to any Loan Party above shall be subordinated in full to the payment of the Obligations of such Loan Party on terms and conditions satisfactory to the Administrative Agent, (B) any Investments consisting of loans or advances by any Loan Party pursuant to clause (iii) above shall be evidenced by Pledged Notes pledged by such Loan Party as Collateral pursuant to the Guaranty and Security Agreement; and (C) in the case of any Investment pursuant to clause (iii) above, (I) before and after giving effect to such Investment, no Default or Event of Default be continuing and (II) the Borrower shall be in compliance on a Pro Forma Basis with the Financial Performance Covenants as of the last day of the most recent Fiscal Quarter for which Financial Statements have been delivered hereunder after giving effect to such Investment; and provided, further that any Investments pursuant to clause (iii) shall not exceed the greater of (A) $10.0 million and (B) an amount equal to (1) $10.0 million multiplied by (2) the ratio of (x) the amount of Consolidated Total Assets as of the end of the Fiscal Quarter immediately prior to the date of such incurrence for which financial statements have been delivered pursuant to Section 6.1 to (y) the amount of Consolidated Total Assets as of October 30, 2010, in the aggregate outstanding at any time;

 

(f)  loans or advances to employees of the Borrower or any of its Subsidiaries to finance travel, entertainment and relocation expenses and other ordinary business purposes in the ordinary course of business as presently conducted; provided, that the aggregate outstanding principal amount of all loans and advances permitted pursuant to this clause (f) shall not exceed $250,000 at any time;

 

(g) any Investment by the Borrower or any of its Subsidiaries; provided, that the aggregate outstanding amount of all such Investments (valued at the time of the making thereof, and without giving effect to any write-downs or write-offs thereof) shall not exceed (i) (x) $5 million, so long as before and after giving effect to such Investment, no Default or Event of Default shall be continuing or (y) $500,000 (in each case, plus any returns of capital actually received by the respective investor in respect of any Investment theretofore made by it pursuant to this clause (g), in each case, in an amount not to exceed the original amount of such Investment) plus (ii) the portion, if any, of the Equity Contribution Basket on the date of such election that the Borrower elects to apply this clause (g)(ii), provided, that with respect to any Investment made in reliance of this clause (g)(ii), no Default or Event of Default shall be continuing before or after giving effect to such Investment;

 

(h) [reserved];

 

(i)  Investments arising out of the receipt by the Borrower or any Subsidiary of noncash consideration for the sale of assets permitted under Section 8.4;

 

(j)  Investments resulting from pledges and deposits referred to in clause (c) of the definition of Customary Permitted Liens and any Investments customarily incurred in connection with accelerated stock repurchase programs otherwise permitted hereunder;

 

(k) Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with or judgments against, customers and suppliers, in each case in the ordinary course of business;

 

(l)  Investments of a Subsidiary acquired after the Closing Date or of a Person merged into the Borrower or merged into or consolidated with a Subsidiary in accordance with Section 8.7 after the Closing Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;

 

 

(m) acquisitions by the Borrower of obligations in an aggregate amount not to exceed $250,000 in any Fiscal Year of one or more officers or other employees of Parent, any direct or indirect parent of Parent, the Borrower or its Subsidiaries in connection with such officer’s or employee’s acquisition of Stock of Parent or any direct or indirect parent of Parent, so long as (A) to the extent any party paid cash for such Stock in connection with such acquisition, Parent or such direct or indirect parent of Parent, as the case may be, received such cash and (B) no cash is actually advanced by the Borrower or any of the Subsidiaries to such officers or employees in connection with the acquisition of any such obligations;

 

(n) Investments by the Borrower or any Subsidiary to the extent they are financed with the proceeds of an issuance of Junior Capital permitted by Section 8.1 not later than 120 days after the receipt of such proceeds by Parent or the Borrower so long as at the time of such Investment no Default or Event of Default shall be continuing;

 

(o)  the purchase and sale of inventory in the ordinary course of business by the Borrower or any Subsidiary; and

 

(p) any Investment by the Borrower or any of its Subsidiaries; provided, that (x) the aggregate outstanding amount of all such Investments (valued at the time of the making thereof, and without giving effect to any write-downs or write-offs thereof) shall not exceed the portion of the Available Investment Basket on the date of such election that the Borrower elects to apply to this clause (p), (y) the Borrower shall be in compliance on a Pro Forma Basis with the Financial Performance Covenants as of the last day of the last Fiscal Quarter for which Financial Statements have been delivered hereunder after giving effect to such Investment and (z) at the time of such Investment, no Default or Event of Default shall be continuing.

 

Section 8.4           Asset Sales. The Borrower shall cause each Group Member not to Sell any of its property (other than cash), including Stock held by it, or issue shares of its own Stock, except for the following:

 

(a) in each case to the extent entered into in the ordinary course of business for fair market value and made to a Person that is not an Affiliate of the Borrower, (i) Sales of Cash Equivalents or inventory, (ii) Sales of surplus, obsolete or worn out property, and (iii) licenses of Intellectual Property;

 

(b) (i) a true lease or sublease of real property that is no longer necessary or desirable to the business of the Group Members and that does not interfere with the ordinary course business of the Group Members, and (ii) a Sale of property pursuant to a Sale and Leaseback Transaction not to exceed property having a fair market value in the aggregate in excess of $500,000; provided, in the case of this clause (ii), that the consideration received in such Sale and Leaseback Transaction is at least equal to the fair market value of the property sold and the Borrower shall have delivered to the Administrative Agent a certificate of a Responsible Officer of the Borrower to such effect;

 

(c)  (i) any Sale of any property (other than its own Stock or Stock Equivalents) by any Group Member to any other Group Member to the extent any resulting Investment constitutes a Permitted Investment allowed under Section 8.3(e), and (ii) any Restricted Payment by any Group Member permitted pursuant to Section 8.5;

 

(d)  (i) any Sale or issuance by the Borrower of its own Stock to Parent, (ii) any Sale or issuance by any Subsidiary of the Borrower of its own Stock to any Group Member, provided, that the proportion of such Stock and of each class of such Stock (both on an outstanding and fully-diluted basis) held by the Loan Parties (other than Parent), taken as a whole, does not change as a result of such Sale or issuance and (iii) to the extent necessary to satisfy any Requirement of Law in the jurisdiction of incorporation of any Subsidiary of the Borrower, any Sale or issuance by such Subsidiary of its own Stock constituting directors’ qualifying shares or nominal holdings;

 

 

(e)  as long as no Default is continuing or would result therefrom, any Sale of property (other than as part of a Sale and Leaseback Transaction) of, or Sale or issuance of its own Stock by, any Group Member for fair market value; provided, that (i) the aggregate consideration received during any Fiscal Year of the Borrower for all such Sales of property shall not exceed the greater of $5.0 million as of the end of the Fiscal Quarter immediately prior to the date of such sale for which financial statements have been delivered pursuant to Section 6.1, (ii) any note or other instrument received in consideration for such sale of assets shall be pledged and delivered to the Collateral Agent pursuant to Section 7.10, (iii) Borrower may not Sell or issue any Stock to any Person other than Parent and any Wholly-Owned Subsidiary shall not Sell or issue any Stock to any Person that is not a Loan Party and (iv) at least 75% of the consideration received in connection with any transaction permitted by this clause (e) shall be paid in cash; provided, that for purposes of clause (iv), (1) the amount of any liabilities (as shown on the Borrower’s or any Subsidiary’s most recent balance sheet or in the notes thereto) of the Borrower or any Subsidiary of the Borrower (other than liabilities that are by their terms subordinated to the Obligations) that are assumed by the transferee of any such assets, (2) any notes or other obligations or other securities or assets received by the Borrower or such Subsidiary of the Borrower from such transferee that are converted by the Borrower or such Subsidiary of the Borrower into cash within 180 days of the receipt thereof (to the extent of the cash received), (3) any Designated Non-Cash Consideration received by the Borrower or any of its Subsidiaries in such Sale having an aggregate fair market value (as determined in good faith by the Borrower), taken together with all other Designated Non-Cash Consideration received pursuant to this paragraph (3) that is at that time outstanding, not to exceed $1 million (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value) and (4) with respect to any lease of assets by the Borrower or a Subsidiary that constitutes a disposition, receipt of lease payments over time on market terms (as determined in good faith by the Borrower) where the payment consideration is at least 75% cash consideration shall, in each case, be deemed to be cash; and

 

(f)  the sale for cash of defaulted receivables in the ordinary course of business and not as part of an accounts receivable financing transaction.

 

Section 8.5           Restricted Payments. The Borrower shall cause each Group Member not to directly or indirectly, declare, order, pay, make or set apart any sum for any Restricted Payment except for the following (and Parent shall not use the proceeds of any Restricted Payment made in reliance on clause (e) below other than as set forth in such clause (e)):

 

(a) (i) Restricted Payments by (A) any Group Member that is a Loan Party to any Loan Party other than Parent and (B) any Group Member that is not a Loan Party to any Group Member and (ii) dividends and distributions by any Subsidiary of the Borrower that is not a Loan Party to any holder of its Stock, to the extent made to all such holders ratably according to their ownership interests in such Stock;

 

(b) dividends and distributions declared and paid on the common Stock of the Borrower or its Subsidiaries ratably to the holders of such common Stock and payable only in common Stock of such Group Member;

 

(c) dividends made by the Borrower in an aggregate amount not to exceed the amount, if any, of the Available Investment Basket then available for such dividends; provided, that (i)  after giving effect to such dividends on a Pro Forma Basis, the Borrower’s Total Secured Leverage Ratio shall be no more than 2.00 to 1.00, (ii) prior to the payment of such dividends, the Borrower shall deliver to Administrative Agent a certificate of a Responsible Officer demonstrating compliance with clause (i) above and (iii) no Default or Event of Default shall be continuing;

 

 

(d) cash dividends on the Stock of the Borrower to Parent or any direct or indirect parent of Parent paid and declared solely for the purpose of funding the following:

 

(i)          Permitted Tax Distributions;

 

(ii)         the redemption, purchase or other acquisition or retirement for value by Parent or any direct or, to the extent allocable to Parent or Borrower, indirect parent of Parent of its common Stock (or Stock Equivalents with respect to its common Stock) from or with respect to any present or former employee, consultant, director or officer (or the assigns, estate, heirs or current or former spouses thereof) of any Group Member, Parent or any direct or indirect parent of Parent upon the death, disability or termination of employment of such employee, director or officer, provided, that, no Default or Event of Default shall be continuing and the amount of such cash dividends paid in any Fiscal Year in reliance on this clause (ii) shall not exceed $250,000 in the aggregate (any unused portion of which for any Fiscal Year may be carried over to and paid as additional dividends in the next two Fiscal Years (but only the next two Fiscal Years));

 

(iii)        in each case, to the extent allocable to the Borrower, and in any event not to exceed $1.0 million in any Fiscal Year, (A) overhead, legal, accounting and other professional fees and expenses of any Group Member, Parent or any direct or indirect parent of Parent, (B) out-of-pocket fees and expenses related to any offering, investment or acquisition permitted hereunder (whether or not successful), and (C) other fees and expenses in connection with the maintenance of the existence of Parent or any direct or indirect parent of Parent, Parent’s ownership of the Borrower and such parent’s ownership of Parent, as the case may be, and in order to permit Parent to make payments permitted by Section 8.9; and

 

(iv)        to the extent allocable to the Borrower, fees and expenses in connection with any initial public offering of any direct or indirect parent of the Borrower (whether or not consummated);

 

(e) dividends by any Loan Party to any direct or indirect parent of a Loan Party which shall apply such dividends for the repurchase of the common stock of Francesca’s Holdings Corporation (the “Specified Stock Repurchase”) in an aggregate amount not to exceed the amount of the Available Investment Basket then available for such dividends; and

 

(f)  noncash repurchases of Stock deemed to occur upon exercise of stock options if such Stock represents a portion of the exercise price of such options.

 

Section 8.6           Payment of Subordinated Debt and Certain Other Debt. The Borrower shall cause each Group Member not to (x) prepay, redeem, purchase, defease or otherwise satisfy prior to the scheduled maturity thereof any Subordinated Debt or Junior Indebtedness, or pay any interest on or with respect thereto, (y) set apart any property for such purpose, whether directly or indirectly and whether to a sinking fund, a similar fund or otherwise, or (z) make any payment in violation of any subordination terms of any Subordinated Debt or Junior Indebtedness; provided, that each Group Member may, to the extent otherwise permitted by the Loan Documents and to the extent not in violation of the applicable subordination terms, do each of the following:

 

(a) prepay, redeem, purchase, defease or otherwise satisfy prior to the scheduled maturity thereof (or set apart any property for such purpose) any Indebtedness owing to any Loan Party;

 

(b) so long as no Default or Event of Default shall be continuing, make regularly scheduled or otherwise required repayments or redemptions of Subordinated Debt;

 

 

(c) so long as no Default or Event of Default shall be continuing, make prepayments of Subordinated Debt not to exceed $20,000,000 in the aggregate; and

 

(d) so long as no Default or Event of Default shall be continuing, make regularly scheduled payments of interest when due.

 

Section 8.7           Fundamental Changes. Parent shall not and the Borrower shall cause each Group Member not to (a) merge, consolidate or amalgamate with any Person, (b) acquire all or substantially all of the Stock or Stock Equivalents of any Person, (c) acquire any brand or all or substantially all of the assets of any Person or all or substantially all of the assets constituting any line of business, division, branch, operating division or other unit operation of any Person, or (d) liquidate or dissolve any Group Member or Subsidiary of the Borrower, in each case except for the following: (i) to consummate any Permitted Acquisition, (ii) the merger, consolidation or amalgamation of any Subsidiary of the Borrower into any Loan Party, (iii) the merger, consolidation or amalgamation of any Group Member that is not a Loan Party with any other Group Member that is not a Loan Party, and (iv) the liquidation or dissolution or change in form of entity of any Foreign Subsidiary if the Borrower determines in good faith that such liquidation, dissolution, or change in form is in the best interests of the Borrower and is not materially disadvantageous to the Lenders; provided, that (A) in the case of any merger, consolidation or amalgamation involving the Borrower, the Borrower shall be the surviving Person, and (B) in the case of any merger, consolidation or amalgamation involving any other Loan Party, a Loan Party shall be the surviving corporation, and (C) all actions required to maintain the perfection of the Lien of the Collateral Agent on the Stock or property of the Borrower or such Loan Party shall have been made.

 

Section 8.8           Change in Nature of Business.

 

(a) The Borrower shall cause each Group Member not to carry on any business, operations or activities (whether directly, through a Joint Venture, in connection with a Permitted Acquisition or otherwise) substantially different from those carried on by the Borrower and its Subsidiaries at the date hereof and business, operations and activities reasonably related thereto or any business or activity that is reasonably similar thereto or a reasonable extension, development or expansion thereof or ancillary thereto.

 

(b) Parent shall not engage in any business, operations or activity, or hold any property, incur or otherwise become liable on any Indebtedness, make or own any Investment, incur, maintain or suffer to exist any Lien or assign any right to receive income or profits other than (i) holding Stock and Stock Equivalents of the Borrower together with activities directly related thereto, (ii) issuing, selling and redeeming its own Stock, (iii) paying dividends and taxes, (iv) holding directors’ and shareholders’ meetings, preparing corporate and similar records and other activities required to maintain its existence and separate corporate or other legal structure, (v) preparing reports to, and preparing and making notices to and filings with, Governmental Authorities and to its holders of Stock and Stock Equivalents, (vi) receiving, and holding proceeds of, Restricted Payments from the Borrower and its Subsidiaries and distributing the proceeds thereof to the extent permitted in Section 8.5, (vii) as necessary to consummate any Permitted Acquisition, (viii) performance of its obligations under and in connection with the Loan Documents, and the other agreements contemplated hereby and thereby, and (ix) activities incidental to its maintenance and continuance, and to the foregoing activities.

 

Section 8.9           Transactions with Affiliates. (a) The Borrower shall cause each Group Member not to, except as otherwise expressly permitted herein, enter into any other transaction directly or indirectly with, or for the benefit of, Parent or any Affiliate of the Borrower that is not a Loan Party (including Guaranty Obligations with respect to any obligation of any such Affiliate), except for:

 

 

(i)          to the extent made on a basis no less favorable to such Loan Party than would be obtained in an arm’s-length transaction with a Person that is not an Affiliate of the Borrower, Indebtedness permitted by the provisions of Section 8.1(b), (e), (g) or (m);

 

(ii)         transactions on a basis no less favorable to such Group Member than would be obtained in an arm’s length transaction with a Person not an Affiliate of the Borrower; provided, that this clause (ii) shall not apply to (x) the payment to the Permitted Investors of the monitoring and management fees referred to in Section 8.9(b) or fees payable on the Closing Date, or (y) the indemnification of directors of the Borrower and the Subsidiaries in accordance with customary practice;

 

(iii)        [reserved];

 

(iv)        any issuance of securities, or other reasonable payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment arrangements, employee stock options and employee stock ownership plans approved by the board of directors of such Group Member;

 

(v)         (A) Investments permitted by the provisions of Section 8.3(e) and (m) and (B) loans or advances to employees or consultants of the Borrower or any of the Subsidiaries in accordance with Section 8.3(f);

 

(vi)        to the extent made on a basis no less favorable to such Loan Party than would be obtained in an arm’s-length transaction with a Person that is not an Affiliate of the Borrower, transactions among the Borrower and the other Group Members and transactions among the Group Members (other than the Borrower), in each case, otherwise permitted by this Agreement;

 

(vii)       the payment of reasonable and customary fees and indemnities to directors, officers, consultants and employees of Parent, any direct or indirect parent of Parent, the Borrower and the Subsidiaries in the ordinary course of business (limited, in the case of Parent or any direct or indirect parent of Parent, to the portion of such fees and indemnities that are allocable to the Borrower and its Subsidiaries);

 

(viii)      [reserved];

 

(ix)         (A) any employment agreements entered into by the Borrower or any of the Subsidiaries in the ordinary course of business, (B) any subscription agreement or similar agreement pertaining to the repurchase of Stock pursuant to put/call rights or similar rights with employees, officers or directors permitted under Section 8.5, and (C) any reasonable employee compensation, benefit plan or arrangement, any reasonable health, disability or similar insurance plan which covers employees, and any reasonable employment contract and transactions pursuant thereto;

 

(x)          Restricted Payments permitted by the provisions of Section 8.5; provided, that the proceeds of Restricted Payments permitted by Section 8.5(d) shall, if received by the Fund, be used as required by Section 8.5(d);

 

(xi)         any purchase by Parent of, or contributions to, the equity capital of the Borrower; provided, that any Stock of the Borrower purchased by Parent shall be pledged to the Collateral Agent on behalf of the Lenders pursuant to the Guaranty and Security Agreement;

 

 

(xii)        payments permitted under paragraph (b) below;

 

(xiii)       to the extent made on a basis no less favorable to such Loan Party than would be obtained in an arm’s-length transaction with a Person that is not an Affiliate of the Borrower, transactions with Wholly Owned Subsidiaries for the purchase or sale of goods, products, parts and services entered into in the ordinary course of business;

 

(xiv)      any transaction otherwise permitted under this Agreement in respect of which the Borrower delivers to the Administrative Agent (for delivery to the Lenders) a letter addressed to the board of directors of the Borrower from an accounting, appraisal or investment banking firm, in each case of nationally recognized standing that is (A) in the good faith determination of the Borrower qualified to render such letter, and (B) reasonably satisfactory to the Administrative Agent, which letter states that such transaction is on terms that are no less favorable to the Borrower or such Subsidiary, as applicable, than would be obtained in a comparable arm’s-length transaction with a Person that is not an Affiliate of the Borrower;

 

(xv)       [reserved]; and

 

(xvi)      transactions with Joint Ventures for the purchase or sale of goods, equipment and services entered into in the ordinary course of business; provided that (a) no Affiliate of the Borrower (other than the Borrower or a Group Member) has a beneficial interest in such Person and (b) such transaction is no less favorable to the Borrower or applicable Group Member than would be obtained in a comparable arm’s length transaction with a Person not an Affiliate of the Borrower.

 

(b) The Borrower shall cause each Group Member not to make payments of or on account of management, consulting, monitoring, transaction and advisory fees or similar fees payable to the Funds or the Fund Affiliates (i) in an aggregate amount in any Fiscal Year in excess of $500,000 (provided that unused amounts may be carried forward to one or more future periods ), (ii) following the occurrence and during the continuance of a Default or Event of Default or (iii) if, after giving effect to such payments, the Borrower is not in compliance on a Pro Forma Basis with the Financial Performance Covenants as of the last day of the last Fiscal Quarter for which Financial Statements have been delivered hereunder; provided that reimbursement of expenses and indemnification payments may be made whether or not a Default or Event of Default has occurred and whether or not the Borrower is so in compliance.

 

 

Section 8.10         Third-Party Restrictions on Indebtedness, Liens, Investments or Restricted Payments. Parent shall not and the Borrower shall cause each Group Member not to incur or otherwise suffer to exist or become effective or remain liable on or responsible for any Contractual Obligation limiting the ability of (a) any Subsidiary of the Borrower to make Restricted Payments to, or Investments in, or repay Indebtedness or otherwise Sell property to, any Group Member, or (b) any Group Member to incur or suffer to exist any Lien upon any property of any Group Member, whether now owned or hereafter acquired, securing any of its Obligations (including any “equal and ratable” clause and any similar Contractual Obligation requiring, when a Lien is granted on any property, another Lien to be granted on such property or any other property), except, for each of clauses (a) and (b) above: (i) restrictions imposed by applicable law; (ii) (A) contractual encumbrances or restrictions in effect on the Amendment Effective Date and set forth on Schedule 8.10 and (B) contractual encumbrances or restrictions in effect on the Amendment Effective Date under Indebtedness existing on the Amendment Effective Date and permitted by Section 8.1(b) or any agreements related to any permitted renewal, extension or refinancing of any such Indebtedness that does not expand the scope of any such encumbrance or restriction; (iii) any restriction on a Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of all or substantially all the Stock or assets of a Subsidiary permitted under Section 8.4 pending the closing of such sale or disposition; (iv) customary provisions in Joint Venture agreements and other similar agreements applicable to Joint Ventures permitted under this Agreement; (v) customary provisions contained in leases or licenses of intellectual property and other similar agreements entered into in the ordinary course of business; (vi) customary provisions restricting subletting or assignment of any lease governing a leasehold interest; (vii) customary provisions restricting assignment of any agreement entered into in the ordinary course of business; (viii) customary restrictions and conditions contained in any agreement relating to the sale of any asset permitted under Section 8.4 pending the consummation of such sale; (ix) customary restrictions and conditions contained in the document relating to any Lien, so long as (A) such Lien is permitted under Section 8.2 and such restrictions or conditions relate only to the specific asset subject to such Lien, and (B) such restrictions and conditions are not created for the purpose of avoiding the restrictions imposed by this Section 8.10; (x) customary net worth provisions contained in real property leases entered into by Subsidiaries of the Borrower, so long as the Borrower has determined in good faith that such net worth provisions could not reasonably be expected to impair the ability of the Borrower and its Subsidiaries to meet their ongoing obligations; (xi) any agreement in effect at the time any Subsidiary becomes a Subsidiary, so long as such agreement was not entered into in contemplation of such Person becoming a Subsidiary; (xii) Permitted Payment Restrictions contained in any documents evidencing or governing Indebtedness permitted hereunder of any Group Member that is not a Loan Party (provided that such restrictions are not applicable to any Loan Party or the properties of any Loan Party); and (xiii) customary restrictions or encumbrances under Indebtedness incurred pursuant to Sections 8.1(r) or (s) to the extent not more restrictive than the comparable restrictions or encumbrances contained under this Agreement.

 

Section 8.11         Modification of Certain Documents. Parent shall not and the Borrower shall cause each Group Member not to do any of the following:

 

(a) waive or otherwise modify any term of, or provide any consent under, any Constituent Document of, or otherwise change the capital structure of, any Group Member (including the terms of any of its outstanding Stock or Stock Equivalents), in each case except for those modifications, consents and waivers that (x) do not elect, or permit the election, to treat the Stock or Stock Equivalents of any limited liability company (or similar entity) as certificated and (y) do not materially and adversely affect the interests of any Secured Party under the Loan Documents or in the Collateral; or

 

(b) waive or otherwise modify any term of, or provide any consent under, any Subordinated Debt and Junior Indebtedness, except for those modifications, consents and waivers that (x) do not materially and adversely affect the interest of any Secured Party and (y) do not affect the subordination provisions thereof in a manner adverse to the Secured Parties.

 

Section 8.12         Accounting Changes; Fiscal Year. Parent shall not and the Borrower shall cause each Group Member not to change its fiscal year or its method for determining fiscal quarters or fiscal months, unless such change is necessary in order to conform the fiscal year of a Group Member to the Borrower’s fiscal year.

 

Section 8.13         Margin Regulations. Parent shall not and the Borrower shall cause each Group Member not to use all or any portion of the proceeds of any credit extended hereunder to purchase or carry margin stock (within the meaning of Regulation U of the Federal Reserve Board) in contravention of Regulation U of the Federal Reserve Board.

 

Section 8.14         Compliance with ERISA. The Borrower shall not cause or suffer to exist any ERISA Event that would, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

 

Section 8.15         Hazardous Materials. The Borrower shall cause each Group Member not to cause or suffer to exist any Release of any Hazardous Material at, to or from any real property owned, leased, subleased or otherwise operated or occupied by any Group Member that would violate any Environmental Law, form the basis for any Environmental Liabilities or otherwise adversely affect the value or marketability of any real property (whether or not owned by any Group Member), other than such violations, Environmental Liabilities and effects that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

Section 8.16         Material Contracts. The Borrower shall cause each Group Member not to change or amend the terms of any material contract if such change could reasonably be expected to have a Material Adverse Effect.

 

Section 8.17         Anti-Terrorism Laws; Anti-Money Laundering; Embargoed Persons. The Borrower shall cause each Group Member not to (i) knowingly deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order or any other Anti-Terrorism Law, (ii) knowingly engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law, or (iii) cause or permit any of the funds of any Group Member that are used to repay the Loans to be derived from any unlawful activity with the result that the making of any of the Loans would be in violation of any Requirement of Law.

 

ARTICLE IX

EVENTS OF DEFAULT

 

Section 9.1           Definition. Each of the following shall be an Event of Default:

 

(a)  the Borrower shall fail to pay (i) any principal of any Loan or any L/C Reimbursement Obligation when the same becomes due and payable or (ii) any interest on any Loan, any fee under any Loan Document or any other Obligation (other than those set forth in clause (i) above) and, in the case of this clause (ii), such non-payment continues for a period of 5 Business Days after the due date therefor; or

 

(b)  any representation, warranty or certification made or deemed made by or on behalf of any Loan Party in any Loan Document or by or on behalf of any Loan Party (or any Responsible Officer thereof) in connection with any Loan Document (including in any document delivered in connection with any Loan Document) shall prove to have been incorrect in any material respect (or in the case of any representation, warranty or certification that is by its terms qualified by concepts of materiality, shall prove to have been incorrect in any respect) when made or deemed made; or

 

(c)  any Loan Party shall fail to comply with (i) any provision of Section 2.19(a)(ii) (Reallocation of Defaulting Lender Commitment, Etc.), Article V (Financial Covenants), Sections 6.1 (Financial Statements), 6.2(a)(i) or (ii) (Other Events), 7.1 (Maintenance of Corporate Existence), 7.9 (Use of Proceeds) or 7.10 (Additional Collateral and Guaranties) or Article VIII (Negative Covenants), or (ii) any other provision of any Loan Document if, in the case of this clause (ii), such failure shall remain unremedied for 30 days after the earlier of the date on which (x) notice thereof shall have been given to the Borrower by the Administrative Agent or the Required Lenders and (y) a Responsible Officer of Parent or the Borrower has actual knowledge of such failure; or

 

 

(d)  (i) any event or condition occurs that (A) results in any Indebtedness of any Group Member having a principal amount of $5.0 million or more becoming due prior to its stated maturity, or (B) enables or permits (with all applicable grace periods having expired) the holder or holders of any such Indebtedness or any trustee or agent on its or their behalf to cause such Indebtedness to become due, or to require the prepayment, repurchase, redemption, or defeasance thereof (or permits the early termination and requires the repayment thereof), prior to its scheduled maturity, or (ii) any Group Member shall fail to pay the principal of any such Indebtedness at the stated final maturity thereof; provided, that this clause (d) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness if such sale or transfer is permitted hereunder and under the documents providing for such Indebtedness; or

 

(e)  (i) Parent or any Group Member shall generally not pay its debts as such debts become due, admit in writing its inability to pay its debts generally or shall make a general assignment for the benefit of creditors, (ii) any proceeding shall be instituted by or against any Parent or any Group Member seeking to adjudicate it a bankrupt or insolvent or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, composition of it or its debts or any similar order, in each case under any Requirement of Law relating to bankruptcy, insolvency or reorganization or relief of debtors or seeking the entry of an order for relief or the appointment of a custodian, receiver, trustee, conservator, liquidating agent, liquidator, other similar official or other official with similar powers, in each case for it or for any substantial part of its property and, in the case of any such proceedings instituted against (but not by or with the consent of) Parent or any Group Member, either such proceedings shall remain undismissed or unstayed for a period of 60 days or more or any action sought in such proceedings shall occur or (iii) Parent or any Group Member shall take any corporate or similar action or any other action to authorize any action described in clause (i) or (ii) above; or

 

(f)  one or more judgments, orders or decrees (or other similar process) shall be rendered against Parent or any Group Member (i)(A) in the case of money judgments, orders and decrees, involving an aggregate amount (excluding amounts adequately covered by insurance payable to any Group Member, to the extent an unaffiliated and solvent insurer has not denied or contested coverage therefor, provided that, for the avoidance of doubt, a reservation of rights by an insurance company would not in and of itself constitute contested coverage) in excess of $5.0 million, or (B) otherwise, that would reasonably be expected to have, in the aggregate, a Material Adverse Effect, and (ii)(A) enforcement proceedings shall have been commenced by any creditor upon any such judgment, order or decree, or (B) such judgment, order or decree shall not have been vacated, discharged or unstayed for a period of 60 consecutive days;

 

(g) except pursuant to a valid, binding and enforceable termination or release permitted under the Loan Documents and executed by the Administrative Agent or as otherwise expressly permitted under any Loan Document, (i) any provision of any Loan Document shall, at any time after the delivery of such Loan Document, fail to be, or be asserted in writing by Parent or any Group Member not to be valid and binding on, or enforceable against, any Loan Party party thereto, or (ii) any Loan Document purporting to grant a Lien to secure any Obligation shall, at any time after the delivery of such Loan Document, fail to create a valid and enforceable Lien on any material portion of the Collateral and purported to be covered thereby or such Lien shall fail or cease to be a perfected Lien with the priority required in the relevant Loan Document, or Parent or any Group Member shall state in writing that any of the events described in clause (i) or (ii) above shall have occurred;

 

(h) there shall occur any Change of Control;

 

(i)  an ERISA Event occurs which has resulted in liability of a Group Member in an aggregate amount that would reasonably be expected to have a Material Adverse Effect; or

 

 

(j)   the subordination provisions applicable to any Subordinated Debt or Junior Indebtedness having a principal amount of $5.0 million or more shall cease to be in full force.

 

Section 9.2           Remedies. During the continuance of any Event of Default, the Administrative Agent may, and, at the request of the Required Lenders, shall, in each case by notice to the Borrower and in addition to any other right or remedy provided under any Loan Document or by any applicable Requirement of Law, do each of the following: (a) declare all or any portion of the Commitments terminated, whereupon the Commitments shall immediately be reduced by such portion or, in the case of a termination in whole, shall terminate together with any obligation any Lender may have hereunder to make any Loan and any L/C Issuer may have hereunder to Issue any Letter of Credit or (b) declare immediately due and payable all or part of any Obligation (including any accrued but unpaid interest thereon), whereupon the same shall become immediately due and payable, without presentment, demand, protest or further notice or other requirements of any kind, all of which are hereby expressly waived by Parent and the Borrower (and, to the extent provided in any other Loan Document, other Loan Parties); provided, that, effective immediately upon the occurrence of the Events of Default specified in Section 9.1(e)(ii), (x) the Commitments of each Lender to make Loans and the commitment of each L/C Issuer to Issue Letters of Credit shall each automatically be terminated and (y) each Obligation (including in each case any accrued all accrued but unpaid interest thereon) shall automatically become and be due and payable, without presentment, demand, protest or further notice or other requirement of any kind, all of which are hereby expressly waived by Parent and the Borrower (and, to the extent provided in any other Loan Document, any other Loan Party).

 

Section 9.3           [Reserved].

 

Section 9.4           Actions in Respect of Letters of Credit. At any time (i) upon the Termination Date, (ii) after the Termination Date when the aggregate funds on deposit in L/C Cash Collateral Accounts shall be less than 105% of the L/C Obligations for all Letters of Credit at such time and (iii) as required by Section 2.12, the Borrower shall pay to the Administrative Agent in immediately available funds at the Administrative Agent’s office referred to in Section 11.11, for deposit in a L/C Cash Collateral Account, the amount required so that, after such payment, the aggregate funds on deposit in the L/C Cash Collateral Accounts equals or exceeds 105% of the L/C Obligations for all Letters of Credit at such time (not to exceed, in the case of clause (iii) above, the payment to be applied pursuant to Section 2.12 to provide cash collateral for Letters of Credit).

 

ARTICLE X

THE AGENTS

 

Section 10.1         Appointment and Authority. (a) Each Lender Party hereby irrevocably appoints Royal Bank to act on its behalf as the Administrative Agent and as the Collateral Agent hereunder and under the other Loan Documents and authorizes the Agents to take such actions on its behalf and to exercise such powers as are delegated to the Agents by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. Each Lender Party hereby irrevocably appoints KeyBank National Association as Syndication Agent hereunder. Notwithstanding any provision to the contrary contained in this Agreement or in any other Loan Document, the Administrative Agent shall have no duties or responsibilities, except those expressly set forth herein, nor shall the Administrative Agent have or be deemed to have any fiduciary relationship with any Lender or Participant, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent. Without limiting the generality of the foregoing sentence, the use of the term “agent” herein and in the other Loan Documents with reference to any Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties The provisions of this Article X are solely for the benefit of the Agents, the Arrangers and the Lender Parties, and neither the Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions.

 

 

 

(b)  Each L/C Issuer shall have all of the benefits and immunities (i) provided to the Agents in this Article X with respect to any acts taken or omissions suffered by such L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and the applications and agreements for letters of credit pertaining to such Letters of Credit as fully as if the term “Agent” as used in this Article X included such L/C Issuer with respect to such acts or omissions, and (ii) as additionally provided herein with respect to such L/C Issuer.

 

Section 10.2         Agents Individually. (a) Each Person serving as an Agent or Arranger hereunder shall have the same rights and powers in its capacity as a Lender Party as any other Lender Party and may exercise the same as though it were not an Agent or an Arranger and the term “Lender Party” or “Lender Parties” shall, unless otherwise expressly indicated or unless the context otherwise requires, include each Person serving as an Agent or an Arranger hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not an Agent or an Arranger hereunder and without any duty to account therefor to the Lender Parties.

 

(b)  Each Lender Party understands that each Person serving as an Agent or an Arranger, in each case, acting in its individual capacity, and its Affiliates (collectively, such “Agent’s Group”) are engaged in a wide range of financial services and businesses (including investment management, financing, securities trading, corporate and investment banking and research) (such services and businesses are collectively referred to in this Section 10.2 as “Activities”) and may engage in the Activities with or on behalf of one or more of the Loan Parties or their respective Affiliates. Furthermore, each Agent’s Group may, in undertaking the Activities, engage in trading in financial products or undertake other investment businesses for its own account or on behalf of others (including the Loan Parties and their Affiliates and including holding, for its own account or on behalf of others, equity, debt and similar positions in the Borrower, another Loan Party or their respective Affiliates), including trading in or holding long, short or derivative positions in securities, loans or other financial products of one or more of the Loan Parties or their Affiliates. Each Lender Party understands and agrees that in engaging in the Activities, each Agent’s Group may receive or otherwise obtain information concerning the Loan Parties or their Affiliates (including information concerning the ability of the Loan Parties to perform their respective Obligations hereunder and under the other Loan Documents) which information may not be available to any of the Lender Parties that are not members of such Agent’s Group. No Agent or Arranger nor any member of such Agent’s Group shall have any duty to disclose to any Lender Party or use on behalf of the Lender Parties, and shall not be liable for the failure to so disclose or use, any information whatsoever about or derived from the Activities or otherwise (including any information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any Loan Party or any Affiliate of any Loan Party) or to account for any revenue or profits obtained in connection with the Activities, except that each Agent shall deliver or otherwise make available to each Lender Party such documents as are expressly required by any Loan Document to be transmitted by such Agent to the Lender Parties.

 

 

(c) Each Lender Party further understands that there may be situations where members of each Agent’s Group or their respective customers (including the Loan Parties and their Affiliates) either now have or may in the future have interests or take actions that may conflict with the interests of any one or more of the Lender Parties (including the interests of the Lender Parties hereunder and under the other Loan Documents). Each Lender Party agrees that no member of any Agent’s Group is or shall be required to restrict its activities as a result of each Person serving as an Agent or an Arranger being a member of such Agent’s Group, and that each member of such Agent’s Group may undertake any Activities without further consultation with or notification to any Lender Party. None of (i) this Agreement nor any other Loan Document, (ii) the receipt by any Agent’s Group of information (including Information) concerning the Loan Parties or their Affiliates (including information concerning the ability of the Loan Parties to perform their respective Obligations hereunder and under the other Loan Documents) nor (iii) any other matter shall give rise to any fiduciary, equitable or contractual duties (including without limitation any duty of trust or confidence) owing by any Agent or Arranger or any member of such Agent’s Group to any Lender Party including any such duty that would prevent or restrict such Agent’s Group from acting on behalf of customers (including the Loan Parties or their Affiliates) or for its own account.

 

Section 10.3         Duties of the Agents; Exculpatory Provisions. (a) Each Agent’s duties hereunder and under the other Loan Documents are solely ministerial and administrative in nature and no Agent shall have any duties or obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, no Agent shall have any duty to take any discretionary action or exercise any discretionary powers, but shall be required to act or refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the written direction of the Required Lenders or the Administrative Agent in the case of the Collateral Agent (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that no Agent shall be required to take any action that, in its opinion or the opinion of its counsel, may expose such Agent or any of its Affiliates to liability or that is contrary to any Loan Document or applicable law.

