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SMURFIT STONE CONTAINER CORP
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8-K/A
May 13, 3:43 PM ET
SMURFIT STONE CONTAINER CORP 8-K/A
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Contents
818
(a) the amount past due and owing by any Canadian Loan Party (or any other Person for which any Canadian Loan Party has joint and several liability), or the accrued amount for which each Canadian Loan Party has an obligation whether to remit to a Governmental Authority or other Person pursuant to any applicable law, rule or regulation, in respect of (i) pension fund obligations, (ii) employment insurance, (iii) goods and services taxes, sales taxes, employee income taxes and other taxes payable or to be remitted or withheld, (iv) workers’compensation, (v) wages, salaries, commission or compensation, including vacation pay, and (vi) other like charges and demands; in each case in respect of which any Governmental Authority or other Person may claim a security interest, hypothecation, prior claim, trust or other claim or Lien ranking or capable of ranking in priority to or pari passu with one or more of the Liens granted pursuant to the Security Documents; and
(b) the aggregate amount of any other liabilities of the Canadian Loan Parties (or any other Person for which the Canadian Loan Parties have joint and several liability) (i) in respect of which a trust has been or may be imposed on Collateral of any Canadian Loan Party to provide for payment or (ii) which are secured by a security interest, hypothecation, prior claim, pledge, charge, right, or claim or other Lien on any Collateral of any Canadian Loan Party, in each case pursuant to any applicable law, rule or regulation and which trust, security interest, hypothecation, prior claim, pledge, charge, right, claim or other Lien ranks or is capable of
ranking in priority to or pari passu with one or more of the Liens granted in the Security Documents.
(a) which is not subject to a first priority perfected Lien in favor of the Security Agent for the benefit of the Secured Parties pursuant to the relevant Security Documents;
(b) which is subject to any Lien other than (i) a Lien in favor of the Security Agent for the benefit of the Secured Parties pursuant to the relevant Security Documents, (ii) a Lien (if any) permitted by Section 10.02 which is junior in priority to the Lien in favor of the Security Agent for the benefit of the Secured Parties pursuant to the relevant Security Documents, and (iii) an unregistered Lien in respect of Canadian Priority Payables that are not yet due and payable;
(c) which is determined, based on the Loan Parties’ historical practices and procedures, in each case, which are reasonably acceptable to the Co-Collateral Agents, slow moving, obsolete, unmerchantable, defective, used, unfit for sale, not salable at prices approximating at least the cost of such Inventory in the ordinary course of business or unacceptable due to age, type, category or quantity;
(d) with respect to which any covenant, representation, or warranty contained in this Agreement or the Security Documents has been breached or is not true in any material
respect and which does not conform in any material respect to all standards imposed by any Governmental Authority;
(e) in which any Person other than such Loan Party shall (i) have any direct or indirect ownership, interest or title to such Inventory or (ii) be indicated on any purchase order or invoice with respect to such Inventory as having or purporting to have an interest therein;
(f) which constitutes spare or replacement parts, subassemblies, packaging supplies and shipping material, manufacturing supplies, samples, prototypes, displays or display items, bill-and-hold goods, goods that are returned or marked for return, defective or damaged goods, goods held on consignment, or goods which are not of a type held for sale in the ordinary course of business, including, but not limited to, chemicals, starches, ink and adhesives (other than fuels in the Co-Collateral Agents’ Permitted Discretion);
(g) which is not located in an Applicable Eligible Jurisdiction, or the laws of such other jurisdiction acceptable to the Co-Collateral Agents in their Permitted Discretion, or is in transit (other than (i) between locations in an Applicable Eligible Jurisdiction controlled by Loan Parties, to the extent included in current perpetual inventory reports of any Loan Party or (ii) from an Account Debtor of a Loan Party to a location in an Applicable Eligible Jurisdiction controlled by such Loan Party so long as a Reserve has been established by the Co-Collateral Agents in their Permitted Discretion (or a contra account is established to reduce the amount owed by such Account Debtor) for the accounts payable of such Loan Party with respect to such inventory in transit);
(h) which (i) is located in any location leased by a Loan Party unless (A) the lessor has delivered to the Security Agent a Collateral Access Agreement or (B) a Rent Reserve with respect to such facility has been established by the Co-Collateral Agents in their Permitted Discretion or (ii) which is located at an owned location subject to a mortgage or other security interest in favor of a creditor other than the Security Agent, the Permitted Notes Agent or the Term Loan Agent or is located in any third party warehouse or other storage facility or is in the possession of a bailee unless (A) such mortgagee, warehouseman or bailee has delivered to the Security Agent a Collateral Access Agreement and such other documentation as the Co-Collateral Agents may require in their Permitted Discretion or (B) a Rent Reserve or other Reserve has been established by the Co-Collateral Agents in their Permitted Discretion;
(i) which is being processed offsite at a third party location or outside processor, or is in-transit to or from said third party location or outside processor;
(j) which is a discontinued product or component thereof;
(k) which is the subject of a consignment by such Loan Party as consignor;
(l) which contains or bears any intellectual property rights licensed to such Loan Party unless the Co-Collateral Agents are satisfied that the Security Agent may sell or otherwise dispose of such Inventory without (i) infringing the rights of such licensor, (ii) violating any contract with such licensor, or (iii) incurring any liability with respect to payment of royalties other than royalties incurred pursuant to sale of such Inventory under the current licensing agreement;
(m) which is not reflected in a current inventory report of such Loan Party (unless such Inventory is reflected in a report to the Co-Collateral Agents as “in transit” Inventory);
(n) for which reclamation rights have been asserted by the seller;
(o) consists of goods that have been returned or rejected by the buyer and are not in salable condition;
(p) is Commingled Inventory;
(q) is not covered by casualty insurance as required by the terms of this Agreement;
(r) consists of Hazardous Materials or goods (other than fuels) that can be transported or sold only with licenses that are not readily available;
(s) any portion of the cost of such Inventory is attributable to intercompany profit between any Loan Party and any of its Affiliates (but only to the extent of such portion); or
(t) is otherwise unacceptable to the Co-Collateral Agents in their Permitted Discretion.
(i) shall be made and maintained in an Available Currency;
(ii) except as hereafter provided, shall, at the option of the applicable Borrowers, be incurred and maintained as, and/or converted into, one or more Borrowings of (x) Base Rate Loans, Canadian Prime Rate Loans or Eurodollar Loans, or (y) (A) in the case of a B/A Lender, Bankers’ Acceptances in Canadian Dollars by acceptance and purchase thereof on the terms and conditions provided for herein and in Schedule 1.01(b) or (B) in the case of a Non-B/A Lender, completed Drafts in Canadian Dollars purchased and, at the request of the Non-B/A Lender, exchanged for B/A Equivalent Notes, in each case on the terms and conditions provided for herein and in Schedule 1.01(b); provided that, except as otherwise specifically provided in Section 2.10(b), all Revolving Loans made as part of the same Borrowing shall at all times consist of Revolving Loans of the same Type;
(iii) may be repaid and reborrowed in accordance with the provisions hereof;
(iv) shall not be made (and shall not be required to be made) by any such Lender in any instance where the incurrence thereof (after giving effect to the use of the proceeds thereof on the date of the incurrence thereof to repay any amounts theretofore outstanding pursuant to this Agreement) would cause (x) in the case of U.S. Facility Revolving Loans, (A) the Individual U.S. Facility Exposure of such U.S. Facility Lender to exceed the amount of its U.S. Facility Commitment at such time or (B) the Aggregate U.S. Facility Exposure to exceed the Total U.S. Facility Commitment at such time or (y) in the case of Canadian Facility Revolving Loans, (A) the Individual Canadian Facility Exposure of such Canadian Facility Lender to exceed the amount of its Canadian Facility Commitment at such time or (B) the Aggregate Canadian Facility Exposure to exceed the Total Canadian Facility Commitment at such time; and
(v) to the extent denominated in Canadian Dollars and required to be made by a Participating Specified Foreign Currency Lender, shall, subject to Section 15, be made by the Fronting Lender.
(b) Subject to and upon the terms and conditions set forth herein (including, without limitation, the conditions set forth in Sections 6 and 7), the Swingline Lender agrees to make, at any time and from time to time on or after the Funding Date and prior to the Swingline Expiry Date (A) in respect of the U.S. Facility Commitments, a revolving loan or revolving loans to any U.S. Borrower (on a joint and several basis with the other U.S. Borrowers) (each, a “U.S. Facility Swingline Loan” and, collectively, the “U.S. Facility Swingline Loans”) and (B) in respect of the Canadian Facility Commitments, (x) a revolving loan or revolving loans to any U.S. Borrower (on a joint and several basis with the other U.S. Borrowers) (each, a “U.S. Borrower Canadian Facility Swingline Loan” and, collectively, the “U.S. Borrower Canadian Facility Swingline Loans”) and (y) a revolving loan or revolving loans to any Canadian Borrower (on a joint and several basis with the other Canadian Borrowers) (each, a “Canadian Borrower Canadian Facility Swingline Loan” and, collectively, the “Canadian Borrower Canadian Facility Swingline Loans” and, together with the U.S. Borrower Canadian Facility Swingline Loans, each, a “Canadian Facility Swingline Loan” and, collectively, the “Canadian Facility Swingline Loans” and, together with the U.S. Facility Swingline Loans, each, a “Swingline Loan” and, collectively, the “Swingline Loans”), which Swingline Loans:
(i) shall be made and maintained in an Available Currency;
(ii) shall be made and maintained as Base Rate Loans or Canadian Prime Rate Loans;
(iii) may be repaid and reborrowed in accordance with the provisions hereof;
(iv) shall not be made (and shall not be required to be made) by the Swingline Lender in any instance where the incurrence thereof (after giving effect to the use of the proceeds thereof on the date of the incurrence thereof to repay any amounts theretofore outstanding pursuant to this Agreement) would cause (x) in the case of U.S. Facility Swingline Loans, the Aggregate U.S. Facility Exposure to exceed the Total U.S. Facility Commitment at such time or (y) in the case of Canadian Facility Swingline Loans, the Aggregate Canadian Facility Exposure to exceed the Total Canadian Facility Commitment at such time; and
(v) shall not exceed in aggregate principal amount at any time outstanding (x) in the case of U.S. Facility Swingline Loans, the Maximum U.S. Facility Swingline Amount or (y) in the case of Canadian Facility Swingline Loans, the Maximum Canadian Facility Swingline Amount.
(c) The Swingline Lender (x) may, in its sole discretion, on any Business Day, and (y) shall, on the penultimate Business Day of each week, give notice to the Lenders under a Tranche that the Swingline Lender’s outstanding Swingline Loans under such Tranche shall be funded with one or more Borrowings of Revolving Loans under such Tranche to be made to, and maintained by, the Borrower of the outstanding Swingline Loan under such Tranche being funded by such Revolving Loan (or any other Borrower jointly and severally liable with such Borrower under such Tranche) in the same currency as the outstanding Swingline Loan under such Tranche being funded by such Revolving Loan (provided that such notice shall be deemed to have been automatically given upon the occurrence of a Default or an Event of Default under Section 11.01(g) or (h) or upon the exercise of any of the remedies provided in the last paragraph of Section 11.01), in which case one or more Borrowings of Revolving Loans under a Tranche constituting Base Rate Loans (in the case of Swingline Loans under such Tranche denominated in U.S. Dollars) or Revolving Loans under a Tranche constituting Canadian Prime Rate Loans (in the case of Swingline Loans under such Tranche denominated in Canadian Dollars), in each case, to be made to, and maintained by, the Borrower of the outstanding Swingline Loan under such Tranche being funded by such Revolving Loan (or any other Borrower jointly and severally liable with such Borrower under such Tranche) in the same currency as the outstanding Swingline Loan under such Tranche being funded by such Revolving Loan (each such Borrowing, a “Mandatory Borrowing”), shall be made on the immediately succeeding Business Day by all Lenders under such Tranche pro rata based on each such Lender’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be (determined before giving effect to any termination of the Commitments under such Tranche pursuant to the last paragraph of Section 11.01) and the proceeds thereof shall be applied directly by the Swingline Lender to repay the Swingline Lender for such outstanding Swingline Loans under such Tranche; provided that such Revolving Loans which are denominated in Canadian Dollars and are required to be made by a Participating Specified Foreign Currency Lender shall,
subject to Section 15, be made by the Fronting Lender. Each Lender under a Tranche hereby irrevocably agrees to make Revolving Loans under such Tranche to the applicable Borrower upon one Business Day’s notice pursuant to each Mandatory Borrowing in the amount and currency and in the manner specified in the preceding sentence and on the date specified in writing by the Swingline Lender notwithstanding (i) the amount of the Mandatory Borrowing may not comply with the Minimum Borrowing Amount otherwise required hereunder, (ii) whether any conditions specified in Section 7 are then satisfied, (iii) whether a Default or an Event of Default then exists, (iv) the date of such Mandatory Borrowing, and (v) the amount of any Borrowing Base or the Total U.S. Facility Commitment or Total Canadian Facility Commitment, as applicable, at such time. In the event that any Mandatory Borrowing cannot for any reason be made on the date otherwise required above (including, without limitation, as a result of the commencement of a proceeding, corporate action or other step taken under any Insolvency Law with respect to any Borrower, then each Lender under a Tranche hereby agrees that it shall forthwith purchase (as of the date the Mandatory Borrowing would otherwise have occurred, but adjusted for any payments received from any Borrower under such Tranche on or after such date and prior to such purchase) from the Swingline Lender such participations in the outstanding Swingline Loans under such Tranche as shall be necessary to cause such Lenders to share in such Swingline Loans ratably based upon their respective U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be (determined before giving effect to any termination of the Commitments under such Tranche pursuant to the last paragraph of Section 11.01), provided that (x) all interest payable on the Swingline Loans under such Tranche shall be for the account of the Swingline Lender until the date as of which the respective participation is required to be purchased and, to the extent attributable to the purchased participation, shall be payable to the participant from and after such date and (y) at the time any purchase of participations pursuant to this sentence is actually made, the purchasing Lender shall be required to pay the Swingline Lender interest on the principal amount of the participation purchased for each day from and including the day upon which the Mandatory Borrowing would otherwise have occurred to but excluding the date of payment for such participation, (A) in the case of a Mandatory Borrowing constituting Revolving Loans denominated in U.S. Dollars, at the overnight Federal Funds Rate for the first three days and at the interest rate otherwise applicable to such Revolving Loans denominated in U.S. Dollars, in each case maintained as Base Rate Loans hereunder for each day thereafter, and (B) in the case of a Mandatory Borrowing constituting Revolving Loans denominated in Canadian Dollars, at the cost to the Administrative Agent of acquiring the overnight funds in Canadian Dollars for the first three days and at the interest rate otherwise applicable to such Revolving Loans denominated in Canadian Dollars, in each case maintained as Canadian Prime Rate Loans hereunder for each day thereafter.