 

(b) No Agent shall be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders or the Administrative Agent in the case of the Collateral Agent (or such other number or percentage of the Lenders as shall be necessary, or as such Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 9.2 or 11.1) or (ii) in the absence of its own gross negligence or willful misconduct, as determined by a court of competent jurisdiction in a final non-appealable judgment or order. No Agent shall be deemed to have knowledge of any Default or the event or events that give or may give rise to any Default unless and until the Borrower or any Lender Party shall have given notice to such Agent describing such Default and such event or events.

 

(c) No Agent or Arranger nor any member of such Agent’s Group shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty, representation or other information made or supplied in or in connection with this Agreement, any other Loan Document or the Disclosure Documents, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith or the adequacy, accuracy and/or completeness of the information contained therein, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or the perfection or priority of any Lien or security interest created or purported to be created by any Loan Document, (v) the value or the sufficiency of any Collateral or (vi) the satisfaction of any condition set forth in Article III or elsewhere herein, other than (in the case of the Agent, but subject to the foregoing clause (ii)) to confirm receipt of items expressly required to be delivered to such Agent.

 

 

(d) Nothing in this Agreement or any other Loan Document shall require any Agent, Arranger or any of their respective Related Persons to carry out any “know your customer” or other checks in relation to any Person on behalf of any Lender Party and each Lender Party confirms to each Agent and each Arranger that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by such Agent, such Arranger or any of their respective Related Persons.

 

Section 10.4         Reliance by Agents. Each Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Each Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender Party, the Administrative Agent may presume that such condition is satisfactory to such Lender Party unless an officer of the Administrative Agent responsible for the transactions contemplated hereby shall have received notice to the contrary from such Lender Party prior to the making of such Loan or the issuance of such Letter of Credit, and in the case of a Borrowing, such Lender Party shall not have made available to the Administrative Agent such Lender Party’s ratable portion of such Borrowing. Each Agent may consult with legal counsel (who may be counsel for the Borrower or any other Loan Party), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

 

Section 10.5         Delegation of Duties. Each Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any Affiliates, agents, employees or attorneys-in-fact, such sub-agents as shall be deemed necessary by such Agent, and shall be entitled to advice of counsel, both internal and external, and other consultants or experts concerning all matters pertaining to such duties. Each Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Persons. Each such sub-agent and the Related Persons of such Agent and each such sub-agent shall be entitled to the benefits of all provisions of this Article X (as though such sub-agents were the “Administrative Agent,” “Collateral Agent” or such other “Agent” under the Loan Documents) as if set forth in full herein with respect thereto. No Agent shall be responsible for the negligence or misconduct of any agent or sub-agent or attorney-in-fact that it selects in the absence of gross negligence or willful misconduct.

 

Section 10.6         Notice of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Administrative Agent for the account of the Lenders, unless the Administrative Agent shall have received written notice from a Lender or the Borrowers referring to this Agreement, describing such Default and stating that such notice is a “notice of default”. The Administrative Agent will promptly notify the Lenders of its receipt of any such notice. The Administrative Agent shall take such action with respect to any Event of Default as may be directed by the Required Lenders in accordance with Article IX; provided that unless and until the Administrative Agent has received any such direction, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Event of Default as it shall deem advisable or in the best interest of the Lenders.

 

 

Section 10.7         Resignation of Agents. (a) The Administrative Agent and the Collateral Agent may at any time give notice of its resignation to the Lender Parties and the Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor, which shall be a bank with an office in New York City, or an Affiliate of any such financial institution with an office in New York City. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Agent gives notice of its resignation (such 30-day period, the “Lender Party Appointment Period”), then the retiring Agent may on behalf of the Lender Parties, appoint a successor Agent meeting the qualifications set forth above. In addition and without any obligation on the part of the retiring Agent to appoint, on behalf of the Lender Parties, a successor Agent, the retiring Agent may at any time upon or after the end of the Lender Party Appointment Period notify the Borrower and the Lender Parties that no qualifying Person has accepted appointment as successor Agent and the effective date of such retiring Agent’s resignation. Upon the resignation effective date established in such notice and regardless of whether a successor Agent has been appointed and accepted such appointment, the retiring Agent’s resignation shall nonetheless become effective and (i) the retiring Agent shall be discharged from its duties and obligations as Agent hereunder and under the other Loan Documents and (ii) all payments, communications and determinations provided to be made by, to or through such Agent shall instead be made by or to each Lender Party directly, until such time as the Required Lenders appoint a successor Agent as provided for above in this paragraph and all Collateral held by the Collateral Agent shall be surrendered to a Lender Party selected by the Required Lenders. Upon the acceptance of a successor’s appointment as Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties as Agent of the retiring (or retired) Agent, and the retiring Agent shall be discharged from all of its duties and obligations as Agent hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this paragraph). The fees payable by the Borrower to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article X shall continue in effect for the benefit of such retiring Agent, its sub-agents and their respective Related Persons in respect of any actions taken or omitted to be taken by any of them while the retiring Agent was acting as Agent.

 

(b) Any resignation pursuant to this Section by a Person acting as Administrative Agent shall, unless such Person shall notify the Borrower and the Lender Parties otherwise, also act to relieve such Person and its Affiliates of any obligation to advance or issue new, or extend existing, Letters of Credit where such advance, issuance or extension is to occur on or after the effective date of such resignation.

 

Section 10.8         Resignation of L/C Issuer. In addition to the foregoing, if a Lender becomes, and during the period it remains, a Defaulting Lender, the L/C Issuer may, upon prior written notice to the Borrower and the Administrative Agent, resign as L/C Issuer effective at the close of business New York time on a date specified in such notice; provided that such resignation by the L/C Issuer will have no effect on the validity or enforceability of any Letter of Credit then outstanding or on the obligations of the Borrower or any Lender under this Agreement with respect to any such outstanding Letter of Credit or otherwise to the L/C Issuer.

 

Section 10.9         Non-Reliance on Agents and Other Lender Parties. (a) Each Lender Party confirms to each Agent, each Arranger, each other Lender Party and each of their respective Related Persons that it (i) possesses (individually or through its Related Persons) such knowledge and experience in financial and business matters that it is capable, without reliance on any Agent, any Arranger, any other Lender Party or any of their respective Related Persons, of evaluating the merits and risks (including tax, legal, regulatory, credit, accounting and other financial matters) of (x) entering into this Agreement, (y) making Loans and other extensions of credit hereunder and under the other Loan Documents and (z) in taking or not taking actions hereunder and thereunder, (ii) is financially able to bear such risks and (iii) has determined that entering into this Agreement and making Loans and other extensions of credit hereunder and under the other Loan Documents is suitable and appropriate for it.

 

 

(b) Each Lender Party acknowledges that (i) it is solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with this Agreement and the other Loan Documents, (ii) that it has, independently and without reliance upon any Agent, any Arranger, any other Lender Party or any of their respective Related Persons, made its own appraisal and investigation of all risks associated with, and its own credit analysis and decision to enter into, this Agreement based on such documents and information, as it has deemed appropriate and (iii) it will, independently and without reliance upon any Agent, any Arranger, any other Lender Party or any of their respective Related Persons, continue to be solely responsible for making its own appraisal and investigation of all risks arising under or in connection with, and its own credit analysis and decision to take or not take action under, this Agreement and the other Loan Documents based on such documents and information as it shall from time to time deem appropriate, which may include, in each case:

 

(i)          the financial condition, status and capitalization of the Borrower and each other Loan Party;

 

(ii)         the legality, validity, effectiveness, adequacy or enforceability of this Agreement and each other Loan Document and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Loan Document;

 

(iii)        determining compliance or non-compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit and the form and substance of all evidence delivered in connection with establishing the satisfaction of each such condition; and

 

(iv)        the adequacy, accuracy and/or completeness of the Disclosure Documents and any other information delivered by any Agent, any Arranger, any other Lender Party or by any of their respective Related Persons under or in connection with this Agreement or any other Loan Document, the transactions contemplated hereby and thereby or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Loan Document.

 

Section 10.10         Release of Collateral or Guarantors. Each Lender Party hereby consents to the release and hereby directs the Collateral Agent to release or subordinate any Lien held by the Collateral Agent for the benefit of the Secured Parties against (i) any Collateral that is Sold by a Loan Party in a Sale (other than a Sale to another Loan Party) permitted by the Loan Documents (including pursuant to a valid waiver or consent), to the extent all Liens required to be granted in such Collateral pursuant to Section 7.10 after giving effect to such Sale have been granted, (ii) any property subject to a Lien permitted hereunder to the extent such property constitutes “Excluded Property” (as defined in the Guaranty and Security Agreement) and (iii) all of the Collateral and all Loan Parties, upon (A) termination of the Commitments and all Secured Hedging Support Documents, (B) payment and satisfaction in full of all Loans, all L/C Reimbursement Obligations and all other Obligations that the Administrative Agent and the Collateral Agent have been notified in writing are then due and payable and (C) deposit of cash collateral with respect to all L/C Obligations (or a back-up letter of credit has been issued), in an amount equal to 105% of such L/C Obligation and with parties satisfactory to the Administrative Agent and the applicable L/C Issuer.

 

Each Lender Party hereby directs the Collateral Agent, and the Collateral Agent hereby agrees at the Borrower’s expense, upon receipt of reasonable advance notice from the Borrower, to execute and deliver or file such documents and to perform other actions reasonably necessary to release the guaranties and Liens when and as directed in this Section 10.10.

 

 

Section 10.11         Additional Secured Parties. The benefit of the provisions of the Loan Documents directly relating to the Collateral or any Lien granted thereunder shall extend to and be available to any Secured Party that is not a Lender Party so long as, by accepting such benefits, such Secured Party agrees, as among the Agents and all other Secured Parties, that such Secured Party agrees to and is bound by (and, if requested by the Administrative Agent, shall confirm such agreement in a writing in form and substance acceptable to the Administrative Agent) this Article X, Section 11.8 (Right of Setoff), Section 11.9 (Sharing of Payments, Etc.) and Section 11.20 (Confidentiality) and the decisions and actions of the Agents and the Required Lenders (or, where expressly required by the terms of this Agreement, a greater proportion of the Lenders) to the same extent a Lender is bound; provided, that, notwithstanding the foregoing, (a) such Secured Party shall be bound by Section 10.12 only to the extent of Liabilities, costs and expenses with respect to or otherwise relating to the Collateral held for the benefit of such Secured Party, in which case the obligations of such Secured Party thereunder shall be such Secured Party’s pro rata share (based on the amount of Obligations owing to such Secured Party relative to the aggregate amount of all Obligations) of such liabilities, costs and expenses, and (b) except as set forth herein specifically for such Secured Party, (i) each of the Agents and the Lender Parties shall be entitled to act at its sole discretion, without regard to the interest of such Secured Party, regardless of whether any Obligation to such Secured Party thereafter remains outstanding, is deprived of the benefit of the Collateral, becomes unsecured or is otherwise affected or put in jeopardy thereby, and without any duty or liability to such Secured Party or any such Obligation, and (ii) such Secured Party shall not have any right to be notified of, consent to, direct, require or be heard with respect to, any action taken or omitted in respect of the Collateral or under any Loan Document. The Borrower hereby authorizes each Secured Hedging Counterparty party to a Secured Hedging Support Document to receive confidential and other information from the counterparty to the Hedging Agreement supported by such Secured Hedging Support Document in respect of such Hedging Agreement, Secured Hedging Support Document, or otherwise in respect of the Borrower and its Affiliates. Each party hereto that is a Secured Hedging Counterparty party to any Secured Hedging Support Document or whose Affiliate is such a Secured Hedging Counterparty shall not, and shall not cause such Affiliate to, revoke, cancel or otherwise terminate such Secured Hedging Support Document prior to the earlier of (w) the scheduled expiration or maturity of such Secured Hedging Support Document, (x) the occurrence or continuation of any Event of Default, (y) any breach of the terms of such Secured Hedging Support Document constituting a termination event or otherwise permitting such termination, and (z) the Scheduled Termination Date.

 

Section 10.12         Expenses; Indemnities. (a) Each Lender agrees to reimburse each Agent, each Arranger and each of their respective Related Persons (to the extent not reimbursed by any Loan Party) promptly upon demand for such Lender’s Pro Rata Share of any costs and expenses (including fees, charges and disbursements of financial, legal and other advisors paid in the name of, or on behalf of, any Loan Party) that may be incurred by such Agent, such Arranger or any of their respective Related Persons in connection with the preparation, syndication, execution, delivery, administration, modification, consent, waiver or enforcement (whether through negotiations, through any work-out, bankruptcy, restructuring or other legal or other proceeding or otherwise) of, or legal advice in respect of its rights or responsibilities under, any Loan Document.

 

 

(b)          EACH LENDER FURTHER AGREES TO INDEMNIFY EACH AGENT, EACH ARRANGER AND EACH OF THEIR RESPECTIVE RELATED PERSONS (TO THE EXTENT NOT REIMBURSED BY ANY LOAN PARTY), FROM AND AGAINST SUCH LENDER’S AGGREGATE PRO RATA SHARE OF ANY LIABILITIES THAT MAY BE IMPOSED ON, INCURRED BY OR ASSERTED AGAINST SUCH AGENT, SUCH ARRANGER OR ANY OF THEIR RESPECTIVE RELATED PERSONS AND IN ANY MATTER RELATING TO OR ARISING OUT OF, IN CONNECTION WITH OR AS A RESULT OF ANY LOAN DOCUMENT OR ANY OTHER ACT, EVENT OR TRANSACTION RELATED, CONTEMPLATED IN OR ATTENDANT TO ANY SUCH DOCUMENT, OR, IN EACH CASE, ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY SUCH AGENT, SUCH ARRANGER OR ANY OF THEIR RESPECTIVE RELATED PERSONS UNDER OR WITH RESPECT TO ANY OF THE FOREGOING (IN EACH CASE, WHETHER OR NOT CAUSED OR ARISING, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE ORDINARY NEGLIGENCE OF ANY AGENT, ANY ARRANGER OR THEIR RESPECTIVE RELATED PERSONS; PROVIDED, THAT NO LENDER SHALL BE LIABLE TO ANY AGENT, ANY ARRANGER OR ANY OF THEIR RESPECTIVE RELATED PERSONS TO THE EXTENT SUCH LIABILITY HAS RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH AGENT, SUCH ARRANGER OR, AS THE CASE MAY BE, SUCH RELATED PERSON, AS DETERMINED BY A COURT OF COMPETENT JURISDICTION IN A FINAL NON-APPEALABLE JUDGMENT OR ORDER. THE AGREEMENTS IN THIS SECTION 10.12 SHALL SURVIVE THE RESIGNATION AND/OR REPLACEMENT OF THE ADMINISTRATIVE AGENT OR COLLATERAL AGENT, AS APPLICABLE, ANY ASSIGNMENT OF RIGHTS BY, OR THE REPLACEMENT OF, A LENDER PARTY, THE TERMINATION OF THIS AGREEMENT AND THE REPAYMENT, SATISFACTION OR DISCHARGE OF ALL OTHER OBLIGATIONS.

 

Section 10.13         No Other Duties, etc. Anything herein to the contrary notwithstanding, none of the Persons acting as Syndication Agent or Arrangers listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, Collateral Agent or as a Lender Party hereunder; provided that the Syndication Agent and Arrangers shall be entitled to all benefits of this Article X.

 

Section 10.14         Withholding Tax. To the extent required by any applicable law, the Administrative Agent may deduct or withhold from any payment to any Secured Party an amount equivalent to any applicable withholding tax. If the Internal Revenue Service or any authority of the United States or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Secured Party (because the appropriate form was not delivered or was not properly executed, or because such Secured Party failed to notify the Administrative Agent of a change in circumstances that rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason), such Secured Party shall indemnify and hold harmless the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed by any Loan Party pursuant to Sections 2.16 and 2.17 and without increasing or limiting the obligation of any Loan Party to do so) fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or otherwise, together with all expenses incurred, including legal expenses, allocated staff costs and any out-of-pocket expenses, whether or not such Tax was correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Secured Party by the Administrative Agent shall be conclusive absent manifest error. Each Secured Party hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Secured Party under this Agreement or any other Loan Document against any amount due to the Administrative Agent under this Section 10.14. The agreements in this Section 10.14 shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Secured Party, the termination of this Agreement and the repayment, satisfaction or discharge of all other Obligations.

 

 

Section 10.15         Removal of Agents. Anything herein to the contrary notwithstanding, if at any time the Required Lenders determine that the Person serving as Administrative Agent or Collateral Agent is (without taking into account any provision in the definition of “Defaulting Lender” requiring notice from the Administrative Agent or any other party) a Defaulting Lender, the Required Lenders (determined after giving effect to Section 11.1(c)) may by notice to the Borrower and such Person remove such Person as Administrative Agent or Collateral Agent and appoint a replacement Administrative Agent or Collateral Agent hereunder. Such removal will, to the fullest extent permitted by applicable law, be effective on the earlier of (i) the date a replacement Administrative Agent or Collateral Agent is appointed and (ii) the date 20 Business Days after the giving of such notice by the Required Lenders (regardless of whether a replacement Administrative Agent or Collateral Agent has been appointed) and, in the case of the Collateral Agent, the Collateral held by the Collateral Agent shall be surrendered to a Lender Party selected by the Required Lenders.

 

ARTICLE XI

MISCELLANEOUS

 

Section 11.1         Amendments, Waivers, Etc. (a) No amendment or waiver of any provision of any Loan Document (other than the Agency Fee Letter or the Fee Letter) and no consent to any departure by any Loan Party therefrom shall be effective unless the same shall be in writing and signed (1) in the case of an amendment, consent or waiver to (A) cure any ambiguity, omission, defect or inconsistency, by the Administrative Agent and the Borrower or (B) grant a new Lien for the benefit of the Secured Parties or extend an existing Lien over additional property, by the Collateral Agent and the Borrower and (2) in the case of any other amendment, waiver or consent by the Required Lenders (or by the Administrative Agent with the consent of the Required Lenders) and the Borrower; provided, that no amendment, consent or waiver described in clause (2) above shall, unless in writing and signed by each Lender directly affected thereby (or by the Administrative Agent with the consent of such Lender), in addition to any other Person the signature of which is otherwise required pursuant to any Loan Document, be effective to do any of the following:

 

(i)          waive any condition specified in Section 3.1, except any condition referring to any other provision of any Loan Document;

 

(ii)         increase the Commitment of such Lender or subject such Lender to any additional obligation;

 

(iii)        reduce (including through release, forgiveness, assignment or otherwise) (A) the principal amount of, the interest rate on, or any obligation of the Borrower to repay (whether or not on a fixed date), any outstanding Loan owing to such Lender, (B) any fee or accrued interest payable to such Lender or (C) any L/C Reimbursement Obligation or any obligation of the Borrower to repay (whether or not on a fixed date) any L/C Reimbursement Obligation; provided, that this clause (iii) does not apply to (x) any change to any provision increasing any interest rate or fee during the continuance of an Event of Default or to any payment of any such increase or (y) any modification to any financial covenant set forth in Article V or in any definition set forth therein or principally used therein;

 

(iv)        extend, waive or postpone any scheduled maturity date or other scheduled date fixed for the payment, in whole or in part, of principal of or interest on any Loan or fee owing to such Lender or for the reduction of such Lender’s Commitment or the stated expiration date of any Letter of Credit beyond the Scheduled Termination Date; provided, that this clause (iv) does not apply to the application of any payment, including as set forth in Section 2.12;

 

(v)         waive or amend any provision of Section 2.12(c) (Application of Payments during an Event of Default) or Section 2.12(d) (Application of Payments Generally);

 

 

(vi)        except as provided in Section 10.10, release all or substantially all of the Collateral or any Guarantor from its guaranty of any Obligation of the Borrower;

 

(vii)       reduce or increase the proportion of Lenders required for the Lenders (or any subset thereof) to take any action hereunder or change the definition of the terms “Required Lenders”, “Pro Rata Share” or “Pro Rata Outstandings”;

 

(viii)      amend Section 10.10 (Release of Collateral or Guarantors) if the effect of such amendment is a release described in clause (vi) above, Section 11.9 (Sharing of Payments) or this Section 11.1;

 

(ix)         waive any condition set forth in Section 3.2 as to any Borrowing , directly or indirectly (including by waiving any Default or Event of Default or amending or modifying Section 3.2 or Section 9.1 if the effect thereof is to permit such Borrowing), without the written consent of the Required Lenders; or

 

(x)          consent to the assignment by any Loan Party of any of its rights and obligations under any Loan Document.

 

(xi)         and provided, further, that (x) any change to the definition of the term “Required Lender” shall require the consent of all of the Lenders, (y) no amendment, waiver or consent shall affect the rights or duties under any Loan Document of, or any payment to, any Agent (or otherwise modify any provision of Article X or the application thereof), any L/C Issuer or any SPV that has been granted an option pursuant to Section 11.2(f) unless in writing and signed by such Agent, such L/C Issuer or, as the case may be, such SPV in addition to any signature otherwise required and (z) the consent of the Borrower shall not be required to change any order of priority set forth in Section 2.12.

 

(b) Each waiver or consent under any Loan Document shall be effective only in the specific instance and for the specific purpose for which it was given. No notice to or demand on any Loan Party shall entitle any Loan Party to any notice or demand in the same, similar or other circumstances. No failure on the part of any Secured Party to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. In the case of any waiver, the Borrower, the Lenders, the Administrative Agent and the Collateral Agent shall be restored to their former positions and rights hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not continuing, it being understood that no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon (or reduce the amount of any increased interest or fee payments as a consequence of any such Default or Event of Default).

 

(c) Anything herein to the contrary notwithstanding, during such period as a Lender is a Defaulting Lender, to the fullest extent permitted by applicable law, such Lender will not be entitled to vote in respect of amendments and waivers hereunder and the Commitment and the outstanding Loans or other extensions of credit of such Lender hereunder will not be taken into account in determining whether the Required Lender or all of the Lenders, as required, have approved any such amendment or waiver (and the definition of “Required Lenders” will automatically be deemed modified accordingly for the duration of such period); provided, that any such amendment or waiver that would increase or extend the term of the Commitment of such Defaulting Lender, extend the date fixed for the payment of principal or interest owing to such Defaulting Lender hereunder, reduce the principal amount of any obligation owing to such Defaulting Lender, reduce the amount of or the rate or amount of interest on any amount owing to such Defaulting Lender or of any fee payable to such Defaulting Lender hereunder, or alter the terms of this proviso, will require the consent of such Defaulting Lender.

 

 

Section 11.2         Assignments and Participations; Binding Effect. (a) Binding Effect. This Agreement shall become effective when it shall have been executed by Parent, the Borrower, the Guarantors and the Agents and when the Administrative Agent shall have been notified by each Lender and L/C Issuer that such Lender or L/C Issuer has executed it. Thereafter, it shall be binding upon and inure to the benefit of Parent, the Borrower (in each case except for Article X), each Agent, each Lender and L/C Issuer and, to the extent provided in Section 10.12, each other Indemnitee and Secured Party and, in each case, their respective successors and permitted assigns. None of Parent, the Borrower, any L/C Issuer or any Agent (except to a successor Agent named pursuant to Section 10.7 or otherwise to facilitate a transaction contemplated by such Section 10.7) shall have the right to assign any rights or obligations hereunder or any interest herein; provided, that each Secured Hedging Counterparty may assign its rights and interests in, but not its obligations under, Secured Hedging Support Provisions.

 

(b) Right to Assign.

 

(i)          Each Lender may sell, transfer, negotiate or assign all or a portion of its rights and obligations hereunder (including all or a portion of its Commitments and its rights and obligations with respect to Loans and Letters of Credit) to (i) any existing Lender, (ii) any Affiliate or Approved Fund of any existing Lender, (iii) any Person that is simultaneously purchasing all or substantially all of such Lender’s loan portfolio, or (iv) any other Person reasonably acceptable (which acceptance shall not be unreasonably withheld or delayed) to the Administrative Agent and the L/C Issuer and, as long as no Event of Default is continuing, the Borrower; provided, that (w) no Lender may sell, transfer, negotiate or assign any rights or obligations hereunder to any Permitted Investor, Parent, the Borrower or any Affiliate or Subsidiary of any of the foregoing, except as permitted by clause (ii) below, (x) such Sales must be ratable among the obligations owing to and owed by such Lender, (y) the aggregate outstanding principal amount (determined as of the effective date of the applicable Assignment) of the Loans, Commitments and L/C Obligations subject to any such Sale shall be an integral multiple of $2,500,000 and (z) the Borrower shall exercise commercially reasonable efforts to respond to a request for consent to an Assignment within ten Business Days after having received notice of such Assignment (provided, that for the avoidance of doubt, failure to respond to such request shall be deemed to be consent). Notwithstanding the foregoing, any such Sales by Defaulting Lenders shall be subject to the Administrative Agent’s prior written consent in all instances.

 

(ii)         Notwithstanding the foregoing, Assignments to any Permitted Investor, Parent, the Borrower or any Affiliate or Subsidiary of any Permitted Investor, Parent or the Borrower shall be permitted only so long as the acquired Loans and Commitments shall be immediately cancelled upon the effectiveness of the Assignment thereof.

 

(c) Procedure. The parties to each Sale made in reliance on clause (b) above (other than those described in clause (e) or (f) below) shall execute and deliver to the Administrative Agent (which shall keep a copy thereof) an Assignment evidencing such Sale (including via an electronic settlement system if so designated by the Administrative Agent), together with any existing Note subject to such Sale (or any affidavit of loss therefor acceptable to the Administrative Agent), any tax forms required to be delivered pursuant to Section 2.17(f) and payment by the assignee of an assignment fee in the amount of $3,500; provided, that (i) no assignment or other fee shall be payable in connection with an assignment by an existing Lender to another existing Lender or an Affiliate of such existing Lender, and (ii) only one assignment fee shall be payable with respect to multiple, simultaneous assignments to an Approved Fund and its Affiliates. Upon receipt of all the foregoing, and conditioned upon such receipt and upon the Administrative Agent and the Borrower, as applicable, consenting to such Assignment, from and after the effective date specified in such Assignment, the Administrative Agent shall record or cause to be recorded in the Register the information contained in such Assignment.

 

 

(d) Effectiveness. Effective upon the recording of an Assignment by the Administrative Agent in the Register, (i) the assignee thereunder shall become a party hereto and, to the extent that rights and obligations under the Loan Documents have been assigned to such assignee pursuant to such Assignment, shall have the rights and obligations of a Lender, (ii) any applicable Note shall be transferred to such assignee through such entry and (iii) the assignor thereunder shall, to the extent that rights and obligations under this Agreement have been assigned by it pursuant to such Assignment, relinquish its rights (except for those surviving the termination of the Commitments and the payment in full of the Obligations) and be released from its obligations under the Loan Documents, other than those relating to events or circumstances occurring prior to such assignment and, in the case of an Assignment covering all or the remaining portion of an assigning Lender’s rights and obligations under the Loan Documents, such Lender shall cease to be a party hereto except that (i) each Lender agrees to remain bound by Article X, Section 11.8 (Right of Setoff) and Section 11.9 (Sharing of Payments) to the extent provided in Section 10.11 (Additional Secured Parties) and (ii) each Lender shall continue to be entitled to the benefits of Section 2.16 (Breakage Costs; Increased Costs; Capital Requirements) and Section 2.17 (Taxes) hereto with respect to facts and circumstances occurring prior to the effective date of such assignment.

 

(e) Grant of Security Interests. In addition to the other rights provided in this Section 11.2, each Lender may, without the consent of the Borrower or the Administrative Agent, grant a security interest in, or otherwise assign as collateral, any of its rights under this Agreement, whether now owned or hereafter acquired (including rights to payments of principal or interest on the Loans), to (A) any federal reserve bank (pursuant to Regulation A of the Federal Reserve Board), without notice to the Administrative Agent or (B) any holder of, or trustee for the benefit of the holders of, such Lender’s Securities, by notice to the Administrative Agent; provided, that no such holder, trustee or other Person, whether because of such grant or assignment or any foreclosure thereon (unless such foreclosure is made through an assignment in accordance with clause (b) above), shall be entitled to any rights of such Lender hereunder and no such Lender shall be relieved of any of its obligations hereunder.

 

 

(f)  Participants and SPVs. In addition to the other rights provided in this Section 11.2, each Lender may, (x) with notice to the Administrative Agent, grant to an SPV the option to make all or any part of any Loan that such Lender would otherwise be required to make hereunder (and the exercise of such option by such SPV and the making of Loans pursuant thereto shall satisfy the obligation of such Lender to make such Loans hereunder) and such SPV may assign to such Lender the right to receive payment with respect to any Obligation and (y) without notice to or consent from the Administrative Agent or the Borrower, sell participations to one or more Persons in or to all or a portion of its rights and obligations under the Loan Documents (including all its rights and obligations with respect to the Loans and Letters of Credit); provided, that, whether as a result of any term of any Loan Document or of such grant or participation, (i) no such SPV or participant shall have a commitment, or be deemed to have made an offer to commit, to make Loans hereunder, and, except as provided in the applicable option agreement, none shall be liable for any obligation of such Lender hereunder, (ii) such Lender’s rights and obligations, and the rights and obligations of the Loan Parties and the Secured Parties towards such Lender, under any Loan Document shall remain unchanged and each other party hereto shall continue to deal solely with such Lender, which shall remain the holder of the Obligations in the Register, except that (A) each such participant and SPV shall be entitled to the benefit of Sections 2.16 (Breakage Costs; Increased Costs; Capital Requirements) and 2.17 (Taxes) (subject to the requirements and limitations of such Sections), but only to the extent of any amount to which such Lender would be entitled in the absence of any such grant or participation, unless the sale of the participation or grant to an SPV is made with the Borrower’s prior written consent (not to be unreasonably withheld or delayed), and (B) each such SPV may receive other payments that would otherwise be made to such Lender with respect to Loans funded by such SPV to the extent provided in the applicable option agreement and set forth in a notice provided to the Administrative Agent by such SPV and such Lender, provided, that in no case (including pursuant to clause (A) or (B) above) shall an SPV or participant have the right to enforce any of the terms of any Loan Document, and (iii) the consent of such SPV or participant shall not be required (either directly, as a restraint on such Lender’s ability to consent hereunder or otherwise) for any amendments, waivers or consents with respect to any Loan Document or to exercise or refrain from exercising any powers or rights such Lender may have under or in respect of the Loan Documents (including the right to enforce or direct enforcement of the Obligations), except for those described in clauses (iii) and (iv) of Section 11.1(a) with respect to amounts, or dates fixed for payment of amounts, to which such participant or SPV would otherwise be entitled and, in the case of participants, except for those described in Section 11.1(a)(v) (or amendments, consents and waivers with respect to Section 10.10 to release all or substantially all of the Collateral), for amendments that would increase the amount of any participant’s participation over the amount then in effect and consents to any assignments or transfers described in Section 11.1(a)(x). No party hereto shall institute (and each of the Borrower and Parent shall cause each other Loan Party not to institute) against any SPV grantee of an option pursuant to this clause (f) any bankruptcy, reorganization, insolvency, liquidation or similar proceeding, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper of such SPV; provided, that each Lender having designated an SPV as such agrees to indemnify each Indemnitee against any Liability that may be incurred by, or asserted against, such Indemnitee as a result of failing to institute such proceeding (including a failure to get reimbursed by such SPV for any such Liability). The agreement in the preceding sentence shall survive the termination of the Commitments and the payment in full of the Obligations.

 

 

 

Section 11.3         Costs and Expenses. Any action taken by any Loan Party under or with respect to any Loan Document, even if required under any Loan Document or at the request of any Secured Party, shall be at the expense of such Loan Party, and no Secured Party shall be required under any Loan Document to reimburse any Loan Party or Group Member therefor. In addition, the Borrower agrees to pay or reimburse upon demand (a) the Agents, the Arrangers and their Related Persons for all reasonable out-of-pocket costs and expenses (including fees and premiums in connection with any title insurance or surveys, search, filing or recording fees) incurred in connection with the investigation, development, preparation, negotiation, syndication, execution, interpretation or administration of, any modification of any term of or termination of, any Loan Document, any commitment or proposal letter therefor, any other document prepared in connection therewith or the consummation and administration of any transaction contemplated therein (including periodic audits in connection therewith and environmental audits and assessments), in each case including the reasonable fees, charges and disbursements of one legal counsel (and one local counsel in each relevant jurisdiction, or two in the case of a conflict preventing the use of only one local counsel) to the Agents, the Arrangers, the Syndication Agent and their Related Persons, fees, costs and expenses incurred in connection with SyndtrakÔ or any other E-System and allocated by the Administrative Agent in its sole discretion and fees, charges and disbursements of the auditors, appraisers, printers and other of their Related Persons retained by or on behalf of any of them or any of their Related Persons, (b) the Agents, the Arrangers and their Related Persons for all reasonable costs and expenses incurred in connection with internal audit reviews, field examinations and Collateral examinations (which shall be reimbursed, in addition to the out-of-pocket costs and expenses of such examiners, at the per diem rate per individual charged by the Collateral Agent for its examiners) and (c) the Arrangers, the Agents, the Lenders and the L/C Issuer and their Related Persons for all costs and expenses incurred in connection with (i) any refinancing or restructuring of the credit arrangements provided hereunder in the nature of a “work-out”, (ii) the enforcement or preservation of any right or remedy under any Loan Document, any Obligation, with respect to the Collateral or any other related right or remedy or (iii) the commencement, defense, conduct of, intervention in, or the taking of any other action with respect to, any proceeding (including any bankruptcy or insolvency proceeding) related to Parent or any Group Member, Loan Document or Obligation (or the response to and preparation for any subpoena or request for document production relating thereto), including fees and disbursements of counsel (including allocated costs of internal counsel).

 

 

 

Section 11.4         Indemnities. (a) THE BORROWER AGREES TO INDEMNIFY, HOLD HARMLESS AND DEFEND EACH AGENT, THE ARRANGERS, EACH LENDER, EACH L/C ISSUER, EACH FORMER LENDER OR L/C ISSUER PARTY TO A SECURED HEDGING DOCUMENT, EACH PERSON THAT EACH L/C ISSUER CAUSES TO ISSUE LETTERS OF CREDIT HEREUNDER AND EACH OF THEIR RESPECTIVE RELATED PERSONS (EACH SUCH PERSON BEING AN “INDEMNITEE”) FROM AND AGAINST ALL LIABILITIES (INCLUDING BROKERAGE COMMISSIONS, FEES AND OTHER COMPENSATION) THAT MAY BE IMPOSED ON, INCURRED BY OR ASSERTED AGAINST ANY SUCH INDEMNITEE AND IN ANY MATTER RELATING TO OR ARISING OUT OF, IN CONNECTION WITH OR AS A RESULT OF (I) ANY LOAN DOCUMENT, ANY DISCLOSURE DOCUMENT, OR ANY OBLIGATION (OR THE REPAYMENT THEREOF), ANY LETTER OF CREDIT, THE USE OR INTENDED USE OF THE PROCEEDS OF ANY LOAN OR THE USE OF ANY LETTER OF CREDIT, OR ANY SECURITIES FILING OF, OR WITH RESPECT TO, ANY GROUP MEMBER, (II) ANY COMMITMENT LETTER, PROPOSAL LETTER OR TERM SHEET WITH ANY PERSON OR ANY CONTRACTUAL OBLIGATION, SYNDICATION OF THE CREDIT FACILITY PROVIDED HEREBY, ANY ENFORCEMENT OF ANY LOAN DOCUMENTS (INCLUDING ANY SALES OF, COLLECTION FROM, OR OTHER REALIZATION UPON ANY OF THE COLLATERAL OR THE ENFORCEMENT OF ANY GUARANTY) ARRANGEMENT OR UNDERSTANDING WITH ANY BROKER, FINDER OR CONSULTANT, IN EACH CASE ENTERED INTO BY OR ON BEHALF OF ANY GROUP MEMBER OR ANY AFFILIATE OF ANY OF THEM IN CONNECTION WITH ANY OF THE FOREGOING AND ANY CONTRACTUAL OBLIGATION ENTERED INTO IN CONNECTION WITH ANY E-SYSTEMS OR OTHER ELECTRONIC TRANSMISSIONS, (III) ANY ACTUAL OR PROSPECTIVE INVESTIGATION, LITIGATION OR OTHER PROCEEDING, WHETHER OR NOT BROUGHT BY ANY SUCH INDEMNITEE OR ANY OF ITS RELATED PERSONS, ANY HOLDERS OF SECURITIES OR CREDITORS (AND INCLUDING ATTORNEYS’ FEES IN ANY CASE), WHETHER OR NOT ANY SUCH INDEMNITEE, RELATED PERSON, HOLDER OR CREDITOR IS A PARTY THERETO, AND WHETHER OR NOT BASED ON ANY SECURITIES OR COMMERCIAL LAW OR REGULATION OR ANY OTHER REQUIREMENT OF LAW OR THEORY THEREOF, INCLUDING COMMON LAW, EQUITY, CONTRACT, TORT OR OTHERWISE, OR (IV) ANY OTHER ACT, EVENT OR TRANSACTION RELATED, CONTEMPLATED IN OR ATTENDANT TO ANY OF THE FOREGOING (COLLECTIVELY, THE “INDEMNIFIED MATTERS”); PROVIDED, THAT THE BORROWER SHALL NOT HAVE ANY LIABILITY UNDER THIS SECTION 11.4 TO AN INDEMNITEE WITH RESPECT TO, AND NO INDEMNITEE SHALL HAVE ANY LIABILITY HEREUNDER OTHER THAN (TO THE EXTENT OTHERWISE LIABLE) FOR, ANY INDEMNIFIED MATTER TO THE EXTENT SUCH LIABILITY HAS RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNITEE, AS DETERMINED BY A COURT OF COMPETENT JURISDICTION IN A FINAL NON-APPEALABLE JUDGMENT OR ORDER. THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH INDEMNIFIED LIABILITIES ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY, OR ARE CAUSED, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF ANY INDEMNITEE. FURTHERMORE, EACH OF PARENT AND THE BORROWER WAIVES AND AGREES NOT TO ASSERT AGAINST ANY INDEMNITEE, AND SHALL CAUSE EACH OTHER LOAN PARTY TO WAIVE AND NOT ASSERT AGAINST ANY INDEMNITEE, ANY RIGHT OF CONTRIBUTION WITH RESPECT TO ANY LIABILITIES THAT MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST ANY RELATED PERSON.

 

 

 

(b) Without limiting the foregoing, “Indemnified Matters” includes all Environmental Liabilities, including those arising from, or otherwise involving, any property of any Group Member or any actual, alleged or prospective damage to property or natural resources or harm or injury alleged to have resulted from any Release of Hazardous Materials on, upon or into such property or natural resource or any property on or contiguous to any real property of any Group Member, whether or not, with respect to any such Environmental Liabilities, any Indemnitee is a mortgagee in possession, the successor-in-interest to any Group Member or the owner, lessee or operator of any property or facility of any Group Member through any foreclosure action, in each case except to the extent such Environmental Liabilities (i) are incurred solely following foreclosure by any Secured Party or following any Secured Party having become the successor-in-interest to any Loan Party and (ii) are attributable solely to acts of such Indemnitee.

 

Section 11.5         Survival. Any indemnification or other protection provided to any Indemnitee pursuant to any Loan Document or the provisions of Section 2.17 (Taxes), Section 2.16 (Breakage Costs; Increased Costs; Capital Requirements), Article X (The Agents), Section 11.3 (Costs and Expenses), Section 11.4 (Indemnities), this Section 11.5, Section 11.8 (Right of Setoff), and Section 11.9 (Sharing of Payments, Etc.) and all representations and warranties made in any Loan Document shall (A) survive the termination of the Commitments and the payment in full of other Obligations and (B) inure to the benefit of any Person that at any time held a right thereunder (as an Indemnitee or otherwise) and, thereafter, its successors and permitted assigns.

 

Section 11.6         Limitation of Liability for Certain Damages. IN NO EVENT SHALL ANY INDEMNITEE BE LIABLE ON ANY THEORY OF LIABILITY FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (INCLUDING ANY LOSS OF PROFITS, BUSINESS OR ANTICIPATED SAVINGS). EACH OF PARENT AND THE BORROWER HEREBY WAIVES, RELEASES AND AGREES (AND SHALL CAUSE EACH OTHER LOAN PARTY TO WAIVE, RELEASE AND AGREE) NOT TO SUE UPON ANY SUCH CLAIM FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.

 

Section 11.7         Lender-Creditor Relationship; No Fiduciary Duty. The relationship between the Lenders, the L/C Issuer and the Agents, on the one hand, and the Loan Parties, on the other hand, is solely that of lender and creditor. Each of the Secured Parties may have economic interests that conflict with those of the Borrower, its stockholders and/or its Affiliates. The Borrower agrees that no Secured Party has any fiduciary or advisory relationship or duty to any Loan Party arising out of or in connection with, and there is no agency, tenancy or joint venture relationship between the Secured Parties and the Loan Parties by virtue of, any Loan Document or any transaction contemplated therein. The Borrower agrees that it will not claim that any Secured Party has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to the Borrower, in connection with the transaction contemplated hereby or the process leading thereto.

 

 

Section 11.8         Right of Setoff. Each Agent, Lender and L/C Issuer and each Affiliate (including each branch office thereof) of any of them is hereby authorized, without notice or demand (each of which is hereby waived by Parent and the Borrower), at any time and from time to time during the continuance of any Event of Default and to the fullest extent permitted by law, to set off and apply any and all deposits (whether general or special, time or demand, provisional or final) at any time held and other Indebtedness, claims or other obligations at any time owing by such Agent, such Lender, such L/C Issuer or any of their respective Affiliates to or for the credit or the account of Parent or the Borrower against any Obligation of any Loan Party now or hereafter existing, whether or not any demand was made under any Loan Document with respect to such Obligation and even though such Obligation may be unmatured. Each Agent, Lender and L/C Issuer agrees promptly to notify the Borrower and the Administrative Agent after any such setoff and application made by such Lender or its Affiliates; provided, that the failure to give such notice shall not affect the validity of such setoff and application. The rights under this Section 11.8 are in addition to any other rights and remedies (including other rights of setoff) that the Agents, the Arrangers, the Syndication Agent, the Lenders and the L/C Issuer and their Affiliates and other Secured Parties may have.

 

Section 11.9         Sharing of Payments, Etc. If any Lender, directly or through an Affiliate or branch office thereof, obtains any payment of any Obligation of any Loan Party (whether voluntary, involuntary or through the exercise of any right of setoff or the receipt of any Collateral or “proceeds” (as defined under the applicable UCC) of Collateral) other than pursuant to Sections 2.16 (Breakage Costs; Increased Costs; Capital Requirements), 2.17 (Taxes) and 2.18 (Substitution of Lenders) and such payment exceeds the amount such Lender would have been entitled to receive if all payments had gone to, and been distributed by, the Administrative Agent in accordance with the provisions of the Loan Documents, such Lender shall purchase for cash from other Secured Parties such participations in their Obligations as necessary for such Lender to share such excess payment with such Secured Parties to ensure such payment is applied as though it had been received by the Administrative Agent and applied in accordance with this Agreement (or, if such application would then be at the discretion of the Borrower, applied to repay the Obligations in accordance herewith); provided, that (a) the provisions of this Section 11.9 shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement, any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in Letters of Credit to any assignee or participant or any payment made as a consent fee for an amendment or waiver to the extent such fee is paid only to consenting Lenders, (b) if such payment is rescinded or otherwise recovered from such Lender or L/C Issuer in whole or in part, such purchase shall be rescinded and the purchase price therefor shall be returned to such Lender or L/C Issuer without interest and (c) such Lender shall, to the fullest extent permitted by applicable Requirements of Law, be able to exercise all its rights of payment (including the right of setoff) with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount of such participation. If a Defaulting Lender receives any such payment as described in the previous sentence, such Lender shall turn over such payments to the Administrative Agent in an amount that would satisfy the cash collateral requirements set forth in Sections 2.4 and 9.4.

 

Section 11.10          Marshaling; Payments Set Aside. No Secured Party shall be under any obligation to marshal any property in favor of any Loan Party or any other party or against or in payment of any Obligation. To the extent that any Secured Party receives a payment from the Borrower, from the proceeds of the Collateral, from the exercise of its rights of setoff, any enforcement action or otherwise, and such payment is subsequently, in whole or in part, invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other party, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all Liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment had not occurred.

 

 

Section 11.11          Notices. (a) Addresses. All notices, demands, requests, consents and other communications provided for in this Agreement shall be given in writing, or by any telecommunication device capable of creating a written record (including electronic mail), and addressed to the party to be notified as follows:

 

(A)         If to Administrative Agent, at

 

Royal Bank of Canada

200 Bay Street, 12th Floor,

South Tower, Royal Bank Plaza

Toronto, Ontario

M5J 2W7

Attention: Manager, Agency

Fax: (416) 842-4023

 

Forward loan requests, interest rate sets, payments and fees to:

 

Royal Bank of Canada

200 Bay Street, 12th Floor,

South Tower, Royal Bank Plaza

Toronto, Ontario

M5J 2W7

Attention: Manager, Agency

Fax: (416) 842-4023

 

(B)         If to Borrower or any Guarantor, at

 

Francesca’s Collections, Inc.

3480 W. 12th Street

Houston, Texas 77008

Attention: Kal Malik, Executive Vice President and General Counsel

Number: 713.864.1358 x128

Email: KMalik@francescas.net

 

With copies to:

 

O’Melveny & Myers LLP

Attention: Sung Pak, Esq.

Times Square Tower

7 Times Square

New York, NY 10036

Number: (212) 326-2000

Fax: (212) 326-2061

Email: spak@omm.com

 

(C)         If to KeyBank National Association as the L/C Issuer, at

 

Keybank National Association
Standby Letter of Credit Services
4910 Tiedeman, 4th floor

Mailcode: OH-01-51-0531
Cleveland, Ohio 44144
Fax: (216) 813-3719

 

 

(D)         If to the Collateral Agent, at

 

Royal Bank of Canada

200 Bay Street, 12th Floor,

South Tower, Royal Bank Plaza

Toronto, Ontario

M5J 2W7

Attention: Manager, Agency

Fax: (416) 842-4023

 

(F)         If to any other Lender Party, to it at its address (or telecopier number) set forth in its Administrative Questionnaire, or (G) at such other address as shall be notified in writing (x) in the case of the Borrower, to the Administrative Agent, (y) in the case of the Administrative Agent, to the other parties hereto and (z) in the case of all other parties, to the Borrower and the Administrative Agent.

 

(b) Effectiveness. All notices, demands, requests, consents and other communications described in clause (a) shall be effective (i) if delivered by hand, including any overnight courier service, upon personal delivery, (ii) if delivered by mail, when deposited in the mails, (iii) if delivered by posting to an Approved Electronic Platform, an Internet website or a similar telecommunication device requiring that a user have prior access to such Approved Electronic Platform, website or other device (to the extent permitted by Section 11.12 to be delivered thereunder), when such notice, demand, request, consent and other communication shall have been made generally available on such Approved Electronic Platform, Internet website or similar device to the class of Person being notified (regardless of whether any such Person must accomplish, and whether or not any such Person shall have accomplished, any action prior to obtaining access to such items, including registration, disclosure of contact information, compliance with a standard user agreement or undertaking a duty of confidentiality) and such Person has been notified in respect of such posting that a communication has been posted to the Approved Electronic Platform and (iv) if delivered by electronic mail or any other telecommunications device, when transmitted to an electronic mail address (or by another means of electronic delivery) as provided in clause (a); provided, however, that notices and communications to the Administrative Agent pursuant to Article II or Article X shall not be effective until received in writing by the Administrative Agent.

 

(c) Notwithstanding clauses (a) and (b) (unless the Administrative Agent requests that the provisions of clause (a) and (b) be followed) and any other provision in this Agreement or any other Loan Document providing for the delivery of any Approved Electronic Communication by any other means, the Loan Parties shall deliver all Approved Electronic Communications to the Administrative Agent by properly transmitting such Approved Electronic Communications in an electronic/soft medium in a format acceptable to the Administrative Agent to chandran.panicker@rbccm.com or such other electronic mail address (or similar means of electronic delivery) as the Administrative Agent may notify to the Borrower. Nothing in this clause (c) shall prejudice the right of the Administrative Agent or any Lender Party to deliver any Approved Electronic Communication to any Loan Party in any manner authorized in this Agreement or to request that the Borrower effect delivery in such manner.

 

 

 

Section 11.12         Posting of Approved Electronic Communications. (a) Each of the Lender Parties and each Loan Party agree that the Administrative Agent may, but shall not be obligated to, make the Approved Electronic Communications available to the Lender Parties by posting such Approved Electronic Communications on Syndtrak™ or a substantially similar electronic platform chosen by the Administrative Agent to be its electronic transmission system (the “Approved Electronic Platform”).

 

(b) Although the Approved Electronic Platform and its primary web portal are secured with generally-applicable security procedures and policies implemented or modified by the Administrative Agent from time to time (including, as of the Closing Date, a dual firewall and a User ID/Password Authorization System) and the Approved Electronic Platform is secured through a single-user-per-deal authorization method whereby each user may access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lender Parties and each Loan Party acknowledges and agrees that the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution. In consideration for the convenience and other benefits afforded by such distribution and for the other consideration provided hereunder, the receipt and sufficiency of which is hereby acknowledged, each of the Lender Parties and each Loan Party hereby approves distribution of the Approved Electronic Communications through the Approved Electronic Platform and understands and assumes the risks of such distribution.

 

(c) THE APPROVED ELECTRONIC PLATFORM AND THE APPROVED ELECTRONIC COMMUNICATIONS ARE PROVIDED “AS IS” AND “AS AVAILABLE”. NONE OF THE ADMINISTRATIVE AGENT NOR ANY OTHER MEMBER OF SUCH AGENT’S GROUP WARRANT THE ACCURACY, ADEQUACY OR COMPLETENESS OF THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM AND EACH EXPRESSLY DISCLAIMS ANY LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE AGENT PARTIES IN CONNECTION WITH THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM. IN NO EVENT SHALL THE ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES OR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES HAVE ANY LIABILITY TO ANY BORROWER, ANY LENDER OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING, WITHOUT LIMITATION, DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF THE BORROWER’S OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF ANY AGENT PARTY IS FOUND IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE RESULTED PRIMARILY FROM SUCH AGENT PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

 

(d) Each of the Lender Parties and each Loan Party agrees that the Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to, store the Approved Electronic Communications on the Approved Electronic Platform in accordance with the Administrative Agent’s generally-applicable document retention procedures and policies.

 

 

Section 11.13         Confidentiality. Each of the Agent and the Lender Parties agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Related Persons or to any Person that any L/C Issuer causes to Issue Letters of Credit hereunder (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it or its Affiliates (including any self-regulatory authority, such as the National Association of Insurance Commissioners) or any similar organization, any examiner or any nationally recognized rating agency or otherwise to the extent consisting of general portfolio information, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal or judicial process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document, any action or proceeding relating to this Agreement or any other Loan Document, the enforcement of rights hereunder or thereunder or any litigation or proceeding to which any Agent, any Lender Party or any of their respective Affiliates may be a party, (f) subject to an agreement no less restrictive than this Section 11.13, to (i) any assignee of or participant in, or any prospective assignee of or participant in, any of its rights or obligations under this Agreement, (ii) to current or prospective grantees of any option described in Section 11.2(f), direct or indirect counterparties to any Secured Hedging Document or any Hedging Agreement permitted hereunder and to their respective Related Persons, (iii) any actual or prospective party (or its managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives), surety, reinsurer, guarantor or credit liquidity enhancer (or their advisors) to or in connection with any swap, derivative or other similar transaction under which payments are to be made by reference to the Obligations or to the Borrower and its obligations or to this Agreement or payments hereunder, (iv) to a trustee, collateral manager, servicer, backup servicer, noteholder, or secured party in a Securitization in connection with the administration, servicing and reporting on the assets serving as collateral for such Securitization, (v) to any rating agency when required by it or (vi) the CUSIP Service Bureau or any similar organization, (g) with the consent of the Borrower, (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section 11.13 or (ii) becomes available to any Agent, any Lender Party or any of their respective Affiliates on a nonconfidential basis from a source other than a Loan Party or (i) to the extent necessary or customary for inclusion in league table measurements or in any tombstone or other advertising materials (and the Loan Parties consent to the publication of such tombstone or other advertising materials by any Agent, Lender, the L/C Issuer or any of their Related Persons). For purposes of this Section 11.13, “Information” means all information received from a Loan Party or any of its Subsidiaries relating to a Loan Party or any of its Subsidiaries or any of their respective businesses, other than any such information that is available to the Administrative Agent, the Collateral Agent or any Lender Party on a nonconfidential basis prior to disclosure by any Loan Party or any of its Subsidiaries, provided that, in the case of information received from a Loan Party or any of its Subsidiaries, such information has been or is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section 11.13 shall be considered to have complied with its obligation to do so if such Person has (i) exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information or (ii) treated such Information in accordance with such Person’s customary procedures for handling confidential information of such nature. In addition, each Agent and each Lender may disclose the existence of this Agreement and the information about this Agreement to market data collectors, similar services providers to the lending industry, and service providers to the Agents and the Lenders in connection with the administration and management of this Agreement and the other Loan Documents, in each case in accordance with customary market practice.

 

 

 

Section 11.14         Treatment of Information.

 

(a)  Certain of the Lenders may enter into this Agreement and take or not take action hereunder or under the other Loan Documents on the basis of information that does not contain material non-public information with respect to any of the Loan Parties (“Restricting Information”). Other Lenders may enter into this Agreement and take or not take action hereunder or under the other Loan Documents on the basis of information that may contain Restricting Information. Neither any Agent nor any of its Related Persons shall, by making any Communications (including Restricting Information) available to a Lender Party, by participating in any conversations or other interactions with a Lender Party or otherwise, make or be deemed to make any statement with regard to or otherwise warrant that any such information or Communication does or does not contain Restricting Information nor shall any Agent or any of its Related Persons be responsible or liable in any way for any decision a Lender Party may make to limit or to not limit its access to Restricting Information. In particular, no Agent nor any of its Related Persons (i) shall have, and each Agent, on behalf of itself and each of its Related Persons, hereby disclaims, any duty to ascertain or inquire as to whether or not a Lender Party has or has not limited its access to Restricting Information, such Lender Party’s policies or procedures regarding the safeguarding of material, nonpublic information or such Lender Party’s compliance with applicable laws related thereto or (ii) shall have, or incur, any liability to any Loan Party or Lender Party or any of their respective Related Persons arising out of or relating to any Agent or any of its Related Persons providing or not providing Restricting Information to any Lender Party.

 

(b) Each Loan Party agrees that (i) all Communications it provides to any Agent intended for delivery to the Lender Parties whether by posting to the Approved Electronic Platform or otherwise shall be clearly and conspicuously marked “PUBLIC” if such Communications do not contain Restricting Information which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof, (ii) by marking Communications “PUBLIC,” each Loan Party shall be deemed to have authorized the Agents and the Lender Parties to treat such Communications as either publicly available information or not material information (although, in this latter case, such Communications may contain sensitive business information and, therefore, remain subject to the confidentiality undertakings of Section 11.13) with respect to such Loan Party for purposes of United States Federal and state securities laws, (iii) all Communications marked “PUBLIC” may be delivered to all Lender Parties and may be made available through a portion of the Approved Electronic Platform designated “Public Side Information,” and (iv) the Agents shall be entitled to treat any Communications that are not marked “PUBLIC” as Restricting Information and may post such Communications to a portion of the Approved Electronic Platform not designated “Public Side Information.” No Agent nor any of their Affiliates shall be responsible for any statement or other designation by a Loan Party regarding whether a Communication contains or does not contain material non-public information with respect to any of the Loan Parties nor shall any Agent or any of its Affiliates incur any liability to any Loan Party, any Lender Party or any other Person for any action taken by such Agent or any of its Affiliates based upon such statement or designation, including any action as a result of which Restricting Information is provided to a Lender Party that may decide not to take access to Restricting Information. Nothing in this Section 11.14 shall modify or limit a Lender Party’s obligations under Section 11.13 with regard to Communications and the maintenance of the confidentiality of or other treatment of Information.

 

(c) Each Lender Party acknowledges that circumstances may arise that require it to refer to Communications that might contain Restricting Information. Accordingly, each Lender Party agrees that it will nominate at least one designee to receive Communications (including Restricting Information) on its behalf and identify such designee (including such designee’s contact information) on such Lender Party’s Administrative Questionnaire. Each Lender Party agrees to notify the Administrative Agent from time to time of such Lender Party’s designee’s e-mail address to which notice of the availability of Restricting Information may be sent by electronic transmission.

 

(d) Each Lender Party acknowledges that Communications delivered hereunder and under the other Loan Documents may contain Restricting Information and that such Communications are available to all Lender Parties generally. Each Lender Party that elects not to take access to Restricting Information does so voluntarily and, by such election, acknowledges and agrees that the Agents and other Lender Parties may have access to Restricting Information that is not available to such electing Lender Party. No Agent nor any Lender Party with access to Restricting Information shall have any duty to disclose such Restricting Information to such electing Lender Party or to use such Restricting Information on behalf of such electing Lender Party, and shall not be liable for the failure to so disclose or use, such Restricting Information.

 

 

(e) The provisions of the foregoing clauses of this Section 11.14 are designed to assist the Agents, the Lender Parties and the Loan Parties, in complying with their respective contractual obligations and applicable law in circumstances where certain Lender Parties express a desire not to receive Restricting Information notwithstanding that certain Communications hereunder or under the other Loan Documents or other information provided to the Lender Parties hereunder or thereunder may contain Restricting Information. No Agent nor any of its Related Persons warrants or makes any other statement with respect to the adequacy of such provisions to achieve such purpose nor does any Agent or any of its Related Persons warrant or make any other statement to the effect that a Loan Party’s or Lender Party’s adherence to such provisions will be sufficient to ensure compliance by such Loan Party or Lender Party with its contractual obligations or its duties under applicable law in respect of Restricting Information and each of the Lender Parties and each Loan Party assumes the risks associated therewith.

 

Section 11.15         Governing Law. This Agreement, each other Loan Document that does not expressly set forth its applicable law, and the rights and obligations of the parties hereto and thereto shall be governed by, and construed and interpreted in accordance with, the law of the State of New York.

 

Section 11.16         Jurisdiction. (a) Submission to Jurisdiction. Any legal action or proceeding with respect to any Loan Document shall be brought exclusively in the courts of the State of New York located in the City of New York, Borough of Manhattan, or of the United States of America for the Southern District of New York and, by execution and delivery of this Agreement, each of Parent and the Borrower hereby accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of the aforesaid courts; provided that nothing in this Agreement shall limit the right of the Administrative Agent or the Collateral Agent to commence any proceeding in the federal or state courts of any other jurisdiction to the extent the Administrative Agent or the Collateral Agent determines that such action is necessary or appropriate to exercise its rights or remedies under the Loan Documents. The parties hereto (and, to the extent set forth in any other Loan Document, each other Loan Party) hereby irrevocably waive any objection, including any objection to the laying of venue or based on the grounds of forum non conveniens, that any of them may now or hereafter have to the bringing of any such action or proceeding in such jurisdictions.

 

(b) Service of Process. Each of Parent and Borrower (and, to the extent set forth in any other Loan Document, each other Loan Party) hereby irrevocably waives personal service of any and all legal process, summons, notices and other documents and other service of process of any kind and consents to such service in any suit, action or proceeding brought in the United States of America with respect to or otherwise arising out of or in connection with any Loan Document by any means permitted by applicable Requirements of Law, including by the mailing thereof (by registered or certified mail, postage prepaid) to the address of Borrower specified in Section 11.11 (and shall be effective when such mailing shall be effective, as provided therein). Each of Parent and Borrower (and, to the extent set forth in any other Loan Document, each other Loan Party) agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

 

(c) Additional Service of Process. Nothing contained in this Section 11.16 shall affect the right of the Administrative Agent, the Collateral Agent or any Lender or the L/C Issuer to serve process in any other manner permitted by applicable Requirements of Law or commence legal proceedings or otherwise proceed against any Loan Party in any other jurisdiction.

 

 

Section 11.17    WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING (INCLUDING ANY COUNTERCLAIM) WITH RESPECT TO, OR DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH, ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED THEREIN OR RELATED THERETO (WHETHER FOUNDED IN CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO OTHER PARTY AND NO RELATED PERSON OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THE LOAN DOCUMENTS, AS APPLICABLE, BY THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.17.

 

Section 11.18    Severability. Any provision of any Loan Document being held illegal, invalid or unenforceable in any jurisdiction shall not affect any part of such provision not held illegal, invalid or unenforceable, any other provision of any Loan Document or any part of such provision in any other jurisdiction.

 

Section 11.19    Execution in Counterparts. This Agreement may be executed in any number of counterparts and by different parties in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Signature pages may be detached from multiple separate counterparts and attached to a single counterpart. Delivery of an executed signature page of this Agreement by facsimile transmission or Electronic Transmission shall be as effective as delivery of a manually executed counterpart hereof.

 

Section 11.20    Entire Agreement. THE LOAN DOCUMENTS EMBODY THE ENTIRE AGREEMENT OF THE PARTIES AND SUPERSEDE ALL PRIOR AGREEMENTS AND UNDERSTANDINGS RELATING TO THE SUBJECT MATTER THEREOF AND ANY PRIOR LETTER OF INTEREST, COMMITMENT LETTER, FEE LETTER, AGENCY FEE LETTER, CONFIDENTIALITY AND SIMILAR AGREEMENTS INVOLVING ANY LOAN PARTY AND ANY OF THE AGENTS, ANY LENDER OR ANY L/C ISSUER OR ANY OF THEIR RESPECTIVE AFFILIATES RELATING TO A FINANCING OF SUBSTANTIALLY SIMILAR FORM, PURPOSE OR EFFECT. IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THIS AGREEMENT AND ANY OTHER LOAN DOCUMENT, THE TERMS OF THIS AGREEMENT SHALL GOVERN (UNLESS SUCH TERMS OF SUCH OTHER LOAN DOCUMENTS ARE NECESSARY TO COMPLY WITH APPLICABLE REQUIREMENTS OF LAW, IN WHICH CASE SUCH TERMS SHALL GOVERN TO THE EXTENT NECESSARY TO COMPLY THEREWITH).

 

Section 11.21    Use of Name. Each of Parent and Borrower agrees, and shall cause each other Loan Party to agree, that it shall not, and none of its Affiliates shall, issue any press release or other public disclosure (other than any document filed with any Governmental Authority relating to a public offering of the Securities of any Loan Party) using the name, logo or otherwise referring to any Agent, Arranger, Syndication Agent or of any of their respective Affiliates, the Loan Documents or any transaction contemplated therein to which the Secured Parties are party without at least 2 Business Days’ prior notice to such Agent, Syndication Agent or Arranger, and without the prior consent of such Agent, Syndication Agent or Arranger except to the extent required to do so under applicable Requirements of Law and then, only after consulting with such Agent, Syndication Agent or Arranger prior thereto.

 

 

Section 11.22    Patriot Act Notice. Each Lender subject to the Patriot Act hereby notifies Parent, the Borrower and each Loan Party that, pursuant to Section 326 thereof, it is required to obtain, verify and record information that identifies such Person, including the name and address of such Person and other information allowing such Lender to identify such Person in accordance with such act.

 

Section 11.23    Borrower Ratification of Loan Documents. The Borrower hereby consents to the amendment and restatement of the Original Credit Agreement effected hereby and confirms and agrees that (a) notwithstanding the effectiveness of this Agreement, the Guaranty and Security Agreement and Trademark Security Agreement are, and shall continue to be, in full force and effect and are hereby ratified and confirmed in all respects and (b) the security documents to which the Borrower is a party and all of the Collateral described therein do, and shall continue to, secure the payment of all of the Guaranteed Obligations (as defined in the Guaranty and Security Agreement). For greater certainty and without limiting the foregoing, the Borrower hereby confirms that the existing security interests granted by the Borrower in favor of the Secured Parties pursuant to the Loan Documents in the Collateral described therein shall continue to secure the obligations of the Borrower under this Agreement and the other Loan Documents

 

Section 11.24    Guarantor Ratification of Loan Documents. Each Guarantor hereby consents to the amendment and restatement of the Original Credit Agreement effected hereby and confirms and agrees that (a) notwithstanding the effectiveness of this Agreement, the Guaranty and Security Agreement and Trademark Security Agreement are, and shall continue to be, in full force and effect and are hereby ratified and confirmed in all respects and (b) the security documents to which such Guarantor is a party and all of the Collateral described therein do, and shall continue to, secure the payment of all of the Guaranteed Obligations (as defined in the Guaranty and Security Agreement). For greater certainty and without limiting the foregoing, each Guarantor hereby confirms that the existing security interests granted by such Guarantor in favor of the Secured Parties pursuant to the Loan Documents in the Collateral described therein shall continue to secure the obligations of such Guarantor under this Agreement and the other Loan Documents.

 

[SIGNATURE PAGES FOLLOW]

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

 

	FrANcesca’s Collections, Inc.
	as Borrower
	By:	/s/ Kal Malik
	Name: Kal Malik
	Title: Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary
	Francesca’s LLC,
	as Parent
	By:	/s/ Kal Malik
	Name: Kal Malik
	Title: Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary

 

Signature Page to

Second Amended and Restated Credit Agreement

 

 

	ROYAL BANK OF CANADA,
	as Administrative Agent
	By:	/s/ Rodica Dutka
		Name: Rodica Dutka
		Title: Manager, Agency
	ROYAL BANK OF CANADA,
	as Collateral Agent
	By:	/s/ Rodica Dutka
		Name: Rodica Dutka
		Title: Manager, Agency

 

Signature Page to

Second Amended and Restated Credit Agreement

 

 

	ROYAL BANK OF CANADA,
	as a Lender
	By:	/s/ Gordan MacArthur
		Name: Gordan MacArthur
		Title: Authorized Signatory

 

Signature Page to

Second Amended and Restated Credit Agreement

 

 

	KEYBANK NATIONAL ASSOCIATION,
	as L/C Issuer
	By:	/s/ Marianne T. Meil
		Name: Marianne T. Meil
		Title: Sr. Vice President

 

Signature Page to

Second Amended and Restated Credit Agreement

 

 

	KEYBANK NATIONAL ASSOCIATION,
	as a Lender
	By:	/s/ Marianne T. Meil
		Name: Marianne T. Meil
		Title: Sr. Vice President

 

Signature Page to

Second Amended and Restated Credit Agreement

 

 

SCHEDULE I

 

Commitments

 

Lender		Commitments
Royal Bank of Canada		$	37,500,000	.00
KeyBank National Association		$	37,500,000	.00
Total		$	75,000,000	.00

 

 

Schedule 4.2

 

Consents

 

None.

 

 

Schedule 4.3

 

Ownership of Borrower and Subsidiaries

 

Name of Subsidiary

Direct Owner

Number of Shares Authorized

Number of Shares Outstanding

Ownership Percentage

Jurisdiction of Organization

Francesca’s Collections, Inc.

Francesca’s LLC

1,000

1,000

100

%

Texas

 

 

Schedule 4.12

 

Labor Matters

 

None.

 

 

Schedule 4.13

 

List of Plans

 

Francesca’s Collections, Inc. 401(k) Retirement Plan, effective on October 1, 2009.

 

 

Schedule 4.14

 

Environmental Matters

 

 

None.

 

 

Schedule 4.16

 

Real Property

 

Owned Real Property

 

None.

 

Leased Real Property

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

CORP

TX

New Corporate Office

8760 Clay Rd., Suite 100

Houston

TX

77080

CORP

CA

California Buying Office

777 E 10th Street, Unit #403

Los Angeles

CA

90015

001

TX

Woodway Village

6514 Woodway

Houston

TX

77057

713-722-0754

002

003

TX

Champion Forest Plaza

5468 W. FM 1960

Houston

TX

77069

832-249-6534

004

TX

Mockingbird Station

5307 E Mockingbird Ln #105

Dallas

TX

75206

214-370-3646

005

TX

Preston Oaks

10720 Preston Rd. #1005

Dallas

TX

75230

214-891-9866

006

TX

Uptown Park

1141-08 Uptown Park Blvd.

Houston

TX

77056

713-622-1254

007

TX

University Park

1600 S. University #604

Fort Worth

TX

76107

817-882-8077

008

CA

Montana

1230 Montana Ave. #106

Santa Monica

CA

90403

310-255-1988

009

TX

Plano

1900 Preston #320

Plano

TX

75093

214-473-8133

010

LA

Canal Place

333 Canal St. #219

New Orleans

LA

70130

504.581.4402

011

IL

Geneva Commons

1520 Commons Dr.

Geneva

IL

60134

630-262-9470

012

IL

Church Street Plaza

1706 Maple Ave.

Evanston

IL

60201

847-328-5459

013

CA

Manhattan Village

3200 N. Sepulveda #D10

Manhattan Beach

CA

90266

310-546-4700

014

TX

Alamo Quarry Market

255 E. Basse Rd. #420

San Antonio

TX

78209

210-822-1598

015

TX

Westbank

3300 Bee Cave Rd. #420

Austin

TX

78746

512-347-7508

016

TX

Highland Village

4022 Westheimer

Houston

TX

77027

713-961-3399

017

TX

Arboretum

10000 Research Blvd #122 C-01

Austin

TX

78759

512-795-9840

018

IL

Lincoln Park

2012 N. Halsted Ave.

Chicago

IL

60614

773-244-4075

019

CA

La Jolla

1025 Prospect St. #160

La Jolla

CA

92037

858-729-0350

020

TX

Southlake

214 State St.

Southlake

TX

76092

817-424-5353

021

CA

Carlsbad

1923 Calle Barcelona #146

Carlsbad

CA

92024

760-943-8644

022

NV

Green Valley

2260 Village Walk, Suite 112

Henderson

NV

89052

702-435-3288

023

TX

Central Park

4001 N. Lamar, Suite 490

Austin

TX

78756

512-323-2499

025

CA

Long Beach

5257 E. 2nd St.

Long Beach

CA

90803

562-856-3257

026

CA

Rancho Cucamonga

7839 Kew Ave. Suite 5620

Rancho Cucamonga

CA

91739

909-899-5751

027

OK

Edmond

1470 S Bryant Ave

Edmond

OK

73034

405-359-7576

028

IL

Rennaisance Place

1850 2nd St #106

Highland Park

IL

60035

847-926-8278

029

TN

Saddle Creek

7615 W. Farmington Blvd. Ste. 33

Germantown

TN

38138

901-753-6847

030

LA

Bellemead

6535 Youree Dr. Suite 501

Shreveport

LA

71105

318-798-8484

031

NE

Village Pointe

17151 Davenport #113

Omaha

NE

68118

402-359-1312

032

MN

Arbor Lake

12121 Elm Creek Blvd.

Maple Grove

MN

55369

763-425-3252

033

CT

The Shoppes at Buckland Hills

194 Buckland Hills Dr. Suite 1056

Manchester

CT

6042

034

AL

Summit

200 Summit Blvd. Ste #600

Birmingham

AL

35243

205-969-2432

035

IL

Deer Park

20530 N. Rand Rd. Ste #344

Deer Park

IL

60010

847-726-2363

036

WI

Greenway Lakes

1650 Deming Way Ste #108

Middleton

WI

53562

608-831-6630

037

MN

Woodbury Lake

9020 Hudson Rd Ste 412

Woodbury

MN

55125

651-730-0608

038

TN

Carriage Crossing

4610  Merchant's Park Cir.#557

Collierville

TN.

38017

901-861-3287

039

IL

Orland Park

14215 La Grange Rd. Space 124

Orland Park

IL

60462

708-349-8490

040

OH

Easton Town Center

108 Easton Town Center

Columbus

OH.

43219

614-476-6410

041

KY

Crestview Hills Town Center

2868 Town Center Blvd. St.7055

Crestview Hills

KY.

41017

859-341-4426

043

AL

Shoppes at Eastchase

6830 Eastchase Pkwy

Montgomery

AL.

36117

334-271-2110

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

044

NE

Southpoint Pavillions

2910 Pine Lake Road Suite L

Lincoln

NE.

68516

402-421-1589

045

CO

Promenade Shops at Centerra

5855 Sky Pond Dr. Ste. # F124

Loveland

CO.

80538

970-663-9004

046

OK

Brookhaven Village Plaza

3720 West Robinson Suite 128

Oklahoma City

OK

73072

405-360-2891

047

OH

Levis Common

3195 Levis Commons Blv.#285

Perrysburg

OH.

43551

419-874-3580

048

TN

Hamilton Corner

2115 Gunbarrel Rd. #C

Chattanoga

TN.

37421

423-893-8978

049

TN

The Pinnacle at Turkey Creek

11347 Parkside Drive

Knoxville

TN

37934

865-675-6361

050

AR

Turtle Creek

3000 E. Highland Dr. Ste#413

Jonesboro

AR

72401

870 336-2674

051

AL

Eastern Shore Center

30500 State Hwy 181 Ste# 313

Spanish Fort

AL

36527

251-621-5740

052

FL

The Avenue

2261 Town Center Ave. Suite 105

Viera

FL

32940

321-639-3200

053

GA

The Avenue Webb Gin

1350 Scenic Highway, Spc 316

Snellville

GA

30078

678 344 0112

054

TX

Woodlands Market Street

9595 Six Pines Dr. Ste 870

The Woodlands

TX

77380

281-419-3750

055

MO

Branson Landing

319 Branson Landing

Branson

MO

65616

417-335-4342

056

OH

Beachcliff Market

19344 Detriot Rd Spc #A-112

Rocky River

OH

44116

440-333-3418

057

OH

Legacy Village

24639 Cedar Rd.

Lyndhurst

OH

44124

216-381-5390

058

GA

West Cobb

3625 Dallas Hwy SW Spc #850

Marietta

GA

30064

770-218-9351

059

NC

Friendly Center

3326 W. Friendly Ste# 118

Greensboro

NC

27410

336-856-1934

060

CA

Galleria at Tyler

1299 Galleria at Tyler #G109

Riverside

CA

92503

951-353-9513

061

CO

Boulder

1850 29TH St Ste# 1012

Boulder

CO

80301

303-442-1722

062

CO

Southland Shopping Center

6235 S. Main St. Ste#108

Aurora

CO

80016

720-274-5338

063

PA

Saucon Valley

2960 Center Valley Parkway  #733

Center Valley

PA

18034

610-798-9901

064

AR

Little Rock Ark

207 N. University Ave.  #180

Little Rock

AR

72205

501-660-4203

065

066

TX

Inwood Village

5330 West Lover's Lane  #112

Dallas

TX.

75209

214-351-0649

067

GA

Abercorn Walk Shopping Center

5525 Abercorn St. Suite#55

Savannah

GA

31405

912-355-7181

068

FL

Bell Tower

13499 US 41 SE #119 Space C-304

Fort Myers

FL

33907

239-267-5050

069

SC

Mount Pleasant Town Center

1237 Belk Drive Suite S-2

Mt. Pleasant

SC

29464

843 884 3958

070

NC

Blakeney Center

9830 Rea Road Suite C

Charlotte

NC

28277

704-544-3104

071

TX

Arlington Highlands

3900 Arlington Highlands Blvd. #177

Arlington

TX

76018

817-419-0371

072

TX

La Palmera

5488 S. Padre Island Dr. #1430

Corpus Christi

TX

78411

073

TX

Shops at Highland Village

1400 Shoal Creek, Suite 170

Highland Village

TX

75077

972-966-0400

074

TX

Stone Oak

22702 US 281, Suite 110

San Antonio

TX

78259

210-481-1382

075

KS

Town Center Plaza

5000 W. 119th Street, Suite 200

Leawood

KS

66209

913-696-1272

076

TN

Hill Center

4017 Hillsboro Pike, Suite 308

Nashville

TN

37215

615-783-0960

077

TN

The Avenue

2615 Medical Center Pkwy Suite 1430

Murfreesboro

TN

37129

615-893-7217

078

IL

Southport Row

3539 N. Southport

Chicago

IL

60657

773-248-4558

079

NC

Mayfaire Town Center

6823 Main Street

Wilmington

NC

28405

910-509-0083

080

SC

King's Street Charleston

338 King Street Unit A

Charleston

SC

29401

843-577-6848

081

TX

Hill Country Galleria

12821 Hill Country Blvd., Suite C2-115

Bee Cave

TX

78738

512-263-1993

082

FL

Pembroke Gardens

505 SW 145th Terrace

Pembroke Pines

FL

33027

954-885-5051

083

LA

Perkins Rowe

10156 Perkins Rowe, Suite 120

Baton Rouge

LA

70810

225-766-0275

084

AZ

Parke West

9828 Northern Ave., Suite 1750

Peoria

AZ

85345

623-772-0428

085

AL

Bridge Street Town Center

340 The Bridge Street, Suite 140

Huntsville

AL

35806

256-327-8595

086

TN

Indian Lake Speciality Center

300 Indian Lake Blvd. Bldg. A Ste 160

Hendersonville

TN

37075

615-822-1266

087

GA

Vinings Jubilee

4300 Paces Ferry, Ste 257

Atlanta

GA

30339

770-431-7672

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

088

AZ

Kierland-Scottsdale

15211 N Kierland Blvd Suite 140

Scottsdale

AZ

85254

480-991-9481

089

AZ

Arrowhead-Glendale

20022 North 67th Ave, Suite 122

Glendale

AZ

85308

623-376-2555

090

IL

Bucktown

1920 W. North Ave

Chicago

IL

60622

773-486-0293

091

AL

Zelda Place

2920-F Zelda Road

Montgomery

AL.