(d) Notwithstanding anything to the contrary in Section 2.01(a) or (b), Section 7.03 or elsewhere in this Agreement, the Co-Collateral Agents shall have the right to establish Reserves in such amounts, and with respect to such matters, as the Co-Collateral Agents in their Permitted Discretion shall deem necessary or appropriate, against any Borrowing Base (with any establishment of or increase in Reserves to reduce such then existing Borrowing Base, as applicable, in an amount equal to such Reserves and any elimination of or reduction in any Reserves to increase such then existing Borrowing Base, as applicable, in an amount equal to such Reserves). The Co-Collateral Agents shall promptly notify Holdings of the establishment of any new Reserve or any increase or decrease to an existing Reserve.
(e) In the event that the Borrowers are unable to comply with the conditions precedent to the making of Revolving Loans set forth in Section 7 (including, without limitation, the Borrowing Base limitations set forth in Section 7.03), the Lenders under any Tranche, subject to the immediately succeeding proviso, hereby authorize the Administrative Agent, for the account of the Lenders under a Tranche, to make U.S. Facility Revolving Loans to any U.S. Borrower (on a joint and several basis with the other U.S. Borrowers), U.S. Borrower Canadian Facility Revolving Loans to any U.S. Borrower (on a joint and several basis with the other U.S. Borrowers) and/or Canadian Borrower Canadian Facility Revolving Loans to any Canadian Borrower (on a joint and several basis with the other Canadian Borrowers) solely in the event that the Administrative Agent in its Permitted Discretion deems necessary or desirable (A) to preserve or protect the Collateral, or any portion thereof, (B) to enhance the likelihood of repayment of the Obligations, or (C) to pay any other amount chargeable to the Borrowers pursuant to the terms of this Agreement, including, without limitation, documented Expenses and Fees which are invoiced in reasonable detail; provided that such Revolving Loans may only be made as Base Rate Loans or Canadian Prime Rate Loans, respectively, as determined by the Administrative Agent (each, an “Agent Advance”), for a period commencing on the date the Administrative Agent first receives a Notice of Borrowing requesting an Agent Advance until the earliest of (x) the twentieth Business Day after such date, (y) the date the respective Borrowers are again able to comply with the applicable Borrowing Base limitations and the conditions precedent to the making of Revolving Loans, or obtain an amendment or waiver with respect thereto and (z) the date the Required Lenders instruct the Administrative Agent to cease making Agent Advances (in each case, the “Agent Advance Period”); provided further that the Administrative Agent shall not make any Agent Advance to the extent that at the time of the making of such Agent Advance, (I) the amount of such Agent Advance when added to the aggregate outstanding amount of all other Agent Advances (w) made to, if such Agent Advance is a U.S. Borrower Revolving Loan, the U.S. Borrowers at such time (for this purpose, using the U.S. Dollar Equivalent of amounts not denominated in U.S. Dollars), would exceed 5% of the U.S. Borrowing Base at such time, (x) made to, if such Agent Advance is a Canadian Borrower Revolving Loan, the Canadian Borrowers at such time (for this purpose, using the U.S. Dollar Equivalent of amounts not denominated in U.S. Dollars), would exceed 5% of the Canadian Borrowing Base at such time, (y) if such Agent Advance is a U.S. Facility Revolving Loan, that are U.S. Facility Revolving Loans (for this purpose, using the U.S. Dollar Equivalent of amounts not denominated in U.S. Dollars), would exceed 5% of the Total U.S. Facility Commitment at such time or (z) if such Agent Advance is a Canadian Facility Revolving Loan, that are Canadian Facility Revolving Loans (for this purpose, using the U.S. Dollar Equivalent of amounts not denominated in U.S. Dollars), would exceed 5% of the Total Canadian Facility Commitment at such time (each, an “Agent Advance Amount”) or (II) the amount of such Agent Advance (after giving effect to thereto) would cause (x) if such Agent Advance is a U.S. Facility Revolving Loan, (A) the Individual U.S. Facility Exposure of any U.S. Facility Lender to exceed the amount of such U.S. Facility Lender’s U.S. Facility Commitment at such time or (B) the Aggregate U.S. Facility Exposure to exceed the Total U.S. Facility Commitment at such time or (y) if such Agent Advance is a Canadian Facility Revolving Loan, (A) the Individual Canadian Facility Exposure of any Canadian Facility Lender to exceed the amount of such Canadian Facility Lender’s Canadian Facility Commitment at such time or (B) the Aggregate Canadian Facility Exposure to exceed the Total Canadian Facility Commitment at such time. Agent Advances may be made by the Administrative Agent in its sole discretion and no Borrower shall
have any right whatsoever to require that any Agent Advances be made, provided that the Administrative Agent shall promptly notify Holdings following the occurrence of an Agent Advance. Agent Advances will be subject to periodic settlement with the applicable Lenders pursuant to Section 2.04(b).
(f) If the Initial Revolving Loan Maturity Date shall have occurred at a time when Extended U.S. Facility Commitments or Extended Canadian Facility Commitments are in effect, then on the Initial Revolving Loan Maturity Date all then outstanding Swingline Loans shall be repaid in full on such date (and there shall be no adjustment to the participations in such Swingline Loans as a result of the occurrence of such Initial Revolving Loan Maturity Date); provided that, if on the occurrence of the Initial Revolving Loan Maturity Date (after giving effect to any repayments of Revolving Loans and any reallocation of Letter of Credit participations as contemplated in Section 3.07), there shall exist sufficient unutilized Extended U.S. Facility Commitments or Extended Canadian Facility Commitments, as the case may be, so that the respective outstanding Swingline Loans could be incurred pursuant the Extended U.S. Facility Commitments or Extended Canadian Facility Commitments, as the case may be, which will remain in effect after the occurrence of the Initial Revolving Loan Maturity Date, then there shall be an automatic adjustment on such date of the participations in such Swingline Loans and same shall be deemed to have been incurred solely pursuant to the Extended U.S. Facility Commitments or Extended Canadian Facility Commitments, as the case may be, and such Swingline Loans shall not be so required to be repaid in full on the Initial Revolving Loan Maturity Date.
(b) Whenever a Borrower desires to incur Swingline Loans hereunder, such Borrower shall give the Swingline Lender no later than 1:00 P.M. (New York City time) on the date that a Swingline Loan is to be incurred, written notice or telephonic notice promptly confirmed in writing of each Swingline Loan to be incurred hereunder. Each such notice shall be irrevocable and specify in each case (A) the date of Borrowing (which shall be a Business Day), (B) the aggregate principal amount of the Swingline Loans to be incurred pursuant to such Borrowing (stated in the Available Currency) and (C) whether the Swingline Loans being incurred pursuant to such Borrowing shall constitute U.S. Facility Swingline Loans or Canadian Facility Swingline Loans.
(c) Mandatory Borrowings shall be made upon the notice specified in Section 2.01(c), with each Borrower irrevocably agreeing, by its incurrence of any Swingline Loan, to the making of the Mandatory Borrowings as set forth in Section 2.01(a).
(d) Without in any way limiting the obligation of any Borrower to confirm in writing any telephonic notice of any Borrowing or prepayment of Loans, the Administrative Agent or the Swingline Lender, as the case may be, may act without liability upon the basis of telephonic notice of such Borrowing or prepayment, as the case may be, believed by the Administrative Agent or the Swingline Lender, as the case may be, in good faith to be from an Authorized Officer of such Borrower, prior to receipt of written confirmation. In each such case, such Borrower hereby waives the right to dispute the Administrative Agent’s or the Swingline Lender’s record of the terms of such telephonic notice of such Borrowing or prepayment of Loans, as the case may be, absent manifest error.
(b) Agent Advances made pursuant to Section 2.01(c) shall be subject to periodic settlement as follows:
(i) The amount of each Lender’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of Revolving Loans shall be computed
weekly (or more frequently in the Administrative Agent’s sole discretion) and shall be adjusted upward or downward on the basis of the amount of outstanding Revolving Loans under such Tranche as of 5:00 P.M. (New York City time) on the last Business Day of each week, or such other period specified by the Administrative Agent (each such date, a “Settlement Date”). The applicable Lenders under a Tranche shall transfer to the Administrative Agent, or the Administrative Agent shall transfer to the applicable Lenders under a Tranche, such amounts as are necessary so that (after giving effect to all such transfers) the amount of Revolving Loans under a Tranche made by each Lender under such Tranche shall be equal to such Lender’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of the aggregate amount of Revolving Loans under such Tranche outstanding as of such Settlement Date. If a notice from the Administrative Agent of any such necessary transfer is received by a Lender on or prior to 12:00 Noon (New York City time) on any Business Day, then such Lender shall make transfers described above in immediately available funds no later than 3:00 P.M. (New York City time) on the day such notice was received; and if such notice is received by a Lender after 12:00 Noon (New York City time) on any Business Day, such Lender shall make such transfers no later than 1:00 P.M. (New York City time) on the next succeeding Business Day. The obligation of each of the Lenders to transfer such funds shall be irrevocable and unconditional and without recourse to, or without representation or warranty by, the Administrative Agent. Each of the Administrative Agent and each Lender agrees and the Lenders agree to mark their respective books and records on each Settlement Date to show at all times the dollar amount of their respective U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of the outstanding Revolving Loans under such Tranche on such date. The provisions of this Section 2.04(b) with respect to Specified Foreign Currency Loans of a Participating Specified Foreign Currency Lender shall be subject to the terms of Section 15.
(ii) To the extent that the settlement described in preceding clause (i) shall not yet have occurred with respect to any particular Settlement Date, upon any repayment of Revolving Loans under a Tranche by any Borrower prior to such settlement, the Administrative Agent may apply such amounts repaid directly to the amounts that would otherwise be made available by the Administrative Agent pursuant to this Section 2.04(b) under such Tranche.
(iii) Because the Administrative Agent on behalf of the Lenders under a Tranche may be advancing and/or may be repaid Revolving Loans under such Tranche prior to the time when such Lenders will actually advance and/or be repaid such Revolving Loans, interest with respect to such Revolving Loans shall be allocated by the Administrative Agent to each such Lender and the Administrative Agent in accordance with the amount of such Revolving Loans actually advanced by and repaid to each such Lender and the Administrative Agent and shall accrue from and including the date such Revolving Loans are so advanced to but excluding the date such Revolving Loans are either repaid by the U.S. Borrowers or the Canadian Borrowers, as the case may be, in accordance with the terms of this Agreement or actually settled by the Administrative Agent or the applicable Lender as described in this Section 2.04(b).
(b) Each Lender under a Tranche will note on its internal records the amount of each Loan under such Tranche made by it and each payment in respect thereof and prior to any transfer of any of its Notes under such Tranche will endorse on the reverse side thereof the outstanding principal amount of Loans under such Tranche evidenced thereby. Failure to make any such notation or any error in such notation shall not affect any Borrower’s obligations in respect of such Loans.
(c) Notwithstanding anything to the contrary contained above in this Section 2.05 or elsewhere in this Agreement, Notes in respect of a Tranche shall only be delivered to Lenders under such Tranche which at any time specifically request the delivery of such Notes. No failure of any Lender to request, obtain, maintain or produce a Note evidencing its Loans to any Borrower shall affect, or in any manner impair, the obligations of any Borrower to pay the Loans (and all related Obligations) incurred by such Borrower which would otherwise
be evidenced thereby in accordance with the requirements of this Agreement, and shall not in any way affect the security or guaranties therefor provided pursuant to any Loan Document. Any Lender which does not have a Note evidencing its outstanding Loans shall in no event be required to make the notations otherwise described in preceding clause (b). At any time when any Lender under a Tranche requests the delivery of a Note under such Tranche to evidence any of its Loans under such Tranche, each of the respective Borrowers shall promptly execute and deliver to the respective Lender, at such Borrowers’ expense, the requested Note in the appropriate amount or amounts to evidence such Loans.
(d) If requested by a Lender following an Extension, the applicable Borrowers shall promptly provide such Lender with the applicable Notes (substantially in the form set forth in Section 2.05(a) with such amendments thereto to reflect the Extension).
(b) Conversions of Bankers’ Acceptance Loans (so long as of the same Tranche) into Canadian Prime Rate Loans (of the same Tranche) shall be made in the circumstances, and to the extent, provided in Schedule 1.01(b). Except as provided in Schedule 1.01(b), Bankers’ Acceptance Loans shall not be permitted to be converted into Canadian Prime Rate Loans prior to the maturity date of the respective Bankers’ Acceptance or B/A Equivalent Note, as the case may be.
(c) Each Borrower shall have the option to convert on any Business Day occurring on or after the Funding Date, all or a portion at least equal to the Minimum Borrowing Amount of the outstanding principal amount of Canadian Prime Rate Loans made to such Borrower pursuant to one or more Borrowings (so long as of the same Tranche) of Canadian Dollar Denominated Revolving Loans into a Borrowing or Borrowings (of the same Tranche) of Bankers’ Acceptance Loans; provided that (i) following notice by the Administrative Agent or the Required Lenders to Holdings during the continuation of any Default or Event of Default (although no such notice shall be required following an Event of Default under Section 11.01(g) or (h)), Canadian Prime Rate Loans may not be converted into Bankers’ Acceptance Loans and (ii) Borrowings of Bankers’ Acceptance Loans resulting from this Section 2.06 shall be limited in number as provided in Section 2.02. Each such conversion shall be effected by the relevant Borrower (of Canadian Dollar Denominated Revolving Loan being converted), by giving the Administrative Agent at the Notice Office, prior to 12:00 Noon (New York City time), at least three Business Days prior to the date of the proposed conversion, a Notice of Conversion/Continuation specifying the Canadian Dollar Denominated Revolving Loans maintained as Canadian Prime Rate Loans to be so converted into Bankers’ Acceptance Loans, the Borrowing or Borrowings pursuant to which such Canadian Dollar Denominated Revolving Loans were made and the term of the proposed Borrowing of Bankers’ Acceptance Loans (which, in each case, shall comply with the requirements of Schedule 1.01(b)). The Administrative Agent shall give each Lender prompt notice of any such proposed conversion affecting any of its Canadian Dollar Denominated Revolving Loans maintained as Canadian Prime Rate Loans.