36106

344-277-9094

092

LA

Magazaine Street

3333 Magazine Street

New Orleans

LA

70115

504-899-2118

093

TX

Watter Creek

843 Market Street

Allen

TX

75013

214-383-2954

094

MS

Dogwood Festival

110 Dogwood Blvd., suite G 3B

Flowood

MS

39232

601-992-9119

095

MS

Rennisance Place

1000 Highland Colony Pkwy. Ste 1012

Ridgeland

MS

39157

601-856-2266

096

NC

Birkdale

16845-B Birkdale Commons Pkwy.

Huntersville

NC

28078

704-896-9644

097

AL

Legacy Village

9 DuRhu Dr. Suite 350

Mobile

AL

36608

251-342-1959

098

AZ

Village Square @ Dana Park

1660 S. Val Vista Dr. Ste. 116

Mesa

AZ

85204

480-545-2685

099

NC

Collumbia Cameron Village

424 Woodburn Ave.

Raleigh

NC

27605

919-829-8250

100

CO

Aspen Grove

7301 S. Santa Fe Dr. Unit 420 B

Littleton

CO

80120

303-794-4783

101

NJ

Promenade at Sagemore

500 Route 73 South, Suite C-1

Marlton

NJ

8053

856-983-2400

102

FL

Mizner Park

322 Plaza Real

Boca Raton

FL

33432

561-544-6892

103

AZ

Casa Paloma

7131 West Ray Road, suite 26

Chandler

AZ

85226

480-753-3511

104

SC

Market Common

3323 Reed Ave., Space A6-700

Myrtle Beach

SC

29577

843-238-9320

105

GA

The Avenue Forsythe

410 Peachtree Pkwy, Bldg. #100, Suite  136

Cumming

GA

30041

106

TX

Memorial City Mall

707 Memorial City Mall (Space 707A)

Houston

TX

77024

107

IL

100 West Higgins Road, Suite F-35

South Barrington

IL

60010

108

NE

Regency Center

120 Regency Parkway, Suite 152

Omaha

NE

68114

109

NC

Crabtree Valley Mall

2840 Plaza Place, Ste 1084

Raleigh

NC

27615

110

AR

Pinnacle Hills Promenade

2203 Promenade Blvd. Ste 2112

Rogers

AR

72758

111

NC

284 South Stratford Rd.

Winston Salem

NC

27103

112

FL

Promenade Lyons @ Coconut Creek

4425 Lyons Rd. Ste F-104

Coconut Creek

FL

33073

113

TX

LaCantera

15300 LaCantera Pkwy, Ste 20100

San Antonio

TX

78256

114

DE

Greenville Center - Unit E236

3801 Kennett Pike

Greenville

DE

19807

115

FL

City Place

701 Rosemary Ave, Suite 157

West Palm Beach

FL

33401

116

AZ

La Encantada

2905 East Skyline Drive #143

Tuscan

AZ

85718

117

IL

Wheaton

55 East Loop Road #107

Wheaton

IL

60187

118

TX

Baybrook Mall

500 Baybrook Mall, Suite 1198

Friendswood

TX

77546

119

FL

Open Feb 09

4300 Legendary Dr., Suite B 104

Destin

FL

32541

120

OK

Penn Square Mall

1901 NW Expressway, Suite 1009A

Oklahoma City

OK

73118

121

FL

The Falls

888 SW 136st. , Suite 368

Miami

FL

33176

122

MO

Saint Louis Galleria

1162 Saint Louis Galleria, Space #1162

St. Louis

MO

63117

123

GA

The Forum

5165 Peachtree Pkwy, Suite 235

Norcross

GA

30092

124

MO

Country Club Plaza

4724 Broadway

Kansas City

MO

64112

125

NC

Southpark Mall

4400 Sharon Rd., Suite E07B

Charlotte

NC

28211

126

OK

Woodland Hills Mall

7021 South Memorial Dr., Suite #184

Tulsa

OK

74133

127

KS

Oak Park Mall

11445 W. 95th St.

Overland Park

KS

66214

128

NY

Eastview Mall

180 Eastview Mall, Space B12

Victor

NY

14564

129

KY

Walnut Street

5426 Walnut Street

Pittsburgh

PA

15232

130

PA

Oxmoor Mall

7900 Shelbyville Raod #D06

Louisville

KY

40222

131

NJ

Bridgewater

400 Commons Way #250

Bridgewater

NJ

0887

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

132

KS

Bradley Fair

200 North Rock Rd, 3134

Witchita

KS

37206

133

NM

ABQ Uptown

2261 Q Street NE, Suite 2F

Albuquerque

NM

87110

134

FL

Merrick Park

370 San Lorenxo Ave, Ste 2430

Coral Gables

FL

33146

135

MN

Rosedale Mall

111 Rosedale Center Space 195

Minneapolis

MN

55113

136

WI

Bayshore

5709 N Centerpark Way

Milwaukee

WI

53217

137

FL

The Avenues-Jacksonville

10300 southside Blvd, Sute 1490B

Jacksonville

FL

32256

138

GA

North Point Mall

1190 North Point Circle Ste 1190

Alpharetta

GA

30022

139

FL

West Shore Plaza

286 West Shore Plaza, Ste B,6,A

Tampa

FL

33609

140

MO

West County Mall

80 West County Center #1194

St. Louis

MO

63131

141

IN

Castleton Mall

6020East 82nd St. Suite 878

Indianapolis

IN

46250

142

PA

Park City Center

214 Park City Center

Lancaster

PA

17601

143

WI

West Towne Mall

42 West Towne Mall, A10

Madison

WI

53719

144

MA

Derby Street

92 Derby St #113

Hingham

MA

02043

145

FL

The Galleria at Fort Lauderdale

2414 E. sunrise blvd room 2089

Ft. Lauderdale

FL

33304

146

NC

Southpointe Mall

6910  Fayetteville Rd, Space #1155

Durham

NC

27713

147

CT

Danbury Faire Mall

7 Backus Ave, Space G-109

Danbury

CT

06810

148

NJ

Paramus Park

1105 Paramus Park

Paramus

NJ

07652

149

RI

Providence Place

One Providence Place #3080

Providence

RI

02903

150

KY

The Summit Louisville KY

4262 summit Plaza Dr. C-9

Louisville

KY

40241

151

MI

Village at Rochester Hills

160 N Adams Road

Rochester

MI

48309

152

AZ

Scottsdale Fashion

7014 E. Camelback rd# b-156

Scottsdale

AZ

85251

153

MA

Cambridge Side Galleria

100 Cambridge Place #W-324

Boston

MA

02141

154

IN

Clay Terrace

14395 Clay Terrace Blvd. #140

Carmel

IN

46032

155

NV

Town Square at Las Vegas

6593 Las Vegas Blvd #201

Las Vegas

NV

89119

156

IL

Northbrook Court

2171 Northbrook Ct. #2056

Northbrook

IL

60062

157

CT

Shops at Somerset Square

140 Glastonbury Blvd.

Glastonbury

CT

06033

158

GA

The Avenue East Cobb

4475 Roswell Rd. #1520

Marietta

GA

30062

159

OH

Polaris Town Center

Polaris Fashion Place #1042

Columbus

OH

43240

160

VA

Short Pump Town Center

11800 W. Broad St. #1044

Richmond

VA

23233

161

NJ

Rockaway Town Square

301 Mt Hope Aven #1018

Rockaway

NJ

07866

162

MA

Shoppes at Legacy Place

640 Legacy Place

Dedham

MA

02026

163

MD

Annapolis Mall

2002 Annapolis Mall #1484

Annapolis

MD

21401

164

SC

Columbiana Centre

100 Columbiana Cir. #1214

Columbiana

SC

29212

165

AZ

Park Place Mall

5870 East Broadway Blvd #416

Tuscon

AZ

85711

166

WI

Brookfield Mall

95 N Moorland Rd. #D22

Brookfield

WI

53005

167

NJ

The Grove at Shrewsbury

597 Route 35

Shrewsbury

NJ

07702

168

SC

Haywood Mall

106 Haywood Rd #1018

Greeenville

SC

29607

169

NJ

Menlo Park Mall

100 Menlo Park #2425

Edison

NJ

08837

170

MA

South Shore Plaza

250 Granite St.

Braintree

MA

02184

171

MN

Mall of America

60 East Broadway #S116

Bloomington

MN

55425

172

MO

Independence Center

1704 Independence Center #2024

Independence

MO

64057

173

VA

Barracks Road

1117 Emmet St.

Charlottesville

VA

22903

174

IL

Old Orchard

4999 Old Orchard Center Sp. E 45

Skokie

IL

60077

175

CA

Bay Street

5659 Bat St.

Emeryville

CA

94608

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

176

IL

Oakbrook Center

100 Oakbrook Center #32

Oakbrook

IL

60523

177

MA

Natick Collection

1245 Worcester St

Natick

MA

01760

178

LA

Lakeside Mall

3301 Veterans Blvd #89

Metairie

LA

70002

179

MI

Rivertown Crossing

4700 Canal Ave. SW #1050

Grandville

MI

49418

180

RI

Garden City Center

100 Midway Rd. #9015

Cranston

RI

02920

181

FL

Waterford Lakes

413 N Alafaya Trail #105

Orlando

FL

32828

182

NJ

Newport Center

30 Mall Dr. West, Suite BO9A

Jersey City

NJ

7310

183

OH

The Greene Town Center

73 Plum St. #G-118

Beaver Creek

OH

45440

184

CA

Old Towne

29 University Center #E29

Los Gatos

CA

95030

185

SF

Stonestown

3251 20th Ave.  #118

San Francisco

CA

94132

186

TN

Cool Springs Galleria

1800 Galleria Blvd. #1515

Franklin

TN

37067

187

OH

Kenwood Town Center

7875 Montgomery Rd. #R61

Cincinnati

OH

45236

188

AL

Riverchase Galleria

3000 Riverchase Galleria

Birmingham

AL

35244

189

IA

Jordan Creek

101 Jordan Creek Pkwy, Suite #11172

West Des Moines

IA

50266

190

CA

Oakridge Mall

925 Blossom Hill Rd

San Jose

CA

95123

191

ME

Maine Mall

364 Maine Mall

South Portland

ME

4106

192

CA

Horton Plaza

324 Horton Plaza #151

San Diego

CA

92101

193

IL

Water Tower Place

835 N Michigan Ave.  Space #6020

Chicago

IL

60611

194

FL

Altamonte Mall

451 East Altamonte Dr. #2333

Altamonte Springs

FL

32701

195

WA

Alderwood Mall

3000 184th St. SW #494

Lynwood

WA

90037

196

CA

Glendale Galleria

1155 Glendale Galleria Space C006

Glendale

CA

91210

197

NJ

Cherry Hill Mall

2000 Rt. 38 Space #514

Cherry Hill

NJ

08002

198

OH

Crocker Park

161 Main Street

Westlake

OH

44145

199

CA

North County Mall

272 E Via Rancho Pkwy

Escondido

CA

92025

200

TX

Deerbrook Mall

20131 Hwy 59 N.  Space 2328

Humble

TX

77338

201

WA

Pacific Place

600 Pine St. #253

Seattle

WA

98101

202

VA

Lynnhaven Mall

701 Lynnhaven Parkway Suite #1068

Virginia Beach

VA

23452

203

TN

West Town Mall

7600 Kingston Pike 1544A

Knoxville

TN

37919

204

IA

Coral Ridge Mall

1451 Coral Ridge Ave. Space #402

Coralville

IA

52241

205

CA

Del Monte Shopping Center

690 Del Monte Center #18A

Monterrey

CA

93940

206

MI

Twelve Oaks Mall

27500 Novi Road

Novi

MI

48377

207

FL

The Oaks

6419 Newberry Rd #A0013

Gainsville

FL

32605

208

CA

Galleria at Roseville

1151 Galleria Blvd. #148

Roseville

CA

95678

209

WA

Southcenter

611 Southcenter, #572

Seattle

WA

98188

210

CA

Village at Corte Madera

1618 Redwood Highway

Corte Madera

CA

94925

211

CA

Valencia Town Center

24201 Valencia Blvd. #3537

Valencia

CA

91355

212

CA

Fashion Valley

7007 Friars Rd Suite#583

San Diego

CA

92108

213

TX

First Colony Mall

16535 Southwest Freeway #275

Sugarland

TX

77479

214

CA

Burlingame Avenue

1235 Burlingame Ave

Burlingame

CA

94010

215

CA

Arden Fair

1689 Arden Way Suite #1167

Sacramento

CA

95815

216

NV

Meadowood Mall

5000 Meadwood Mall Cir Space #D122

Reno

NV

89502

217

MD

Bethesda Row

7115 Arlington Rd., Space #14

Bethesda

MD

20814

218

FL

Miami Int. Mall

1455 N.W. 107th Ave #596

Miami

FL

33172

219

CT

Shoppes at Farmington Valley

110 Albany Turnpike Suite 711

Canton

CT

06019

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

220

NV

Rampart Commons

1037 S Rampart Blvd

Summerlin

NV

89117

221

GA

Cumberland Mall

1000 Cumberland Dr. Space 1208

Atlanta

GA

30339

222

NJ

Quarter at Tropicana

2801 Pacific Ave #2228

Atlantic City

NJ

08401

223

IN

Circle Center

49 W Maryland St Space E-16

Indianapolis

IN

46204

224

NY

Carousel Center

9090 Carousel Center Space F-206

Syracuse

NY

13290

225

NY

Walt Whitman

160 Walt Whitman Rd, Ste#1003a

Huntington

NY

11746

226

CA

The Oaks

548 W. Hilcrest Dr

Thousand Oaks

CA

91360

227

MD

Gallery at Harborplace

200 E Pratt St. #1010

Baltimore

MD

21202

228

CA

Del Amo

3525 Carson St Suite 175

Torrance

CA

90503

229

SC

Barefoot Landing

4816 Hwy 17 South

N.Myrtle Beach

SC

29582

230

TX

La Plaza

2200 10th Street SuiteE02A

McAllen

TX

78503

231

MI

Mall At Partridge Creek

17360 Hall Road Space #179

Clinton Township

MI

48038

232

NY

The Orchard

4005 N Buffalo Road Suite #150

Orchard Park

NY

14128

233

CT

Connecticut Post Mall

1201 Boston Post Rd Suite 2016

Milford

CT

06460

234

MN

Ridgedale Mall

12323 Wayzata Blvd.

Minnetonka

MN

55305

235

TX

Northeast Mall

1101 Melbourne St Suite 3052

Hurst

TX

76053

236

NY

Staten Island Mall

2655 Richmond Ave

Staten Island

NY

10314

237

WI

Fox River Mall

4301 W Wisconsion Ave Suite 120

Appleton

WI

54913

238

CA

Irvine Spectrum

83 Fortune Dr Suite 237

Irvine

CA

92618

239

NJ

Freehold Mall

3710 Rt.9  Suite

Freehold

NJ

07728

240

MD

Towson Town Center

825 Dulaney Valley Rd 4090

Towson

MD

21204

241

MA

Cape Cod Mall

769 Lyannough Road Suite S184

Hyannis

MA

02601

242

NJ

Ocean County Mall

1201  Hooper Ave Suite 1081

Toms River

NJ

08753

243

NY

Mall at Smith Haven

313 Smith Haven Mall #L20

Lake Grove

NY

11755

244

VA

Reston Town Center

11936 Market St

Reston

VA

20190

245

VA

Fashion Center at Pentagon

1100 S. Hayes St. #Q-7

Arlington

VA

22202

246

FL

Citrus Park Mall

7949 Citrus Park Center

Tampa

FL

33625

247

FL

Coral Square Mall

9469 W. Atlantic Blvd Suite 9097A

Coral Springs

FL

33071

248

MA

Mall at Solomon Pond

601 Donald Lynch Blvd., Suite N 247

Malborough

MA

01752

249

GA

Perimeter Mall

4400 Ashford Dunwoody Road Ste. 2370

Atlanta

GA

30346

250

IN

Glenbrook Square

4201 Coldwater Blvd. Unit C03

Fort Wayne

IN

46805

251

WI

Mayfair Mall

2500 N. Mayfair Rd.  Space 264

Milwaukee

WI

53226

252

OH

Mall at Summit

3265 W. Market St. #556

Akron

OH

44333

253

CA

Valley Plaza Mall

2701 Ming Ave .#253

Bakersfield

CA

93304

254

KY

Fayette Mall

3401 Nicholasville Rd. Suite 418

Lexington

KY

40503

255

LA

Acadiana Mall

5725 Johnson Street, S[ace B-114

Lafayette

LA

70503

256

MO

Battlefield Mall

2825 S. Glenstone #U03A

Springfield

MO

65804

257

TX

Westgate Mall

7791 W. Interstate 40  Suite 320

Amarillo

TX

79121

258

WA

Tacoma Mall

4502 S. Steele St. #670

Tacoma

WA

98409

259

NJ

Willowbrook Mall

1505 Willowbrook Mall

Wayne

NJ

07470

260

RI

Long Wharf Shops

Thames & Long Wharf #F1

Newport

RI

02840

261

FL

Coastland Mall

1766 Tamiami Trail

Naples

FL

34102

262

CA

Shops at Mission Viejo

906 Shoppes at Mission Viejo

Mission Viejo

CA

95691

263

FL

Florida Mall

8001 S. Orange Blosson Trail

Orlando

FL

32809

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

264

NH

Pheasant Lane Mall

310 Daniel Webster Hwy #W227

Nashua

NH

03060

265

VA

Chesterfield Town Center

11500 Midlothian Turnpike

Richmond

VA

23235

266

VA

Tyson's Corner

7965 Tyson's Corner Center

McLean

VA

22102

267

CA

Blackhawk Plaza

3400 Blackhawk Plaza Circle, Space D12-6

Danville

CA

94506

268

NJ

Shops at Riverside

One Riverside Square #240

Riverside

NJ

07601

269

NH

Mall at Rockingham Park

99 Rockingham Park Blvd. #E135

Salem

NH

03079

270

IN

Hamilton Town Center

13170 Harrell Pkwy #400

Nobelsville

IN

46060

271

PA

Ross Park Mall

1000 Ross Park Mall Dr. #H25

Pittsburgh

PA

15237

272

MD

White Marsh Mall

8200 Perry Hall Blvd #1125

Baltimore

MA

21236

273

CA

Topanga

6600 Topanga Canyon Blvd, #2074

Conoga Park

CA

91303

274

ID

Boise Town Square

350 N. Milwaukee #1105

Boise

ID

83704

275

FL

Town Center at Boca Raton

6000 Galdes Road Suite 200

Boca Raton

FL

33431

276

PA

Shoppes at Sesquehanna

2617 Brindle Drive #C2

Harrisburg

PA

17110

277

MI

Woodland Mall

3195  28th St. SE

Grand Rapids

MI

49512

278

MO

The Meadows at Lake St.Louis

10 Meadows Circle Dr. #108

St. Louis

MO

63367

279

MA

Longmeadow Shops

704 Bliss Road

Longmeadow

MA

01106

280

IL

St. Clair Square

151 St. Clair Square

Fairview Heights

IL

62208

281

CA

The Gardens at El Paseo

73-585 El Paseo #1102

Palm Desert

CA

92260

282

OR

Bridgeport Village

7351 SW Bridgeport Rd.

Tigard

OR

97224

283

CA

Universal City Walk

1000 Universal Studios Blvd.

Hollywood

CA

91608

284

CA

Fashion Island

100 Innovation Dr.

Newport Beach

CA

92660

285

NJ

Garden State

1 Garden State Plaza #2131

Paramus

NJ

07652

286

IL

#39RL Orland Square Mall

288 Orland Square

Orland Park

IL

60462

287

CA

Main Place

2800 N. Main St #348

Santa Ana

CA

92705

288

AZ

San Tan Village

2218 E Willians Field Rd. Suite 632

Gilbert

AZ

85295

289

FL

Coconut Point

23161 Fashion Drive Suite 121

Estero

FL

33928

290

AR

Promenade at Chenal

17711 Chenal Parkway Suite C-108

Little Rock

AR

72223

291

CA

Santa Anita

400 Baldwin Ave Suite 372-L

Arcadia

CA

91007

292

MD

Washingtonian Center

19 Grand Corner Avenue

Gaithersburg

MD

20878

293

GA

The Shoppes at River Crossing

5080 Riverside Drive Suite 429

Macon

GA

31210

294

MD

Festival at Woodholme

1809 Reistertown Road, Suite 114

Baltimore

MD

21208

295

FL

Cordova Mall

5100 North 9th Ave Suite D431

Pensacola

FL

32504

296

NY

Poughkeepsie Galleria

2001 South Road Space B - 202

Poughkeepsie

NY

12601

297

NJ

Deptford Mall

1750 Deptford Center Rd Space 2029

Deptford

NJ

08096

298

SC

Coligny Plaza

1 N. Forest Beach Dr. Building M Space 5

Hilton Head Island

SC

29928

299

TX

Kingsgate Center

8201 Quaker Ave, Suite 139

Lubbock

TX

79429

300

FL

Pier Park Mall

600 Pier Park Drive Suite 125

Panama City

FL

32413

301

NJ

Woodbridge Mall

216 Woodbridge Center Drive

Woodbridge

NJ

07095

302

FL

Treasure Coast Mall

3194 N.W. Federal Hwy.

Jensen Beach

FL

34957

303

NY

Ridge Hill

1Ridge Hill Boulevard Suite 1330

Yonkers

NY

10710

304

NY

Crossgates Mall

One Crossgates Mall Rd. Space B 232

Albany

NY

12203

305

CA

Stoneridge Mall

1336 Stoneridge Mall D-120

Pleasanton

CA

94588

306

AZ

Chandler Fashion Square

3111 W. Chandler Blvd Space 1196

Chandler

AZ

85226

307

NC

Carolina Place

11025 Carolina Place Parkway Space A-20

Pineville

NC

28134

308

GA

Mall of Georgia

3333 Buford Drive Suite 2015

Atlanta

GA

30519

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

309

GA

Town Center at Cobb

400 Ernest Barrett Pkwy Suite 170

Kennesaw

GA

30144

310

PA

South Hills Mall

301 South Hills Village Suite 1070 A

Pittsburgh

PA

15241

311

UT

Fashion Place

6191 South State Street #236

Salt Lake  City

UT

84107

312

UT

University Mall

575 E. University Parkway Suite C55

Provo

UT

84097

313

VT

Burlington Town Center

49 Church St Burlington Space #1026

Burlington

VT

05401

314

MN

Crossroads Mall

4101 West Division Street Suite B0027

St. Cloud

MN

56301

315

CT

Trumbull Mall

5065 Main Street Suite 2075

Trumbull

CT

06611

316

MN

Apache Mall

333 Apache Mall Space 409

Rochester

MN

55902

317

MO

Columbia Mall

2300 Bernadette Drive Space #508

Columbia

MO

65203

318

UT

The Gateway

50 South Rio Grande St Suite 1085

Salt Lake City

UT

84101

319

CA

Paseo Nuevo

727 State Street

Santa Barbara

CA

93101

320

IL

Marketplace Mall

2000 N Neil Street Space 370

Champagne

IL

61820

321

PA

Suburban Square

33 Coulter Ave

Ardmore

PA

19003

322

MO

Chesterfield Mall

291 Cesterfield Mall, space 616

Chesterfield

MO

63017

323

IL

White Oaks Mall

2501 Wabash Ave Space H05B

Springfiled

IL

62704

324

MN

Miller Hill Mall

1600 Miller Trunk Highway Space L06

Duluth

MN

55811

325

AR

Northwest Arkansas Mall

4201 N. Shiloh Dr Space 1665

Fayetteville

AR

72703

326

AR

Central Mall

5111 Rodgers Avenue Suite 160

Fort Smith

AR

72903

327

IN

Greenwood Park Mall

1251 US Highway 31 N Space #D11B

Greenwood

IN

46142

328

TX

Shops at Legacy

7201 Bishop Road Ste E-9

Plano

TX

75024

329

IN

University Park Mall

6501 North Grape Space 108 Mishawaka

Mishawaka

IN

46545

330

PA

Monroeville Mall

225A Monroeville Mall Monroeville

Monroeville

PA

15146

331

MI

Briarwood Mall

264 Briarwood Circle,G-106, Ann Arbor

Ann Arbor

MI

48108

332

MN

Southdale  Center

10 Southdale Center Suite 1750  Edina

Edina

MN

55435

333

WI

Bay Park Square

2401 South Oneida St. Space 645 Square Green Bay

Green Bay

WI

54304

334

CA

Promenade at Peninsula

550 Deep Valley Dr Suite 266 Rolling Hills Estates

Rolling Hills

CA

90274

335

CT

Waterford Commons

915 Hartford Turnpike, space# 29, waterford, CT

Waterford

CT

06385

336

MO

South County Mall

18 south county centerway, suite 301, St. Louis, MO

St. Louis

MO

63129

337

PA

Shops at Montage

2451 Shoppes Blvd

Moosic

PA

18507

338

PA

Millcreek Mall

654 Millcreek Mall Unit 420

Erie

PA

16565

339

OH

Southpark Mall

500 South Park Center  Space AL-152

Strongsville

OH

44136

340

VA

MacArthur Mall

300 Monticello Ave. Suite #285

Norfolk

VA

23510

341

VA

Fair Oaks Mall

11750 FAIR OAKS MALL, SPACE K-113

Fairfax

VA

22033

342

NY

Palisades Center

2671 Palisades Center Drive

West Nyack

NY

10994

343

MI

Laurel Park Place

37562 W. 6 Mile Road Suite G-510

Livonia

MI

48152

344

CA

San Francisco Center

865 MARKET STREET suite 212

San Francisco

CA

94103

345

OH

Deerfield Town Center

5615 Deerfield Blvd. Space 3100

Mason

OH

45040

346

MD

Mall in Columbia

10300 LITTLE PATUXENT PARKWAY, SPACE 2800,

Columbia

MD

21044

347

OH

Mall at Tuttle Crossing

5043 Tuttle Crossing Blvd Suite 162

Dublin

OH

43016

348

CA

Hillsdale Shopping Center

158 HILLSDALE SHOPPING CENTER, SUITE 1350

San Mateo

CA

94403

349

LA

Pecanland Mall

4700 MILLHAVEN RD, SUITE 1042

Monroe

LA

71203

350

PA

Willow Grove Mall

2500 Moreland Road Suite 2069

Willow Grove

PA

19090

2001

TX

Houston Premium Outlets

29300 Hempstead Rd Suite 300

Cypress

TX

77433

351

CA

Otay Ranch

2015 Birch Road Suite 903

Chula Vista

CA

91915

352

IL

Hawthorne

122 Hawthorn Center Space 405

Vernon Hills

IL

60061

353

MI

The Crossroads

6650 South Westnedge Ave., Suite 216

Portage

MI

49024

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

354

GA

Augusta Mall

3450 WRIGHTSBORO RD, SUITE 2090

Augusta

GA

30909

355

WV

Charleston Town Center

3000 CHARELSTON TOWN CENTER, SUITE 1019

Charleston

WV

25389

356

OR

NW 23rd Street

940 NW 23rd, Suite 103

Portland

OR

97210

357

GA

Avenue at Peachtree City

239 CITY CIRCLE, SUITE 900

Peachtree City

GA

30069

358

IL

25 W. Jefferson

25 W. JEFFERSON

NAPIERVILLE

IL

60540

359

OK

Quail Springs Mall

2501 West Memorial Road, Suite 149

Oklahoma City

OK

73134

360

CA

Visalia Mall

2201 S. Mooney Blvd Visalia

Visalia

CA

93277

361

FL

Hyde Park

712 S. Village Circle F6 Tampa

Tampa

FL

33606

362

IN

Eastland Mall

800 N. Green River Rd Space 72 Evansville

Evansville

IN

47715

363

MN

Calhoun Square

3001 Hennepin Ave S. Suite 301A Minneapolis

Minneapolis

MN

55408

364

NV

Fashion Show

3200 Las Vegas Blvd South Space 2500

Las Vegas

NV

89109

365

TX

Post Oak Mall

1500 Harvey Road, Suite 5012

College Station

TX

77840

366

PA

Neshaminy Mall

636 Neshaminy Mall Bensalem

Bensalem

PA

19020

367

KS

742 Massachusettes

742 Massachussettes St

Lawrence

PA

66044

368

OR

Lake View Village

355 1st street, Suite 121

Lake Oswego

OR

97034

369

MA

Wareham Crossing

2421 Cranberry Highway, Suite 432

Wareham

MA

02571

370

TX

Pearland Town Center

11200 Broadway Street, Suite 1365,

Pearland

TX

76132

371

VA

Boonesboro Shopping Center

4925 Boonsboro Rd

Lynchburg

VA

24503

372

TX

Hulen Mall

4800 S. Hulen Street Suite 137a

Fort Worth

TX

76132

373

NV

Miracle Mile Shops

3663 Las Vegas Blvd South, Space D34

Las Vegas

NV

89109-1969

374

TX

Firewheel Town Center

265 Cedar Sage Drive

Garland

TX

75040

375

CO

Promenade at Briargate

1645 Briargate Parkway, Suite 209

Colorado Springs

CO

80920

376

VA

Peninsula Town Center

1661 Merchant Lane Suite D-106

Hampton

VA

23666

377

AL

Midtown Village

1800 McFarland Blvd Suite 217

Tuscaloosa

AL

35404

378

TX

2nd Street Austin

241 W 2nd Street

Austin

TX

78701

379

CA

Clocktower

3569 A&B Mt Diabli Blvd

Lafayette

CA

94549

380

LA

Oakwood Center

197 Westbank Expressway Suite 1085

Gretna

LA

70053

381

PA

Glen Eagle Sqaure

477 Wilmington West Chester Pike #D26

Glen Mills

PA

19342

382

AL

Parkway Place

2801 Memorial Parkway South Space #166

Huntsville

AL

35801

383

GA

Emory Point

855 Emory Point Drive, Suite C-155

Atlanta

GA

30329

384

MA

Mansfield Crossing

112 Eisenhower Parkway Space #1014

Mansfield

MA

07039

385

IN

College Mall

894 E. Third St  #C07E

Bloomington

IN

47401

386

IN

Tippecanoe Mall

2415 Sagamore Parkway S. #D20

Lafayette

IN

47905

387

KY

Greenwood Mall

2625 Scottsville RD, Space 120

Bowling Green

KY

42104

388

MA

Emerald Sqaure

999 South Washington Sreet Space E345

North Attleboro

MA

02760

389

OR

Old Mill District

520 SW Powerhouse Drive #60

Bend

OR

97702

390

PA

Oxford Valley

2300 E Lincoln Hwy Suite 1071B

Langhorne

PA

19047

391

MS

Barnes Crossing

1001 Barnes Crossing Road Suite 205

Tupelo

MS

38804

392

NY

Boulevard Mall

730 Alberta Drive, Suite 341

Amherst

NY

14226

393

NJ

161 E. Broad Street

161 East Broad Street

Westfield

NJ

07090

394

NJ

Shoppes at Union Hill

3056 State Route 10 West, Suite T

Denville

NJ

07834

395

FL

Delray Marketplace

9025 W Atlantic Ave

Delray Beach

FL

33446

396

FL

Shops at Wiregrass

28211 Paseo Dr, Suite 215

Wesley Chappel

FL

33543

397

MD

Hunt Valley Town Center

118 swawan road, suite 118

Hunt Valley

MD

21030

398

PA

Exton Square Mall

260 Exton Square Parkway Unit 2700

Exton

PA

19341

399

PA

Montgomery Mall

230 Montgomery Mall, Room 2033B

North Wales

PA

19454

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

2002

TX

Galveston Premium

5885 Gulf Freeway Space #375

Texas City

TX

77591

2003

TX

San Marcos Premium

3939 IH-35 South Suite #185

San Marcos

TX

78666

400

CO

Park Meadows

8505 Park Meadows Center Dr Space 2553

Lone Tree

CO

80124

401

MI

Eastwood Town Center

3034 Towne Centre Blvd Space 42

Lansing

MI

48912

402

WV

Morgantown Mall

9707 Mall Road Morgantown, space 707

Morgantown

WV

26501

403

WA

Bellis Fair

1 Bellis Fair Parkway Suite 406

Bellingham

WA

98226

404

MD

Bowie Town Center

15606 Emerald Way, Unit B01

Bowie

MD

20716

405

VA

631 King Street

631 King street, suite 201

Alexandria

VA

22314

406

LA

The Village at Pelican Point

2885 Highway 190, Building C Suite A

Mandeville

LA

70471

407

MI

115 S. Old Woodward

115. South Old Woodward

Birmingham

MI

48009

408

TX

Midland Park Mall

4511 N Mikiff Dr. Space #F-10

Midland

TX

78705

409

NM

Mall of New Hampshire

1500 South Willow Street, E109

Manchester

NM

3103

410

NJ

Livingston Mall

112 Eisenhower Parkway Space #1014

Livingston

NJ

07039

411

OH

Great Lakes Mall

7850 Mentor Ave, 327A

Mentor

OH

44060

412

WA

Spokane Valley

14700 E. Indiana Ave Space #1150

Spokane

WA

99216

413

TN

Old Hickory Mall

2021 North Highland Avenue Suite #A6

Jackson

TN

38305

414

MN

River Hills Mall

1850 Adams Street , Space 0218

Mankato

MN

56001

130RL

KY

Oxmoor Valley Mall

7900 Shelbyville Rd, Suite E04

Louisville

KY

40222

415

OR

Oakway Center

20 Oakway Center

Eugene

OR

97401

416

WA

Capital Mall

625 Black Lake Blvd, E15

Olympia

WA

98502

417

WA

Vancouver Mall

8700 NE Vancouver Mall Drive Suite 134

Vancouver

WA

98662

418

NY

Roosevelt Field

630 Old Country Rd, Room 2029B

Garden City

NY

11530

419

MN

Eden Prairie Mall

8251 Flying Cloud Drive,  Space 1056

Eden Prairie

MN

55344

420

NY

Woodbury Commons

8285 Jericho Turnpike

Woodbury

NY

11797

421

NM

CottonWood Mall

10000 Coors Blvd BYP NW, #C03B

Albuquerque

NM

87114

422

CO

E. 2nd Street

2800 E. 2nd Ave, Suite 106

Denver

CO

80206

423

TX

Cielo Vista

8401 Gateway Blvd, West, space A01C

El Paso

TX

79925

424

VA

Dulles Town Center

21100 Dulles Town Circle Suite 177

Dulles

VA

20166

425

IL

Shops at Grand Prairie

5201 W. War Memorial Drive, Suite 445

Peoria

IL

61615

426

IL

Shops at College Hill

307 Veteran's Parkway, Suite 515

Normal

IL

61761

427

AR

McCain Mall

3929 McCain BLVD. F05A

N. Little Rock

AR

72116

428

TX

Galleria Dallas

13350 dallas Parkway # 2415

Dallas

TX

75240

429

OH

Franklin Park

5001 Monroe Street, suite 1594

Toledo

OH

43623

430

OH

Rookwood Commons

2687 Edmandson Rd

Cinncinnati

OH

45209

431

CA

Fresno Fashion Fair

685 E. Shaw Avenue

Fresno

CA

93710

432

CA

Shops at Vintage Oaks

208 Vintage Way, Suite K107

Novato

CA

94945

433

MO

Summit Fair

860 NW Blue Parkway, space D-116

Lee's Summit

MO

64086

434

NY

Jefferson Valley Mall

650 Lee Blvd Yorktown Heights

Yorktown

NY

10598

435

DC

Union Station

40 Massachusette Ave. NE-2W Suite Z207

Washington

DC

20002

437

OH

Shops at Bradley Park

6301 Whitesville Rd, Suite 200

Columbus

OH

31904

436

IL

Roosevelt Collection

1127 S. Delano Court East, D11

Chicago

IL

60605

438

LA

Prien Lake

496 West Prien Lake Road, G13

Lake Charles

LA

70601

439

NY

2345 Broadway

2345 Broadway

New York

NY

10024

440

WI

Southridge Mall

5300 S 76th St #1550

Milwaukee

WI

53129

441

TN

Wolfchase Galleria

2760 N German Parkway, Space 1485

Memphis

TN

38133

442

MA

Marketstreet at Lynnfield

427 Walnut St., Suite 1320

Lynnfield

MA

01940

443

CA

522 Hartz Avenue

522 Hartz Ave. Suite A

Danville

CA

94526

 

 

Store No.

State

Center Name

Address

City

State

Zip

Phone #

444

MA

Northshore Mall

210 Andover St W141 Peabody

Peabody

MA

01960

445

CA

Town and Country SC

855 El Camino Real, Suite 10,

Palo Alto

CA

94306

446

MD

Montgomery

7101 Democracy Blvd. #1030

Bethesda

MD

20817

447

ND

West Acres Mall

3902 13th Ave S Suite 4305

Fargo

ND

58103

448

MA

Chestnut Hill Square

Boylston Street (Rte9), suite B103

Chesnut Hill

MA

02467

MN

West End

1621 West End Blvd. 'Suite 3220

St Louis Park

MN

55416

MI

Southland Mall

23000 Eureka Road, 'Space 1585

Taylor

MI

48180

NC

Cross Creek Mall

418 Cross Creek Mall 'Space 7

Fayetteville

NC

28303

OH

Southern Park Mall

7401 Market Street, 'Space 265

Youngstown

OH

44512

WI

Oakwood Mall

4800 Gulf Road, Space 332

Eau Claire

WI

54701

FL

Miracle Plaza

1815 Thomasville Road 'Suite E

Tallahassee

FL

32303

KY

Lexington Green

161 lexington Green Circle

Lexington

KY

40503

ID

Village at Meridian

N Eagle @ E. Fairview, space J-150

Meridian

ID

83642

TX

Longview Mall

3500 McCann Road Suite H07B

longview

TX

75605

IA

Northpark Mall

320 W. Kimberly Rd. Suite 0032

Davenport

IA

52806

KS

Manhattan Town Center

100 Manhattan center, 'Suite 225

Manhattan

KS

66502

DE

Dover Mall

1365 N DuPOnt HWY, suite 3036A

Dover

DE

19901

FL

Seminole Town Center

200 Towne center Circle, 'B11B

Seminole

FL

32771

FL

Southgate

3501 S. Tamiami Trail, 'Space 1048

Sarasota

FL

34239

ND

Dakota Square

2400 10th street, SW Suite 403 & 402A

Minot

ND

58701

SC

Trenholm Plaza

4840 Forest Drive, 'Suite 60

Columbia

SC

29206

ND

Kirkwood

744 Kirkwood Mall, Suite 300

Bismarck

ND

58504

MA

Square One Mall

1201 Broadway, Suite E237

Suagus

MA

01906

DE

Christiana Mall

513 Christiana Mall

Newark

DE

19702

SD

Rushmore Mall

220 N Maple Ave, Suite 0416

Rapid City

SD

57701

IA

Southern Hills Mall

4400 Sergeant Rd, Suite 310

Sioux City

IA

51106

NY

Wilton Mall

3065 Route 50, suite 25

Saratoga Springs

NY

12866

VA

Promenade at Va Gateway

Linton Hall Rd, Space G-4

Gainsville

VA

20155

PA

Lehigh Valley

250 Lehgh Valley Dr, space 1069A

Whithall

PA

10852

MN

Burnsville Center

1178 Burnsville center, Space 1034

Burnsville

MN

55306

MN

Maplewood Square

3001 White Bear Ave, Suite 1010c

St Paul

MN

55109

TX

Broadway Square

4601 S. Boradway, Suite F08

Tyler

TX

75703

 

 

Schedule 4.20

 

Insurance

 

FRANCESCA’S COLLECTIONS

2012 COVERAGE SUMMARY

 

Policy No.		Coverage		Policy Term		Limits of Insurance						Carrier
WC 012055090		Workers’		10/05/12-13		Workers’ Compensation – Statutory						New Hampshire
		Compensation – All				Employer’s Liability						Insurance Company
		Other States				$	1,000,000			Bodily Injury by Accident – Each Accident
						$	1,000,000			Each Employee Bodily Injury by Disease
						$	1,000,000			Policy Limit Bodily Injury by Disease
						Stop Gap
						$	1,000,000			Bodily Injury by Accident – Each Accident
						$	1,000,000			Each Employee Bodily Injury by Disease
						$	1,000,000			Policy Limit Bodily Injury by Disease
WC 012055091		Workers’		10/05/12-13		Workers’ Compensation – Statutory						The Insurance
		Compensation –										Company of the State
		California				Employer’s Liability						of Pennsylvania
						$	1,000,000			Bodily Injury by Accident – Each Accident
						$	1,000,000			Each Employee Bodily Injury by Disease
						$	1,000,000			Policy Limit Bodily Injury by Disease
GL 5076596		Commercial General		10/05/12-13		$	1,000,000			Each Occurrence Limit		The Insurance
		Liability				$	1,000,000			Personal & Advertising Injury Limit (Any One Person or Organization)		Company of the State
						$	2,000,000			General Aggregate Limit		of Pennsylvania
						$	5,000,000			General Aggregate Limit: Per Location
						$	2,000,000			Products-Completed Operations Aggregate Limit
						$	300,000			Damage to Premises Rented to You (any one premise)
						$	10,000			Medical Expense Limit (any one person)
						$	1,000,000			Employee Benefits Liability

 

 

FRANCESCA’S COLLECTIONS

2012 COVERAGE SUMMARY

 

Policy No.		Coverage		Policy Term		Limits of Insurance						Carrier
CA 3447461		Business Auto		10/05/12-10/01/13		$	1,000,000			Liability, Symbol 1		The Insurance
		Liability				Basic Benefits by State, Personal Injury Protection – Per Insured’s Selection, Symbol 5						Company of the State of Pennsylvania
						$	1,000,000			Uninsured Motorists/Underinsured Motorists – Per Insured’s Selection, Symbol 2
						$	50,000			Hired Car Physical Damage
						Physical Damage
						Limit – Except for Hired or Borrowed Autos: Actual Cash Value or Cost to Repair, whichever is less, Minus a Comprehensive / Collision Deductible for each covered auto of: $1,000, Symbol 2, 8
						If Symbol 8 is included above, Limit – for Hired or Borrowed Autos: Actual Cash Value or Cost to Repair, whichever is less, minus a Comprehensive / Collision Deductible for each covered auto of: $1,000, Symbol 8
BE 018715278		Umbrella Liability		10/05/12-10/01/13		$	10,000,000			Each Occurrence		Commerce & Industry
						$	10,000,000			General Aggregate in accordance with Section IV, Limits of Insurance		Insurance Company
						$	10,000,000			Products/Completed Operations Aggregate in accordance with Section IV, Limits of Insurance
						$	250,000			CrisisResponse Limit of Insurance
						$	50,000			Excess Casualty CrisisFund Limit of Insurance
						SIR:
						$	10,000
WS11003053		International Package		10/05/12-10/01/13		Foreign Commercial General Liability						Insurance Company of
						$	2,000,000			Master Control Program Aggregate Limit		the State of
						$	1,000,000			General Aggregate Limit		Pennsylvania
						$	1,000,000			Products-Completed Operations Aggregate Limit
						$	1,000,000			Personal & Advertising Injury Limit
						$	1,000,000			Each Occurrence Limit
						$	100,000			Damage to Premises Rented to You Limit
						$	10,000			Medical Expense Limit
						Foreign Business Auto Liability
						$	1,000,000			Coverage A: Liability Coverage Limit (any one accident)
						$	20,000			Coverage B: Medical Expense Coverage (each accident limit)
						$	25,000			Hired Autos, Limit Each Auto
						$	25,000			Hired Autos, Each Loss Limit

 

 

FRANCESCA’S COLLECTIONS

2012 COVERAGE SUMMARY

 

Policy No.		Coverage		Policy Term		Limits of Insurance					Carrier
						Deductible
						$	1,000		Each Auto
						Foreign Voluntary Compensation and Employers Liability
						$	500,000		Limit of Liability for Part One – Supplemental Repatriation Expense Per Person
						$	1,000,000		Limits of Liability for Part Two – Employers Liability Injury by Accident Each Accident
						$	1,000,000		Limits of Liability for Part Two – Employers Liability Injury by Disease Coverage Part Limit
						$	1,000,000		Limits of Liability for Part Two – Employers Liability Injury by Disease Each Employee
						Foreign Travel Accident and Sickness
						Coverage A-B Accidental Death and Dismemberment – 24 Hour Protection
						$	250,000		Principal Sum Insured, each Insured person or five (5) times the insured person’s annual salary whichever is the lower
						$	2,500,000		Aggregate Limit any one accident for all insured persons
						Coverage C – Accidental and Sickness Medical Expense
						$	25,000		Covered Medical Expense, Each Insured Person Injury or Sickness
						$	500		Deductible per Insured Person, per each Injury or Sickness
						Coverage D – Emergency Medical Evacuation
						$	100,000		Covered Expenses, each Insured person each Serious Injury or Sickness
						Coverage E – Emergency Family Travel
						$	10,000		Covered Expenses, Each Insured Person
						$	25,000		Maximum for all Insured person(s0 any one Accident or Sickness
						Coverage F – Repatriation of Remains
						$	25,000		Covered Expense, Each Insured Person
						$	100,000		Maximum for all Insured Person(s) any one Accident or Sickness
						Corporate Kidnap and Ransom/Extortion
						$	5,000,000		Each Insured Event Limit
						$	10,000,000		Coverage Part Aggregate Limit
						Each Loss Component Limit:
						$	1,000,000		Ransom Monies
						$	1,000,000		In-Transit/Delivery
						$	1,000,000		Expenses
						$	1,000,000		Consultants Expenses
						$	1,000,000		Judgments, Settlements and Defense Costs
						$	100,000		Death or Dismemberment, any one person &
						$	1,000,000		Death or Dismemberment, Each Insured Event

 

 

FRANCESCA’S COLLECTIONS

2012 COVERAGE SUMMARY

 

Policy No.		Coverage		Policy Term		Limits of Insurance					Carrier
											Liberty Mutual Fire
YU2-Z91-457770-012		Commercial Property		10/05/12-10/01/13		$	88,255,000		Blanket Personal Property		Insurance Company
						$	6,265,552		Blanket Loss of Business Income
						$	500,000		Blanket Extra Expense
						$	250,000		Interruption of Services Coverage
						$	1,000,000		Earth movement covered only in New Madrid, per occurrence/annualaggregate(excluding Alaska, California, Hawaii, Nevada, Puget Sound& Puerto Rico)
						$	2,500,000		Earth Movement Coverage (any covered property situated in or at any other location(s) not specified above, per occurrence/annual aggregate
						$	5,000,000		Flood Coverage per occurrence/annual aggregate (Except $2,500,000 for Group 1 and $250,000 for Group 2);
						Deductibles:
						$	2,500		Policy Deductible
						See policy details for specific deductibles
MCN761831/01/20		Directors and		7/22/13-7/22/14		$	10,000,000		Aggregate Limit		Axis
13		Officers Liability
						Retention
						$	0 / $250,000 / $500,000
0306-8454		Excess Directors		7/22/13-7/22/14		$	10,000,000		Aggregate Limit		AWAC
		and Officers
		Liability				Attachment
						$	10,000,000

 

 

FRANCESCA’S COLLECTIONS

2012 COVERAGE SUMMARY

 

Policy No.		Coverage		Policy Term		Limits of Insurance				Carrier
105968619		Excess Directors		7/22/13-7/22/14		$	10,000,000 Aggregate Limit			Travelers
		and Officers
		Liability
						Attachment
						$	20,000,000
CUG 36046		Excess Directors		7/22/13-7/22/14		$10,000,000 Aggregate Limit				Old Republic
		and Officers
		Liability				Attachment
						$	30,000,000
DO3HAAFHMH002		Excess Directors		7/22/13-7/22/14		$10,000,000 Aggregate Limit				Liberty
		and Officers
		Liability
						Attachment
						$	40,000,000
596348556		Excess Directors		7/22/13-7/22/14		$10,000,000 Aggregate Limit				CNA
		and Officers
		Liability
						Attachment
						$	50,000,000

 

 

FRANCESCA’S COLLECTIONS

2012 COVERAGE SUMMARY

 

Policy No.		Coverage		Policy Term			Limits of Insurance			Carrier
DOX G25592815		Excess Side A DIC		7/22/13-7/22/14		$10,000,000 Aggregate Limit				Ace
002
		Directors and Officers Liability
						Attachment
						$	60,000,000
596353577		Fiduciary Liability		7/31/13-10/1/15		$1,000,000 Aggregate Limit				CNA
						Retention
						$	5,000
TBD		Employment		7/31/13-10/1/14		$5,000,000 Aggregate Limit				Beazley
		Practices Liability
						Retention
						$50,000 / $100,000
105356696		ERISA Compliance Bond		10/01/09-10/01/15		$15,000 Per Occurrence				Travelers
						Retention
						$	0

 

 

FRANCESCA’S COLLECTIONS

2012 COVERAGE SUMMARY

 

Policy No.		Coverage		Policy Term		Limits of Insurance					Carrier
W12E45120101		Cyber Liability		9/01/1-10/01/13		$	3,000,000		Policy Aggregate Limit		Beazley Syndicate
						$	3,000,000		Information Security, Privacy and Media Content Liability Limit		2623/623 at Lloyd’s
						$	3,000,000		Cyber Extortion Loss Limit
						$	3,000,000		Data Protection Loss and Business Interruption Loss Limit
									See policy details for BI sublimits
						$	1,000,000		Privacy Regulatory Defense & Penalties Sub-Limit
						$	100,000		Crisis Management & Public Relations Sub-Limit
						$	250,000		PCI Fines & Costs Sub-Limit
						Breach Response Services (Outside the Policy Limit)
							2,000,000		Notified Individuals in the Aggregate
						$	250,000		Legal and Forensic Expenses
							20,000		Fraud Resolution Cases in the Aggregate
						$	250,000		Foreign Notification
						Retentions:
						$	75,000		Information Security & Privacy Liability and Regulatory
						$	75,000		Media Content Liability
						$	75,000		PCI Fines and Costs
						$	75,000		Cyber Extortion
						$	75,000		Data Protection Loss and Income Loss
						$	50,000		Extra Expense
							12 hours		Business Interruption waiting period
						$	10,000		Crisis Management/Public Relations Expenses
						$	10,000		Legal, Forensics and Notification Expenses
							100 individuals		Call Center Services & Credit Monitoring Program

 

 

Schedule 8.1

 

Existing Indebtedness

  

None.

 

  

Schedule 8.2

 

Existing Liens

 

1.

Liens granted pursuant to the Terms of Service, effective as of July 5, 2008, by and among Francesca’s Collections, Elavon (f/k/a NOVA Information System, Inc.) and Wachovia Bank, National Association.

 

2.

Liens granted pursuant to the Select Merchant Payment Instrument Processing Agreement, effective as of March 30, 2012, by and among Francesca’s Collections, Inc., Paymentech, LLC and JPMorgan Chase Bank, N.A..

 

3.

Equipment lien in favor of Toyota Motor Credit Corporation pursuant to UCC financing statement no. 12-0027750589 filed with the Texas Secretary of State on August 31, 2012, naming Francesca’s LLC as debtor.

 

4.

Equipment lien in favor of Toyota Motor Credit Corporation pursuant to UCC financing statement no. 12-0027877488 filed with the Texas Secretary of State on September 4, 2012, naming Francesca’s Collections. Inc. as debtor, as amended by UCC financing statement no. 12-00285717 filed with the Texas Secretary of State on September 10, 2012, changing the debtor’s name to Francesca’s Collections, Inc.

 

 

Schedule 8.3

 

Existing Investments

 

None.

 

 

SCHEDULE 8.10

 

Existing Third-Party Restrictions

 

None.

  

 

EXHIBIT 1.1(1)

 

[FORM OF]

ASSIGNMENT AND ACCEPTANCE

 

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

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including participations in any Letters of Credit included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Acceptance, without representation or warranty by the Assignor.

 

1.	Assignor:
2.	Assignee:
		[and is an Affiliate/Approved Fund of [identify Lender]1]
3.	Borrower:	Francesca’s Collections, Inc.
4.	Administrative Agent:	Royal Bank of Canada, as administrative agent under the Credit Agreement.

 

1

Select as applicable.

 

 

5.	Credit Agreement:	Second Amended and Restated Credit Agreement, dated as of August 30, 2013, among Francesca’s Collections, Inc., as borrower (the “Borrower”), Francesca’s LLC, as parent (the “Parent”), the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the L/C Issuer, Royal Bank of Canada, as Administrative Agent (in such capacity, the “Administrative Agent”), Royal Bank of Canada, as Collateral Agent for the Secured Parties, and the other parties party thereto
6.	Assigned Interest:

 

Aggregate Amount of Commitment/ Loans for all Lenders				Amount of Commitment/ Loans Assigned				Percentage Assigned of Commitment/ Loans2
$				$						%

 

Effective Date: _____________ ___, 20___ [TO BE INSERTED BY THE ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR].³

 

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

 

	ASSIGNOR
		[nAME OF ASSIGNOR]
		By:
			Name:
			Title:

 

	ASSIGNEE
		[nAME OF ASSIGNEE]
		By:
			Name:
			Title:

 

2

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

3

This date may not be fewer than 5 Business Days after the date of assignment unless the Administrative Agent otherwise agrees.

 

 

 

[Consented to and]⁴ Accepted:

 

Royal Bank of Canada, as Administrative Agent
	By:
		Name:
		Title:

 

[Consented to:]⁵

 

[FRANCESCA’S COLLECTIONS, INC.]
	By:
		Name:
		Title:

  

[Consented to:]⁶

 

[____________, as L/C Issuer]
	By:
		Name:
		Title:

 

4

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

5

To be added only if the consent of the Borrower is required by the terms of the Credit Agreement.

6

Consent of the L/C Issuer is required for an assignment of Revolving Credit Commitments.

 

 

 

ANNEX 1

 

STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ACCEPTANCE

 

1.          Representations and Warranties Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby, and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of Parent, the Borrower, any of their Subsidiaries or Affiliates or any other person obligated in respect of any Loan Document or (iv) the performance or observance by Parent, the Borrower, any of their Subsidiaries or Affiliates or any other person of any of their respective obligations under any Loan Document.

 

2          Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) subject to receipt of such consents as may be required under the Credit Agreement, it satisfies the requirements specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 6.1 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, (vi) if it is not already a Lender under the Credit Agreement, attached to this Assignment and Acceptance is an Administrative Questionnaire in the form supplied by the Administrative Agent, (vii) the Administrative Agent has received a processing and recordation fee of $3,500 as of the Effective Date and (viii) attached to this Assignment and Acceptance is any documentation required to be delivered by it pursuant to Section 2.17(f) of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender and, based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

 

3.          Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

 

4.          General Provisions

 

This Assignment and Acceptance shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Acceptance may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Acceptance by telecopy or other electronic delivery shall be effective as delivery of a manually executed counterpart of this Assignment and Acceptance. This Assignment and Acceptance shall be governed by, and construed in accordance with, the law of the State of New York.

 

 

EXHIBIT 1.1(2)

 

[FORM OF]
COMPLIANCE CERTIFICATE

 

Reference is made to the Second Amended and Restated Credit Agreement, dated as of August 30, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Francesca’s Collections, Inc., as borrower (the “Borrower”), Francesca’s LLC, the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the L/C Issuer, Royal Bank of Canada, as Administrative Agent (in such capacity, the “Administrative Agent”), Royal Bank of Canada, as Collateral Agent, and the other parties party thereto. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement. Pursuant to Section 6.1(c) of the Credit Agreement, the undersigned, in his/her capacity as a Responsible Officer of the Borrower, certifies as follows:

 

[Attached hereto as Exhibit A is the Consolidated balance sheet of the Borrower as of [______], 20[ ] and related Consolidated statements of income, stockholders' equity and cash flow for the Fiscal Year then ended, each prepared in accordance with GAAP, audited and accompanied by (a) a complete and correct copy of [______]¹, (b) an opinion² of Group Members’ Accountants and (c) a summary of such financial statements setting forth in comparative form the corresponding figures for the prior Fiscal Year. These Financial Statements fairly present in all material respect the Consolidated financial position, results of operations and cash flow of the Borrower for such Fiscal Year in accordance with GAAP.]³

 

[Attached hereto as Exhibit A is the Consolidated unaudited balance sheet of the Borrower as of [_____], 20[ ] and the related Consolidated statements of income and cash flow for such Fiscal Quarter and for the portion of the Fiscal Year then ended, setting forth in comparative form the figures for the corresponding period in the prior Fiscal Year and the corresponding portion of the previous Fiscal Year, all in reasonable detail. These Financial Statements fairly present in all material respects the Consolidated financial condition, results of operations and cash flow of the Borrower as at the dates indicated and for the periods indicated in accordance with GAAP, subject to normal year-end audit adjustments and the absence of footnote disclosure.]⁴

 

1

To include each final management letter, audit report or similar letter or report from any independent registered certified public accountant (including the Group Members’ Accountants) in connection with such Financial Statements or any audit thereof and submitted to any Group Member (or such Group Member’s board of directors).

2

Such opinion is to indicate that: (x) such Consolidated Financial Statements fairly present in all material respects the Consolidated financial position, results of operations and cash flow of the Borrower as at the dates indicated and for the periods indicated therein in accordance with GAAP without qualification with respect to going concern or scope of audit or any like qualifications, and (y) in the course of the regular audit of the businesses of the Borrower and its Subsidiaries, which audit was conducted in accordance with the standards of the United States’ Public Company Accounting Oversight Board (or any successor entity), such Group Members’ Accountants have obtained no knowledge that a Default in respect of the Financial Performance Covenants is continuing or, if in the opinion of the Group Members’ Accountants such a Default is continuing, a statement as to the nature thereof (which statement may be limited to accounting matters and may disclaim responsibility for legal interpretations).

3

To be included if accompanying annual financial statements only (it being understood that the delivery by the Borrower of annual reports on Form 10-K of Holdings and its consolidated subsidiaries shall satisfy the requirements of Section 6.1(b) of the Credit Agreement to the extent such annual reports include the information specified therein.

4

To be included if accompanying quarterly financial statements only (it being understood that the delivery by the Borrower of quarterly reports on Form 10-Q of Holdings and its consolidated subsidiaries shall satisfy the requirements of Section 6.1(a) of the Credit Agreement to the extent such quarterly reports include the information specified therein).

 

 

[Attached hereto as Exhibit B is a summary narrative discussion and analysis of the financial condition and results of operations of the Group Members for [the portion of] the Fiscal Year ended [          ] and [the corresponding period in] the previous Fiscal Year.]⁵

 

No Default has occurred and is continuing as of the date hereof. [If unable to provide the foregoing certification, fully describe the nature of any such Default and the action that the Borrower proposes to take with respect thereto on Annex A attached hereto.]

 

[Attached hereto as Annex [B] is a complete and correct report⁶ summarizing the insurance coverage in effect for the Borrower and each Loan Party and its Subsidiaries.] ⁷

 

The following represent true and accurate calculations, as of [              ], to be used to determine compliance with the covenants set forth in Article 5 of the Credit Agreement:

 

Maximum Consolidated Total Lease Adjusted Leverage Ratio:
Sum of Consolidated Total Debt plus the product of (a) Consolidated Rent Expense multiplied by (b) 6.00=		[             ]
Consolidated EBITDAR=		[             ]
Actual Ratio=		[             ] to 1.0
Required Ratio=		No more than 4.25 to 1.00
Borrower in compliance with Financial Performance Covenant:		[Yes / No]

 

Supporting detail showing the calculation of the Consolidated Total Lease Adjusted Leverage Ratio is attached hereto as Schedule 1.⁸

 

4

To be included if accompanying quarterly financial statements only (it being understood that the delivery by the Borrower of quarterly reports on Form 10-Q of Holdings and its consolidated subsidiaries shall satisfy the requirements of Section 6.1(a) of the Credit Agreement to the extent such quarterly reports include the information specified therein).

5

To be included unless delivery by the Borrower of quarterly reports on Form 10-Q or annual reports on Form 10-K, as applicable, of Holdings and its consolidated subsidiaries satisfy the requirements of Section 6.1(h) of the Credit Agreement.

6

Such report to specify type, amount and carrier of insurance and to contain such additional information as the Administrative Agent may reasonably specify.

7

To be included if accompanying annual financial statements only.

8

Which calculations shall be in reasonable detail.

 

 

Attached hereto as Schedule 2 are calculations setting forth the ratio of (x) the amount of Consolidated Total Assets at the end of the applicable Fiscal Quarter to (y) the amount of Consolidated Total Assets as of October 30, 2010.

 

Attached hereto as Schedule 3 is a summary of the outstanding balances of all intercompany Indebtedness as of the last day of the last Fiscal Quarter included in the Financial Statements attached hereto, which summary is complete and correct.

 

[[The Corporate Chart previously delivered on [              ], 20[ ], pursuant to Section 6.1(d) of the Credit Agreement, is correct and complete as of the date hereof.] [Attached hereto as Exhibit C is a Corporate Chart, which Corporate Chart is correct and complete as of the date hereof.]]⁹

 

[The Loan Parties have delivered to the Administrative Agent (i) all documents (including updated schedules as to the acquisition of Intellectual Property or real property) they are required to deliver pursuant to any Loan Document on or prior to the date hereof and (ii) complete and correct copies of all documents modifying any term of any Constituent Document of any Group Member or Joint Venture thereof on or prior to the date hereof. [Any such documents not previously delivered prior to the date hereof are attached hereto as Exhibit [D].] ¹⁰

 

9

To be included only in annual Compliance Certificate.

10

To be included only in annual Compliance Certificate.

 

 

IN WITNESS WHEREOF, the undersigned, in his/her capacity as a Responsible Officer of the Borrower, has executed this certificate for and on behalf of the Borrower and has caused this certificate to be delivered this ____ day of _____________.

 

		FRANCESCA’S COLLECTIONS, INC.
	By:
		Name:
		Title:

 

 

SCHEDULE 1

 

Calculation of Covenant Compliance

 

Consolidated Total Lease Adjusted Leverage Ratio: (i) Sum of Consolidated Total Debt plus the product of (a) Consolidated Rent Expense multiplied by (b) 6.00 to (ii) Consolidated EBITDAR
(1)       Consolidated Total Debt of the Borrower as of [          ], 20[ ]:
(a)      the sum of all Indebtedness of a type described in clauses (i) through (vi) below of the Borrower and its Subsidiaries on a Consolidated basis:
(i)       all indebtedness for borrowed money
(ii)      all obligations evidenced by notes, bonds, debentures or similar instruments,
(iii)     the principal component of all obligations with respect to letters of credit (other than to the extent undrawn), bank guarantees or bankers’ acceptances,
(iv)     all obligations to pay the deferred purchase price of property or services 1,
(v)      all Capitalized Lease Obligations, and
(vi)     all obligations, whether or not contingent, to purchase, redeem, retire, defease or otherwise acquire for value, or pay any dividends or other amounts with respect to, or convert into or exchange for Indebtedness, any of the Stock or Stock Equivalents of Borrower and its Subsidiaries (or any Stock or Stock Equivalent of a direct or indirect parent entity thereof) prior to the date that is 180 days after the Scheduled Termination Date, valued at, in the case of redeemable preferred Stock, the greater of the voluntary liquidation preference and the involuntary liquidation preference of such Stock plus accrued and unpaid dividends,
(b)       plus, all Guaranty Obligations of the Borrower and its Subsidiaries on a Consolidated basis with respect to any Indebtedness of any other Person of a type described in clause (a) above,

 

1

Other than current trade liabilities and current intercompany liabilities (but not any refinancings, extensions, renewals or replacements thereof) incurred in the ordinary course of business and maturing within 180 days after the incurrence thereof.

 

 

(c)       minus, unrestricted cash and Cash Equivalents of the Borrower and its Subsidiaries (reduced, in the case of any Subsidiary that is not a Wholly Owned Subsidiary, to reflect the extent of the relative aggregate direct and indirect beneficial ownership interest of the Borrower therein) on such date in an amount not to exceed $7,500,000 less the outstanding principal amount of Loans on such date.2
Consolidated Total Debt
(2) Consolidated Rent Expense of the Borrower for the period of four consecutive Fiscal Quarters ending [         ], 20[ ]:
(a)       Rental expense attributable to leases of real property that is deducted in determining Consolidated Net Income for such period, determined on a consolidated basis in accordance with GAAP.
Consolidated Rent Expense
(3) Consolidated EBITDAR of the Borrower for the period of four consecutive Fiscal Quarters ending [          ], 20[ ]3:
(a)      Consolidated EBITDA:
(i)    Consolidated Net Income of the Borrower for such period determined in accordance with GAAP: the aggregate of the Net Income of the Borrower and its Subsidiaries attributable to the Borrower (after giving effect to non-controlling interests) for such period, on a Consolidated basis
excluding, without duplication:
A.   any net after-tax extraordinary, nonrecurring, or unusual gains or losses or income or expenses (less all fees and expenses relating thereto), including any severance expenses, and fees, expenses or charges related to the IPO, any other offering of the Stock of Parent, any Investment, acquisition or Indebtedness permitted to be incurred under the Credit Agreement (in each case, whether or not successful), including any such fees, expenses, charges or change in control payments related to any acquisition consummated after the Closing Date,

 

2

Such unrestricted cash and Cash Equivalents that reduce Consolidated Total Debt pursuant to this clause (c) shall be maintained in an account subject to a Control Agreement (as defined in the Guaranty and Security Agreement).

3

Determined on a Pro Forma Basis.

 

 

B.   any net after-tax income or loss from discontinued operations and any net after-tax gain or loss on disposal of discontinued operations,
C.   any net after-tax gain or loss (less all fees and expenses or charges relating thereto) attributable to business dispositions or asset dispositions other than in the ordinary course of business (as determined in good faith by the board of directors (or equivalent) of the Borrower), other than write downs of current assets in the ordinary course of business,
D.   any net after-tax income or loss (less all fees and expenses or charges relating thereto) attributable to the early extinguishment of Indebtedness,
E.   the cumulative effect of a change in accounting principles during such period,
F.   any increase in amortization or depreciation or any one-time non-cash charges resulting from purchase accounting in connection with any acquisition that is consummated after the Closing Date,
G.   any non-cash impairment charges resulting from the application of Statement of Financial Accounting Standards No. 142 and 144, and the amortization of intangibles arising pursuant to No. 141,
H.   the effect of mark-to-market accounting for derivatives contracts under Statement of Financial Accounting Standards No. 157,
I.    any non-cash compensation expenses realized from grants of stock appreciation or similar rights, stock options or other rights to officers, directors and employees of the Borrower or any of its Subsidiaries,
J.    any pre-opening expenses,
K.   to the extent covered by insurance and actually reimbursed, or, so long as such person has made a determination that there exists reasonable evidence that such amount will in fact be reimbursed by the insurer and only to the extent that such amount is (a) not denied by the applicable carrier in writing within 180 days and (b) in fact reimbursed within 365 days of the date of such evidence (with a deduction for any amount so added back to the extent not so reimbursed within 365 days), expenses with respect to liability or casualty events or business interruption shall be excluded; provided that any proceeds of such reimbursement when received shall be excluded from the calculation of Consolidated Net Income to the extent the expense reimbursed was previously excluded pursuant to this clause K, and

 

 

 

L.   the net income for such period of any entity (other than a Subsidiary of the Borrower) in which any Person other than the Borrower and its Subsidiaries has an ownership interest, except to the extent that cash in an amount equal to any such income has actually been received by the Borrower or its Subsidiaries during such period,
Consolidated Net Income
(ii)   plus, to the extent applicable to the Borrower in such period, the sum of the following (without duplication and only to the extent the amounts described in clauses (A) through (F) below decreased such Consolidated Net Income for such period):
A.   provision for Taxes based on income, profits or capital of the Borrower and its Subsidiaries for such period, including, without limitation, state, franchise and similar taxes,
B.   Consolidated Interest Expense of the Borrower for such period,
C.   depreciation and amortization expense of the Borrower and its Subsidiaries for such period,
D.   business optimization expenses and other restructuring charges of the Borrower and its Subsidiaries for such period4,
E.   any other non-cash charges of the Borrower and its Subsidiaries for such period (but excluding (a) any such charges which represent the accrual of, or a cash reserve for, anticipated cash charges in any future period and (b) any such non-cash charge to the extent that it represents the amortization of a prepaid cash charge that was paid in a prior period unless such non-cash charge represents an amount that was not recognized in any prior period),
F.   management, consulting, monitoring, transaction, and advisory fees and related expenses for the Borrower and its Subsidiaries for such period paid to the Permitted Investors (or any accruals related to such fees and related expenses), 5

 

4

(A) With respect to each business optimization expense or other such restructuring charge, the Borrower shall have delivered to the Administrative Agent a certificate of a Responsible Officer of the Borrower specifying and quantifying such expense or charge and stating that such expense or charge is a business optimization expense or other restructuring charge, as the case may be, and (B) the aggregate amount of cash business optimization expenses and other cash restructuring charges for purposes of this clause (D) shall not exceed 5% of Consolidated EBITDA for such period (as calculated prior to giving effect to the addition of amounts specified in this clause (D)).

5

The aggregate amount of such fees and related expenses for purposes of this clause (F) shall not exceed in any period of four consecutive Fiscal Quarters $500,000 as of the date of determination.

 

 

 

G.   any fees, expenses or charges related to the documentation and closing of the Second Amended and Restated Credit Agreement,
H.   any fees, expenses or charges related to Specified Stock Repurchases,
(iii)  minus, the sum (without duplication and only to the extent the amounts described in this clause (iii) increased such Consolidated Net Income for such period) of non-cash items increasing Consolidated Net Income of the Borrower for such period (but excluding any such items (a) in respect of which cash was received in a prior period or will be received in a future period, or (b) which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period)
Consolidated EBITDA
Consolidated EBITDAR (sum of Consolidated EBITDA (Item A(3)(a)) plus (without duplication and only to the extent that such amounts decreased Consolidated Net Income for the respective period for which Consolidated EBITDA is being determined) Consolidated Rent Expense (Item A(2))
Consolidated Total Debt plus the product of Consolidated Rent Expense multiplied by 6.00 to Consolidated EBITDAR		[   ]:1.00
Covenant Requirement		No more than 4.25:1.00

  

 

SCHEDULE 2

 

Change in Consolidated Total Assets

 

Ratio of (x) the amount of Consolidated Total Assets at the end of applicable Fiscal Quarter to (y) the amount of Consolidated Total Assets as of October 30, 2010

 

(1)		Consolidated Total Assets1 at the end of Fiscal Quarter ending [     ], 20[  ]
(2)		Consolidated Total Assets as of October 30, 2010		$	52,965,111
		Ratio of (1) to (2)

 

¹ Consolidated Total Assets means, as of any date, the total assets of the Borrower and the Consolidated Subsidiaries, determined in accordance with GAAP, set forth on the Consolidated balance sheet of the Borrower as of such date. In no event shall Consolidated Total Assets include the amount of goodwill that would be recorded from the acquisition of the Borrower by the Fund and the Fund Affiliates to the extent purchase accounting treatment was given or is given to such acquisition.

 

 

SCHEDULE 3

 

Summary of Intercompany Indebtedness

 

[To set forth a summary of the outstanding balances of all intercompany Indebtedness.]

 

 

EXHIBIT A

 

Financial Statements

 

Attached.

 

 

EXHIBIT B

 

Management’s Summary Narrative Discussion and Analysis

 

Attached.

 

 

EXHIBIT C

 

Corporate Chart

 

Attached.

 

 

EXHIBIT D

 

Documents

 

Attached.

 

 

EXHIBIT 1.1(3)

 

[FORM OF]

GUARANTY AND SECURITY AGREEMENT

 

 

GUARANTY AND SECURITY AGREEMENT

 

Dated as of November 17, 2010

 

by and among

 

Francesca’s Collections, inc.

and

Each Other Grantor
From Time to Time Party Hereto

 

and

 

royal bank of canada,
as Collateral Agent

 

and

 

Royal Bank of Canada,
as Administrative Agent

 

 

 

TABLE OF CONTENTS

 

			Page
Article I	Defined Terms		1
Section 1.1		Definitions	1
Section 1.2		Certain Other Terms	4
Article II	GUARANTY		4
Section 2.1		Guaranty	4
Section 2.2		Limitation of Guaranty	4
Section 2.3		Contribution	5
Section 2.4		Authorization; Other Agreements	5
Section 2.5		Guaranty Absolute and Unconditional	5
Section 2.6		Waivers	6
Section 2.7		Reliance	6
Article III	Grant of Security Interest		7
Section 3.1		Collateral	7
Section 3.2		Grant of Security Interest in Collateral	7
Section 3.3		Continuing Liability Under Collateral	7
Article IV	Representations and Warranties		8
Section 4.1		Title; No Other Liens	8
Section 4.2		Perfection and Priority	8
Section 4.3		Jurisdiction of Organization; Chief Executive Office	8
Section 4.4		Locations of Inventory, Equipment and Books and Records	9
Section 4.5		Pledged Collateral	9
Section 4.6		Instruments and Tangible Chattel Paper Formerly Accounts	9
Section 4.7		Intellectual Property	9
Section 4.8		Commercial Tort Claims	10
Section 4.9		Specific Collateral	10
Section 4.10		Enforcement	10
Section 4.11		Representations and Warranties of the Credit Agreement	10
Article V	Covenants		10
Section 5.1		Maintenance of Perfected Security Interest; Further Documentation and Consents	10
Section 5.2		Reserved	11
Section 5.3		Pledged Collateral	11
Section 5.4		Accounts	12
Section 5.5		Delivery of Instruments and Tangible Chattel Paper, Letter-of-Credit Rights and Electronic Chattel Paper	12
Section 5.6		Intellectual Property	13
Section 5.7		Notices	14
Section 5.8		Notice of Commercial Tort Claims	14
Section 5.9		Compliance with Credit Agreement	14
Section 5.10		Controlled Securities Account	14
Section 5.11		Cash Management Systems	14

 

 

Article VI	Remedial Provisions		14
Section 6.1		Code and Other Remedies	14
Section 6.2		Accounts and Payments in Respect of General Intangibles	17
Section 6.3		Pledged Collateral	18
Section 6.4		Proceeds to be Turned over to and Held by Collateral Agent	19
Section 6.5		Registration Rights	19
Section 6.6		Deficiency	19
Article VII	The Collateral Agent		20
Section 7.1		Collateral Agent’s Appointment as Attorney-in-Fact	20
Section 7.2		Authorization to File Financing Statements	21
Section 7.3		Authority of Collateral Agent	21
Section 7.4		Duty; Obligations and Liabilities	22
Section 7.5		Replacement of Collateral Agent	24
Article VIII	Miscellaneous		24
Section 8.1		Reinstatement	24
Section 8.2		Release of Collateral	25
Section 8.3		Independent Obligations	25
Section 8.4		No Waiver by Course of Conduct	25
Section 8.5		Amendments in Writing	25
Section 8.6		Additional Grantors; Additional Pledged Collateral	25
Section 8.7		Notices	26
Section 8.8		Successors and Assigns	26
Section 8.9		Counterparts	26
Section 8.10		Severability	26
Section 8.11		Governing Law	26
Section 8.12		Waiver of Jury Trial	26
Section 8.13		Indemnities	27

ANNEXES AND SCHEDULES

	Annex 1	Form of Pledge Amendment
	Annex 2	Form of Joinder Agreement
	Annex 3	Form of Intellectual Property Security Agreement
	Schedule 1	Commercial Tort Claims
	Schedule 2	UCC Filings
	Schedule 3	Jurisdiction of Organization; Chief Executive Office
	Schedule 4	Locations of Inventory and Equipment
	Schedule 5	Pledged Collateral
	Schedule 6	Intellectual Property

 

 

Guaranty and Security Agreement, dated as of November 17, 2010, by and among FRANCESCA’S COLLECTIONS, INC. (the “Borrower”), each of the other entities listed on the signature pages hereof or that becomes a party hereto pursuant to Section 8.6 (together with the Borrower, the “Grantors”), Royal Bank of Canada, as administrative agent (in such capacity, together with its successors and permitted assigns, the “Administrative Agent”), and Royal Bank of Canada, as collateral agent (in such capacity, together with its successors and permitted assigns, the “Collateral Agent”) for the Lenders, the L/C Issuer and each other Secured Party (each as defined in the Credit Agreement referred to below).