(b) Overdue principal and, to the extent permitted by law, overdue interest in respect of each Loan and any other overdue amount payable hereunder and under any other Loan Document, by acceleration or otherwise, shall, in each case, bear interest at a rate per annum equal to the rate which is two percent (2.0%) in excess of the otherwise applicable rate of interest then borne by the applicable borrowing (or, if any such amount does not relate to a borrowing under this Agreement, the rate which is 2% in excess of the rate otherwise applicable to Base Rate Loans from time to time). Interest that accrues under this Section 2.08(b) shall be payable on demand.
(c) Accrued (and theretofore unpaid) interest shall be payable (i) in respect of each Base Rate Loan, quarterly in arrears on each Quarterly Payment Date, (ii) in respect of each Canadian Prime Rate Loan, quarterly in arrears on each Quarterly Payment Date, (iii) in respect of each Eurodollar Rate Loan, on the last day of each Interest Period applicable thereto and, in the case of an Interest Period in excess of three months, on each date occurring at three month intervals after the first day of such Interest Period and (iv) in respect of each Loan (other than Bankers’ Acceptance Loans), (x) on the date of any repayment or prepayment thereof (on the amount prepaid or repaid) (except that repayments and prepayments of Base Rate Loans or Canadian Prime Rate Loans, in each case, under a Tranche shall not be required to be accompanied by a payment of accrued, and theretofore unpaid, interest thereon, unless either all outstanding Loans of such Type under such Tranche are being repaid or prepaid or the Total Commitment under such Tranche has terminated or will be terminated concurrently with such repayment or prepayment), (y) at maturity (whether by acceleration or otherwise) and (z) after such maturity, on demand.
(d) Upon each Interest Determination Date, the Administrative Agent shall determine the Eurodollar Rate for each Interest Period applicable to the respective Eurodollar Loans and shall promptly notify the respective Borrowers and the Lenders thereof. Each such
determination shall, absent manifest error, be final and conclusive and binding on all parties hereto.
(a) all Eurodollar Loans comprising a Borrowing shall at all times have the same Interest Period;
(b) the initial Interest Period for any Eurodollar Loan shall commence on the date of Borrowing of such Eurodollar Loan (including, the date of any conversion thereto from a Base Rate Loan) and each Interest Period occurring thereafter in respect of such Eurodollar Loan shall commence on the day on which the next preceding Interest Period applicable thereto expires;
(c) if any Interest Period for a Eurodollar Loan begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period, such Interest Period shall end on the last Business Day of such calendar month;
(d) if any Interest Period for a Eurodollar Loan would otherwise expire on a day which is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided, however, that if any Interest Period for a Eurodollar Loan would otherwise expire on a day which is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the next preceding Business Day;
(e) unless the Required Lenders otherwise agree, no Interest Period may be selected at any time when a Default or an Event of Default is then in existence; and
(f) no Interest Period in respect of any Borrowing of any Tranche of Loans shall be selected which extends beyond the Maturity Date for such Tranche of Loans.
(i) on any Interest Determination Date that, by reason of any changes arising after the date of this Agreement affecting the applicable interbank market, adequate and fair means do not exist for ascertaining the applicable interest rate on the basis provided for in the definition of the respective Eurodollar Rate; or
(ii) at any time, that such Lender shall incur increased costs or reductions in the amounts received or receivable hereunder (and deemed by such Lender to be material) with respect to any Eurodollar Loan because of (x) any change since the Closing Date in any applicable law or governmental rule, regulation, order, guideline or request (whether or not having the force of law) or in the interpretation or administration thereof and including the introduction of any new law or governmental rule, regulation, order, guideline or request (other than with respect to any Tax, which shall be governed solely by Section 5.04), such as, but not limited to, a change in official reserve requirements, but, in all events, excluding reserves required under Regulation D to the extent included in the computation of the Eurodollar Rate, and/or (y) other circumstances arising since the Closing Date affecting such Lender, the interbank eurodollar market or the position of such Lender in such market; or
(iii) at any time, that the making or continuance of any Eurodollar Loan has been made unlawful by any law or governmental rule, regulation or order adopted or changed after the Closing Date which materially and adversely affects the applicable eurodollar; or
(iv) at any time that there is no market for Bankers’ Acceptances by reason of circumstances affecting the Canadian money market generally or the relevant Available Currency (other than U.S. Dollars) is not available in sufficient amounts, in either case as determined in good faith by the Administrative Agent, acting reasonably;
(b) At any time that any Eurodollar Loan is affected by the circumstances described in Section 2.10(a)(ii), the affected Borrower may, and in the case of a Eurodollar Loan affected by the circumstances described in Section 2.10(a)(iii), the affected Borrower shall, either (i) if the affected Eurodollar Loan is then being made initially or pursuant to a conversion, cancel such Borrowing by giving the Administrative Agent telephonic notice (confirmed in writing) on the same date that such Borrower was notified by the affected Lender or the Administrative Agent pursuant to Section 2.10(a)(ii) or (iii), or (ii) if the affected Eurodollar Loan is then outstanding, upon at least three Business Days’ written notice to the Administrative Agent, require the affected Borrower to convert such Eurodollar Loan into a Base Rate Loan (which conversion, in the case of the circumstance described in Section 2.10(a)(iii), shall occur no later than the last day of the Interest Period then applicable to such Eurodollar Loan or such earlier day as shall be required by applicable law); provided that if more than one Lender is affected at any time, then all affected Lenders must be treated the same pursuant to this Section 2.10(b).
(c) If any Lender determines that after the Closing Date the introduction of or any change in any applicable law or governmental rule, regulation, order, guideline, directive or request (whether or not having the force of law) concerning capital adequacy, or any change in interpretation or administration thereof by the NAIC or any Governmental Authority, central bank or comparable agency, will have the effect of increasing the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender based on the existence of such Lender’s Commitment hereunder or its obligations hereunder, by an amount deemed by such Lender to be material, then Holdings agrees to pay to such Lender, upon
its written demand therefor, such additional amounts as shall be required to compensate such Lender or such other corporation on an after-tax basis for the increased cost to such Lender or such other corporation or the reduction in the rate of return to such Lender or such other corporation as a result of such increase of capital. In determining such additional amounts, each Lender will act reasonably and in good faith and will use averaging and attribution methods which are reasonable; provided that such Lender’s determination of compensation owing under this Section 2.10(c) shall, absent manifest error, be final and conclusive and binding on all the parties hereto. Each Lender, upon determining that any additional amounts will be payable pursuant to this Section 2.10(c), will give prompt written notice thereof to Holdings, which notice shall show in reasonable detail the basis for calculation of such additional amounts, although the failure to give any such notice shall not release or diminish Holdings’ obligations to pay additional amounts pursuant to this Section 2.10(c) upon the subsequent receipt of such notice.
(b) Each Lender agrees that on the occurrence of any event giving rise to the operation of Section 2.10(a)(ii) or (iii), Section 2.10(c), Section 3.06 or Section 5.04 with respect to such Lender, it will, if requested by Holdings, use reasonable efforts (subject to overall policy considerations of such Lender) to designate another lending office for any Loans or Letters of Credit affected by such event; provided that such designation is made on such terms that such Lender and its lending office suffer no economic, legal or regulatory disadvantage, with the object of avoiding the consequence of the event giving rise to the operation of such Section. Nothing in this Section 2.12(b) shall affect or postpone any of the obligations of any Borrower or the right of any Lender provided in Sections 2.10, 3.06 and 5.04.
(i) at the time of any replacement pursuant to this Section 2.13, the Replacement Lender shall enter into one or more Assignment and Assumption Agreements pursuant to Section 13.04(b) (and with all fees payable pursuant to said Section 13.04(b) to be paid by the Borrowers or, if otherwise agreed, the Replacement Lender) pursuant to which the Replacement Lender shall acquire the entire Commitment and all outstanding Revolving Loans (other than Bankers’ Acceptance Loans) and all participations in Letters of Credit by, the Replaced Lender and, in connection therewith, shall pay to (i) the Replaced Lender in respect thereof an amount equal to the sum of (A) an amount equal to the principal of, and all accrued interest on, all outstanding Loans (other than Bankers’ Acceptances and B/A Equivalent Notes) of the respective Replaced Lender with respect to which such Replaced Lender is being replaced, (B) an amount equal to the Face Amount of any outstanding B/A Instrument of the respective Replaced Lender in satisfaction of the obligations of the Borrower to repay the B/A Instrument on
the maturity thereof, (C) an amount equal to all Unpaid Drawings (if any) that have been funded by (and not reimbursed to) such Replaced Lender, together with all then unpaid interest with respect thereto at such time and (D) an amount equal to all accrued, but theretofore unpaid, Fees owing to the Replaced Lender pursuant to Section 4.01, (ii) each Issuing Lender an amount equal to such Replaced Lender’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of any Unpaid Drawing relating to Letters of Credit issued by such Issuing Lender under such Tranche (which at such time remains an Unpaid Drawing) to the extent such amount was not theretofore funded by such Replaced Lender and (iii) the Swingline Lender an amount equal to such Replaced Lender’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of any Mandatory Borrowing under such Tranche to the extent such amount was not theretofore funded by such Replaced Lender to the Swingline Lender; and
(ii) all obligations of the Borrowers then owing to the Replaced Lender (other than those specifically described in clause (i) above in respect of which the assignment purchase price has been, or is concurrently being, paid, but including all amounts, if any, owing under Section 2.11 shall be paid in full to such Replaced Lender concurrently with such replacement) shall be paid in full to such Replaced Lender concurrently with such replacement.
(b) At the time of the provision of Incremental Commitments pursuant to this Section 2.14, (I) Holdings, each other Borrower, each Guarantor, the Administrative Agent and each such Lender or other Eligible Transferee which agrees to provide an Incremental Commitment (each, an “Incremental Lender”) shall execute and deliver to Holdings and the Administrative Agent an Incremental Commitment Agreement, appropriately completed (with the effectiveness of the Incremental Commitment provided therein to occur on the date set forth in such Incremental Commitment Agreement, which date in any event shall be no earlier than the date on which (i) all fees required to be paid in connection therewith at the time of such effectiveness shall have been paid, (ii) all Incremental Commitment Requirements have been satisfied, (iii) all conditions set forth in this Section 2.14 shall have been satisfied and (iv) all other conditions precedent that may be set forth in such Incremental Commitment Agreement shall have been satisfied) and (II) Holdings, each other Borrower, each Guarantor, the Security Agent and each Incremental Lender (as applicable) shall execute and deliver to the Administrative Agent and the Security Agent such additional Security Documents and/or amendments to the Security Documents as the Administrative Agent may reasonably request which are necessary to ensure that all Loans incurred pursuant to the Incremental Commitments and any Additional Commitment Fee and/or Additional Margin are secured by each relevant Security Document (the “Incremental Security Documents”). The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Incremental Commitment Agreement and, at such time, Schedule 1.01(a) shall be deemed modified to reflect the Incremental Commitments of such Incremental Lenders.
(c) It is understood and agreed that the Incremental Commitments provided by an Incremental Lender or Incremental Lenders, as the case may be, pursuant to each Incremental Commitment Agreement shall constitute part of, and be added to, the U.S. Facility Commitment and/or the Canadian Facility Commitment, as the case may be, and each Incremental Lender shall constitute a U.S. Facility Lender and/or Canadian Facility Lender, as applicable, for all purposes of this Agreement and each other applicable Loan Document.
(d) At the time of any provision of Incremental Commitments pursuant to this Section 2.14, each Borrower shall, in coordination with the Administrative Agent, repay outstanding Revolving Loans of certain of the Lenders, and incur additional Revolving Loans from certain other Lenders (including the Incremental Lenders), in each case to the extent necessary so that all of the U.S. Facility Lenders and/or Canadian Lenders, as applicable, participate in each outstanding Borrowing of each Tranche of Revolving Loans pro rata on the basis of their respective Commitments (after giving effect to any increase in the Total Commitment pursuant to this Section 2.14) and with the Borrowers being obligated to pay to the respective Lenders any costs of the type referred to in Section 2.11 in connection with any such repayment and/or Borrowing.
(b) For the purposes of the Interest Act (Canada) and with respect to Canadian Borrowers only:
(i) whenever any interest or fee payable by the Canadian Borrowers is calculated using a rate based on a year of 360 days or 365 days, as the case may be, the rate determined pursuant to such calculation, when expressed as an annual rate, is equivalent to (x) the applicable rate based on a year of 360 days or 365 days, as the case may be, (y) multiplied by the actual number of days in the calendar year in which such rate is to be ascertained and (z) divided by 360 or 365, as the case may be; and
(ii) all calculations of interest payable by the Canadian Borrowers under this Agreement or any other Loan Document are to be made on the basis of the nominal interest rate described herein and therein and not on the basis of effective yearly rates or on any other basis which gives effect to the principle of deemed reinvestment of interest. The parties hereto acknowledge that there is a material difference between the stated nominal interest rates and the effective yearly rates of interest and that they are capable of making the calculations required to determine such effective yearly rates of interest.
(c) The parties hereto acknowledge and agree that clauses (a) and (b) of this Section 2.15 only apply to the Canadian Borrowers and shall not otherwise reduce or effect the obligations of the U.S. Borrowers under this Agreement to pay the full amount of the Obligations of such U.S. Borrowers in accordance with the terms of this Agreement (including to reimburse the Administrative Agent and the applicable Lenders for any amounts refunded by the Administrative Agent or any Lender to the Canadian Borrowers pursuant to clause (a) of this Section 2.15).
(a) if any U.S. Facility Swingline Exposure or U.S. Facility Letter of Credit Exposure exists at the time a Lender becomes a Defaulting Lender then:
(b) if any Canadian Facility Swingline Exposure or Canadian Facility Letter of Credit Exposure exists at the time a Lender becomes a Defaulting Lender then:
(c) so long as any U.S. Facility Lender is a Defaulting Lender, the Swingline Lender shall not be required to fund any U.S. Facility Swingline Loan and no Issuing Lender shall be required to issue, amend or increase any U.S. Facility Letter of Credit, unless it is satisfied that the related exposure will be 100% covered by the U.S. Facility Commitments of the Non-Defaulting Lenders and/or cash collateral will be provided by the applicable Borrowers in accordance with Section 2.18(a), and participating interests in any such newly issued or increased U.S. Facility Letter of Credit or newly made U.S. Facility Swingline Loan shall be allocated among U.S. Facility Lender that are Non-Defaulting Lenders in a manner consistent with Section 2.18(a)(i) (and Defaulting Lenders shall not participate therein); and
(d) so long as any Canadian Facility Lender is a Defaulting Lender, the Swingline Lender shall not be required to fund any Canadian Facility Swingline Loan and no Issuing Lender shall be required to issue, amend or increase any Canadian Facility Letter of Credit, unless it is satisfied that the related exposure will be 100% covered by the Canadian Facility Commitments of the Non-Defaulting Lenders and/or cash collateral will be provided by the applicable Borrowers in accordance with Section 2.18(b), and participating interests in any such newly issued or increased Canadian Facility Letter of Credit or newly made Canadian Facility Swingline Loan shall be allocated among Canadian Facility Lender that are Non-Defaulting Lenders in a manner consistent with Section 2.18(b)(i) (and Defaulting Lenders shall not participate therein).
(a) Notwithstanding anything to the contrary in this Agreement, subject to the terms of this Section 2.19, the Borrowers may extend the maturity date, and otherwise modify the terms of each of the Tranches, or any portion thereof (including, without limitation, by increasing the interest rate or fees payable in respect of any Loans and/or Commitments applicable to a Tranche, or any portion thereof (and related outstandings) (the “Extension”) pursuant to a written offer (the “Extension Offer”) made by Holdings to all Lenders, in each case on a pro rata basis under each Tranche (based on the aggregate outstanding principal amount of the respective outstanding Loans and unfunded Commitments of such Tranche) and on the same terms to each such Lender. In connection with the Extension, Holdings will provide notification to the Administrative Agent (for distribution to the Lenders), not earlier than 18 months and not later than 6 months prior to the Initial Revolving Loan Maturity Date of the requested Extension and new Extended Revolving Loan Maturity Date. In connection with the Extension, each Lender of the applicable Tranche, acting in its sole and individual discretion, wishing to participate in the Extension shall, prior to the date (the “Notice Date”) that is 30 days after delivery of notice by the Administrative Agent to such Lender, provide the Administrative Agent with a written notice thereof in a form reasonably satisfactory to the Administrative Agent. Any Lender that does not respond to the Extension Offer by the Notice Date shall be deemed to have rejected such Extension. The Administrative Agent shall promptly notify Holdings of each Lender’s determination under this Section 2.19(a). The election of any Lender to agree to the Extension shall not obligate any other Lender to so agree. After giving effect to the Extension, the U.S. Facility Commitments and Canadian Facility Commitments so extended shall cease to be a part of the Tranche they were a part of immediately prior to the Extension and shall be a new Tranche hereunder.
(b) Holdings shall have the right to replace each Lender that shall have rejected (or be deemed to have rejected) the Extension under Section 2.19(a) with, and add as
“Lenders” under this Agreement in place thereof, one or more Replacement Lenders as provided in Section 2.13; provided that each of such Replacement Lenders shall enter into an Assignment and Assumption Agreement pursuant to which such Replacement Lender shall, effective as of a closing date selected by the Administrative Agent in consultation with Holdings (which shall occur no later than 30 days following the Notice Date and shall occur on the same date as the effectiveness of the Extension as to the Lenders which have consented thereto pursuant to Section 2.19(a)), undertake the U.S. Facility Commitment and Canadian Facility Commitment of such Replaced Lender (and, if any such Replacement Lender is already a Lender, its U.S. Facility Commitment and Canadian Facility Commitment shall be in addition to such Lender’s U.S. Facility Commitment and Canadian Facility Commitment hereunder on such date).
(c) The Extension shall be subject to the following:
(i) no Default or Event of Default shall have occurred and be continuing at the time any offering document in respect of the Extension Offer is delivered to the Lenders and at the time of the Extension;
(ii) (A) except as to interest rates, utilization fees, unused fees and final maturity, the U.S. Facility Commitment of any U.S. Facility Lender extended pursuant to the Extension (the “Extended U.S. Facility Commitment”), and the related outstandings, shall be a U.S. Facility Commitment (or related outstandings, as the case may be) with the same terms as the original U.S. Facility Commitments (and related outstandings); provided that, subject to the provisions of Sections 3.07 and 2.01(f) to the extent dealing with Swingline Loans and Letters of Credit which mature or expire after the Initial Revolving Loan Maturity Date, all U.S. Facility Swingline Loans and U.S. Facility Letters of Credit shall be participated in on a pro rata basis by all U.S. Facility Lenders with U.S. Facility Commitments and/or Extended U.S. Facility Commitments in accordance with their U.S. Facility RL Percentages (and except as provided in Sections 3.07 and 2.01(f), without giving effect to changes thereto on the Initial Revolving Loan Maturity Date with respect to U.S. Facility Swingline Loans and U.S. Facility Letters of Credit theretofore incurred or issued) and all borrowings under U.S. Facility Commitments and repayments thereunder shall be made on a pro rata basis (except for (x) payments of interest and fees at different rates on Extended U.S. Facility Commitments (and related outstandings) and (y) repayments required upon any Revolving Loan Maturity Date of any Tranche of U.S. Facility Commitments or Extended U.S. Facility Commitments); and
(iii) (A) if the aggregate principal amount of U.S. Facility Commitments in respect of which U.S. Facility Lenders shall have accepted the Extension Offer shall exceed the maximum aggregate principal amount of U.S. Facility Commitments offered to be extended by Holdings pursuant to the Extension Offer, then the U.S. Facility Commitments of such U.S. Facility Lenders shall be extended ratably up to such maximum amount based on the respective principal amounts (but not to exceed actual holdings of record) with respect to which such U.S. Facility Lenders have accepted the Extension Offer; and
(B) if the aggregate principal amount of Canadian Facility Commitments in respect of which Canadian Facility Lenders shall have accepted the Extension Offer shall exceed the maximum aggregate principal amount of Canadian Facility Commitments offered to be extended by Holdings pursuant to the Extension Offer, then the Canadian Facility Commitments of such Canadian Facility Lenders shall be extended ratably up to such maximum amount based on the respective principal amounts (but not to exceed actual holdings of record) with respect to which such Canadian Facility Lenders have accepted the Extension Offer;
(iv) all documentation in respect of the Extension shall be consistent with the foregoing, and all written communications by the Borrowers under the applicable Tranche generally directed to the Lenders under such Tranche in connection therewith shall be in form and substance consistent with the foregoing and otherwise reasonably satisfactory to the Administrative Agent;
(v) the Minimum Extension Condition shall be satisfied; and
(vi) the Extension shall not become effective unless, on the proposed effective date of the Extension, (x) the Borrowers shall deliver to the Administrative Agent a certificate of an Authorized Officer of each Loan Party dated the applicable date of the Extension and executed by an Authorized Officer of such Loan Party certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such extension and (y) the conditions set forth in Section 7 shall be satisfied (with all references in such Section to any Credit Event being deemed to be references to the Extension on the applicable date of the Extension) and the Administrative Agent shall have received a certificate to that effect dated the applicable date of the Extension and executed by a Financial Officer of each Borrower.
(d) With respect to the Extension consummated by the Borrowers pursuant to this Section 2.19, (i) the Extension shall not constitute voluntary or mandatory payments or prepayments for purposes of Sections 5.01, 5.02, 5.03, 13.02 or 13.06, (ii) the Extension Offer shall contain a condition (a “Minimum Extension Condition”) to consummating the Extension that (x) at least 60% of the aggregate amount of the U.S. Facility Commitments in effect immediately prior to the Initial Revolving Loan Maturity Date (unless another amount is agreed to by the Administrative Agent) and (y) at least 60% of the aggregate amount of the Canadian Facility Commitments in effect immediately prior to the Initial Revolving Loan Maturity Date (unless another amount is agreed to by the Administrative Agent), shall, in each case, be in effect immediately following the Initial Revolving Loan Maturity Date, (iii) if the amount extended is less than the Maximum U.S. Facility Letter of Credit Amount, the Maximum U.S. Facility Letter of Credit Amount shall be reduced upon the date that is five (5) Business Days prior to the Initial Revolving Loan Maturity Date (to the extent needed so that the Maximum U.S. Facility Letter of Credit Amount does not exceed the aggregate U.S. Facility Commitment which would be in effect after the Initial Revolving Loan Maturity Date), and, if applicable, the Borrowers under such Tranche shall cash collateralize obligations under any issued U.S. Facility Letters of Credit in an amount equal to 100% of the Stated Amount of such U.S. Facility Letters of Credit, (iv) if the amount extended is less than the Maximum Canadian Facility Letter of Credit Amount, the Maximum Canadian Facility Letter of Credit Amount shall be reduced upon the date that is five (5) Business Days prior to the Initial Revolving Loan Maturity Date (to the extent needed so that the Maximum Canadian Facility Letter of Credit Amount does not exceed the aggregate Canadian Facility Commitment which would be in effect after the Initial Revolving Loan Maturity Date), and, if applicable, the Borrowers under such Tranche shall cash collateralize obligations under any issued Canadian Facility Letters of Credit in an amount equal to 100% of the Stated Amount of such Canadian Facility Letters of Credit, (v) if the amount extended is less than the Maximum U.S. Facility Swingline Amount, the Maximum U.S. Facility Swingline Amount shall be reduced upon the date that is five (5) Business Days prior to the Initial Revolving Loan Maturity Date (to the extent needed so that the Maximum U.S. Facility Swingline Amount does not exceed the aggregate U.S. Facility Commitment which would be in effect after the Initial Revolving Loan Maturity Date), and, if applicable, the Borrowers under such Tranche shall prepay any outstanding U.S. Swingline Loans, and (vi) if the amount extended is less than the Maximum Canadian Facility Swingline Amount, the Maximum Canadian Facility Swingline Amount shall be reduced upon the date that is five (5) Business Days prior to the Initial Revolving Loan Maturity Date (to the extent needed so that the Maximum Canadian Facility Swingline Amount does not exceed the aggregate Canadian Facility Commitment which would be in effect after the Initial Revolving Loan Maturity Date), and, if applicable, the Borrowers under such Tranche shall prepay any outstanding Canadian Swingline Loans. The Administrative Agent and the Lenders hereby consent to the Extension and the other transactions contemplated by this Section 2.19 (including, for the avoidance of doubt, payment of any interest or fees in respect of any Extended U.S. Facility Commitments and Extended Canadian Facility Commitments on the such terms as may be set forth in the Extension Offer) and hereby waive the requirements of any provision of this Credit Agreement (including, without limitation, Sections 5.01, 5.02, 5.03, 13.02 or 13.06) or any other Loan Document that may otherwise prohibit the Extension or any other transaction contemplated by this Section 2.19, provided that such consent shall not be deemed to be an acceptance of the Extension Offer.
(e) The Lenders hereby irrevocably authorize the Administrative Agent to enter into amendments to this Credit Agreement and the other Loan Documents with the Borrowers as may be necessary in order establish new Tranches or sub-Tranches in respect of U.S. Facility Commitments and Canadian Facility Commitments so extended and such technical amendments as may be necessary in connection with the establishment of such new Tranches or sub-Tranches, in each case on terms consistent with this Section 2.19. Notwithstanding the foregoing, the Administrative Agent shall have the right (but not the obligation) to seek the advice or concurrence of the Required Lenders with respect to any matter contemplated by this Section 2.19 and, if the Administrative Agent seeks such advice or concurrence, the Administrative Agent shall be permitted to enter into such amendments with the Borrowers in accordance with any instructions actually received by such Required Lenders and shall also be entitled to refrain from entering into such amendments with the Borrowers unless and until it shall have received such advice or concurrence; provided, however, that whether or not there has been a request by the Administrative Agent for any such advice or concurrence, all such amendments entered into with the Borrowers by the Administrative Agent hereunder shall be binding and conclusive on the Lenders. Without limiting the foregoing, in connection with the Extension, the respective Loan Parties shall (at their expense) amend (and the Administrative Agent is hereby directed to amend) any Mortgage that has a maturity date prior to the Extended Revolving Loan Maturity Date so that such maturity date is extended to the Extended Revolving Loan Maturity Date (or such later date as may be advised by local counsel to the Administrative Agent).
(f) In connection with the Extension, Holdings shall provide the Administrative Agent at least ten (10) Business Days’ (or such shorter period as may be agreed by the Administrative Agent) prior written notice thereof, and shall agree to such procedures, if any, as may be reasonably established by, or reasonably acceptable to, the Administrative Agent, in each case acting reasonably to accomplish the purposes of this Section 2.19.
(b) Subject to and upon the terms and conditions set forth herein (including, without limitation, the conditions set forth in Section 7), each Issuing Lender agrees that it will, at any time and from time to time on and after the Funding Date and prior to the 30th day prior to the Revolving Loan Maturity Date, following its receipt of the respective Letter of Credit Request, issue for (i) in the case of a request for a U.S. Facility Letter of Credit, for the joint and several account of the U.S. Borrowers, (ii) in the case of a request for a Canadian Facility Letter of Credit by a U.S. Borrower, for the joint and several account of the U.S. Borrowers and (iii) in the case of a request for a Canadian Facility Letter of Credit by a Canadian Borrower, for the joint and several account of the Canadian Borrowers, and one or more Letters of Credit, in each case as are permitted to remain outstanding hereunder without giving rise to a Default or an Event of Default; provided that no Issuing Lender shall be under any obligation to issue any Letter of Credit of the types described above if at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuing Lender from issuing such Letter of Credit or any requirement of law applicable to such Issuing Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing Lender shall prohibit, or request that such Issuing Lender refrain from, the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon such Issuing Lender with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuing Lender is not otherwise compensated hereunder) not in effect with respect to such Issuing Lender on the date hereof, or any unreimbursed loss, cost or expense which was not applicable or in effect with respect to such Issuing Lender as of the date hereof and which such Issuing Lender reasonably and in good faith deems material to it and for which such Issuing Lender is not otherwise entitled to reimbursement or indemnification hereunder and has not received assurances satisfactory to such Issuing Lender that it will be paid; or
(ii) such Issuing Lender shall have received from any Borrower, any other Loan Party or the Required Lenders prior to the issuance of such Letter of Credit notice of the type described in the second sentence of Section 3.03(b).
(b) The making of each Letter of Credit Request shall be deemed to be a representation and warranty by such requesting Borrower to the Lenders of the respective Tranche that such Letter of Credit may be issued in accordance with, and will not violate the requirements of, Section 3.02. Unless the respective Issuing Lender has received notice from any Borrower, any other Loan Party or the Required Lenders before it issues a Letter of Credit that one or more of the conditions specified in Section 6 or 7 are not then satisfied, or that the issuance of such Letter of Credit would violate Section 3.02, then such Issuing Lender shall, subject to the terms and conditions of this Agreement, issue the requested Letter of Credit for the account of such Borrower (and the U.S. Borrowers in a combined fashion, or the Canadian Borrowers in a combined fashion, as the case may be) in accordance with such Issuing Lender’s usual and customary practices. Upon the issuance of or modification or amendment to any standby Letter of Credit, each Issuing Lender shall promptly notify the Borrower to be named as account party therein and the Administrative Agent, in writing of such issuance, modification or amendment and such notice shall be accompanied by a copy of such Letter of Credit or the respective modification or amendment thereto, as the case may be. Promptly after receipt of such notice the Administrative Agent shall notify the Participants, in writing, of such issuance, modification or amendment. On the first Business Day of each week, each Issuing Lender shall furnish the Administrative Agent with a written (including via facsimile) report of the daily aggregate outstandings of Letters of Credit issued by such Issuing Lender for the immediately preceding week.