 

Witnesseth:

 

Whereas, pursuant to the Credit Agreement dated as of the date hereof (as the same may be amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among the Borrower, Francesca’s LLC (“Parent”), the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the Administrative Agent, the Collateral Agent and the other parties thereto, the Lenders and the L/C Issuer have severally agreed to make extensions of credit to the Borrower upon the terms and subject to the conditions set forth therein;

 

Whereas, each Grantor (other than the Borrower) has agreed to guaranty the Obligations (as defined in the Credit Agreement) of the Borrower;

 

WHEREAS, each Grantor will derive substantial direct and indirect benefits from the making of the extensions of credit under the Credit Agreement; and

 

Whereas, it is a condition precedent to the obligation of the Lenders and the L/C Issuer to make their respective extensions of credit to the Borrower under the Credit Agreement that the Grantors shall have executed and delivered this Agreement to the Administrative Agent and the Collateral Agent.

 

Now, therefore, in consideration of the premises and to induce the Lenders, the L/C Issuer, the Administrative Agent and the Collateral Agent to enter into the Credit Agreement and to induce the Lenders and the L/C Issuer to make their respective extensions of credit to the Borrower thereunder, each Grantor hereby agrees with the Administrative Agent and the Collateral Agent as follows:

 

Article I

Defined Terms

 

Section 1.1           Definitions. (a) Capital terms used herein without definition are used as defined in the Credit Agreement.

 

(b)          Terms used herein without definition that are defined in the UCC have the meanings given to them in the UCC (such meanings to be equally applicable to both the singular and plural forms of the terms defined and, if defined in more than one Article of the UCC, shall have the meaning specified in Article 9 thereof).

 

(c)          The following terms shall have the following meanings:

 

“Agreement” means this Guaranty and Security Agreement, as the same may be amended, amended and restated, supplemented or otherwise modified from time to time.

 

 

“Applicable IP Office” means the United States Patent and Trademark Office, the United States Copyright Office or any similar office or agency within or outside the United States.

 

“Collateral” has the meaning specified in Section 3.1.

 

“Control Agreement” means, with respect to any deposit account, securities account, commodity account, securities entitlement or commodity contract, an agreement among the Collateral Agent, the financial institution or other Person at which such account is maintained or with which such entitlement or contract is carried, and the Loan Party maintaining such account effective to grant “control” (as defined under the applicable UCC) over such account to the Collateral Agent in form and substance reasonably satisfactory to the Collateral Agent.

 

“Excluded Equity” means (a) Voting Stock in excess of 66% of the outstanding Voting Stock of any Foreign Subsidiary and (b) any Stock to the extent that, and for so long as, the requirements of Section 7.10 of the Credit Agreement do not apply thereto by reason of clause (ii) of the final paragraph of such Section.

 

“Excluded Property” means, collectively: (i) Vehicles; (ii) Excluded Equity; (iii) any permit or license or any Contractual Obligation entered into by any Grantor (A) that prohibits, terminates or permits termination by any Person other than the Borrower and its Affiliates of such permit, license or Contractual Obligation upon, or requires the consent of any Person other than the Borrower and its Affiliates as a condition to, the creation by such Grantor of a Lien on any right, title or interest in such permit, license or Contractual Obligation or any Stock or Stock Equivalent related thereto or (B) to the extent that any Requirement of Law applicable thereto prohibits the creation of a Lien thereon, but only, with respect to the prohibition in (A) and (B), to the extent, and for as long as, such prohibition, termination provision or requirement for consent is not terminated or rendered unenforceable or otherwise deemed ineffective by the UCC or any other Requirement of Law or required consent is not obtained (and immediately upon the lapse, termination, unenforceability or ineffectiveness of any such prohibition, termination provision or requirement for consent or grant of such required consent, the Collateral shall include, and the Grantors shall be deemed to have automatically granted a security interest in, all such permits, licenses, Contractual Obligations or Stock or Stock Equivalents no longer subject to such prohibition or termination provision or required consent); (iv) fixed or capital assets owned by any Grantor that are subject to a purchase money Lien or a Capital Lease permitted under the Credit Agreement if the Contractual Obligation pursuant to which such Lien is granted (or in the document providing for such Capital Lease) prohibits or requires the consent of any Person other than the Borrower and its Affiliates (which consent has not been obtained) as a condition to the creation of any other Lien on such equipment; (v) any “intent to use” Trademark applications for which a statement of use has not been filed with and accepted by the Applicable IP Office (but only until such statement is filed and accepted); and (vi) any assets to the extent that, and for so long as, the requirements of Section 7.10 of the Credit Agreement do not apply thereto by reason of clause (iii) of the final paragraph of such Section; provided, that “Excluded Property” shall not include any proceeds, products, substitutions or replacements of Excluded Property (unless such proceeds, products, substitutions or replacements would otherwise constitute Excluded Property).

 

“Guaranteed Obligations” has the meaning set forth in Section 2.1.

 

“Guarantor” means each Grantor other than the Borrower.

 

“Guaranty” means the guaranty of the Guaranteed Obligations made by the Guarantors as set forth in this Agreement.

 

 

“Material Intellectual Property” means Intellectual Property that is owned by or licensed to a Grantor and material to the conduct of any Grantor’s business.

 

“Pledged Certificated Stock” means all certificated securities and any other Stock or Stock Equivalent of any Person evidenced by a certificate, instrument or similar document (as defined in the UCC), in each case owned by any Grantor, and any distribution of property made on, in respect of, or in exchange for the foregoing from time to time, including all Stock and Stock Equivalents listed on Schedule 5. Pledged Certificated Stock excludes any Excluded Property and any Cash Equivalents that are not held in securities accounts that are subject to Control Agreements to the extent permitted by Section 5.10 hereof.

 

“Pledged Collateral” means, collectively, the Pledged Stock and the Pledged Debt Instruments.

 

“Pledged Debt Instruments” means all right, title and interest of any Grantor in instruments evidencing any Indebtedness owed to such Grantor or other obligations owed to such Grantor, and any distribution of property made on, in respect of or in exchange for the foregoing from time to time, including all such instruments described on Schedule 5, issued by the obligors named therein. Pledged Debt Instruments excludes any Cash Equivalents that are not held in securities accounts that are subject to Control Agreements to the extent permitted by Section 5.10 hereof.

 

“Pledged Investment Property” means any investment property of any Grantor, and any distribution of property made on, in respect of or in exchange for the foregoing from time to time, other than any Pledged Stock or Pledged Debt Instruments. Pledged Investment Property excludes any Cash Equivalents that are not held in securities accounts that are subject to Control Agreements to the extent permitted by Section 5.10 hereof.

 

“Pledged Stock” means all Pledged Certificated Stock and all Pledged Uncertificated Stock.

 

“Pledged Uncertificated Stock” means any Stock or Stock Equivalent of any Person that is not Pledged Certificated Stock, including all right, title and interest of any Grantor as a limited or general partner in any partnership not constituting Pledged Certificated Stock or as a member of any limited liability company, all right, title and interest of any Grantor in, to and under any Constituent Document of any partnership or limited liability company to which it is a party, and any distribution of property made on, in respect of or in exchange for the foregoing from time to time, including in each case those interests set forth on Schedule 5, to the extent such interests are not certificated. Pledged Uncertificated Stock excludes any Excluded Property and any Cash Equivalents that are not held in securities accounts that are subject to Control Agreements to the extent permitted by Section 5.10 hereof.

 

“Secured Obligations” has the meaning specified in Section 3.2.

 

“Security Cash Collateral Account” means a Cash Collateral Account that is not a L/C Cash Collateral Account.

 

“Software” means (a) all computer programs, including source code and object code versions, (b) all data, databases and compilations of data, whether machine readable or otherwise, and (c) all documentation, training materials and configurations related to any of the foregoing.

 

“Subsidiary Guarantor” means any Guarantor that is a Subsidiary of the Borrower.

 

 

“UCC” means the Uniform Commercial Code as from time to time in effect in the State of New York; provided, that, in the event that, by reason of mandatory provisions of any applicable Requirement of Law, any of the attachment, perfection or priority of the Collateral Agent’s or any other Secured Party’s security interest in any Collateral is governed by the Uniform Commercial Code of a jurisdiction other than the State of New York, “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection or priority and for purposes of the definitions related to or otherwise used in such provisions.

 

“Vehicles” means all vehicles covered by a certificate of title law of any state.

 

Section 1.2           Certain Other Terms. (a) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms. The terms “herein”, “hereof” and similar terms refer to this Agreement as a whole and not to any particular Article, Section or clause in this Agreement. References herein to an Annex, Schedule, Article, Section or clause refer to the appropriate Annex or Schedule to, or Article, Section or clause in this Agreement. Where the context requires, provisions relating to any Collateral when used in relation to a Grantor shall refer to such Grantor’s Collateral or any relevant part thereof.

 

(b)          Section 1.5 (Interpretation) of the Credit Agreement is applicable to this Agreement as and to the extent set forth therein.

 

Article II

GUARANTY

 

Section 2.1           Guaranty. To induce the Lenders to make the Loans and the L/C Issuer to Issue Letters of Credit, each Guarantor hereby, jointly and severally, absolutely, unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, to the Administrative Agent, the Collateral Agent, the Lenders, the L/C Issuer and the other Secured Parties the full and punctual payment when due, whether at stated maturity or earlier, by reason of acceleration, mandatory prepayment or otherwise in accordance with any Loan Document, of all the Obligations of the Borrower whether existing on the date hereof or hereinafter incurred or created (the “Guaranteed Obligations”). This Guaranty by each Guarantor hereunder constitutes a guaranty of payment and not of collection.

 

Section 2.2           Limitation of Guaranty. Any term or provision of this Guaranty or any other Loan Document to the contrary notwithstanding, the maximum aggregate amount for which any Subsidiary Guarantor shall be liable hereunder shall not exceed the maximum amount for which such Subsidiary Guarantor can be liable without rendering this Guaranty or any other Loan Document, as it relates to such Subsidiary Guarantor, subject to avoidance under applicable Requirements of Law relating to fraudulent conveyance or fraudulent transfer (including the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act and Section 548 of title 11 of the United States Code or any applicable provisions of comparable Requirements of Law) (collectively, “Fraudulent Transfer Laws”). Any analysis of the provisions of this Guaranty for purposes of Fraudulent Transfer Laws shall take into account the right of contribution established in Section 2.3 and, for purposes of such analysis, give effect to any discharge of intercompany debt as a result of any payment made under the Guaranty.

 

 

Section 2.3           Contribution. To the extent that any Subsidiary Guarantor shall be required hereunder to pay any portion of any Guaranteed Obligation exceeding the greater of (a) the amount of the economic benefit actually received by such Subsidiary Guarantor and its Subsidiaries from the Loans and other Obligations, and (b) the amount such Subsidiary Guarantor would otherwise have paid if such Subsidiary Guarantor had paid the aggregate amount of the Guaranteed Obligations (excluding the amount thereof repaid by the Borrower and Parent) in the same proportion as such Subsidiary Guarantor’s net worth on the date enforcement is sought hereunder bears to the aggregate net worth of all the Subsidiary Guarantors on such date, then such Guarantor shall be reimbursed by such other Subsidiary Guarantors for the amount of such excess, pro rata, based on the respective net worth of such other Subsidiary Guarantors on such date.

 

Section 2.4           Authorization; Other Agreements. The Secured Parties are hereby authorized, without notice to or demand upon any Guarantor and without discharging or otherwise affecting the obligations of any Guarantor hereunder and without incurring any liability hereunder, from time to time, to do each of the following:

 

(a)          (i) modify, amend, supplement or otherwise change, (ii) accelerate or otherwise change the time of payment or (iii) waive or otherwise consent to noncompliance with, any Guaranteed Obligation or any Loan Document;

 

(b)          apply to the Guaranteed Obligations any sums by whomever paid or however realized to any Guaranteed Obligation in such order as provided in the Loan Documents;

 

(c)          refund at any time any payment received by any Secured Party in respect of any Guaranteed Obligation;

 

(d)          (i) Sell, exchange, enforce, waive, substitute, liquidate, terminate, release, abandon, fail to perfect, subordinate, accept, substitute, surrender, exchange, affect, impair or otherwise alter or release any Collateral for any Guaranteed Obligation or any other guaranty therefor in any manner, (ii) receive, take and hold additional Collateral to secure any Guaranteed Obligation, (iii) add, release or substitute any one or more other Guarantors, makers or endorsers of any Guaranteed Obligation or any part thereof and (iv) otherwise deal in any manner with the Borrower and any other Guarantor, maker or endorser of any Guaranteed Obligation or any part thereof; and

 

(e)          settle, release, compromise, collect or otherwise liquidate the Guaranteed Obligations.

 

Section 2.5           Guaranty Absolute and Unconditional. Each Guarantor hereby waives and agrees not to assert any defense, whether arising in connection with or in respect of any of the following or otherwise, and hereby agrees that its obligations under this Guaranty are irrevocable, absolute and unconditional and shall not be discharged as a result of or otherwise affected by any of the following (which may not be pleaded and evidence of which may not be introduced in any proceeding with respect to this Guaranty, in each case except as otherwise agreed in writing by the Collateral Agent):

 

(a)          the invalidity or unenforceability of any obligation of the Borrower or any other Guarantor under any Loan Document or any other agreement or instrument relating thereto (including any amendment, consent or waiver thereto), or any security for, or other guaranty of, any Guaranteed Obligation or any part thereof, or the lack of perfection or continuing perfection or failure of priority of any security for the Guaranteed Obligations or any part thereof;

 

(b)          the absence of (i) any attempt to collect any Guaranteed Obligation or any part thereof from the Borrower or any other Guarantor or other action to enforce the same or (ii) any action to enforce any Loan Document or any Lien thereunder;

 

(c)          the failure by any Person to take any steps to perfect and maintain any Lien on, or to preserve any rights with respect to, any Collateral;

 

 

(d)          any workout, insolvency, bankruptcy proceeding, reorganization, arrangement, liquidation or dissolution by or against the Borrower, any other Guarantor or any of the Borrower’s other Subsidiaries or any procedure, agreement, order, stipulation, election, action or omission thereunder, including any discharge or disallowance of, or bar or stay against collecting, any Guaranteed Obligation (or any interest thereon) in or as a result of any such proceeding;

 

(e)          any foreclosure, whether or not through judicial sale, and any other Sale of any Collateral or any election following the occurrence of an Event of Default by any Secured Party to proceed separately against any Collateral in accordance with such Secured Party’s rights under any applicable Requirement of Law; or

 

(f)          any other defense, setoff, counterclaim or any other circumstance that might otherwise constitute a legal or equitable discharge of the Borrower, any other Guarantor or any of the Borrower’s other Subsidiaries, in each case other than the payment in full of the Guaranteed Obligations.

 

Section 2.6           Waivers. Each Guarantor hereby unconditionally and irrevocably waives and agrees not to assert any claim, defense, setoff or counterclaim based on diligence, promptness, presentment, requirements for any demand or notice hereunder including any of the following: (a) any demand for payment or performance and protest and notice of protest, (b) any notice of acceptance, (c) any presentment, demand, protest or further notice or other requirements of any kind with respect to any Guaranteed Obligation (including any accrued but unpaid interest thereon) becoming immediately due and payable, (d) any rights and defenses arising out of an election of remedies by Collateral Agent or any Secured Party, even if such election has destroyed such Grantor’s rights of subrogation and reimbursement against the Borrower or any other Guarantor, and (e) any other notice in respect of any Guaranteed Obligation or any part thereof, and any defense arising by reason of any disability or other defense of the Borrower or any other Guarantor. Each Guarantor further unconditionally and irrevocably agrees not to (x) enforce or otherwise exercise any right of subrogation or any right of reimbursement or contribution or similar right against the Borrower or any other Guarantor by reason of any Loan Document or any payment made thereunder or (y) assert any claim, defense, setoff or counterclaim it may have against any other Loan Party or set off any of its obligations to such other Loan Party against obligations of such Loan Party to such Guarantor. No obligation of any Guarantor hereunder shall be discharged other than by complete performance.

 

Section 2.7           Reliance. Each Guarantor hereby assumes responsibility for keeping itself informed of the financial condition of the Borrower, each other Guarantor and any other guarantor, maker or endorser of any Guaranteed Obligation or any part thereof, and of all other circumstances bearing upon the risk of nonpayment of any Guaranteed Obligation or any part thereof that diligent inquiry would reveal, and each Guarantor hereby agrees that no Secured Party shall have any duty to advise any Guarantor of information known to it regarding such condition or any such circumstances. In the event any Secured Party, in its sole discretion, undertakes at any time or from time to time to provide any such information to any Guarantor, such Secured Party shall be under no obligation to (a) undertake any investigation, (b) disclose any information that such Secured Party, pursuant to accepted or reasonable commercial finance or banking practices, wishes to maintain confidential or (c) make any future disclosures of such information or any other information to any Guarantor.

 

 

Article III

Grant of Security Interest

 

Section 3.1           Collateral. For the purposes of this Agreement, all of the following property now owned or at any time hereafter acquired by a Grantor or in which a Grantor now has or at any time in the future may acquire any right, title or interest is collectively referred to as the “Collateral”:

 

(a)          all accounts, chattel paper, deposit accounts, documents (as defined in the UCC), equipment, general intangibles, instruments, inventory, investment property, letter-of-credit rights and any supporting obligations related to any of the foregoing;

 

(b)          the commercial tort claims described on Schedule 1 and on any supplement thereto received by the Collateral Agent pursuant to Section 5.8;

 

(c)          all books and records pertaining to the other property described in this Section 3.1;

 

(d)          all property of such Grantor held by any Secured Party, including all property of every description, in the custody of or in transit to such Secured Party for any purpose, including safekeeping, collection or pledge, for the account of such Grantor or as to which such Grantor may have any right or power, including but not limited to cash;

 

(e)          all other goods (including but not limited to fixtures) and personal property of such Grantor, whether tangible or intangible and wherever located; and

 

(f)          to the extent not otherwise included, all proceeds of the foregoing;

 

provided, that “Collateral” shall not include any Excluded Property; and provided, further, that if and when any property shall cease to be Excluded Property, such property shall be deemed at all times from and after the date thereof to constitute Collateral.

 

Section 3.2           Grant of Security Interest in Collateral. Each Grantor, as collateral security for the prompt and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of the Obligations of such Grantor (the “Secured Obligations”), hereby mortgages, pledges and hypothecates to the Collateral Agent for the benefit of the Secured Parties, and grants to the Collateral Agent for the benefit of the Secured Parties a Lien on and security interest in, all of its right, title and interest in, to and under the Collateral of such Grantor.

 

Section 3.3           Continuing Liability Under Collateral. Notwithstanding anything herein to the contrary, (i) each Grantor shall remain liable for all obligations under the Collateral and nothing contained herein is intended to be or shall be a delegation of duties to the Collateral Agent or any other Secured Party, (ii) each Grantor shall remain liable under each of the agreements included in the Collateral, including, without limitation, any agreements relating to pledged partnership interests or pledged limited liability company interests, to perform all of the obligations undertaken by it thereunder all in accordance with and pursuant to the terms and provisions thereof and neither the Collateral Agent nor any Secured Party shall have any obligation or liability under any of such agreements by reason of or arising out of this Agreement or any other document related thereto nor shall the Collateral Agent nor any Secured Party have any obligation to make any inquiry as to the nature or sufficiency of any payment received by it or have any obligation to take any action to collect or enforce any rights under any agreement included in the Collateral, including, without limitation, any agreements relating to pledged partnership interests or pledged limited liability company interests, and (iii) the exercise by the Collateral Agent of any of its rights hereunder shall not release any Grantor from any of its duties or obligations under the contracts and agreements included in the Collateral.

 

 

Article IV

Representations and Warranties

 

To induce the Lenders, the L/C Issuer, the Administrative Agent and the Collateral Agent to enter into the Loan Documents, each Grantor hereby represents and warrants each of the following to the Administrative Agent, the Collateral Agent, the Lenders, the L/C Issuer and the other Secured Parties:

 

Section 4.1           Title; No Other Liens. Except for the Lien granted to the Collateral Agent pursuant to this Agreement and other Permitted Liens, such Grantor owns each item of the Collateral free and clear of any and all Liens or claims of others. Such Grantor (a) is the record and beneficial owner of the Collateral pledged by it hereunder constituting instruments or certificates and (b) has rights in or the power to transfer each other item of Collateral in which a Lien is granted by it hereunder, free and clear of any other Lien.

 

Section 4.2           Perfection and Priority. The security interest granted pursuant to this Agreement constitutes a valid and continuing perfected security interest in favor of the Collateral Agent for the benefit of the Secured Parties in all Collateral subject, for the following Collateral, to the occurrence of the following: (i) in the case of all Collateral in which a security interest may be perfected by filing a financing statement under the UCC, the completion of the filings specified on Schedule 2 (which, in the case of all filings referred to on such schedule, have been duly authorized by each Grantor and delivered to the Collateral Agent in completed form), (ii) with respect to any deposit account, the execution of a Control Agreement, (iii) in the case of all Copyrights, Trademarks and Patents for which UCC filings are insufficient, all appropriate filings having been made with the Applicable IP Office, (iv) in the case of letter-of-credit rights that are not supporting obligations of Collateral, the execution of a Contractual Obligation granting control to the Collateral Agent over such letter-of-credit rights, and (v) in the case of electronic chattel paper, the completion of all steps necessary to grant control to the Collateral Agent over such electronic chattel paper. Such security interest shall be prior to all other Liens on the Collateral except for Customary Permitted Liens having priority over the Collateral Agent’s Lien by operation of law or permitted pursuant to clause (c), (e) or (j) of the definition of “Customary Permitted Liens” in the Credit Agreement or subsection 8.2(c), 8.2(d), 8.2(e), 8.2(f) or 8.2(h) of the Credit Agreement upon (i) in the case of all Pledged Certificated Stock, Pledged Debt Instruments and Pledged Investment Property, the delivery thereof to the Collateral Agent of such Pledged Certificated Stock, Pledged Debt Instruments and Pledged Investment Property consisting of instruments and certificates, in each case properly endorsed for transfer to the Collateral Agent or in blank, (ii) in the case of all Pledged Investment Property not in certificated form, the execution of a Control Agreement with respect to such investment property, and (iii) in the case of all other instruments and tangible chattel paper that are not Pledged Certificated Stock, Pledged Debt Instruments or Pledged Investment Property, the delivery to the Collateral Agent of such instruments and tangible chattel paper. Except as set forth in this Section 4.2, all actions by each Grantor necessary to perfect the Lien granted hereunder on the Collateral have been duly taken.

 

Section 4.3           Jurisdiction of Organization; Chief Executive Office. Such Grantor’s jurisdiction of organization, legal name and organizational identification number, if any, and the location of such Grantor’s chief executive office or sole place of business, in each case as of the date hereof, is specified on Schedule 3 and such Schedule 3 also lists all jurisdictions of incorporation, legal names and locations of such Grantor’s chief executive office or sole place of business for the five years preceding the date hereof.

 

 

Section 4.4           Locations of Inventory, Equipment and Books and Records. On the date hereof, such Grantor’s inventory and equipment (other than inventory or equipment in transit) and books and records concerning the Collateral are kept at the locations listed on Schedule 4 and such Schedule 4 also lists the locations of such inventory, equipment and books and records for the five years preceding the date hereof.

 

Section 4.5           Pledged Collateral. (a) The Pledged Stock of all Subsidiaries pledged by such Grantor hereunder and all other Pledged Stock in excess of $500,000 individually or $1,000,000 in the aggregate (i) is, as of the Closing Date, listed on Schedule 5 and, as of the Closing Date, constitutes that percentage of the issued and outstanding equity of all classes of each issuer thereof as set forth on Schedule 5, (ii) has been duly authorized, validly issued and is fully paid and nonassessable (other than Pledged Stock in limited liability companies and partnerships), (iii) constitutes the legal, valid and binding obligation of the obligor with respect thereto, enforceable in accordance with its terms and (iv) in the case of Pledged Certificated Stock, has been delivered to the Collateral Agent in accordance with Section 5.3(a) as of the Closing Date.

 

(b)          As of the Closing Date, all Pledged Collateral (other than Pledged Stock) in excess of $500,000 individually or $1,000,000 in the aggregate, all Pledged Debt Instruments required to be pledged hereunder pursuant to Section 8.1(e) or 8.3(e) of the Credit Agreement, and all Pledged Investment Property consisting of instruments and certificates in excess of $500,000 individually or $1,000,000 in the aggregate, in each case has been delivered to the Collateral Agent in accordance with Section 5.3(a).

 

(c)          Upon the occurrence and during the continuance of an Event of Default, the Collateral Agent, at the direction of the Administrative Agent, shall be entitled to exercise all of the rights of the Grantor granting the security interest in any Pledged Stock, and a transferee or assignee of such Pledged Stock shall become a holder of such Pledged Stock to the same extent as such Grantor and be entitled to participate in the management of the issuer of such Pledged Stock and, upon the transfer of the entire interest of such Grantor, such Grantor shall, by operation of law, cease to be a holder of such Pledged Stock.

 

Section 4.6           Instruments and Tangible Chattel Paper Formerly Accounts. No amount payable to such Grantor under or in connection with any Collateral is evidenced by any instruments or tangible chattel paper in excess of $500,000 individually or $1,000,000 in the aggregate that has not been delivered to the Collateral Agent, properly endorsed for transfer, to the extent delivery is required by Section 5.5(a).

 

Section 4.7           Intellectual Property. (a) As of the Closing Date, Schedule 6 sets forth a true and complete list of the following Intellectual Property such Grantor owns (or, in the case of Material Intellectual Property, licenses): (i) Intellectual Property that is registered or subject to applications for registration, including for each of the foregoing items (1) the owner, (2) the title, (3) the jurisdiction in which such item has been registered or otherwise arises or in which an application for registration has been filed, and (4) as applicable, the registration or application number and registration or application date, (ii) Internet Domain Names and (iii) Material Intellectual Property.

 

 

(b)          On the Closing Date, all Material Intellectual Property owned by such Grantor is in full force and effect, subsisting, unexpired and, to such Grantor’s knowledge, valid and enforceable, and no Material Intellectual Property has been abandoned. The consummation of the transactions contemplated by the Loan Documents shall not limit or impair the ownership, use, validity or enforceability of, or any rights of such Grantor in, any Material Intellectual Property. There are no pending (or, to the knowledge of such Grantor, threatened) actions, investigations, suits, proceedings, audits, claims, demands, orders or disputes challenging the ownership, use, validity, enforceability of, or such Grantor’s rights in, any Material Intellectual Property owned by such Grantor. To such Grantor’s knowledge, no Person has been or is infringing, misappropriating, diluting, violating or otherwise impairing any Material Intellectual Property owned by such Grantor. Such Grantor and, to such Grantor’s knowledge, each other party thereto is not in material breach or default of any material IP License.

 

Section 4.8           Commercial Tort Claims. The only commercial tort claims of any Grantor existing on the date hereof (regardless of whether the amount, defendant or other material facts can be definitively determined and regardless of whether such commercial tort claim has been asserted, threatened or has otherwise been made known to the obligee thereof or whether litigation has been commenced for such claims) in excess of $500,000 individually or $1,000,000 in the aggregate are those listed on Schedule 1, which sets forth such information separately for each Grantor.

 

Section 4.9           Specific Collateral. As of the Closing Date, none of the Collateral is or is proceeds or products of farm products, “as-extracted collateral” (as defined in the UCC), health care insurance receivables or timber to be cut.

 

Section 4.10         Enforcement. No Permit, notice to or filing with any Governmental Authority or any other Person or any consent from any Person is required for the exercise by the Collateral Agent of its rights (including voting rights) provided for in this Agreement or the enforcement of remedies in respect of the Collateral pursuant to this Agreement, including the transfer of any Collateral, except as may be required in connection with the disposition of any portion of the Pledged Collateral by laws affecting the offering and sale of securities generally or any approvals that may be required to be obtained from any bailees or landlords to collect the Collateral.

 

Section 4.11         Representations and Warranties of the Credit Agreement. The representations and warranties as to such Grantor and its Subsidiaries made by the Borrower in Article IV (Representations and Warranties) of the Credit Agreement are true and correct on each date as required by Section 3.2(b) of the Credit Agreement.

 

Article V

Covenants

 

Each Grantor agrees with the Administrative Agent and the Collateral Agent to the following, as long as any Obligation or Commitment remains outstanding and, in each case, unless the Required Lenders otherwise consent in writing:

 

Section 5.1           Maintenance of Perfected Security Interest; Further Documentation and Consents. (a) Generally. Such Grantor shall (i) not use or permit any Collateral to be used unlawfully or in violation of any provision of any Loan Document, any Requirement of Law or any policy of insurance covering the Collateral and (ii) not enter into any Contractual Obligation or undertaking restricting the right or ability of such Grantor or the Collateral Agent to Sell any Collateral if such restriction could, either individually or in the aggregate, have a Material Adverse Effect.

 

(b)          Such Grantor shall maintain the security interest created by this Agreement as a perfected security interest having at least the priority described in Section 4.2 and shall defend such security interest and such priority against the claims and demands of all Persons.

 

 

(c)          Such Grantor shall furnish to the Administrative Agent and the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral and such other documents in connection with the Collateral as the Administrative Agent and the Collateral Agent may reasonably request, all in reasonable detail and in form and substance satisfactory to the Administrative Agent and the Collateral Agent.

 

(d)          At any time and from time to time, upon the reasonable written request of the Collateral Agent (as so directed by the Administrative Agent), such Grantor shall, for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, (i) promptly and duly execute and deliver, and have recorded, such further documents, including an authorization to file (or, as applicable, the filing of) any financing statement or amendment under the UCC (or other filings under similar Requirements of Law) in effect in any jurisdiction with respect to the security interest created hereby and (ii) take such further action as the Administrative Agent or the Collateral Agent may reasonably request.

 

(e)          To ensure that a Lien and security interest is granted on any of the Excluded Property set forth in clause (ii) of the definition of “Excluded Property”, such Grantor shall use its commercially reasonable efforts to obtain any required consents from any Person other than the Borrower and its Affiliates with respect to any permit or license or any Contractual Obligation with such Person entered into by such Grantor that requires such consent as a condition to the creation by such Grantor of a Lien on any right, title or interest in such permit, license or Contractual Obligation or any Stock or Stock Equivalent related thereto.

 

Section 5.2           [Reserved].

 

Section 5.3           Pledged Collateral. (a) Delivery of Pledged Collateral. Such Grantor shall, within 30 days of the acquisition or formation thereof, (i) deliver to the Collateral Agent, in suitable form for transfer and in form and substance satisfactory to the Administrative Agent, (A) all Pledged Certificated Stock of Subsidiaries, (B) all other Pledged Certificated Stock, (C) all Pledged Debt Instruments and (D) all certificates and instruments evidencing Pledged Investment Property, in each case of clauses (B), (C), and (D) in excess of $500,000 individually or $1,000,000 in the aggregate; provided that Pledged Certificated Stock of Subsidiaries and Pledged Debt Instruments required to be pledged hereunder pursuant to Section 8.1(e) or 8.3(e) of the Credit Agreement shall be delivered regardless of their value and (ii) maintain all other Pledged Investment Property in a securities account subject to a Control Agreement.

 

(b)          Event of Default. During the continuance of an Event of Default, the Collateral Agent shall have the right, at any time at the direction of the Administrative Agent (in the Administrative Agent’s discretion) and without notice to the Grantor, to (i) transfer to or to register in its name or in the name of its nominees any Pledged Collateral or any Pledged Investment Property and (ii) exchange any certificate or instrument representing or evidencing any Pledged Collateral or any Pledged Investment Property for certificates or instruments of smaller or larger denominations.

 

(c)          Cash Distributions with respect to Pledged Collateral. Except as provided in Article VI, such Grantor shall be entitled to receive all cash distributions paid in respect of the Pledged Collateral.

 

(d)          Voting Rights. Except as provided in Article VI, such Grantor shall be entitled to exercise all voting, consent and corporate, partnership, limited liability company and similar rights with respect to the Pledged Collateral; provided, that no vote shall be cast, consent given or right exercised or other action taken by such Grantor that would impair the Collateral or be inconsistent with or result in any violation of any provision of any Loan Document. The Collateral Agent shall have no duty or obligation to exercise or monitor such voting rights.

 

 

Section 5.4           Accounts. Such Grantor shall not, other than in the ordinary course of business, (i) grant any extension of the time of payment of any account, (ii) compromise or settle any account for less than the full amount thereof, (iii) release, wholly or partially, any Person liable for the payment of any account, (iv) allow any credit or discount on any account or (v) amend, supplement or modify any account in any manner that could adversely affect the value thereof.

 

Section 5.5           Delivery of Instruments and Tangible Chattel Paper, Letter-of-Credit Rights and Electronic Chattel Paper. (a) If any amounts in excess of $500,000 individually or $1,000,000 in the aggregate payable under or in connection with any Collateral owned by such Grantor shall be or become evidenced by an instrument or tangible chattel paper other than such instrument delivered in accordance with Section 5.3(a) and in the possession of the Collateral Agent, such Grantor shall mark all such instruments and tangible chattel paper with the following legend: “This writing and the obligations evidenced or secured hereby are subject to the security interest of Royal Bank of Canada, as Collateral Agent”, shall promptly (and in any event within 30 days) provide a notice of acquisition of such instrument or chattel paper to the Collateral Agent, and, at the request of the Administrative Agent, shall immediately deliver such instrument or tangible chattel paper to the Collateral Agent, duly indorsed in a manner satisfactory to the Administrative Agent.

 

(b)          Such Grantor shall not grant “control” (within the meaning of such term under Article 9-106 of the UCC) over any investment property to any Person other than the Collateral Agent.

 

(c)          If such Grantor is or becomes the beneficiary of a letter or letters of credit that is (i) not a supporting obligation of any Collateral and (ii) in excess of $500,000 individually or $1,000,000 in the aggregate, then such Grantor shall promptly, and in any event within 2 Business Days after becoming a beneficiary, notify the Collateral Agent thereof. Such Grantor shall use commercially reasonable efforts to enter into a Contractual Obligation with the Collateral Agent, the issuer of such letter of credit or any nominated person with respect to the letter-of-credit rights under such letter of credit. Such Contractual Obligation shall assign proceeds of such letters of credit to the Collateral Agent in a manner sufficient to grant control for the purposes of Section 9-107 of the UCC (or any similar section under any equivalent UCC). Such Contractual Obligation shall also direct all payments thereunder to a Cash Collateral Account. The provisions of such Contractual Obligation shall be in form and substance reasonably satisfactory to the Administrative Agent.

 

(d)          If any amounts in excess of $500,000 individually or $1,000,000 in the aggregate payable under or in connection with any Collateral owned by such Grantor shall be or become evidenced by electronic chattel paper, such Grantor shall take all steps necessary to grant the Collateral Agent control of all such electronic chattel paper for the purposes of Section 9-105 of the UCC (or any similar section under any equivalent UCC) and all “transferable records” as defined in each of the Uniform Electronic Transactions Act and the Electronic Signatures in Global and National Commerce Act related to such electronic chattel paper.

 

Section 5.6           Intellectual Property. (a) Within 60 days after any change to Schedule 6 for such Grantor, such Grantor shall provide the Collateral Agent notification thereof and the short-form intellectual property agreements and assignments as described in this Section 5.6 and other documents that the Administrative Agent reasonably requests with respect thereto.

 

 

(b)          Such Grantor shall (and shall exercise commercially reasonable efforts to cause all of its licensees to), to the extent the applicable Intellectual Property remains, in the reasonable judgment of such Grantor, necessary for or useful in the conduct of such Grantor’s business: (i) (1) continue to use each Trademark included in the Material Intellectual Property in order to maintain such Trademark in full force and effect with respect to each class of goods for which such Trademark is currently used, free from any claim of abandonment for non-use, (2) maintain at least the same standards of quality of products and services offered under such Trademark as are currently maintained, (3) use such Trademark, where commercially practicable, with the appropriate notice of registration and all other notices and legends required by applicable Requirements of Law, and (4) not adopt or use any other Trademark that is confusingly similar or a colorable imitation of such Trademark unless the Collateral Agent shall obtain a perfected security interest in such other Trademark pursuant to this Agreement; and (ii) not do any act or omit to do any act whereby (w) any Trademark included in the Material Intellectual Property (or any goodwill associated therewith) may become destroyed, invalidated, impaired or harmed in any way, (x) any Patent included in the Material Intellectual Property may become forfeited, misused, unenforceable, abandoned or dedicated to the public, (y) any Copyrights included in the Material Intellectual Property may become invalidated, otherwise impaired or fall into the public domain, or (z) any Trade Secret that is Material Intellectual Property may be disclosed to an unauthorized third party or become publicly available or otherwise unprotectable.

 

(c)          Such Grantor shall notify the Collateral Agent immediately if it knows, or has reason to know, that any application or registration relating to any Material Intellectual Property may become forfeited, misused, unenforceable, abandoned or dedicated to the public, or of any adverse determination or development regarding the validity or enforceability or such Grantor’s ownership of, interest in, right to use, register, own or maintain any Material Intellectual Property (including the institution of, or any such determination or development in, any proceeding relating to the foregoing in any Applicable IP Office). Such Grantor shall take all actions that are necessary or reasonably requested by the Administrative Agent to maintain and pursue each application (and to obtain the relevant registration or recordation) and to maintain each registration and recordation included in the Material Intellectual Property.

 

(d)          Such Grantor shall not do any act or omit to do any act to infringe, misappropriate, dilute, violate or otherwise impair the Intellectual Property of any other Person, except for any such action or omission as would not be expected to have a Material Adverse Effect. In the event that any Material Intellectual Property of such Grantor is or has been infringed, misappropriated, violated, diluted or otherwise impaired by a third party, such Grantor shall take such action, if any, as it reasonably deems appropriate under the circumstances in response thereto, including promptly bringing suit and recovering all damages therefor.