(c) The initial Stated Amount of each Letter of Credit shall not be less than $10,000 (or, in the case of a Letter of Credit issued in a currency other than U.S. Dollars, the U.S. Dollar Equivalent thereof) or such lesser amount as is acceptable to the respective Issuing Lender.
(b) In determining whether to pay under any Letter of Credit under a Tranche, no Issuing Lender shall have any obligation relative to the other Lenders under such Tranche other than to confirm that any documents required to be delivered under such Letter of Credit appear to have been delivered and that they appear to substantially comply on their face with the requirements of such Letter of Credit. Any action taken or omitted to be taken by an Issuing Lender under or in connection with any Letter of Credit issued by it shall not create for such Issuing Lender any resulting liability to any Borrower, any other Loan Party, any Lender or any other Person unless such action is taken or omitted to be taken with gross negligence or willful misconduct on the part of such Issuing Lender (as determined by a court of competent jurisdiction in a final and non-appealable decision).
(c) In the event that an Issuing Lender makes any payment under any Letter of Credit under a Tranche issued by it and the U.S. Borrowers or the Canadian Borrowers, as applicable, shall not have reimbursed such amount in full to such Issuing Lender pursuant to Section 3.05(a), such Issuing Lender shall promptly notify the Administrative Agent, which shall promptly notify each Participant under such Tranche of such failure, and each such Participant shall promptly and unconditionally pay to such Issuing Lender the amount of such Participant’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of such unreimbursed payment in U.S. Dollars (or, in the case of any unreimbursed payment made in a currency other than U.S. Dollars, the U.S. Dollar Equivalent of such unreimbursed payment, as determined by the Issuing Lender on the date on which such unreimbursed payment was made by such Issuing Lender) in immediately available funds. If the Administrative Agent so notifies, prior to 12:00 Noon (New York City time) on any Business Day, any Participant under a Tranche required to fund a payment under a Letter of Credit under such Tranche, such Participant shall make available to the respective Issuing Lender in U.S. Dollars (or, in the case of any unreimbursed payment made in a currency other than U.S. Dollars, the U.S. Dollar Equivalent thereof) such Participant’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of the amount of such payment on such Business Day in immediately available funds. If and to the extent such Participant shall not have so made its U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of the amount of such payment available to the respective Issuing Lender, such Participant agrees to pay to such Issuing Lender, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to such Issuing Lender at the overnight Federal Funds Rate (or, in the case of any unreimbursed payment made in a currency other than U.S. Dollars, at the respective Issuing Lender’s customary rate for interbank advances) for the first three days and at the interest rate applicable to U.S. Dollar Denominated Revolving Loans that are maintained as Base Rate Loans for each day thereafter. The failure of any Participant under a Tranche to make available to an Issuing Lender its U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of any payment under any Letter of Credit under such Tranche issued by such Issuing Lender shall not relieve any other Participant under such Tranche of its obligation hereunder to make available to such Issuing Lender its U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of any payment under any Letter of Credit under such Tranche on the date required, as specified above, but no Participant under such Tranche shall be responsible for the failure of any other Participant under such Tranche to make available to such Issuing Lender such other Participant’s U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be, of any such payment.
(d) Whenever an Issuing Lender receives a payment of a reimbursement obligation as to which it has received any payments from the Participants pursuant to clause (c) above, such Issuing Lender shall pay to each such Participant which has paid its applicable U.S. Facility RL Percentage or Canadian Facility RL Percentage thereof, in U.S. Dollars (or, in the case of any unreimbursed payment made in a currency other than U.S. Dollars, the U.S. Dollar Equivalent thereof) and in same day funds, an amount equal to such Participant’s share (based upon the proportionate aggregate amount originally funded by such Participant to the aggregate amount funded by all Participants in respect of such participation) of the principal amount of such reimbursement obligation and interest thereon accruing after the purchase of the respective participations.
(e) Upon the request of any Participant under a Tranche, each Issuing Lender shall furnish to such Participant copies of any standby Letter of Credit under such Tranche issued by it and such other documentation as may reasonably be requested by such Participant.
(f) The obligations of the Participants under a Tranche to make payments to each Issuing Lender with respect to Letters of Credit under such Tranche shall be irrevocable and not subject to any qualification or exception whatsoever and shall be made in accordance with the terms and conditions of this Agreement under all circumstances, including, without limitation, any of the following circumstances:
(i) any lack of validity or enforceability of this Agreement or any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense or other right which Holdings or any of its Subsidiaries may have at any time against a beneficiary named in a Letter of Credit, any transferee of any Letter of Credit (or any Person for whom any such transferee may be acting), the Administrative Agent, any Participant, or any other Person, whether in connection with this Agreement, any Letter of Credit, the transactions contemplated herein or any unrelated transactions (including any underlying transaction between Holdings or any Subsidiary of Holdings and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented under any 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;
(iv) the surrender or impairment of any security for the performance or observance of any of the terms of any of the Loan Documents; or
(v) the occurrence of any Default or Event of Default.
(b) The joint and several obligations of such U.S. Borrowers or such Canadian Borrowers, as the case may be, under this Section 3.05 to reimburse each Issuing Lender with respect to drafts, demands and other presentations for payment under Letters of Credit issued by it (each, a “Drawing”) (including, in each case, interest thereon) shall be absolute and unconditional under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment which Holdings, any Borrower or any other Subsidiary of Holdings may have or have had against any Lender under the respective Tranche (including in its capacity as an Issuing Lender or as a Participant under such Tranche), including, without limitation, any defense based upon the failure of any drawing under a Letter of Credit to conform to the terms of the Letter of Credit or any nonapplication or misapplication by the beneficiary of the proceeds of such Drawing; provided, however, that no Borrower shall be obligated to reimburse any Issuing Lender for any wrongful payment made by such Issuing Lender under a Letter of Credit issued by it as a result of acts or omissions constituting willful misconduct or gross negligence on the
part of such Issuing Lender (as determined by a court of competent jurisdiction in a final and non-appealable decision).
(b) (i) Each U.S. Borrower, in the case of a U.S. Facility Letter of Credit, hereby jointly and severally agrees, (ii) each U.S. Borrower, in the case of a Canadian Facility Letter of Credit issued for the account of a U.S. Borrower, hereby jointly and severally agrees and (iii) each Canadian Borrower, in the case of a Canadian Facility Letter of Credit issued for the account of a Canadian Borrower, hereby jointly and severally agrees, in each case, to pay to the Administrative Agent for distribution to each Non-Defaulting Lender under the respective Tranche (based on each such Lender’s respective U.S. Facility RL Percentage or Canadian Facility RL Percentage, as the case may be) a fee in respect of each Letter of Credit issued for the account of such U.S. Borrower or such Canadian Borrower, as applicable (the “Letter of Credit Fee”) for the period from and including the date of issuance of such Letter of Credit to and including the date of termination or expiration of such Letter of Credit, computed at a rate per annum equal to the Applicable Margin as in effect from time to time during such period with respect to Revolving Loans that are maintained as Eurodollar Loans on the daily Stated Amount of each such Letter of Credit. Accrued Letter of Credit Fees shall be due and payable quarterly in arrears on each Quarterly Payment Date and on the first day on or after the termination of the Total U.S. Facility Commitment or Total Canadian Facility Commitment, as the case may be, upon which no Letters of Credit under the respective Tranche remain outstanding.
(c) (i) Each U.S. Borrower, in the case of a U.S. Facility Letter of Credit, hereby jointly and severally agrees, (ii) each U.S. Borrower, in the case of a Canadian Facility Letter of Credit issued for the account of a U.S. Borrower, hereby jointly and severally agrees and (iii) each Canadian Borrower, in the case of a Canadian Facility Letter of Credit issued for the account of a Canadian Borrower, hereby jointly and severally agrees, in each case, to pay to each Issuing Lender, for its own account, a facing fee in respect of each Letter of Credit issued by it for the account of such U.S. Borrower or such Canadian Borrower, as applicable (the “Facing Fee”) as may have been, or are hereafter, agreed to in writing from time to time by Holdings and such Issuing Lender.
(d) (i) Each U.S. Borrower, in the case of a U.S. Facility Letter of Credit, hereby jointly and severally agrees, (ii) each U.S. Borrower, in the case of a Canadian Facility Letter of Credit issued for the account of a U.S. Borrower, hereby jointly and severally agrees and (iii) each Canadian Borrower, in the case of a Canadian Facility Letter of Credit issued for the account of a Canadian Borrower, hereby jointly and severally agrees, in each case, to pay to
each Issuing Lender, for its own account, upon each payment under, issuance of, or amendment to, any Letter of Credit issued by it for the account of such U.S. Borrower or such Canadian Borrower, as applicable, such amount as shall at the time of such event be the administrative charge and the reasonable expenses which such Issuing Lender is generally imposing in connection with such occurrence with respect to letters of credit.
(e) (i) Each U.S. Borrower, in the case of U.S. Facility Bankers’ Acceptance Loans, hereby jointly and severally agrees, (ii) each U.S. Borrower, in the case of Canadian Facility Bankers’ Acceptance Loans made to them, hereby jointly and severally agrees and (iii) each Canadian Borrower, in the case of Canadian Facility Bankers’ Acceptance Loans made to them, hereby jointly and severally agrees, in each case, to pay Drawing Fees at the time of the incurrence (by way of acceptance, purchase or otherwise) of each such respective Bankers’ Acceptance Loan.
(f) The applicable Borrowers agree to pay to each Agent such fees as may have been, or are hereafter, agreed to in writing from time to time by Holdings or any of its Subsidiaries and such Agent on the basis and to the extent set forth therein.
(b) In addition to any other mandatory commitment reductions pursuant to this Section 4.03(b), the Total Commitment (and the Commitments of each Lender) shall terminate in its entirety upon the earlier of (i) the Revolving Loan Maturity Date and (ii) unless the Required Lenders otherwise agree in writing, the date on which a Change of Control occurs.
(ii) In connection with any repayment and/or cash collateralization required pursuant to Section 5.02(a)(i) on any day, the Borrowers shall prepay the Loans in the following order:
(iii) If the conditions set forth in Section 5.02(a)(i)(x) or (y) exist or, after giving effect to the prepayment of all Loans under a Tranche (other than Bankers’ Acceptance Loans where the underlying B/A Instrument has not matured), the conditions set forth in Section 5.02(a)(i) continue to exist, the respective Borrowers shall pay to the Administrative Agent at the Payment Office on such day an amount of cash and/or Permitted Investments equal to 105% of the amount of such excess, such cash and/or Permitted Investments to be held as security for all Obligations of the Borrowers to the Issuing Lenders and the Lenders, in each case, under such Tranche hereunder in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent (and which cash and/or Permitted Investments may, without limiting the Borrowers’ obligations in respect thereof, be paid to and applied by such Issuing Lenders in satisfaction of the Obligations of the Borrowers to such Issuing Lenders and/or Lenders in respect of any Drawings made under any Letter of Credit under such Tranche issued for the account of a Borrower or such Bankers’ Acceptance Loans under such Tranche on the respective maturity dates thereof).
(b) In addition to any other mandatory repayments pursuant to this Section 5.02, all then outstanding Loans shall be repaid in full and the respective Borrowers shall pay to the Administrative Agent at the Payment Office on such day an amount of cash and/or Permitted Investments equal to 105% of the amount of such excess, such cash and/or Permitted Investments to be held as security for all Obligations of the applicable Borrower to the applicable Issuing Lenders and Lenders hereunder in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent (and which cash and/or Permitted Investments may, without limiting the Borrowers’ obligations in respect thereof, be paid to and applied by such Issuing Lenders and/or Lenders in satisfaction of the Obligations of the Borrowers to such Issuing Lenders and/or Lenders in respect of any Drawings made under any Letter of Credit issued for the account of a Borrower or such Bankers’ Acceptance Loan on the respective maturity dates thereof), in each case on the Initial Revolving Loan Maturity Date (or, in the case of any Extended U.S. Facility Commitments and Extended Canadian Facility Commitments, the Extended Revolving Loan Maturity Date).
(c) In addition to any other mandatory repayments pursuant to this Section 5.02, each Swingline Loan under a Tranche will be repaid (for the avoidance of doubt,
such repayment may be made with proceeds from Revolving Loans under such Tranche incurred by the same Borrower), no later than the seventh day following the incurrence thereof; provided that, if the seventh day is not a Business Day, such repayment shall be made on the next succeeding Business Day.
(b) Each U.S. Loan Party shall, along with the Security Agent, certain financial institutions selected by Holdings and reasonably acceptable to the Administrative Agent (the “U.S. Collection Banks”), and each of those banks in which each Core U.S. Concentration Account, U.S. Collection Account and Deposit Account (other than Excluded Accounts) are maintained by each such U.S. Loan Party, enter into, and thereafter maintain, separate Control Agreements in respect of each such Core U.S. Concentration Account, U.S. Collection Account and Deposit Account (other than Excluded Accounts) in compliance with the Collateral and Guarantee Requirements. Each U.S. Loan Party shall instruct all Account Debtors of the U.S. Loan Parties to remit all payments to the applicable “P.O. Boxes” or “Lockbox Addresses” of the applicable U.S. Collection Bank (or to remit such payments to the applicable U.S. Collection Bank by electronic settlement) with respect to all Accounts of such Account Debtor, which remittances shall be collected by the applicable U.S. Collection Bank and deposited in the applicable U.S. Collection Account. All amounts received by any U.S. Loan Party and any U.S. Collection Bank in respect of any Account of an Account Debtor of any U.S. Loan Party, in addition to all other cash received by any U.S. Loan Party from any other source, shall upon receipt be deposited into a U.S. Collection Account or a Core U.S. Concentration Account or, to the extent permitted hereunder in the case of amounts not constituting payments in respect of Accounts of any U.S. Loan Party, an Excluded Account or Term Sweep Account; provided that so long as no Dominion Period then exists collections with regard to such Accounts and with respect to inventory in an aggregate amount not to exceed $15,000,000 during any calendar month may be deposited in Canadian depository accounts of a Canadian Borrower so long as no later than 30 days following the end of each such month, such collections are settled through the intercompany accounting procedures of Holdings and its Subsidiaries.
(c) Each Canadian Loan Party shall, along with the Security Agent, certain financial institutions selected by Holdings and reasonably acceptable to the Administrative Agent (the “Canadian Collection Banks”), and each of those banks in which each Core Canadian Concentration Account, Canadian Collection Account and Deposit Account (other than Excluded Accounts) are maintained by each such Canadian Loan Party, enter into, and thereafter maintain, separate Control Agreements in respect of each such Core Canadian Concentration Account, Canadian Collection Account and Deposit Account (other than Excluded Accounts) in compliance with the Collateral and Guarantee Requirements. Each Canadian Loan Party shall instruct all Account Debtors of the Canadian Loan Parties to remit all payments to the applicable “P.O. Boxes” or “Lockbox Addresses” of the applicable Canadian Collection Bank (or to remit such payments to the applicable Canadian Collection Bank by electronic settlement) with respect to all Accounts of such Account Debtor, which remittances shall be collected by the applicable Canadian Collection Bank and deposited in the applicable Canadian Collection Account. All amounts received by any Canadian Loan Party and any Canadian Collection Bank in respect of any Account of an Account Debtor of any Canadian Loan Party, in addition to all other cash received by any Canadian Loan Party from any other source, shall upon receipt be deposited into a Canadian Collection Account, a Core Canadian Concentration Account or, to the extent permitted hereunder in the case of amounts not constituting payments in respect of Accounts of any Canadian Loan Party, an Excluded Account or Term Sweep Account.
(d) (i) All amounts deposited or held in all of the U.S. Collection Accounts with respect to each U.S. Loan Party and available for transfer shall be transferred by the close of business on each Business Day into one or more accounts with the Administrative Agent or a financial institution reasonably acceptable to the Administrative Agent (each a “Core U.S. Concentration Account” and collectively, the “Core U.S. Concentration Accounts”) unless such amounts are otherwise (A) required or permitted to be applied pursuant to Section 5.02 or (B) so long as no Dominion Period then exists, required to be retained in any U.S. Collection Account, in each case to satisfy the payment of outstanding obligations owing in respect of checks or similar obligations issued by any U.S. Loan Party, provided that the aggregate amount retained in all such U.S. Collection Accounts pursuant to this clause (B) shall not exceed that amount (as reasonably determined by Holdings) to cover all of the aggregate amount of all such outstanding obligations and (ii) all amounts deposited or held in all of the Canadian Collection Accounts with respect to each Canadian Loan Party and available for transfer shall be transferred by the close of business on each Business Day into one or more accounts with the Administrative Agent or a financial institution reasonably acceptable to the Administrative Agent (each, a “Core Canadian Concentration Account” and, collectively, the “Core Canadian Concentration Accounts”) unless such amounts are otherwise (A) required or permitted to be applied pursuant to Section 5.02 or (B) so long as no Dominion Period then exists, required to be retained in any Canadian Collection Account, in each case to satisfy the payment of outstanding obligations owing in respect of checks or similar obligations issued by any Canadian Loan Party, provided that the aggregate amount retained in all such Canadian Collection Accounts pursuant to this clause (B) shall not exceed that amount (as reasonably determined by Holdings) to cover all of the aggregate amount of all such outstanding obligations. Except as, and to the extent, permitted by this Section 5.03(d), and Section 10 each Collection Account shall have a zero balance immediately following the transfer of funds on each Business Day pursuant to the immediately preceding sentences. So long as no Dominion Period then exists, the Borrowers and the other Loan Parties shall be permitted to transfer cash from the Core Concentration Accounts to other
Deposit Accounts to be used for working capital and general corporate purposes all subject to the requirements of this Agreement (including this Section 5.03(d)). If a Dominion Period exists, all collected amounts held in the Core Concentration Accounts shall be applied as provided in Section 5.03(e) or (f), as applicable.
(e) Each Control Agreement relating to a Core U.S. Concentration Account shall (unless otherwise agreed by the Administrative Agent in its sole discretion) include provisions that allow, during any Dominion Period, for all collected amounts held in such Core U.S. Concentration Account from and after the date requested by the Administrative Agent, to be sent by ACH or wire transfer or similar electronic transfer no less frequently than once per Business Day to one or more accounts maintained by the Administrative Agent at DBNY (or if DBNY is not the Administrative Agent, at the institution designated by such successor Administrative Agent) or an affiliate thereof (each a “DB U.S. Account”). Subject to the terms of the respective Security Document, all amounts received in a DB U.S. Account during the existence of a Dominion Period shall be applied (and allocated) by the Administrative Agent on a daily basis in the following order (in each case to the extent the Administrative Agent has actual knowledge of the amounts owing or outstanding as described below, and after giving effect to the application of any such amounts constituting proceeds from any Collateral otherwise required to be applied pursuant to the terms of the respective Security Document during the existence of an Event of Default), subject to the provisions of the immediately succeeding sentence (to the extent applicable): (1) first, to the payment (on a ratable basis) of any outstanding Expenses actually due and payable by any U.S. Borrower to the Administrative Agent, the Co-Collateral Agents and the Security Agent under any of the Loan Documents; (2) second, to the extent all amounts referred to in preceding clause (1) have been paid in full, to pay (on a ratable basis) all outstanding Expenses actually due and payable by any U.S. Borrower to each Issuing Lender under any of the Loan Documents; (3) third, to the extent all amounts referred to in preceding clauses (1) and (2) have been paid in full, to pay (on a ratable basis) all accrued and unpaid interest actually due and payable on the U.S. Borrower Loans and then all accrued and unpaid Fees actually due and payable by any U.S. Borrower to the Administrative Agent, the Issuing Lenders and the Lenders under any of the Loan Documents; (4) fourth, to the extent all amounts referred to in preceding clauses (1) through (3), inclusive, have been paid in full, to pay (on a ratable basis) any and all unpaid principal of U.S. Borrower Loans and Unpaid Drawings in respect of Letters of Credit issued for the account of a U.S. Borrower in each case which are then actually due and payable; (5) fifth, to the extent all amounts referred to in preceding clauses (1) through (4), inclusive, have been paid in full, to repay or prepay outstanding U.S. Borrower Swingline Loans and to repay or prepay all outstanding U.S. Borrower Revolving Loans advanced by the Administrative Agent on behalf of the Lenders pursuant to Section 2.01(e); (6) sixth, to the extent all amounts referred to in preceding clauses (1) through (5), inclusive, have been paid in full, to repay (on a ratable basis) the outstanding principal of U.S. Borrower Revolving Loans (whether or not then due and payable, but excluding any outstanding Bankers’ Acceptance Loans where the underlying B/A Instrument has not matured), provided that, with respect to each repayment of U.S. Borrower Revolving Loans required by this Section 5.03(e)(6), so long as no Default or Event of Default then exists and less than all outstanding U.S. Borrower Revolving Loans would otherwise be required to be repaid pursuant hereto, the U.S. Borrowers may designate the Types of U.S. Borrower Revolving Loans which are to be repaid and, in the case of Eurodollar Loans which are U.S. Borrower Revolving Loans, the specific Borrowing or Borrowings pursuant to which such Eurodollar Loans were
made; (7) seventh, to the extent all amounts referred to in preceding clauses (1) through (6), inclusive, have been paid in full, but only if an Event of Default has occurred and is continuing, to cash collateralize (on a ratable basis) all outstanding Letters of Credit issued for the account of a U.S. Borrower and Bankers’ Acceptance Loans which are U.S. Borrower Revolving Loans where the underlying B/A Instrument has not matured (such cash collateral to be held by the Administrative Agent while an Event of Default exists in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent and applied to the Obligations of the U.S. Borrowers to the Issuing Lenders and/or Lenders in respect of any Drawings made under any such Letters of Credit or any such Bankers’ Acceptance Loans); (8) eighth, to the extent all amounts referred to in preceding clauses (1) through (7), inclusive, have been paid in full, to pay (on a ratable basis) all other outstanding Obligations of any U.S. Borrower then due and payable to the Administrative Agent, the Co-Collateral Agents, the Security Agent and the Lenders under any of the Loan Documents; and (9) ninth, to the U.S. Borrowers; provided that, with respect to any payments or cash collateralization required to be applied (or allocated) pursuant to preceding clauses (1) through (8), in each case, to the extent the outstanding Obligations under any such clause constitutes outstanding Obligations under more than one Tranche, any such payments or cash collateralization shall be applied (or allocated) under such clause to the outstanding Obligations under each Tranche on a pro rata basis based upon the outstanding Obligations with respect to such Tranches under such clause. Each U.S. Loan Party agrees that it will not cause any proceeds of any Core Concentration Account to be otherwise redirected.
(f) Each Control Agreement relating to a Core Canadian Concentration Account shall (unless otherwise agreed by the Administrative Agent in its sole discretion) include provisions that allow, during any Dominion Period, for all collected amounts held in such Core Canadian Concentration Account from and after the date requested by the Administrative Agent, to be sent by ACH or wire transfer or similar electronic transfer no less frequently than once per Business Day to one or more accounts maintained by the Administrative Agent at DBNY (or if DBNY is not the Administrative Agent, at the institution designated by such successor Administrative Agent) or an affiliate thereof (each a “DB Canadian Account”). Subject to the terms of the respective Security Document, all amounts received in a DB Canadian Account during the existence of a Dominion Period shall be applied (and allocated) by the Administrative Agent on a daily basis in the following order (in each case to the extent the Administrative Agent has actual knowledge of the amounts owing or outstanding as described below, and after giving effect to the application of any such amounts constituting proceeds from any Collateral otherwise required to be applied pursuant to the terms of the respective Security Document during the existence of an Event of Default), subject to the provisions of the immediately succeeding sentence (to the extent applicable): (1) first, to the payment (on a ratable basis) of any outstanding Expenses actually due and payable by any Canadian Borrower to the Administrative Agent, the Co-Collateral Agents and the Security Agent under any of the Loan Documents; (2) second, to the extent all amounts referred to in preceding clause (1) have been paid in full, to pay (on a ratable basis) all outstanding Expenses actually due and payable by any Canadian Borrower to each Issuing Lender under any of the Loan Documents; (3) third, to the extent all amounts referred to in preceding clauses (1) and (2) have been paid in full, to pay (on a ratable basis) all accrued and unpaid interest actually due and payable on the Canadian Borrower Loans and then all accrued and unpaid Fees actually due and payable by any Canadian Borrower to the Administrative Agent, the Issuing Lenders and the Lenders under any of the
Loan Documents; (4) fourth, to the extent all amounts referred to in preceding clauses (1) through (3), inclusive, have been paid in full, to pay (on a ratable basis) any and all unpaid principal of Canadian Borrower Loans and Unpaid Drawings in respect of Letters of Credit issued for the account of a Canadian Borrower in each case which are then actually due and payable; (5) fifth, to the extent all amounts referred to in preceding clauses (1) through (4), inclusive, have been paid in full, to repay or prepay outstanding Canadian Borrower Swingline Loans and to repay or prepay all outstanding Canadian Borrower Revolving Loans advanced by the Administrative Agent on behalf of the Lenders pursuant to Section 2.01(e); (6) sixth, to the extent all amounts referred to in preceding clauses (1) through (5), inclusive, have been paid in full, to repay (on a ratable basis) the outstanding principal of Canadian Borrower Revolving Loans (whether or not then due and payable, but excluding any outstanding Bankers’ Acceptance Loans where the underlying B/A Instrument has not matured), provided that, with respect to each repayment of Canadian Borrower Revolving Loans required by this Section 5.03(f)(6), so long as no Default or Event of Default then exists and less than all outstanding Canadian Borrower Revolving Loans would otherwise be required to be repaid pursuant hereto, the Canadian Borrowers may designate the Types of Canadian Borrower Revolving Loans which are to be repaid and, in the case of Eurodollar Loans which are Canadian Borrower Revolving Loans, the specific Borrowing or Borrowings pursuant to which such Eurodollar Loans were made; (7) seventh, to the extent all amounts referred to in preceding clauses (1) through (6), inclusive, have been paid in full, but only if an Event of Default has occurred and is continuing, to cash collateralize (on a ratable basis) all outstanding Letters of Credit issued for the account of a Canadian Borrower and Bankers’ Acceptance Loans which are Canadian Borrower Revolving Loans where the underlying B/A Instrument has not matured (such cash collateral to be held by the Administrative Agent while an Event of Default exists in a cash collateral account to be established by, and under the sole dominion and control of, the Administrative Agent and applied to the Obligations of the Canadian Borrowers to the Issuing Lenders and/or Lenders in respect of any Drawings made under any such Letters of Credit or Bankers’ Acceptance Loans); (8) eighth, to the extent all amounts referred to in preceding clauses (1) through (7), inclusive, have been paid in full, to pay (on a ratable basis) all other outstanding Obligations of any Canadian Borrower then due and payable to the Administrative Agent, the Co-Collateral Agents, the Security Agent and the Lenders under any of the Loan Documents; and (9) ninth, to the Canadian Loan Parties. Each Canadian Loan Party agrees that it will not cause any proceeds of any Core Canadian Concentration Account to be otherwise redirected.
(g) Without limiting the provisions set forth in Section 13.15, the Administrative Agent shall maintain accounts on its books in the name of each Borrower (collectively, the “Credit Account”) in which each Borrower will be charged with all loans and advances under each Tranche made by the Lenders to the respective Borrower for the respective Borrower’s account, including the Loans, the Letter of Credit Outstandings, and the Fees, Expenses and any other Obligations relating thereto. Each Borrower will be credited, in accordance with this Section 5.03, with all amounts received by the Lenders from such Borrower or from others for its account, including, as set forth above, all amounts received by the Administrative Agent and applied to the Obligations. In no event shall prior recourse to any Accounts or other Collateral be a prerequisite to the Administrative Agent’s right to demand payment of any Obligation upon its maturity. Further, the Administrative Agent shall have no obligation whatsoever to perform in any respect any of the Borrowers’ or other Loan Parties’ contracts or obligations relating to the Accounts.