 

(e)          Such Grantor shall execute and deliver to the Collateral Agent in form and substance reasonably acceptable to the Administrative Agent and suitable for (i) filing in the Applicable IP Office the short-form intellectual property security agreements in the form attached hereto as Annex 3 for all Copyrights, Trademarks, Patents and IP Licenses of such Grantor, and (ii) if requested by the Collateral Agent at the direction of the Administrative Agent during the continuation of an Event of Default, recording with the appropriate Internet domain name registrar, a duly executed form of assignment for all Internet Domain Names of such Grantor, in each case, together with appropriate supporting documentation as may be requested by the Collateral Agent.

 

Section 5.7           Notices. Such Grantor shall promptly (and in any event within 30 days of the acquisition thereof) notify the Collateral Agent in writing of its acquisition of any interest hereafter in property that is of a type where a security interest or lien must be or may be registered, recorded or filed under, or notice thereof given under, any federal statute or regulation.

 

 

 

Section 5.8           Notice of Commercial Tort Claims. Such Grantor agrees that, if it shall acquire any interest in any commercial tort claims in excess of $500,000 individually or $1,000,000 in the aggregate (whether from another Person or because such commercial tort claim shall have come into existence), (i) such Grantor shall, immediately upon such acquisition, deliver to the Collateral Agent, in each case in form and substance satisfactory to the Administrative Agent, a notice of the existence and nature of such commercial tort claim and a supplement to Schedule 1 containing a specific description of such commercial tort claim, (ii) Section 3.1 shall apply to such commercial tort claim and (iii) such Grantor shall execute and deliver to the Collateral Agent, in each case in form and substance satisfactory to the Administrative Agent, any document, and take all other action, deemed by the Administrative Agent to be reasonably necessary or appropriate for the Collateral Agent to obtain, on behalf of the Lenders, a perfected security interest having at least the priority set forth in Section 4.2 in all such commercial tort claims. Any supplement to Schedule 1 delivered pursuant to this Section 5.8 shall, after the receipt thereof by the Collateral Agent, become part of Schedule 1 for all purposes hereunder other than in respect of representations and warranties made prior to the date of such receipt.

 

Section 5.9           Compliance with Credit Agreement. Such Grantor agrees to comply with all covenants and other provisions applicable to it under the Credit Agreement, including Sections 2.17 (Taxes) and 11.3 (Costs and Expenses) of the Credit Agreement, and agrees to the same submission to jurisdiction as that agreed to by the Borrower in the Credit Agreement.

 

Section 5.10         Controlled Securities Account. Each Grantor shall deposit all of its Cash Equivalents in securities accounts that are subject to Control Agreements except for (i) Cash Equivalents the value of which does not exceed $500,000 individually or $1,000,000 in the aggregate and (ii) Cash Equivalents which are deposited in accounts that are the subject of Section 5.11.

 

Section 5.11         Cash Management Systems. Each Grantor shall enter into, and cause each depository, securities intermediary or commodities intermediary to enter into, Control Agreements with respect to each deposit, securities, commodity or similar account maintained by such Person (other than any payroll account, withholding tax and fiduciary accounts and other accounts containing less than $500,000 individually or $1,000,000 in the aggregate) as of or after the Closing Date.

 

Article VI

Remedial Provisions

 

Section 6.1           Code and Other Remedies. (a) UCC Remedies. During the continuance of an Event of Default, the Collateral Agent may exercise, in addition to all other rights and remedies granted to it in this Agreement and in any other instrument or agreement securing, evidencing or relating to any Secured Obligation, all rights and remedies of a secured party under the UCC or any other applicable law.

 

(b)          Disposition of Collateral. Without limiting the generality of the foregoing, the Collateral Agent may at the written direction of the Administrative Agent, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law referred to below) to or upon any Grantor or any other Person (all and each of which demands, defenses, advertisements and notices are hereby waived), during the continuance of any Event of Default (personally or through its agents or attorneys), (i) enter upon the premises where any Collateral is located, without any obligation to pay rent, through self-help, without judicial process, without first obtaining a final judgment or giving any Grantor or any other Person notice or opportunity for a hearing on the Collateral Agent’s claim or action, (ii) collect, receive, appropriate and realize upon any Collateral and (iii) Sell, grant an option or options to purchase and deliver any Collateral (enter into Contractual Obligations to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange, broker’s board or office of any Secured Party or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk. The Collateral Agent shall have the right, upon any such public sale or sales and, to the extent permitted by the UCC and other applicable Requirements of Law, upon any such private sale, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption of any Grantor, which right or equity is hereby waived and released.

 

 

(c)          Management of the Collateral. Each Grantor further agrees that, during the continuance of any Event of Default, (i) at the Administrative Agent’s request, it shall assemble the Collateral and make it available to the Collateral Agent at places that the Collateral Agent shall reasonably select, whether at such Grantor’s premises or elsewhere, (ii) without limiting the foregoing, the Collateral Agent also has the right to require that each Grantor store and keep any Collateral pending further action by the Collateral Agent and, while any such Collateral is so stored or kept, provide such guards and maintenance services as shall be necessary to protect the same and to preserve and maintain such Collateral in good condition, (iii) until the Collateral Agent is able to Sell any Collateral, the Collateral Agent shall have the right to hold or use such Collateral to the extent that it deems appropriate for the purpose of preserving the Collateral or its value or for any other purpose deemed appropriate by the Collateral Agent and (iv) the Collateral Agent may, if it so elects, seek the appointment of a receiver or keeper to take possession of any Collateral and to enforce any of the Collateral Agent’s remedies (for the benefit of the Secured Parties), with respect to such appointment without prior notice or hearing as to such appointment. The Collateral Agent shall not have any obligation to any Grantor to maintain or preserve the rights of any Grantor as against third parties with respect to any Collateral while such Collateral is in the possession of the Collateral Agent.

 

(d)          Application of Proceeds. The Collateral Agent shall apply the cash proceeds of any action taken by it pursuant to this Section 6.1, after deducting all of its reasonable costs and expenses of every kind incurred in connection therewith or incidental to the care or safekeeping of any Collateral or in any way relating to the Collateral or the rights of the Collateral Agent and any other Secured Party hereunder, including, but not limited to, the reasonable fees and disbursements of any third party agent and reasonable attorneys’ fees and disbursements, to the payment in whole or in part of the Secured Obligations, as set forth in the Credit Agreement, and only after such application and after the payment by the Collateral Agent of any other amount required by any Requirement of Law, need the Collateral Agent account for the surplus, if any, to any Grantor.

 

(e)          Direct Obligation. Neither the Collateral Agent nor any other Secured Party shall be required to make any demand upon, or pursue or exhaust any right or remedy against, any Grantor, any other Loan Party or any other Person with respect to the payment of the Obligations or to pursue or exhaust any right or remedy with respect to any Collateral therefor or any direct or indirect guaranty thereof. All of the rights and remedies of the Collateral Agent and any other Secured Party under any Loan Document shall be cumulative, may be exercised individually or concurrently and not exclusive of any other rights or remedies provided by any Requirement of Law. To the extent it may lawfully do so, each Grantor absolutely and irrevocably waives and relinquishes the benefit and advantage of, and covenants not to assert against the Collateral Agent or any other Secured Party, any valuation, stay, appraisement, extension, redemption or similar laws and any and all rights or defenses it may have as a surety, now or hereafter existing, arising out of the exercise by them of any rights hereunder. If any notice of a proposed sale or other disposition of any Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least 10 days before such sale or other disposition.

 

 

(f)          Commercially Reasonable. To the extent that applicable Requirements of Law impose duties on the Collateral Agent to exercise remedies in a commercially reasonable manner, each Grantor acknowledges and agrees that it is commercially reasonable for the Collateral Agent to do any of the following:

 

(i)          fail to incur significant costs, expenses or other Liabilities reasonably deemed as such by the Collateral Agent to prepare any Collateral for disposition or otherwise to complete raw material or work in process into finished goods or other finished products for disposition;

 

(ii)         fail to obtain Permits, or other consents, for access to any Collateral to Sell or for the collection or Sale of any Collateral, or, if not required by other Requirements of Law, fail to obtain Permits or other consents for the collection or disposition of any Collateral;

 

(iii)        fail to exercise remedies against account debtors or other Persons obligated on any Collateral or to remove Liens on any Collateral or to remove any adverse claims against any Collateral;

 

(iv)        advertise dispositions of any Collateral through publications or media of general circulation, whether or not such Collateral is of a specialized nature or to contact other Persons, whether or not in the same business as any Grantor, for expressions of interest in acquiring any such Collateral;

 

(v)         exercise collection remedies against account debtors and other Persons obligated on any Collateral, directly or through the use of collection agencies or other collection specialists, hire one or more professional auctioneers to assist in the disposition of any Collateral, whether or not such Collateral is of a specialized nature or, to the extent deemed appropriate by the Collateral Agent, obtain the services of other brokers, investment bankers, consultants and other professionals to assist the Collateral Agent in the collection or disposition of any Collateral, or utilize Internet sites that provide for the auction of assets of the types included in the Collateral or that have the reasonable capacity of doing so, or that match buyers and sellers of assets to dispose of any Collateral;

 

(vi)        dispose of assets in wholesale rather than retail markets;

 

(vii)       disclaim disposition warranties, such as title, possession or quiet enjoyment; or

 

(viii)      purchase insurance or credit enhancements to insure the Collateral Agent against risks of loss, collection or disposition of any Collateral or to provide to the Collateral Agent a guaranteed return from the collection or disposition of any Collateral.

 

Each Grantor acknowledges that the purpose of this Section 6.1 is to provide a non-exhaustive list of actions or omissions that are commercially reasonable when exercising remedies against any Collateral and that other actions or omissions by the Secured Parties shall not be deemed commercially unreasonable solely on account of not being indicated in this Section 6.1. Without limitation upon the foregoing, nothing contained in this Section 6.1 shall be construed to grant any rights to any Grantor or to impose any duties on the Collateral Agent that would not have been granted or imposed by this Agreement or by applicable Requirements of Law in the absence of this Section 6.1.

 

 

(g)          IP Licenses. For the purpose of enabling the Collateral Agent (at the direction of the Administrative Agent) to exercise rights and remedies under this Section 6.1 (including in order to take possession of, collect, receive, assemble, process, appropriate, remove, realize upon, Sell or grant options to purchase any Collateral) at such time as the Collateral Agent shall be lawfully entitled to exercise such rights and remedies, each Grantor hereby grants to the Collateral Agent, for the benefit of the Secured Parties, (i) an irrevocable, nonexclusive, worldwide license (exercisable without payment of royalty or other compensation to such Grantor), including in such license the right to sublicense, use and practice any Intellectual Property now owned or hereafter acquired by such Grantor and access to all media in which any of the licensed items may be recorded or stored and to all Software and programs used for the compilation or printout thereof and (ii) an irrevocable license (without payment of rent or other compensation to such Grantor) to use, operate and occupy all Real Property owned, operated, leased, subleased or otherwise occupied by such Grantor.

 

Section 6.2           Accounts and Payments in Respect of General Intangibles. (a) In addition to, and not in substitution for, any similar requirement in the Credit Agreement, if required by the Collateral Agent at any time during the continuance of (A) an Event of Default under clause (a) or clause (e)(ii) of Section 9.1 of the Credit Agreement or (B) any other Event of Default in connection with the exercise of remedies by the Administrative Agent pursuant to Section 9.2 of the Credit Agreement, (i) any payment of accounts or payment in respect of general intangibles, when collected by any Grantor, shall be promptly (and, in any event, within 2 Business Days) deposited by such Grantor in the exact form received, duly indorsed by such Grantor to the Collateral Agent, in a Security Cash Collateral Account, subject to withdrawal by the Collateral Agent as provided in Section 6.4, and (ii) until so turned over, such payment shall be held by such Grantor in trust for the Collateral Agent, segregated from other funds of such Grantor. Each such deposit of proceeds of accounts and payments in respect of general intangibles shall be accompanied by a report identifying in reasonable detail the nature and source of the payments included in the deposit.

 

(b)          At any time during the continuance of (A) an Event of Default under clause (a) or clause (e)(ii) of Section 9.1 of the Credit Agreement or (B) any other Event of Default in connection with the exercise of remedies by the Administrative Agent pursuant to Section 9.2 of the Credit Agreement:

 

(i)          each Grantor shall, upon the Collateral Agent’s request, deliver to the Collateral Agent all original and other documents evidencing, and relating to, the Contractual Obligations and transactions that gave rise to any account or any payment in respect of general intangibles, including all original orders, invoices and shipping receipts and notify account debtors that the accounts or general intangibles have been collaterally assigned to the Collateral Agent and that payments in respect thereof shall be made directly to the Collateral Agent; and

 

(ii)         the Collateral Agent may, without notice, limit or terminate the authority of a Grantor to collect its accounts or amounts due under general intangibles or any thereof and, in its own name or in the name of others, communicate with account debtors to verify with them to the Collateral Agent’s satisfaction the existence, amount and terms of any account or amounts due under any general intangible. In addition, the Collateral Agent may (at the direction of the Administrative Agent) at any time enforce such Grantor’s rights against such account debtors and obligors of general intangibles.

 

(c)          At any time during the continuance of an Event of Default, each Grantor shall take all actions, deliver all documents and provide all information necessary or reasonably requested by the Collateral Agent (at the direction of the Administrative Agent) to ensure any Internet Domain Name is registered.

 

 

(d)          Anything herein to the contrary notwithstanding, each Grantor shall remain liable under each account and each payment in respect of general intangibles to observe and perform all the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement giving rise thereto. No Secured Party shall have any obligation or liability under any agreement giving rise to an account or a payment in respect of a general intangible by reason of or arising out of any Loan Document or the receipt by any Secured Party of any payment relating thereto, nor shall any Secured Party be obligated in any manner to perform any obligation of any Grantor under or pursuant to any agreement giving rise to an account or a payment in respect of a general intangible, to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by it or as to the sufficiency of any performance by any party thereunder, to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts that may have been assigned to it or to which it may be entitled at any time or times.

 

Section 6.3           Pledged Collateral. (a) Voting Rights. During the continuance of an Event of Default, upon notice by the Collateral Agent to the relevant Grantor or Grantors, the Collateral Agent or its nominee may exercise (at the direction of the Administrative Agent) (A) any voting, consent, corporate and other right pertaining to the Pledged Collateral at any meeting of shareholders, partners or members, as the case may be, of the relevant issuer or issuers of Pledged Collateral or otherwise and (B) any right of conversion, exchange and subscription and any other right, privilege or option pertaining to the Pledged Collateral as if it were the absolute owner thereof (including the right to exchange at its discretion any Pledged Collateral upon the merger, amalgamation, consolidation, reorganization, recapitalization or other fundamental change in the corporate or equivalent structure of any issuer of Pledged Stock, the right to deposit and deliver any Pledged Collateral with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions as the Collateral Agent may determine), all without liability except to account for property actually received by it; provided, that the Collateral Agent shall have no duty to any Grantor to exercise any such right, privilege or option and shall not be responsible for any failure to do so or delay in so doing.

 

(b)          Proxies. In order to permit the Collateral Agent to exercise the voting and other consensual rights that it may be entitled to exercise pursuant hereto and to receive all dividends and other distributions that it may be entitled to receive hereunder, (i) each Grantor shall promptly execute and deliver (or cause to be executed and delivered) to the Collateral Agent all such proxies, dividend payment orders and other instruments as the Collateral Agent may from time to time reasonably request and (ii) without limiting the effect of clause (i) above, such Grantor hereby grants to the Collateral Agent an irrevocable proxy to vote all or any part of the Pledged Collateral and to exercise all other rights, powers, privileges and remedies to which a holder of the Pledged Collateral would be entitled (including giving or withholding written consents of shareholders, partners or members, as the case may be, calling special meetings of shareholders, partners or members, as the case may be, and voting at such meetings), which proxy shall be effective, automatically and without the necessity of any action (including any transfer of any Pledged Collateral on the record books of the issuer thereof) by any other person (including the issuer of such Pledged Collateral or any officer or agent thereof) during the continuance of an Event of Default and which proxy shall only terminate upon the payment in full of the Secured Obligations.

 

(c)          Authorization of Issuers. Each Grantor hereby expressly and irrevocably authorizes and instructs, without any further instructions from such Grantor, each issuer of any Pledged Collateral pledged hereunder by such Grantor to (i) comply with any instruction received by it from the Collateral Agent in writing that states that an Event of Default is continuing and is otherwise in accordance with the terms of this Agreement and each Grantor agrees that such issuer shall be fully protected from Liabilities to such Grantor in so complying and (ii) unless otherwise expressly permitted hereby, pay any dividend or make any other payment with respect to the Pledged Collateral directly to the Collateral Agent.

 

 

Section 6.4           Proceeds to be Turned over to and Held by Collateral Agent. Unless otherwise expressly provided in the Credit Agreement or this Agreement, during the continuance of an Event of Default, all proceeds of any Collateral received by any Grantor hereunder in cash or Cash Equivalents shall be held by such Grantor in trust for the Collateral Agent and the other Secured Parties, segregated from other funds of such Grantor, and shall, promptly upon receipt by any Grantor, be turned over to the Collateral Agent in the exact form received (with any necessary endorsement). All such proceeds of Collateral and any other proceeds of any Collateral received by the Collateral Agent in cash or Cash Equivalents shall be held by the Collateral Agent in a Security Cash Collateral Account. All proceeds being held by the Collateral Agent in a Security Cash Collateral Account (or by such Grantor in trust for the Collateral Agent) shall continue to be held as collateral security for the Secured Obligations and shall not constitute payment thereof until applied as provided in the Credit Agreement.

 

Section 6.5           Registration Rights. (a) If, in the opinion of the Administrative Agent, it is necessary or advisable to Sell any portion of the Pledged Collateral by registering such Pledged Collateral under the Securities Act of 1933 (the “Securities Act”), each relevant Grantor shall cause the issuer thereof to do or cause to be done all acts as may be, in the opinion of the Collateral Agent, necessary or advisable to register such Pledged Collateral or that portion thereof to be Sold under the provisions of the Securities Act, all as directed by the Administrative Agent in conformity with the requirements of the Securities Act and the rules and regulations of the Securities and Exchange Commission applicable thereto and in compliance with the securities or “Blue Sky” laws of any jurisdiction that the Administrative Agent shall designate.

 

(b)          Each Grantor recognizes that the Collateral Agent may be unable to effect a public sale of any Pledged Collateral by reason of certain prohibitions contained in the Securities Act and applicable state or foreign securities laws or otherwise or may determine that a public sale is impracticable, not desirable or not commercially reasonable and, accordingly, may resort to one or more private sales thereof to a restricted group of purchasers that shall be obliged to agree, among other things, to acquire such securities for their own account for investment and not with a view to the distribution or resale thereof. Each Grantor acknowledges and agrees that any such private sale may result in prices and other terms less favorable than if such sale were a public sale and, notwithstanding such circumstances, agrees that any such private sale shall be deemed to have been made in a commercially reasonable manner. The Collateral Agent shall be under no obligation to delay a sale of any Pledged Collateral for the period of time necessary to permit the issuer thereof to register such securities for public sale under the Securities Act or under applicable state securities laws even if such issuer would agree to do so.

 

(c)          Each Grantor agrees to use its best efforts to do or cause to be done all such other acts as may be necessary to make such sale or sales of any portion of the Pledged Collateral pursuant to Section 6.1 and this Section 6.5 valid and binding and in compliance with all applicable Requirements of Law. Each Grantor further agrees that a breach of any covenant contained in Section 6.1 and this Section 6.5 will cause irreparable injury to the Collateral Agent and other Secured Parties, that the Collateral Agent and the other Secured Parties have no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in Section 6.1 and this Section 6.5 shall be specifically enforceable against such Grantor, and such Grantor hereby waives and agrees not to assert any defense against an action for specific performance of such covenants except for a defense that no Event of Default has occurred under the Credit Agreement. Each Grantor waives any and all rights of contribution or subrogation upon the sale or disposition of all or any portion of the Pledged Collateral by the Collateral Agent.

 

Section 6.6           Deficiency. Each Grantor shall remain liable for any deficiency if the proceeds of any sale or other disposition of any Collateral are insufficient to pay the Secured Obligations and the fees and disbursements of any attorney employed by the Collateral Agent or any other Secured Party to collect such deficiency.

 

 

Article VII

The Collateral Agent

 

Section 7.1           Collateral Agent’s Appointment as Attorney-in-Fact. (a) Each Grantor hereby irrevocably constitutes and appoints the Collateral Agent and any Related Person thereof, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of such Grantor and in the name of such Grantor or in its own name, for the purpose of carrying out the terms of the Loan Documents, to, upon the occurrence of and during the continuation of an Event of Default, take any appropriate action and to execute any document or instrument that may be necessary or desirable to accomplish the purposes of the Loan Documents, and, without limiting the generality of the foregoing, each Grantor hereby gives the Collateral Agent (as so directed by the Administrative Agent) and its Related Persons the power and right, on behalf of such Grantor, without notice to or assent by such Grantor, to do any of the following, in all cases solely, when an Event of Default shall be continuing:

 

(i)          in the name of such Grantor, in its own name or otherwise, take possession of and indorse and collect any check, draft, note, acceptance or other instrument for the payment of moneys due under any account or general intangible or with respect to any other Collateral and file any claim or take any other action or proceeding in any court of law or equity or otherwise deemed appropriate by the Collateral Agent for the purpose of collecting any such moneys due under any account or general intangible or with respect to any other Collateral whenever payable;

 

(ii)         in the case of any Intellectual Property owned by or licensed to the Grantors, execute, deliver and have recorded any document that the Collateral Agent may request to evidence, effect, publicize or record the Collateral Agent’s security interest in such Intellectual Property and the goodwill and general intangibles of such Grantor relating thereto or represented thereby;

 

(iii)        pay or discharge taxes and Liens levied or placed on or threatened against any Collateral, effect any repair or pay any insurance called for by the terms of the Credit Agreement (including all or any part of the premiums therefor and the costs thereof);

 

(iv)        execute, in connection with any sale provided for in Section 6.1 or Section 6.5, any document to effect or otherwise necessary or appropriate in relation to evidence the Sale of any Collateral; or

 

(v)         (A) direct any party liable for any payment under any Collateral to make payment of any moneys due or to become due thereunder directly to the Collateral Agent or as the Collateral Agent shall direct, (B) ask or demand for, and collect and receive payment of and receipt for, any moneys, claims and other amounts due or to become due at any time in respect of or arising out of any Collateral, (C) sign and indorse any invoice, freight or express bill, bill of lading, storage or warehouse receipt, draft against debtors, assignment, verification, notice and other document in connection with any Collateral, (D) commence and prosecute any suit, action or proceeding at law or in equity in any court of competent jurisdiction to collect any Collateral and to enforce any other right in respect of any Collateral, (E) defend any actions, suits, proceedings, audits, claims, demands, orders or disputes brought against such Grantor with respect to any Collateral, (F) settle, compromise or adjust any such actions, suits, proceedings, audits, claims, demands, orders or disputes and, in connection therewith, give such discharges or releases as the Collateral Agent may deem appropriate, (G) assign any Intellectual Property owned by the Grantors or any IP Licenses of the Grantors throughout the world on such terms and conditions and in such manner as the Administrative Agent shall in its sole discretion determine, including the execution and filing by the Collateral Agent (at the direction of the Administrative Agent) of any document necessary to effectuate or record such assignment and (H) generally, Sell, grant a Lien on, make any Contractual Obligation with respect to and otherwise deal with, any Collateral as fully and completely as though the Collateral Agent were the absolute owner thereof for all purposes and do, at the Administrative Agent’s option, at any time or from time to time, all acts and things that the Administrative Agent deems necessary to protect, preserve or realize upon any Collateral and the Secured Parties’ security interests therein and to effect the intent of the Loan Documents, all as fully and effectively as such Grantor might do.

 

 

(b)          If any Grantor fails to perform or comply with any Contractual Obligation contained herein, the Collateral Agent, at its option, but without any obligation so to do, may perform or comply, or otherwise cause performance or compliance, with such Contractual Obligation.

 

(c)          The expenses of the Collateral Agent incurred in connection with actions undertaken as provided in this Section 7.1, together with interest thereon at a rate set forth in Section 2.9 (Interest) of the Credit Agreement, from the date of payment by the Collateral Agent to the date reimbursed by the relevant Grantor, shall be payable by such Grantor to the Collateral Agent on demand.

 

(d)          Each Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue of this Section 7.1. All powers, authorizations and agencies contained in this Agreement are coupled with an interest and are irrevocable until this Agreement is terminated and the security interests created hereby are released.

 

Section 7.2           Authorization to File Financing Statements. Each Grantor authorizes the Collateral Agent and its Related Persons, at any time and from time to time, to file or record financing statements, amendments thereto, and other filing or recording documents or instruments with respect to any Collateral in such form and in such offices as the Administrative Agent reasonably determines appropriate to perfect the security interests of the Collateral Agent under this Agreement, and such financing statements and amendments may describe the Collateral covered thereby as “all assets of the debtor” or words of similar effect. A photographic or other reproduction of this Agreement shall be sufficient as a financing statement or other filing or recording document or instrument for filing or recording in any jurisdiction. Such Grantor also hereby ratifies its authorization for the Collateral Agent to have filed any initial financing statement or amendment thereto under the UCC (or other similar laws) in effect in any jurisdiction if filed prior to the date hereof.

 

Section 7.3            (a)          Authority of Collateral Agent. Each Grantor acknowledges that the rights and responsibilities of the Collateral Agent under this Agreement with respect to any action taken by the Collateral Agent or the exercise or non-exercise by the Collateral Agent of any option, voting right, request, judgment or other right or remedy provided for herein or resulting or arising out of this Agreement shall, as between the Collateral Agent and the other Secured Parties, be governed by the Credit Agreement and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Collateral Agent and the Grantors, the Collateral Agent shall be conclusively presumed to be acting as agent for the Secured Parties with full and valid authority so to act or refrain from acting, and no Grantor shall be under any obligation or entitlement to make any inquiry respecting such authority.

 

 

(b)          Reliance by Collateral Agent. Whenever reference is made in this Agreement to any action by, consent, designation, specification, requirement or approval of, notice, request or other communication from, or other direction given or action to be undertaken or to be (or not to be) suffered or omitted by the Collateral Agent or to any election, decision, opinion, acceptance, use of judgment, expression of satisfaction or other exercise of discretion, rights or remedies to be made (or not to be made) by the Collateral Agent, it is understood that in all cases the Collateral Agent shall be fully justified in failing or refusing to take any such action under this Agreement if it shall not have received such advice or concurrence of the Administrative Agent as it deems appropriate. This provision is intended solely for the benefit of the Collateral Agent and its successors and permitted assigns and is not intended to and will not entitle the other parties hereto to any defense, claim or counterclaim, or confer any rights or benefits on any party hereto.

 

Section 7.4           Duty; Obligations and Liabilities. (a) Duty of Collateral Agent. The Collateral Agent’s sole duty with respect to the custody, safekeeping and physical preservation of the Collateral in its possession shall be to deal with it in the same manner as the Collateral Agent deals with similar property for its own account. The powers conferred on the Collateral Agent hereunder are solely to protect the Collateral Agent’s interest in the Collateral and shall not impose any duty upon the Collateral Agent to exercise any such powers. The Collateral Agent shall be accountable only for amounts that it receives as a result of the exercise of such powers, and neither it nor any of its Related Persons shall be responsible to any Grantor or Secured Party for any act or failure to act hereunder, except for their own gross negligence or willful misconduct as finally determined by a court of competent jurisdiction. In addition, the Collateral Agent shall not be liable or responsible for any loss or damage to any Collateral, or for any diminution in the value thereof, by reason of the act or omission of any warehousemen, carrier, forwarding agency, consignee or other bailee if such Person has been selected by the Collateral Agent in good faith.

 

(b)          Obligations and Liabilities with respect to Collateral. No Secured Party and no Related Person thereof shall be liable for failure to demand, collect or realize upon any Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of any Grantor or any other Person or to take any other action whatsoever with regard to any Collateral. The powers conferred on the Collateral Agent hereunder shall not impose any duty upon any other Secured Party to exercise any such powers. The other Secured Parties shall be accountable only for amounts that they actually receive as a result of the exercise of such powers, and neither they nor any of their respective officers, directors, employees or agents shall be responsible to any Grantor for any act or failure to act hereunder, except for their own gross negligence or willful misconduct as finally determined by a court of competent jurisdiction.

 

(c)          The Collateral Agent shall not incur any liability for not performing any act or fulfilling any duty, obligation or responsibility hereunder by reason of any occurrence beyond the control of the Collateral Agent (including but not limited to any act or provision of any present or future law or regulation or governmental authority, any act of God or war, civil unrest, local or national disturbance or disaster, any act of terrorism, or the unavailability of the Federal Reserve Bank wire facility or other wire or communication facility).

 

(d)          The Borrower shall pay to the Collateral Agent from time to time such compensation as is agreed to in writing by the Collateral Agent and the Borrower for the services hereunder.

 

(e)          Each Grantor irrevocably authorizes the Administrative Agent and the Collateral Agent to take such action on such Grantor's behalf and to exercise such powers hereunder and under the other Loan Documents and under the other instruments and agreements referred to herein and therein as are specifically delegated to it by the terms hereof and thereof, together with such powers as are reasonably incidental thereto. Each of the Administrative Agent and the Collateral Agent shall have only those duties and responsibilities which are expressly specified in this Agreement and the other Loan Documents and it may perform such duties by or through its agents or employees.

 

 

(f)          The Collateral Agent shall not be responsible to any Grantor for the execution, effectiveness, genuineness, validity, enforceability, collectability or sufficiency of this Agreement or any of the other Loan Documents, or for any Lien or guarantee granted by, or purported to be granted by, any of the Loan Documents, or for any representations, warranties, recitals or statements made herein or therein or made in any written or oral statement or in any financial or other statements, instruments, reports, certificates or any other documents in connection herewith or therewith furnished or made by the Collateral Agent to any Grantor or by or on behalf of the Borrower to the Administrative Agent, the Collateral Agent or any Grantor, or be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained herein or therein or as to the use of the proceeds of the Loans or the existence or possible existence of any Default or Event of Default.

 

(g)          Neither the Collateral Agent nor any of its officers, directors, employees, agents, investigators, consultants, attorneys-in-fact or affiliates shall be liable to any Lender for any action taken or omitted hereunder, under any of the other Loan Documents or in connection herewith or therewith unless caused by its or their gross negligence or willful misconduct. If the Collateral Agent shall request instructions from the Administrative Agent with respect to any act or action (including the failure to take an action) in connection with this Agreement or any of the other Loan Documents, the Collateral Agent shall be entitled to refrain from such act or taking such action unless and until it shall have received instructions from the Administrative Agent. Without prejudice to the generality of the foregoing, (i) the Collateral Agent shall be entitled to conclusively rely, and shall be fully protected in relying, upon any communication, instrument or document believed by it to be genuine and correct and to have been signed or sent by the proper Person or Persons, and shall be entitled to conclusively rely and shall be protected in relying on opinions and judgments of attorneys (who may be attorneys for the Borrower or its Affiliates), accountants, experts and other professional advisors selected by it; and (ii) no Lender shall have any right of action whatsoever against the Collateral Agent as a result of the Collateral Agent acting or (where so instructed) refraining from acting under this Agreement or the other instruments and agreements referred to herein in accordance with the instructions of the Administrative Agent. The Collateral Agent shall be entitled to refrain from exercising any power, discretion or authority vested in it under this Agreement or the other Loan Documents or the other instruments and agreements referred to herein or therein unless and until it has obtained the instructions of the Administrative Agent or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expenses which may be incurred by it by reason of taking or continuing to take such action. The Collateral Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the Administrative Agent, and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders.

 

(h)          The agency hereby created shall in no way impair or affect any of the rights and powers of, or impose any duties or obligations upon, the Administrative Agent or the Collateral Agent in its individual capacity as a Lender hereunder. With respect to its participation in the Loans, each of the Administrative Agent and the Collateral Agent shall have the same rights and powers hereunder as any other Lender and may exercise the same as though it were not performing the duties and functions of delegated to it hereunder, and the term “Lender” or “Lenders” or any similar term shall, unless the context clearly otherwise indicates, include the Administrative Agent or the Collateral Agent in its individual capacity. Each of the Administrative Agent and the Collateral Agent and their respective Affiliates may accept deposits from, lend money and to generally engage in any kind of banking, trust, financial advisory or other business with the Borrower or its Affiliates as if it were not performing the duties specified herein, and may accept fees and other consideration from the Borrower or any Affiliates thereof for services in connection with this Agreement and the other Loan Documents, including transactions contemplated hereby or thereby, and otherwise without having to account for the same to the Lenders.

 

 

(i)          Without limiting the foregoing, neither the Administrative Agent nor the Collateral Agent shall be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any of the other Loan Documents, or to inspect the properties, books or records of the Borrower.

 

(j)          Without limiting the foregoing, each of the Administrative Agent and the Collateral Agent may deem and treat the payee of any Loan as the owner thereof for all purposes unless and until an Assignment with respect thereto shall have been filed with, and recorded by, the Administrative Agent. Any request, authority or consent of any Person or entity who, at the time of making such request or giving such authority or consent, is a Lender shall be conclusive and binding on any subsequent transferee or assign of that Lender.

 

(k)          In no event shall the Collateral Agent be responsible or liable for any failure or delay in the performance of its obligations hereunder directly or indirectly caused by events beyond its control, including general labor disputes, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, or interruptions, losses or malfunctions of utilities, communications or computer (software and hardware) services, provided, that lack of funds or other financial circumstances and labor disputes only by the personnel of the affected party shall not constitute an event beyond its control hereunder and provided, further, that the Collateral Agent, as the case may be, shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performances as soon as practicable under the circumstances.

 

Section 7.5           Replacement of Collateral Agent. The Collateral Agent may resign from the performance of all its functions and duties hereunder and under the other Loan Documents in accordance with Section 10.6 of the Credit Agreement.

 

Article VIII

Miscellaneous

 

Section 8.1           Reinstatement. Each Grantor agrees that, if any payment made by any Loan Party or other Person and applied to the Secured Obligations is at any time annulled, avoided, set aside, rescinded, invalidated, declared to be fraudulent or preferential or otherwise required to be refunded or repaid, or the proceeds of any Collateral are required to be returned by any Secured Party to such Loan Party, its estate, trustee, receiver or any other party, including any Grantor, under any bankruptcy law, state or federal law, common law or equitable cause, then, to the extent of such payment or repayment, any Lien or other Collateral securing such liability shall be and remain in full force and effect, as fully as if such payment had never been made. If, prior to any of the foregoing, (a) any Lien or other Collateral securing such Grantor’s liability hereunder shall have been released or terminated by virtue of the foregoing or (b) any provision of the Guaranty hereunder shall have been terminated, cancelled or surrendered, such Lien, other Collateral or provision shall be reinstated in full force and effect and such prior release, termination, cancellation or surrender shall not diminish, release, discharge, impair or otherwise affect the obligations of any such Grantor in respect of any Lien or other Collateral securing such obligation or the amount of such payment.

 

 

Section 8.2           Release of Collateral. (a) At the time provided in clause (iii) of Section 10.9 (Release of Collateral or Guarantors) of the Credit Agreement, the Collateral shall be released from the Lien created hereby and this Agreement and all obligations (other than those expressly stated to survive such termination) of the Collateral Agent and each Grantor hereunder shall terminate, all without delivery of any instrument or performance of any act by any party, and all rights to the Collateral shall revert to the Grantors. Each Grantor is hereby authorized to file UCC amendments at such time evidencing the termination of the Liens so released. At the request of any Grantor following any such termination, the Collateral Agent shall deliver to such Grantor any Collateral of such Grantor held by the Collateral Agent hereunder and execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence such termination.

 

(b)          If the Collateral Agent shall be directed or permitted pursuant to clause (i) or (ii) of Section 10.9 of the Credit Agreement to release any Lien or any Collateral, such Collateral shall be released from the Lien created hereby to the extent provided under, and subject to the terms and conditions set forth in, such clauses (i) and (ii). In connection therewith, the Collateral Agent, at the request of any Grantor, shall execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence such release.

 

Section 8.3           Independent Obligations. The obligations of each Grantor hereunder are independent of and separate from the Secured Obligations and the Guaranteed Obligations. If any Secured Obligation or Guaranteed Obligation is not paid when due, or upon any Event of Default, the Collateral Agent may, at its sole election, proceed directly and at once, without notice, against any Grantor and any Collateral to collect and recover the full amount of any Secured Obligation or Guaranteed Obligation then due, without first proceeding against any other Grantor, any other Loan Party or any other Collateral and without first joining any other Grantor or any other Loan Party in any proceeding.

 

Section 8.4           No Waiver by Course of Conduct. No Secured Party shall by any act (except by a written instrument pursuant to Section 8.5), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default. No failure to exercise, nor any delay in exercising, on the part of any Secured Party, any right, power or privilege hereunder shall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. A waiver by any Secured Party of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy that such Secured Party would otherwise have on any future occasion.

 

Section 8.5           Amendments in Writing. None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwise modified except in accordance with Section 11.1 of the Credit Agreement; provided, that schedules to this Agreement may be supplemented (but no existing provisions may be modified and no Collateral may be released) in accordance with Section 5.6 and 5.8 and through Pledge Amendments and Joinder Agreements, in substantially the form of Annex 1 and Annex 2, respectively, in accordance with Section 8.6 hereof.

 

Section 8.6           Additional Grantors; Additional Pledged Collateral. (a) Joinder Agreements. If, at the option of the Borrower or as required pursuant to Section 7.10 of the Credit Agreement, the Borrower shall cause any Subsidiary that is not a Grantor to become a Grantor hereunder, such Subsidiary shall execute and deliver to the Collateral Agent a joinder agreement substantially in the form of Annex 2 (each, a “Joinder Agreement”) and shall thereafter for all purposes be a party hereto and have the same rights, benefits and obligations as a Grantor party hereto on the Closing Date.

 

 

(b)          Pledge Amendments. To the extent any Pledged Collateral has not been delivered as of the Closing Date, such Grantor shall deliver a pledge amendment duly executed by the Grantor in substantially the form of Annex 1 (each, a “Pledge Amendment”). Such Grantor authorizes the Collateral Agent to attach each Pledge Amendment to this Agreement.

 

Section 8.7           Notices. All notices, requests and demands to or upon the Collateral Agent or any Grantor hereunder shall be effected in the manner provided for in Section 11.11 of the Credit Agreement; provided, that any such notice, request or demand to or upon any Grantor shall be addressed to the Borrower’s notice address set forth in such Section 11.11.