(b) Each Lender that is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes agrees to deliver to Holdings and the Administrative Agent on or prior to the Closing Date (i) two accurate and complete original signed copies of Internal Revenue Service Form W-8IMY, Form W-8ECI or Form W-8BEN (with respect to a complete exemption under an income tax treaty) (or successor forms) certifying to such Lender’s entitlement as of such date to a complete exemption from United States withholding tax with respect to payments to be made by the U.S. Borrowers under this Agreement and under any Note, or (ii) if the Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue Service Form W-8IMY, Form W-8ECI or Form W-8BEN (with respect to a complete exemption under an income tax treaty) pursuant to clause (i) above, (x) a certificate substantially in the form of Exhibit L (any such certificate, a “Section 5.04(b)(ii) Certificate”) and (y) two accurate and complete original signed copies of Internal Revenue Service Form W-8BEN (with respect to the portfolio interest exemption) (or successor form) certifying to such Lender’s entitlement as of such date to a complete exemption from United States withholding tax with respect to payments of interest to be made by the U.S. Borrowers under this Agreement and under any Note. In addition, each Lender agrees that from time to time after the Closing Date, when a lapse in time or change in circumstances renders the previous certification obsolete or inaccurate in any material respect, such Lender will deliver to Holdings and the Administrative Agent two new accurate and complete original signed copies of Internal Revenue Service Form W-8IMY, Form W-8ECI, Form W-8BEN (with respect to the benefits of any income tax treaty), or Form W-8BEN (with respect to the portfolio interest exemption) and a Section 5.04(b)(ii) Certificate, as the case may be, and such other forms as may be required in order to confirm or establish the entitlement of such Lender to a continued exemption from or reduction in United States withholding tax with respect to payments by the U.S. Borrowers under this Agreement and any Note, or such Lender shall immediately notify Holdings and the Administrative Agent of its inability to deliver any such Form or Certificate, in which case such Lender shall not be required to deliver any such Form or Certificate pursuant to this Section 5.04(b). Notwithstanding anything to the contrary contained in Section 5.04(a)(ii), but subject to Section 13.04(b) and the immediately succeeding sentence, (x) each U.S. Borrower shall be entitled, to the extent it is required to do so by law, to deduct or withhold income or similar taxes imposed by the United States (or any political subdivision or taxing authority thereof or therein) from interest, Fees or other amounts payable hereunder for the account of any Lender which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes to the extent that such Lender has not provided to Holdings U.S. Internal Revenue Service Forms that establish a complete exemption from such deduction or withholding and (y) each U.S. Borrower shall not be obligated pursuant to Section 5.04(a) to gross-up payments to be made to a Lender in
respect of income or similar taxes imposed by the United States if (I) such Lender has not provided to Holdings the Internal Revenue Service Forms required to be provided to Holdings pursuant to this Section 5.04(b) or (II) in the case of a payment, other than interest, to a Lender described in clause (ii) above, to the extent that such forms do not establish a complete exemption from withholding of such taxes. Notwithstanding anything to the contrary contained in the preceding sentence or elsewhere in this Section 5.04 and except as set forth in Section 13.04(b) and subject to Section 14.07, (i) the U.S. Borrowers (jointly and severally) agree (and the applicable U.S. Subsidiary Guarantors agree), to indemnify and hold harmless each U.S. Facility Lender and (ii) the U.S. Borrowers (jointly and severally) or the Canadian Borrowers (jointly and severally), as applicable, agree (and the applicable Subsidiary Guarantors agree) to pay any additional amounts and to indemnify such Lender in the manner set forth in Section 5.04(a) (without regard to the identity of the jurisdiction requiring the deduction or withholding) in respect of any amounts deducted or withheld by it as described in the immediately preceding sentence as a result of any changes after the Closing Date in any applicable law, treaty, governmental rule, regulation, guideline or order, or in the interpretation thereof, relating to the deducting or withholding of income or similar taxes.
(c) Each Canadian Facility Lender agrees to use reasonable efforts (consistent with legal and regulatory restrictions and subject to overall policy considerations of such Canadian Facility Lender) to file any certificate or document or to furnish to the relevant Canadian Borrower any information, in each case, as reasonably requested by such Canadian Borrower that may be necessary to establish any available exemption from, or reduction in the amount of, any Taxes; provided, however, that nothing in this Section 5.04(c) shall require a Canadian Facility Lender to disclose any confidential information (including, without limitation, its tax returns or its calculations).
(d) If any Borrower or Loan Party pays any amount under this Section 5.04 to a Lender or any other Person and such Lender determines in its sole discretion that it (or any of its Affiliates) has actually received or realized in connection therewith any refund or any reduction of its Tax liabilities in or with respect to the taxable year in which the additional amount is paid (a “Tax Benefit”), such Lender shall pay to such Borrower an amount that the Lender shall, in its sole discretion, determine is equal to the net benefit, after tax, which was obtained by the Lender (or its Affiliates) as a consequence of such Tax Benefit; provided, however, that (i) any Lender may determine, in its sole discretion consistent with the policies of such Lender, whether to seek a Tax Benefit; (ii) any Taxes that are imposed on a Lender as a result of a disallowance or reduction of any Tax Benefit with respect to which such Lender has made a payment to the Borrower pursuant to this Section 5.04(d) shall be treated as a Tax for which the Borrower is obligated to indemnify such Lender pursuant to this Section 5.04 without any exclusions or defenses; (iii) nothing in this Section 5.04(d) shall require the Lender to disclose any confidential information to the Borrower (including, without limitation, its tax returns); and (iv) no Lender shall be required to pay any amounts pursuant to this Section 5.04(d) at any time which a Default or Event of Default exists.
(e) Each Agent and each Lender that is a U.S. person within the meaning of Section 7701(a)(30) of the Code (other than any such person that is treated as a corporation for United States federal income tax purposes) shall deliver to Holdings and the Administrative Agent on or before the date such Person becomes a party to this Agreement a duly completed
United States Internal Revenue Service form W-9 (or successor form) establishing that such Person is not subject to U.S. federal backup withholding.
(a) The Administrative Agent shall have received from each party hereto either (i) a counterpart of this Agreement signed on behalf of such party or (ii) evidence satisfactory to the Administrative Agent (which may include a facsimile transmission) that such party has signed a counterpart of this Agreement as provided in Section 13.10.
(b) The Administrative Agent shall have received a favorable written opinion of each of Winston & Strawn LLP, U.S. counsel for the Loan Parties, substantially to the effect set forth in Exhibit P-1, Craig A. Hunt, Senior Vice President, Secretary and General Counsel for SSCC and SSCE, substantially to the effect set forth in Exhibit P-2, Osler, Hoskin & Harcourt LLP, Canadian counsel for the Loan Parties, substantially to the effect set forth in Exhibit P-3, and Stewart McKelvey, Nova Scotia counsel for the Loan Parties, substantially to the effect set forth in Exhibit P-4, in each case (A) dated the Closing Date, (B) addressed to the Administrative Agent, the Security Agent and the Lenders, and (C) covering such customary legal matters relating to this Agreement as the Administrative Agent shall reasonably request and with such changes as are reasonably acceptable to the Administrative Agent. SSCC, SSCE and the other Borrowers hereby instruct their counsel to deliver such opinions.
(c) All legal matters incident to this Agreement, the Borrowings and other extensions of credit hereunder and the other Loan Documents shall be reasonably satisfactory to the Administrative Agent and the Lenders.
(d) The Administrative Agent shall have received (i) a copy of the certificate or articles of incorporation (or equivalent organizational documents), including all amendments thereto, of each of SSCC, SSCE and the other Borrowers, certified as of a recent date by the Secretary of State or other relevant Governmental Authority of the jurisdiction of its organization, and a certificate as to the good standing (or the equivalent thereof) of each of SSCC, SSCE and the other Borrowers as of a recent date from such Secretary of State or other Governmental Authority; (ii) a certificate of the Secretary or Assistant Secretary of each of SSCC, SSCE and the other Borrowers dated the Closing Date and certifying (A) that attached thereto is a true and complete copy of the by-laws (or equivalent organizational documents) of SSCC, SSCE or each other Borrower, as applicable, as in effect on the Closing Date, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of SSCC, SSCE or each other Borrower, as applicable, authorizing the Transactions, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the certificate or articles of incorporation (or equivalent organizational documents) of SSCC, SSCE or each other Borrower, as applicable, have not been amended since the date of the last amendment thereto shown on the certificate of good standing furnished pursuant to clause (i) above and (D) as to the incumbency and specimen signature of each officer
executing this Agreement on behalf of SSCC, SSCE or each other Borrower, as applicable (and each of the foregoing in sub-clauses (i) and (ii) shall be in form and substance reasonably acceptable to the Administrative Agent); (iii) a certificate of another officer as to the incumbency and specimen signature of the Secretary or Assistant Secretary executing the certificate pursuant to clause (ii) above; (iv) a certificate of the Secretary or Assistant Secretary of Holdings dated the Closing Date and certifying that attached thereto is a true and complete copy of the Term Loan Credit Agreement (including all exhibits, annexes and schedules thereto) which shall contain terms that conform to the Plan of Reorganization and are otherwise in form and substance reasonably satisfactory to the Administrative Agent; and (v) such other documents as the Administrative Agent may reasonably request.
(e) The Administrative Agent shall have received a certificate, dated the Closing Date and signed by a Financial Officer of and on behalf of Holdings, confirming compliance as of the Closing Date with the condition precedent set forth in Section 7.01(ii) with the same effect as if each reference to the date of a Credit Event therein were a reference to the Closing Date.
(f) The Administrative Agent shall have received (i) management’s financial projections for SSCC and the Subsidiaries through 2014, including but not limited to monthly projections for 2010 (including projected monthly borrowing base levels for such year), reflecting the Transactions and the Plan of Reorganization as disclosed in the Disclosure Statement as of the Closing Date and including the material assumptions on which such projections were based, in each case in form and substance reasonably satisfactory to the Administrative Agent, and (ii) an unaudited pro forma consolidated balance sheet of SSCC and its Subsidiaries as of the last day of the most recent fiscal quarter for which financial statements are publicly available, adjusted to give pro forma effect to implementation of the Plan of Reorganization and the Transactions as if such transactions had occurred on such date, which, in each case, shall be prepared in good faith and based upon reasonable assumptions.
(g) The U.S. Bankruptcy Court shall have entered an order in form and substance reasonably acceptable to DBNY and JPMCB approving Holdings and the other Borrowers’ execution, delivery and performance of this Agreement, including the payment of fees, expenses, indemnities and other amounts contemplated hereby, and approving as an administrative expense claim against Holdings and the other Borrowers the indemnification, cost reimbursement obligations and fee obligations accruing or payable in respect of periods or events occurring on or prior to the Funding Date.
(h) The Plan of Reorganization as reflected in the Disclosure Statement shall be in form and substance reasonably acceptable to the Lead Arrangers.
(i) On or prior to the Closing Date, Holdings shall have provided to the Administrative Agent and the Co-Collateral Agents (i) an appraisal of the Inventory of each Borrower and their respective Subsidiaries from Great American Advisory & Valuation Services, LLC and (ii) a collateral examination of the Accounts and Inventory and related assets and liabilities of each Borrower and their respective Subsidiaries from JPMCB and, in each case, the
results of such appraisal and collateral examination shall be in form and substance reasonably satisfactory to the Co-Collateral Agents.
(j) On the Closing Date, the Administrative Agent and the Co-Collateral Agents shall have received the initial Borrowing Base Certificate.
(k) The Administrative Agent shall have received all Fees and other amounts due and payable on or prior to the Closing Date, including, to the extent invoiced, payment or reimbursement of all Fees and expenses (including the reasonable fees, charges and disbursements of counsel) required to be reimbursed or paid by Holdings or any Borrower hereunder or under any other Loan Document or in respect of the execution and delivery of this Agreement.
(a) The Administrative Agent shall have received a favorable written opinion of each of (i) Winston & Strawn LLP, U.S. counsel for the Loan Parties, Craig A. Hunt, Senior Vice President, Secretary and General Counsel for SSCC and SSCE, Osler, Hoskin & Harcourt LLP, Canadian counsel for the Loan Parties and Stewart McKelvey, Nova Scotia counsel for the Loan Parties, and (ii) such local counsel reasonably acceptable to the Administrative Agent, in each case (A) dated the Funding Date, (B) addressed to the Administrative Agent, the Security Agent and the Lenders, and (C) covering such customary legal matters relating to the Loan Documents as the Administrative Agent shall reasonably request and in form and substance reasonably satisfactory to the Administrative Agent. SSCC, SSCE and the other Loan Parties hereby instruct their counsel to deliver such opinions.
(b) The Administrative Agent shall have received (i) a copy of the certificate or articles of incorporation (or equivalent organizational documents), including all amendments thereto, of each Loan Party, certified as of a recent date by the Secretary of State or other relevant Governmental Authority of the jurisdiction of its organization, and a certificate as to the good standing (or the equivalent thereof) of each Loan Party as of a recent date from such Secretary of State or other Governmental Authority; (ii) a certificate of the Secretary or Assistant Secretary of each Loan Party dated the Funding Date and certifying (A) that attached thereto is a true and complete copy of the by-laws (or equivalent organizational documents) of such Loan Party as in effect on the Funding Date, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of such Loan Party authorizing the Transactions, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the certificate or articles of incorporation (or equivalent organizational documents) of such Loan Party have not been amended since the date of the last amendment thereto shown on the certificate of good standing furnished pursuant to clause (i) above, and (D) as to the incumbency and specimen signature of each officer executing any Loan Document on behalf of such Loan Party (and each of the foregoing in sub-clauses (i) and (ii) shall be in form and substance reasonably acceptable to the Administrative Agent); (iii) a certificate of another officer as to the incumbency and specimen signature of the Secretary or
Assistant Secretary executing the certificate pursuant to clause (ii) above; (iv) a certificate of the Secretary or Assistant Secretary of each Loan Party dated the Funding Date and certifying that attached thereto is a true and complete copy of the material Term Loan Facility Documents (other than the Term Loan Credit Agreement) and any amendments to the Term Loan Credit Agreement (including all exhibits, annexes and schedules thereto) from and after the Closing Date, in each case, which shall contain terms that conform to the Plan of Reorganization and are otherwise in form and substance reasonably satisfactory to the Administrative Agent; and (v) such other documents as the Administrative Agent may reasonably request.
(c) The Administrative Agent shall have received a certificate, dated the Funding Date and signed by a Financial Officer of and on behalf of Holdings, confirming compliance with the conditions precedent set forth in Section 7.01.
(d) The Administrative Agent shall have received all Fees and other amounts due and payable on or prior to the Funding Date, including, to the extent invoiced, payment or reimbursement of all Fees and expenses (including the reasonable fees, charges and disbursements of counsel) required to be reimbursed or paid by any Loan Party hereunder or under any other Loan Document or in respect of the execution and delivery of this Agreement.
(e) The Administrative Agent shall have received a notice of such Credit Event as required by Section 7.02.