 

Section 8.8           Successors and Assigns. This Agreement shall be binding upon the successors and assigns of each Grantor and shall inure to the benefit of each Secured Party and their successors and assigns; provided, that no Grantor may assign, transfer or delegate any of its rights or obligations under this Agreement without the prior written consent of the Administrative Agent and the Collateral Agent and in accordance with the terms of the Credit Agreement.

 

Section 8.9           Counterparts. This Agreement may be executed in any number of counterparts and by different parties in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Signature pages may be detached from multiple separate counterparts and attached to a single counterpart. Delivery of an executed signature page of this Agreement by facsimile transmission or by Electronic Transmission shall be as effective as delivery of a manually executed counterpart hereof.

 

Section 8.10         Severability. Any provision of this Agreement being held illegal, invalid or unenforceable in any jurisdiction shall not affect any part of such provision not held illegal, invalid or unenforceable, any other provision of this Agreement or any part of such provision in any other jurisdiction.

 

Section 8.11         Governing Law. This Agreement and the rights and obligations of the parties hereto shall be governed by, and construed and interpreted in accordance with, the law of the State of New York.

 

Section 8.12         Waiver of Jury Trial. Each party hereto hereby irrevocably waives trial by jury in any suit, action or proceeding with respect to, or directly or indirectly arising out of, under or in connection with, any loan document or the transactions contemplated therein or related thereto (whether founded in contract, tort or any other theory). Each party hereto (A) certifies that no other party and no Related Person of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce the foregoing waiver and (B) acknowledges that it and the other parties hereto have been induced to enter into this agreement by the mutual waivers and certifications in this Section 8.12.

 

 

Section 8.13         Indemnities. (a) THE BORROWER AGREES TO INDEMNIFY, HOLD HARMLESS AND DEFEND EACH AGENT, THE ARRANGERS, EACH LENDER, EACH L/C ISSUER, EACH FORMER LENDER OR L/C ISSUER PARTY TO A SECURED HEDGING DOCUMENT, EACH PERSON THAT EACH L/C ISSUER CAUSES TO ISSUE LETTERS OF CREDIT UNDER THE CREDIT AGREEMENT AND EACH OF THEIR RESPECTIVE RELATED PERSONS (EACH SUCH PERSON BEING AN “INDEMNITEE”) FROM AND AGAINST ALL LIABILITIES (INCLUDING BROKERAGE COMMISSIONS, FEES AND OTHER COMPENSATION) THAT MAY BE IMPOSED ON, INCURRED BY OR ASSERTED AGAINST ANY SUCH INDEMNITEE AND IN ANY MATTER RELATING TO OR ARISING OUT OF, IN CONNECTION WITH OR AS A RESULT OF (I) ANY LOAN DOCUMENT, ANY DISCLOSURE DOCUMENT, OR ANY OBLIGATION (OR THE REPAYMENT THEREOF), ANY LETTER OF CREDIT, THE USE OR INTENDED USE OF THE PROCEEDS OF ANY LOAN OR THE USE OF ANY LETTER OF CREDIT, OR ANY SECURITIES FILING OF, OR WITH RESPECT TO, ANY GROUP MEMBER, (II) ANY COMMITMENT LETTER, PROPOSAL LETTER OR TERM SHEET WITH ANY PERSON OR ANY CONTRACTUAL OBLIGATION, SYNDICATION OF THE CREDIT FACILITIES PROVIDED BY THE CREDIT AGREEMENT, ANY ENFORCEMENT OF ANY LOAN DOCUMENTS (INCLUDING ANY SALES OF, COLLECTION FROM, OR OTHER REALIZATION UPON ANY OF THE COLLATERAL OR THE ENFORCEMENT OF ANY GUARANTY) ARRANGEMENT OR UNDERSTANDING WITH ANY BROKER, FINDER OR CONSULTANT, IN EACH CASE ENTERED INTO BY OR ON BEHALF OF ANY GROUP MEMBER OR ANY AFFILIATE OF ANY OF THEM IN CONNECTION WITH ANY OF THE FOREGOING AND ANY CONTRACTUAL OBLIGATION ENTERED INTO IN CONNECTION WITH ANY E-SYSTEMS OR OTHER ELECTRONIC TRANSMISSIONS, (III) ANY ACTUAL OR PROSPECTIVE INVESTIGATION, LITIGATION OR OTHER PROCEEDING, WHETHER OR NOT BROUGHT BY ANY SUCH INDEMNITEE OR ANY OF ITS RELATED PERSONS, ANY HOLDERS OF SECURITIES OR CREDITORS (AND INCLUDING ATTORNEYS’ FEES IN ANY CASE), WHETHER OR NOT ANY SUCH INDEMNITEE, RELATED PERSON, HOLDER OR CREDITOR IS A PARTY THERETO, AND WHETHER OR NOT BASED ON ANY SECURITIES OR COMMERCIAL LAW OR REGULATION OR ANY OTHER REQUIREMENT OF LAW OR THEORY THEREOF, INCLUDING COMMON LAW, EQUITY, CONTRACT, TORT OR OTHERWISE, OR (IV) ANY OTHER ACT, EVENT OR TRANSACTION RELATED, CONTEMPLATED IN OR ATTENDANT TO ANY OF THE FOREGOING (COLLECTIVELY, THE “INDEMNIFIED MATTERS”); PROVIDED, THAT THE BORROWER SHALL NOT HAVE ANY LIABILITY UNDER THIS SECTION 8.13 TO AN INDEMNITEE WITH RESPECT TO, AND NO INDEMNITEE SHALL HAVE ANY LIABILITY HEREUNDER OTHER THAN (TO THE EXTENT OTHERWISE LIABLE) FOR, ANY INDEMNIFIED MATTER TO THE EXTENT SUCH LIABILITY HAS RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNITEE, AS DETERMINED BY A COURT OF COMPETENT JURISDICTION IN A FINAL NON-APPEALABLE JUDGMENT OR ORDER. THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH INDEMNIFIED LIABILITIES ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY, OR ARE CAUSED, IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF ANY INDEMNITEE. FURTHERMORE, EACH OF PARENT AND THE BORROWER WAIVES AND AGREES NOT TO ASSERT AGAINST ANY INDEMNITEE, AND SHALL CAUSE EACH OTHER LOAN PARTY TO WAIVE AND NOT ASSERT AGAINST ANY INDEMNITEE, ANY RIGHT OF CONTRIBUTION WITH RESPECT TO ANY LIABILITIES THAT MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST ANY RELATED PERSON.

 

 

(b)          Without limiting the foregoing, “Indemnified Matters” includes all Environmental Liabilities, including those arising from, or otherwise involving, any property of any Group Member or any actual, alleged or prospective damage to property or natural resources or harm or injury alleged to have resulted from any Release of Hazardous Materials on, upon or into such property or natural resource or any property on or contiguous to any real property of any Group Member, whether or not, with respect to any such Environmental Liabilities, any Indemnitee is a mortgagee in possession, the successor-in-interest to any Group Member or the owner, lessee or operator of any property or facility of any Group Member through any foreclosure action, in each case except to the extent such Environmental Liabilities (i) are incurred solely following foreclosure by any Secured Party or following any Secured Party having become the successor-in-interest to any Loan Party and (ii) are attributable solely to acts of such Indemnitee.

 

[Signature Pages Follow]

 

 

In witness whereof, each of the undersigned has caused this Guaranty and Security Agreement to be duly executed and delivered as of the date first above written.

 

	francesca’s collections, inc.,
		as Grantor
	By:
		Name:
		Title:
	francesca’s LLC,
		as Grantor
	By:
		Name:
		Title:

 

[Signature Page to Guaranty and Security Agreement]

 

 

ROYAL BANK OF CANADA,
	as Collateral Agent and Administrative Agent
By:
	Name:
	Title:

 

[Signature Page to Guaranty and Security Agreement]

 

 

ANNEX 1

TO

GUARANTY AND SECURITY AGREEMENT¹

 

Form of Pledge Amendment

 

This Pledge Amendment, dated as of __________ __, 20__, is delivered pursuant to Section 8.6 of the Guaranty and Security Agreement, dated as of November 17, 2010, by and among Francesca’s Collections, Inc. (the “Borrower”), the undersigned Grantor and the other Affiliates of the Borrower from time to time party thereto as Grantors, Royal Bank of Canada, as administrative agent, and Royal Bank of Canada, as collateral agent for the Secured Parties referred to therein (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Guaranty and Security Agreement”). Capitalized terms used herein without definition are used as defined in the Guaranty and Security Agreement.

 

The undersigned hereby agrees that this Pledge Amendment may be attached to the Guaranty and Security Agreement and that the Pledged Collateral listed on Annex 1-A to this Pledge Amendment shall be and become part of the Collateral referred to in the Guaranty and Security Agreement and shall secure all of the Obligations of the undersigned.

 

The undersigned hereby represents and warrants that each of the representations and warranties contained in Sections 4.1, 4.2, 4.5 and 4.10 of the Guaranty and Security Agreement is true and correct on and as of the date hereof as if made on and as of such date.

 

	[Grantor]
	By:
		Name:
		Title:

 

Acknowledged and Agreed
as of the date first above written:
ROYAL BANK OF CANADA,
	as Collateral Agent and Administrative Agent
By:
	Name:
	Title:

 

To be used for pledge of Additional Pledged Collateral by existing Grantor.

 

 

Annex 1-A

 

 

PLEDGED STOCK

  

Issuer		Class		Certificate No(s).		Par Value		Number of Shares, Units or Interests

 

PLEDGED DEBT INSTRUMENTS 

 

Issuer		Description of Debt		Certificate No(s).		Final Maturity		Principal Amount

  

 

ANNEX 2

TO

GUARANTY AND SECURITY AGREEMENT

 

Form of Joinder Agreement

 

This Joinder Agreement, dated as of _________ __, 20__, is delivered pursuant to Section 8.6 of the Guaranty and Security Agreement, dated as of November 17, 2010, by and among Francesca’s Collections, Inc. (the “Borrower”), the undersigned Grantor and the other Affiliates of the Borrower from time to time party thereto as Grantors, Royal Bank of Canada, as administrative agent, and Royal Bank of Canada, as collateral agent for the Secured Parties referred to therein (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Guaranty and Security Agreement”). Capitalized terms used herein without definition are used as defined in the Guaranty and Security Agreement.

 

By executing and delivering this Joinder Agreement, the undersigned, as provided in Section 8.6 of the Guaranty and Security Agreement, hereby becomes a party to the Guaranty and Security Agreement as a Grantor thereunder with the same force and effect as if originally named as a Grantor therein and, without limiting the generality of the foregoing, the undersigned (i) as collateral security for the prompt and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of the Secured Obligations of the undersigned, hereby mortgages, pledges and hypothecates to the Collateral Agent for the benefit of the Secured Parties, and grants to the Collateral Agent for the benefit of the Secured Parties a lien on and security interest in, all of its right, title and interest in, to and under the Collateral of the undersigned and expressly assumes all obligations and liabilities of a Grantor thereunder and (ii) hereby unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, the full and punctual payment when due, whether at stated maturity or earlier, by reason of acceleration, mandatory prepayment or otherwise in accordance with any Loan Document, of all the Guaranteed Obligations on the terms set forth in the Guaranty and Security Agreement. The undersigned hereby agrees to be bound as a Grantor for the purposes of the Guaranty and Security Agreement.

 

The information set forth in Annex A to this Joinder Agreement is hereby added to the information set forth in Schedules 1 through 6 to the Guaranty and Security Agreement. By acknowledging and agreeing to this Joinder Agreement, the undersigned hereby agree that this Joinder Agreement may be attached to the Guaranty and Security Agreement and that the Pledged Collateral listed on Annex A to this Joinder Amendment shall be and become part of the Collateral referred to in the Guaranty and Security Agreement and shall secure all Secured Obligations of the undersigned.

 

The undersigned hereby represents and warrants that each of the representations and warranties contained in Article IV of the Guaranty and Security Agreement applicable to it is true and correct on and as of the date hereof as if made on and as of such date.

 

In witness whereof, the undersigned has caused this Joinder Agreement to be duly executed and delivered as of the date first above written.

 

	[Additional Grantor]
	By:
		Name:
		Title:

 

 

Acknowledged and Agreed
as of the date first above written:
[EACH GRANTOR PLEDGING
ADDITIONAL COLLATERAL]
By:
	Name:
	Title:
ROYAL BANK OF CANADA,
	as Collateral Agent and Administrative Agent
By:
	Name:
	Title:

 

 

ANNEX 3

TO

GUARANTY AND SECURITY AGREEMENT

Form of Intellectual Property Security Agreement

 

THIS [Copyright] [Patent] [Trademark] Security Agreement, dated as of _________ __, 20__, is entered into by and among each of the entities listed on the signature pages hereof (each a “Grantor” and, collectively, the “Grantors”), Royal Bank of Canada, as administrative agent (“Administrative Agent”), and Royal Bank of Canada, as collateral agent (in such capacity, together with its successors and permitted assigns, the “Collateral Agent”) for the Lenders, the L/C Issuer and each other Secured Party (as defined in the Credit Agreement referred to below).

 

WITNESSETH:

 

Whereas, pursuant to the Credit Agreement, dated as of November 17, 2010 (as the same may be amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Borrower, Parent, the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the Collateral Agent and the other parties thereto, the Lenders and the L/C Issuer have severally agreed to make extensions of credit to the Borrower upon the terms and subject to the conditions set forth therein;

 

Whereas, each undersigned Grantor has agreed, pursuant to the Guaranty and Security Agreement, dated as of November 17, 2010, by and among the Borrower, the undersigned Grantor(s) and the other Affiliates of the Borrower from time to time party thereto as grantors, Administrative Agent and Collateral Agent (the “Guaranty and Security Agreement”), to guarantee the Obligations (as defined in the Credit Agreement) of the Borrower; and

 

Whereas, all of the Grantors are party to the Guaranty and Security Agreement pursuant to which the Grantors are required to execute and deliver this [Copyright] [Patent] [Trademark] Security Agreement;

 

Now, Therefore, in consideration of the premises and to induce the Lenders, the L/C Issuer, the Administrative Agent and the Collateral Agent to enter into the Credit Agreement and to induce the Lenders and the L/C Issuer to make their respective extensions of credit to the Borrower thereunder, each Grantor hereby agrees with the Collateral Agent as follows:

 

Section 1.          Defined Terms. Capitalized terms used herein without definition are used as defined in the Guaranty and Security Agreement.

 

Section 2.          Grant of Security Interest in [Copyright] [Trademark] [Patent] Collateral. Each Grantor, as collateral security for the prompt and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of the Secured Obligations of such Grantor, hereby mortgages, pledges and hypothecates to the Collateral Agent for the benefit of the Secured Parties, and grants to the Collateral Agent for the benefit of the Secured Parties a Lien on and security interest in, all of its right, title and interest in, to and under the following Collateral of such Grantor (the “[Copyright] [Patent] [Trademark] Collateral”):

 

(a)       [all of its Copyrights and all IP Licenses providing for the grant by or to such Grantor of any right under any Copyright, including, without limitation, those Copyright registrations, applications for registration and IP Licenses referred to on Schedule 1 hereto;

 

(b)      all renewals, reversions and extensions of the foregoing; and

 

 

(c)       all income, royalties, proceeds and Liabilities at any time due or payable or asserted under and with respect to any of the foregoing, including, without limitation, all rights to sue and recover at law or in equity for any past, present and future infringement, misappropriation, dilution, violation or other impairment thereof.]

 

or

 

(a)       [all of its Patents and all IP Licenses providing for the grant by or to such Grantor of any right under any Patent, including, without limitation, those referred to on Schedule 1 hereto;

 

(b)       all reissues, reexaminations, continuations, continuations-in-part, divisionals, renewals and extensions of the foregoing; and

 

(c)       all income, royalties, proceeds and Liabilities at any time due or payable or asserted under and with respect to any of the foregoing, including, without limitation, all rights to sue and recover at law or in equity for any past, present and future infringement, misappropriation, dilution, violation or other impairment thereof.]

 

or

 

(d)       [all of its Trademarks and all IP Licenses providing for the grant by or to such Grantor of any right under any Trademark, including, without limitation, those Trademark registrations, applications for registration and IP Licenses referred to on Schedule 1 hereto;

 

(e)       all renewals and extensions of the foregoing;

 

(f)        all goodwill of the business connected with the use of, and symbolized by, each such Trademark; and

 

(g)       all income, royalties, proceeds and Liabilities at any time due or payable or asserted under and with respect to any of the foregoing, including, without limitation, all rights to sue and recover at law or in equity for any past, present and future infringement, misappropriation, dilution, violation or other impairment thereof.]

 

Section 3.          Guaranty and Security Agreement. The security interest granted pursuant to this [Copyright] [Patent] [Trademark] Security Agreement is granted in conjunction with the security interest granted to the Collateral Agent pursuant to the Guaranty and Security Agreement and each Grantor hereby acknowledges and agrees that the rights and remedies of the Collateral Agent with respect to the security interest in the [Copyright] [Patent] [Trademark] Collateral made and granted hereby are more fully set forth in the Guaranty and Security Agreement, the terms and provisions of which are incorporated by reference herein as if fully set forth herein.

 

Section 4.         Grantor Remains Liable. Each Grantor hereby agrees that, anything herein to the contrary notwithstanding, such Grantor shall assume full and complete responsibility for the prosecution, defense, enforcement or any other necessary or desirable actions in connection with their [Copyrights] [Patents] [Trademarks] and IP Licenses subject to a security interest hereunder.

 

Section 5.          Counterparts. This [Copyright] [Patent] [Trademark] Security Agreement may be executed in any number of counterparts and by different parties in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Signature pages may be detached from multiple separate counterparts and attached to a single counterpart.

 

 

Section 6.          Governing Law. This [Copyright] [Patent] [Trademark] Security Agreement and the rights and obligations of the parties hereto shall be governed by, and construed and interpreted in accordance with, the law of the State of New York.

 

[Signature Pages Follow]

 

 

In witness whereof, each Grantor has caused this [Copyright] [Patent] [Trademark] Security Agreement to be executed and delivered by its duly authorized officer as of the date first set forth above.

 

	Very truly yours,
	[Grantor],
		as Grantor
	By:
		Name:
		Title:

 

Royal Bank of Canada,
	as Collateral Agent and Administrative Agent
By:
	Name:
	Title:

 

[SIGNATURE PAGE TO [COPYRIGHT] [PATENT] [TRADEMARK] SECURITY AGREEMENT]

  

 

Schedule I
to
[Copyright] [Patent] [Trademark] Security Agreement

 

[Copyright] [Patent] [Trademark] Registrations

 

REGISTERED [COPYRIGHTS] [PATENTS] [TRADEMARKS]

 

[Include Registration Number and Date]

 

[COPYRIGHT] [PATENT] [TRADEMARK] APPLICATIONS

 

[Include Application Number and Date]

 

IP LICENSES

 

[Include complete legal description of agreement (name of agreement, parties and date)]

 

  

EXHIBIT 1.1(4)

 

[FORM OF]

 PERFECTION CERTIFICATE

  

In connection with that certain Credit Agreement, dated as of November 17, 2010 (as it may be amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among Francesca’s Collections, Inc., as borrower (the “Borrower”), Francesca’s LLC, the other Guarantors from time to time party thereto, the Lenders from time party thereto, the L/C Issuer, Royal Bank of Canada as Administrative Agent, Royal Bank of Canada as Collateral Agent for the Secured Parties, and the other parties party thereto, the Borrower hereby certifies on behalf of itself and the Guarantors as follows:

 

I.           CURRENT INFORMATION

 

A.           Legal Names, Organizations, Jurisdictions of Organization and Organizational Identification Numbers. The full and exact legal name¹ (as it appears in each respective certificate or articles of incorporation, limited liability membership agreement or similar organizational documents, in each case as amended to date), the type of organization (or if the Borrower or a particular Guarantor is an individual, please indicate so), the jurisdiction of organization (or formation, as applicable), and the organizational identification number² (not tax i.d. number) of the Borrower and each other Guarantor are as follows:

 

Name of Borrower/Guarantor		Type of Organization (e.g. corporation, limited liability company, limited partnership)		Jurisdiction of Organization/ Formation		Organizational Identification Number3

 

 

B.           Chief Executive Offices and Mailing Addresses. The chief executive office address (or the principal residence if the Borrower or a particular Guarantor is a natural person) and the preferred mailing address (if different than chief executive office or residence) of the Borrower and each other Guarantor are as follows:

 

Name of Borrower/Guarantor		Address of Chief Executive Office (or for natural persons, residence)		Mailing Address (if different than CEO or residence)

 

C.           Special Borrowers. Except as specifically identified below none of the Guarantors is a: (i) transmitting utility (as defined in Section 9-102(a)(80)), (ii) primarily engaged in farming operations (as defined in Section 9-102(a)(35)), (iii) a trust, (iv) a foreign air carrier within the meaning of the federal aviation act of 1958, as amended or (v) a branch or agency of a bank which bank is not organized under the law of the United States or any state thereof.

 

Name of Borrower/Guarantor		Type of Special Guarantor

 

D.           Trade Names/Assumed Names.

 

Current Trade Names. Set forth below is each trade name or assumed name currently used by the Borrower or any other Guarantor or by which the Borrower or any Guarantor is known or is transacting any business:

 

Borrower/Guarantor		Trade/Assumed Name

 

 

E.           Changes in Names, Jurisdiction of Organization or Corporate Structure.

 

Except as set forth below, neither the Borrower nor any other Guarantor has changed its name, jurisdiction of organization or its corporate structure in any way (e.g. by merger, consolidation, change in corporate form, change in jurisdiction of organization or otherwise) within the past five (5) years:

 

Borrower/Guarantor		Date of Change		Description of Change

 

F.           Prior Addresses.

 

Except as set forth below, neither the Borrower nor any other Guarantor has changed its chief executive office, or principal residence if the Borrower or a particular Guarantor is a natural person, within the past five (5) years:

 

Borrower/Guarantor		Prior Address/City/State/Zip Code

 

G.           Acquisitions of Equity Interests or Assets.

 

Except as set forth below, neither the Borrower nor any Guarantor has acquired the equity interests of another entity or substantially all the assets of another entity within the past five (5) years:

 

Borrower/Guarantor		Date of Acquisition		Description of Acquisition

 

H.           Corporate Ownership and Organizational Structure.

 

Attached as Exhibit H hereto is a true and correct chart showing the ownership relationship of the Borrower and all of its affiliates.

 

 

II.          INFORMATION REGARDING CERTAIN COLLATERAL

 

A.           Investment Related Property

 

1.          Equity Interests. Set forth below is a list of all equity interests owned by the Borrower and each Guarantor together with the type of organization which issued such equity interests (e.g. corporation, limited liability company, partnership or trust):

 

Borrower/Guarantor

Issuer

Type of Organization

# of Shares Owned

Total Shares Outstanding

% of Interest Pledged

Certificate No. (if uncertificated, please indicate so)

Par Value

 

2.         Securities Accounts. Set forth below is a list of all securities accounts in which the Borrower or any other Guarantor customarily maintains securities or other assets having an aggregate value in excess of $10,000:

 

Borrower/Guarantor		Type of Account		Name & Address of Financial Institutions

 

 

3.          Deposit Accounts. Set forth below is a list of all bank accounts (checking, savings, money market or the like) in which the Borrower or any other Guarantor customarily maintains in excess of $10,000:

 

Borrower/Guarantor		Type of Account		Name & Address of Financial Institutions

 

4.          Debt Securities & Instruments. Set forth below is a list of all debt securities and instruments owed to the Borrower or any other Guarantor in the principal amount of greater than $10,000:

 

Borrower/Guarantor		Issuer of Instrument		Principal Amount of Instrument		Maturity Date

 

B.           Intellectual Property. Set forth below is a list of all copyrights, patents, and trademark, all applications and licenses thereof and other intellectual property owned or used, or hereafter adopted, held or used, by the Borrower and each other Guarantor:

 

1.          Copyrights, Copyright Applications and Copyright Licenses

 

Borrower/Guarantor		Title		Filing Date/Issued Date		Status		Application/ Registration No.

 

2.          Patents, Patent Applications and Patent Licenses

 

Borrower/Guarantor		Title		Filing Date/Issued Date		Status		Application/ Registration No.

 

 

3.          Trademarks, Trademark Applications and Trademark Licenses

 

Borrower/Guarantor		Title		Filing Date/Issued Date		Status		Application/ Registration No.

 

C.           Tangible Personal Property in Possession of Warehousemen, Bailees and Other Third Parties. Except as set forth below, no persons (including, without limitation, warehousemen and bailees) other than the Borrower or any other Guarantor have possession of any material amount (fair market value of $10,000 or more) of tangible personal property of the Borrower or any other Guarantor:

 

Borrower/Guarantor		Address/City/State/Zip Code		County		Description of Assets and Value

 

 

D.           Tangible Personal Property in Former Article 9 Jurisdictions and Canada. Set forth below are all the locations within the Commonwealth of Puerto Rico and any Province of Canada where the Borrower or any other Guarantor currently maintains or has maintained any material amount (fair market value of $10,000 or more) of its tangible personal property (including goods, inventory and equipment) of such Borrower or any other Guarantor (whether or not in the possession of such Borrower or any other Guarantor) within the past five (5) years:

 

Borrower/Guarantor		Address/City/Province or Commonwealth

 

E.           Real Estate Related UCC Collateral

 

1.           Fixtures. Set forth below are all the locations where the Borrower or any other Guarantor owns or leases any real property:

 

Borrower/Guarantor		Address/City/State/Zip Code		County		Owned or Leased

 

 

2.          “As Extracted” Collateral. Set forth below are all the locations where the Borrower or any other Guarantor owns, leases or has an interest in any wellhead or minehead:

 

Borrower/Guarantor		Address/City/State/Zip Code		County

 

3.          Timber to be Cut. Set forth below are all locations where the Borrower or any other Guarantor owns goods that are timber to be cut:

 

Borrower/Guarantor		Address/City/State/Zip Code		County

 

 

III.         AUTHORITY TO FILE FINANCING STATEMENTS

 

The undersigned, on behalf of the Borrower and each Guarantor, hereby authorizes the Collateral Agent to file financing or continuation statements, and amendments thereto, in all jurisdictions and with all filing offices as the Collateral Agent may determine, in its sole discretion, are necessary or advisable to perfect the security interest granted or to be granted to the Collateral Agent under the Guaranty and Security Agreement. Such financing statements may describe the collateral in the same manner as described in the Guaranty and Security Agreement or may contain an indication or description of collateral that describes such property in any other manner as the Collateral Agent may determine, in its sole discretion, is necessary, advisable or prudent to ensure the perfection of the security interest in the collateral granted to the Collateral Agent, including, without limitation, describing such property as “all assets” or “all personal property.”

 

IN WITNESS WHEREOF, the undersigned hereto has caused this Perfection Certificate to be executed as of this ___ day of ____________, 20__ by its officer thereunto duly authorized.

 

	FRANCESCA’S COLLECTIONS, INC.
	By:
		Name:
		Title:

 

	FRANCESCA’S LLC
	By:
		Name:
		Title:

 

 

End Notes

 

1.             It is crucial that the full and exact name of each Grantor is given. Even seemingly minor errors such as substituting “n.a.” for “national association” or “inc.” for “incorporated” may be seriously misleading in some states.

 

2.             Please note that the organizational identification number is not the same as the federal employer’s tax identification number. The organizational identification number is customarily issued by the Secretary of State or State Corporations Department in the State under which the particular entity had been organized or formed and may be found on its organizational documents.

 

3.             If a Grantor does not have an organizational identification number, please indicate “none.” Additionally, organizational identification numbers are not required for entities organized under the laws of New York, Delaware, Connecticut, Georgia or Ohio for financing statements filed in such states. Such organizational identification numbers nevertheless may be required for financing statements filed in respect of entities organized under the foregoing states but filed in other states, e.g. in respect of fixtures.

 

  

EXHIBIT 2.2(a)

 

[FORM OF]

NOTICE OF BORROWING

 

Royal Bank of Canada,

as Administrative Agent for

the Lenders referred to below

200 Bay Street, 12th Floor

South Tower, Royal Bank Plaza

Toronto, Ontario

M5J2W7

Attention: Manager, Agency

 

[Date]¹

 

Ladies and Gentlemen:

 

Reference is made to the Second Amended and Restated Credit Agreement, dated as of August 30, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Francesca’s Collections, Inc., as borrower (the “Borrower”), Francesca’s LLC, the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the L/C Issuer, Royal Bank of Canada, as Administrative Agent, Royal Bank of Canada, as Collateral Agent for the Secured Parties, and the other parties party thereto. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

 

The Borrower hereby gives you notice pursuant to Section 2.2 of the Credit Agreement that it requests a Borrowing under the Credit Agreement, and in that connection sets forth below the terms on which such Borrowing is requested to be made:

 

(A)	Date of Borrowing (which is a Business Day):
(B)	Principal Amount of Borrowing:
(C)	Type of Borrowing2:
(D)	Interest Period and the last day thereof3 (in the case of a Eurodollar Borrowing):
(E)	Account Number and Location:

 

1

Notice must be received prior to (i) 12:00 p.m. on the Business Day prior to the date of the proposed Borrowing, in the case of a Borrowing of Base Rate Loans and (ii) 12:00 p.m. on the third Business Day prior to the date of the proposed Borrowing, in the case of a Borrowing of Eurodollar Rate Loans.

2

Specify a Eurodollar Rate Borrowing or a Base Rate Borrowing.

3

Subject to the definition of “Interest Period” in the Credit Agreement.

 

 

The Borrower hereby represents and warrants that the conditions to lending specified in Sections 3.2(b) and (c) of the Credit Agreement are satisfied as of the date hereof.

 

[Signature page follows]

 

 

	FRANCESCA’S COLLECTIONS, INC.
		By:
			Name:
			Title:

 

 

EXHIBIT 2.4(b)

 

[FORM OF]

L/C REQUEST

 

Royal Bank of Canada,

as Administrative Agent for

the Lenders referred to below

200 Bay Street, 12th Floor

South Tower, Royal Bank Plaza

Toronto, Ontario

M5J2W7

Attention: Manager, Agency

 

KeyBank National Association,

as L/C Issuer

127 Public Square

Cleveland, OH 44114

Attention: [____________]

 

[Date]²⁶

 

Ladies and Gentlemen:

 

Reference is made to the Second Amended and Restated Credit Agreement, dated as of August 30, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Francesca’s Collections, Inc., as borrower (the “Borrower”), Francesca’s LLC, the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the L/C Issuer, Royal Bank of Canada, as Administrative Agent, Royal Bank of Canada, as Collateral Agent for the Secured Parties, and the other parties party thereto. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

 

Pursuant to Section 2.4 of the Credit Agreement, the Borrower hereby requests that [__________], as L/C Issuer, issue a Letter of Credit for the account of the undersigned, as follows:

 

(A)	Date of Issuance:
(B)	Aggregate Amount of Letter of Credit:
(C)	Beneficiary:27
(D)	Supported Transaction:28
(E)	Stated Termination Date:

  

26

Notice must be received no later than 12:00 p.m. on the third Business Day prior to the date of the requested Issuance.

27

Insert name and address of beneficiary.

28

Insert description of obligation or commercial transaction to which Letter of Credit relates and include description of the documents to be presented by such beneficiary in case of any drawing thereunder and the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder.

 

 

The Borrower hereby represents and warrants that the conditions to Issuance specified in Sections 3.2(b) and (c) of the Credit Agreement are satisfied as of the date hereof.

  

[Signature page follows]

 

 

	Very truly yours,
	FRANCESCA’S COLLECTIONS, INC.
	By:
		Name:
		Title:

 

 

EXHIBIT 2.10(b)

 

[FORM OF]

NOTICE OF CONVERSION OR CONTINUATION

 

Royal Bank of Canada,

as Administrative Agent for

the Lenders referred to below

200 Bay Street, 12th Floor

South Tower, Royal Bank Plaza

Toronto, Ontario

M5J2W7

Attention: Manager, Agency

 

[Date]¹

 

Ladies and Gentlemen:

 

Reference is made to the Second Amended and Restated Credit Agreement, dated as of August 30, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Francesca’s Collections, Inc., as borrower (the “Borrower”), Francesca’s LLC, the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the L/C Issuer, Royal Bank of Canada, as Administrative Agent, Royal Bank of Canada, as Collateral Agent for the Secured Parties, and the other parties party thereto. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

 

The Borrower hereby gives you notice pursuant to Section 2.10 of the Credit Agreement that it elects to (a) continue a Eurodollar Rate Loan or a portion thereof under the Credit Agreement; (b) convert a Eurodollar Rate Loan or a portion thereof into a Base Rate Loan; or (c) convert a Base Rate Loans or a portion thereof into Eurodollar Rate Loans, and in that connection sets forth below the terms on which such conversion or continuation is requested to be made:

 

(A)	Date of proposed conversion or continuation (which is a Business Day):
(B)	Aggregate amount of Eurodollar Loans or Base Rate Loans to be converted or continued2:
(C)	Nature of the proposed conversion or continuation (including identification of Loans to be converted or continued) :
(E)	Interest Period and the last day thereof3 (if the Loans are to be converted into or continued as Eurodollar Loans):

 

1

Notice must be provided upon 3 Business Days’ prior notice in the case of any Base Rate Loans or any portion thereof to be converted into Eurodollar Rate Loans.

2

For each Interest Period, the aggregate amount of Eurodollar Rate Loans having such Interest Period must be $1,000,000 or an integral multiple of $100,000 in excess thereof.

3

Subject to the definition of “Interest Period” in the Credit Agreement.

 

 

[The Borrower hereby certifies that the following statements are true on the date hereof, and will be true on the date of the proposed conversion or continuation, both before and after giving effect thereto:

 

(a)          the foregoing conversion or continuation complies with the terms and conditions of the Credit Agreement (including, without limitation, Section 2.10 of the Credit Agreement);

 

(b)          no Default or Event of Default has occurred and is continuing, or would result from such proposed conversion or continuation.]⁴

 

[Signature page follows]

 

4

Include if the Loans are to be converted into or continued as Eurodollar Loans.

 

 

	FRANCESCA’S COLLECTIONS, INC.
		By:
			Name:
			Title:

 

 

EXHIBIT 2.14(e)

 

[FORM OF]

NOTE

 

Lender: [NAME OF LENDER]		New York, New York
Principal Amount: [$              ]		[_______], 2013

 

 

FOR VALUE RECEIVED, the undersigned, FRANCESCA’S COLLECTIONS, INC., a Texas corporation (the “Company”), hereby promises to pay the Lender set forth above (the “Lender”), the Principal Amount set forth above, or, if less, the then aggregate unpaid principal amount of all Loans made by the Lender pursuant to the Second Amended and Restated Credit Agreement, dated as of August 30, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Company, Francesca’s LLC, the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the L/C Issuer, Royal Bank of Canada, as administrative agent, Royal Bank of Canada, as collateral agent for the Secured Parties, and the other parties thereto. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

 

The Company also promises to pay interest on the unpaid principal amount of such Loan from the date made until such principal amount is paid in full, at such interest rates, and payable at such times, as are specified in the Credit Agreement.

 

This Note is one of the Notes referred to in the Credit Agreement and is subject to the terms and entitled to the benefits of thereof and of the other Loan Documents. This Note is secured and guaranteed as provided in the Guaranty and Security Agreement and by the other security documents. This Note is subject to voluntary prepayment prior to the Scheduled Termination Date, in whole or in part, as provided in the Credit Agreement.

 

If an Event of Default shall occur, the principal of and accrued interest on this Note may become or be declared to be due and payable in the manner and with the effect provided in the Credit Agreement.

 

All parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind in connection with this Note.

 

THIS NOTE MAY NOT BE TRANSFERRED OR AMENDED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE CREDIT AGREEMENT.

 

THIS NOTE, AND THE RIGHTS AND OBLIGATIONS OF THE COMPANY AND THE LENDER HEREUNDER, SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

[SIGNATURE PAGE FOLLOWS]

 

 

IN WITNESS WHEREOF, the Company has caused this Note to be executed and delivered by its duly authorized officer as of the day and year and at the place set forth above.

 

	FRANCESCA’S COLLECTIONS, INC.
	By:
	Name:
	Title:

 

 

EXHIBIT 2.17(f)

 

[FORM OF]

 UNITED STATES TAX COMPLIANCE CERTIFICATE

 

Reference is made to the Second Amended and Restated Credit Agreement, dated as of August 30, 2013 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among Francesca’s Collections, Inc., a Texas corporation, as the borrower (the “Borrower”), Francesca’s LLC, a Delaware limited liability company, the other Guarantors from time to time party thereto, the Lenders from time to time party thereto, the L/C Issuer, Royal Bank of Canada, as Administrative Agent, Royal Bank of Canada, as Collateral Agent, and the other parties thereto. Capitalized terms used herein that are not defined herein shall have the meanings ascribed to them in the Credit Agreement. [______________________] (the “Non-U.S. Lender Party”) is providing this certificate pursuant to subsection 2.17(f)(ii)(III) of the Credit Agreement. The Non-U.S. Lender Party hereby represents and warrants that:

 

1.          The Non-U.S. Lender Party is the sole record and beneficial owner of the Loans or the obligations evidenced by Note(s) in respect of which it is providing this certificate.

 

2.          The Non-U.S. Lender Party is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code. In this regard, the Non-U.S. Lender Party further represents and warrants that:

 

(a)         the Non-U.S. Lender Party is not subject to regulatory or other legal requirements as a bank in any jurisdiction; and

 

(b)         the Non-U.S. Lender Party has not been treated as a bank for purposes of any tax, securities law or other filing or submission made to any Governmental Authority, any application made to a rating agency or qualification for any exemption from tax, securities law or other legal requirements.

 

3.          The Non-U.S. Lender Party is not a 10-percent shareholder of the Borrower, within the meaning of Section 881(c)(3)(B) of the Code.

 

4.          The Non-U.S. Lender Party is not a controlled foreign corporation described in Section 881(c)(3)(C) of the Code.

 

5.          No payments in connection with the Loan Documents are effectively connected with the Non-U.S. Lender Party’s conduct of a U.S. trade or business.

 

[Signature page follows]

 

 

IN WITNESS WHEREOF, the undersigned has duly executed this certificate.

 

	[NAME OF NON-U.S. LENDER PARTY]
	By:
	Name:
	Title:

Date: ____________________