(f) The Collateral and Guarantee Requirement shall have been satisfied, including with respect to each Borrower and each Domestic Subsidiary and Canadian Subsidiary of Holdings that is a Material Subsidiary based on the most recently available consolidated financial statements of SSCC or that is or will be a guarantor under the Term Loan Facility, and the requirements of the covenant set forth in Section 10.15 shall have been satisfied. The Administrative Agent shall have received a completed Perfection Certificate, dated the Funding Date and duly executed by a Authorized Officer of Holdings, together with all attachments contemplated thereby, including results of a search of the UCC (or equivalent) filings made with respect to the Loan Parties in the jurisdictions contemplated by the Perfection Certificate and with copies of the financing statements (or similar documents) disclosed by such search and evidence reasonably satisfactory to the Administrative Agent that the Liens indicated by such financing statements (or similar document) are permitted under Section 10.02 or have been, or substantially contemporaneously with the Funding Date will be, released.
(g) None of the Mortgaged Properties shall be subject to any Lien other than those expressly permitted under Section 10.02 and other encumbrances permitted by the relevant Mortgage.
(h) The Administrative Agent shall have received copies of, or an insurance broker’s or agent’s certificate as to coverage under, the insurance policies required by Section 9.02 and the applicable provisions of the Security Documents, each of which policies shall be endorsed or otherwise amended to include a loss payable endorsement with respect to the Collateral and to name the Security Agent as additional insured, in form and substance reasonably satisfactory to the Administrative Agent.
(i) The Administrative Agent shall have received (i) an unaudited pro forma consolidated balance sheet of Holdings and its Subsidiaries as of the last day of the most recent fiscal quarter for which financial statements are publicly available, adjusted to give pro forma effect to the implementation of the Plan of Reorganization, the consummation of the Transactions and the funding of Term Loans under the Term Loan Facility and any incurrence of Loans or issuance of Letters of Credit hereunder on the Funding Date as if such transaction had occurred on such date, which, in each case, shall be prepared in good faith and based upon reasonable assumptions and (ii) a certificate, dated the Funding Date and signed by a Financial Officer of Holdings, certifying that as of the Funding Date, Holdings and its Subsidiaries have not incurred any material liabilities not reflected in such pro forma consolidated balance sheet, other than liabilities incurred in the ordinary course of business.
(j) The U.S. Bankruptcy Court shall have entered an order confirming the Plan of Reorganization, which order (the “Confirmation Order”) (i) shall be in form and substance reasonably satisfactory to DBNY and JPMCB, (ii) shall authorize this Agreement and the Transactions and the Term Loan Facility and (iii) shall be in full force and effect and shall not have been reversed or modified and shall not be stayed. The assets of SSC Canada and Smurfit-MBI (as defined in the Plan of Reorganization) shall be transferred to the newco(s) that will be Canadian Borrowers on the Funding Date, which transfer shall be approved by the Canadian Bankruptcy Court pursuant to a vesting order, sanction or other order issued by the Canadian Bankruptcy Court, in each case, in form and substance reasonably satisfactory to DBNY and JPMCB. The effective date of the Plan of Reorganization shall have occurred (and all conditions precedent thereto as set forth therein shall have been satisfied (or shall be concurrently satisfied) or waived pursuant to the terms of the Plan of Reorganization) and the Funding Date Merger shall have been consummated. Since the Closing Date, there shall have been no amendment or modification of the terms and conditions of the Plan of Reorganization as reflected in the Disclosure Statement on the Closing Date (including without limitation the incurrence or continuation of Indebtedness or Liens not specifically contemplated by the Disclosure Statement on the Closing Date to exist after the effective date of the Plan of Reorganization) that could reasonably be expected to adversely affect the interests of the Lenders in any significant respect that has not been approved by the Non-Defaulting Lenders which would constitute the Required Lenders under, and as defined in, this Agreement, if the reference to “a majority” contained therein were changed to “66-2/3%”.
(k) The Administrative Agent shall be reasonably satisfied that, and shall have received a certificate from a Financial Officer of Holdings dated the Funding Date and confirming that, following consummation of the transactions expected to occur substantially simultaneously with the funding of the Term Loans under the Term Loan Facility and any incurrence of Loans or issuance of Letters of Credit hereunder on the Funding Date, no event, circumstance or condition will exist that would constitute a Default or Event of Default hereunder had the affirmative and negative covenants contained in Sections 9 and 10 and the Events of Default been applicable at all times after the Closing Date, other than any such event, condition or circumstance directly attributable to the Plan of Reorganization as reflected in the Disclosure Statement on the Closing Date or to changes therein not requiring approval of the applicable Lenders pursuant to Section 6.02(j) above (it being understood that any such non-compliance with covenants or Event of Default prior to the Funding Date that has been cured or otherwise is not continuing as of the Funding Date (and any noncompliance with the notification
requirements of Section 9.05 relating to any such noncompliance attributable to the Plan of Reorganization or otherwise cured or not continuing) will not be deemed to result in a failure of this condition).
(l) After giving pro forma effect to the implementation of the Plan of Reorganization and the transactions contemplated thereunder, the funding of the Term Loans under the Term Loan Facility and any incurrence of Loans or issuance of Letters of Credit hereunder on the Funding Date, Holdings’ Consolidated Leverage Ratio for the most recent twelve-month period for which financial statements are available, but in any event, the most recent twelve-month period ending at least 30 days prior to the Funding Date shall not exceed (i) 3.50 to 1.00 if the Funding Date occurs on or prior to April 30, 2010 or (ii) 3.85 to 1.00 if the Funding Date occurs after April 30, 2010. The Administrative Agent shall have received a certificate, dated the Funding Date and signed by a Financial Officer of Holdings, certifying as to compliance with the foregoing condition.
(m) The Administrative Agent shall have received reasonably satisfactory evidence that the conditions to the effectiveness of the Term Loan Facility Documents shall have been (or will be), substantially simultaneously with the Funding Date, satisfied or waived in accordance with their terms and, on the Funding Date, Holdings shall have received cash proceeds of $1,200,000,000 (calculated before underwriting and original issue discounts, commissions, fees and expenses) from the incurrence of Term Loans under the Term Loan Facility.
(n) Prior to the fifth day preceding the Funding Date (or such shorter period as may be agreed to by the Administrative Agent in its sole discretion), the Administrative Agent and the Co-Collateral Agents shall have received a Borrowing Base Certificate as at a date not earlier than the date occurring on the 30th day preceding the Funding Date (the “Funding Date Borrowing Base Certificate”).
(o) On the Funding Date and after giving effect to the incurrence of Loans, the issuance of Letters of Credit and occurrence of all payments and transfers to be effected on or as of the Funding Date, including all such payments and transfers contemplated by the Plan of Reorganization, the sum of (i) Excess Availability and (ii) Holdings’ unrestricted cash and unrestricted cash equivalents shall be greater than (x) $500,000,000 if the Funding Date occurs on or prior to April 30, 2010 or (y) $450,000,000 if the Funding Date occurs after April 30, 2010.
(p) The Closing Date shall have occurred.
(q) On or prior to the Funding Date, there shall have been delivered to the Administrative Agent for the account of each of the Lenders that has requested same the appropriate Revolving Notes executed by the appropriate Borrowers and if requested by the Swingline Lender, the appropriate Swingline Note executed by the appropriate Borrowers, in each case, in the applicable amount, maturity and as otherwise provided herein.
(r) Prior to the fifth Business Day preceding the Funding Date, the Agents shall have received from the Loan Parties, to the extent requested, all documentation and other
information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.
(s) The Administrative Agent shall have received a solvency certificate from a Financial Officer of Holdings in the form of Exhibit F hereto dated the Funding Date.
(b) Prior to the issuance of each Letter of Credit, the Administrative Agent and the respective Issuing Lender shall have received a Letter of Credit Request meeting the requirements of Section 3.03(a).
(i) the Aggregate U.S. Borrower Exposure would not exceed the U.S. Borrowing Base at such time;
(ii) the Aggregate Canadian Borrower Exposure would not exceed the Canadian Borrowing Base at such time;
(iii) the Aggregate U.S. Facility Exposure at such time would not exceed the Total U.S. Facility Commitment at such time;
(iv) the Aggregate Canadian Facility Exposure at such time would not exceed the Total Canadian Facility Commitment at such time;
(v) the aggregate U.S. Facility Letter of Credit Outstandings would not exceed the Maximum U.S. Facility Letter of Credit Amount; and
(vi) the aggregate Canadian Facility Letter of Credit Outstandings would not exceed the Maximum Canadian Facility Letter of Credit Amount.
(b) As of the Closing Date, the Projections delivered to the Administrative Agent and the Lenders prior to the Closing Date have been prepared in good faith and are based on reasonable assumptions.
(b) Each of Holdings and the Subsidiaries has complied with all obligations under all leases to which it is a party and enjoys peaceful and undisturbed possession under all such leases, except where the failure thereof could not reasonably be expected to have a Material Adverse Effect.
(b) None of SSCC, any Borrower and any of their respective Subsidiaries nor any of their respective properties or assets is (i) in violation of, nor will the continued operation of their properties and assets as currently conducted violate, any law, rule, regulation, statute (including any zoning, building, Environmental Laws, ordinance, code or approval or any building permits) in respect of the conduct of its business, the relationship with its employees and the ownership of its property or any restrictions of record or agreements affecting the Mortgaged Properties, where such violations could reasonably be expected to have a Material Adverse Effect or (ii) in default with respect to any judgment, writ, injunction, decree or order
of, any Governmental Authority, where such defaults, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.
(b) No part of the proceeds of any Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, (i) to purchase or carry Margin Stock or to extend credit to others for the purpose of purchasing or carrying Margin Stock or to refund indebtedness originally incurred for such purpose or (ii) for any purpose that entails a violation of, or is inconsistent with, the provisions of the Regulations of the Board, including Regulation T, U or X.
(c) All proceeds of the Loans will be used by the Borrowers for working capital, capital expenditures, Permitted Acquisitions and general corporate purposes of Holdings and its Subsidiaries. All Letters of Credit will be used for the purposes described in Section 3.01(a).
(i) a Plan’s or Multiemployer Plan’s funded status since the most recent valuation or other statement of financial condition prior to the Closing Date; or
(ii) withdrawal liability with respect to a Multiemployer Plan that exceeds the most recent estimate of withdrawal liability for such Multiemployer Plan received before the Closing Date; provided, however, that Holdings and the Loan Parties will, and will cause each of their respective ERISA Affiliates to, make a request from the administrator or sponsor of such Multiemployer Plan for the notices described in Section 101(l)(1) of ERISA at least annually not later than the anniversary date of the date hereon.
(b) The Canadian Pension Plans are duly registered under the ITA and any other applicable laws which require registration, have been administered in all material respects in accordance with the ITA and such other applicable laws, and no event has occurred which could reasonably be expected to cause the loss of such registered status. Except as set forth on Schedule 8.14(b), all material obligations of SSC Canada and the other Canadian Subsidiaries of Holdings required to be performed by SSC Canada or the other Canadian Subsidiaries of Holdings in connection with the Canadian Pension Plans and the funding agreements therefor have been performed on a timely basis. As of the Closing Date, there are no outstanding disputes concerning the assets of the Canadian Pension Plans or the Canadian Benefit Plans. Except as set forth on Schedule 8.14(b), no promises of benefit improvements under the Canadian Pension Plans or the Canadian Benefit Plans have been made, except as provided for in a collective bargaining agreement or where such improvement could not reasonably be expected to have a Material Adverse Effect. Except as set forth on Schedule 8.14(b), all contributions or premiums required to be made or paid by SSC Canada and each Canadian Subsidiary of Holdings to the Canadian Pension Plans or the Canadian Benefit Plans have been made on a timely basis in accordance with the terms of such plans and all applicable laws. There have been no improper withdrawals or applications of the assets of the Canadian Pension Plans or the Canadian Benefit Plans. Except as set forth on Schedule 8.14(b), as of the date of the most recent actuarial valuations with Governmental Authorities, none of the Canadian Pension Plans or the Canadian Benefit Plans has any unfunded actuarial liabilities or solvency deficiencies (within the meaning of the Quebec Supplemental Pension Plans Act and other applicable laws) in an aggregate amount that could reasonably be expected to result in a Material Adverse Effect.
(a) Except as set forth on Schedule 8.15:
(i) Each of SSCC, any Borrower and their respective Subsidiaries has obtained all permits, licenses and other authorizations that are required and material with respect to the operation of the business of SSCC and the Subsidiaries, taken as a whole, under any Environmental Law, and each such permit, license and authorization is in full force and effect, except where the failure thereof could not reasonably be expected to have a Material Adverse Effect.
(ii) Each of SSCC, any Borrower and their respective Subsidiaries is in compliance with all material terms and conditions of the permits, licenses and authorizations specified in paragraph (i) above, and also is in compliance with all other limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in or pursuant to any Environmental Law applicable to it and its business, assets, operations and properties, except for any noncompliance that could not reasonably be expected to have a Material Adverse Effect.
(iii) There is no civil, criminal or administrative action, suit, demand, claim, hearing, notice of violation, investigation, proceeding, notice or demand letter or request for information pending or, to the knowledge of SSCC or any Borrower, after inquiry, threatened against SSCC, any Borrower or any of their respective Subsidiaries under any Environmental Law that could reasonably be expected to result have a Material Adverse Effect.
(iv) None of SSCC, any Borrower and their respective Subsidiaries has received notice (A) that it has been identified as a potentially responsible party under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (“CERCLA”) or any comparable state law or Canadian federal or provincial law that any hazardous substances or any pollutant or contaminant, as defined in CERCLA and its implementing regulations, or any toxic substance, hazardous waste, hazardous constituents, hazardous materials, asbestos or asbestos containing material, polychlorinated biphenyls, petroleum, including crude oil and any fractions thereof, or other wastes, chemicals, substances or materials regulated by any Environmental Laws (collectively, “Hazardous Materials”) that it or any of their respective predecessors in interest has used, generated, stored, tested, handled, transported or disposed of, has been found at any site at which any Governmental Authority or private party is conducting a remedial investigation or other action pursuant to any Environmental Law or (B) otherwise alleging that it has any liability, obligation or cost pursuant to any Environmental Law, except in the cases of (A) and (B) for any such notices that could not reasonably be expected to have a Material Adverse Effect.
(v) There have been no Releases of Hazardous Materials at, in, on, under or from any location, and neither SSCC, any Borrower nor any of their respective Subsidiaries has otherwise become subject to any liability or obligation, whether contingent or otherwise, relating to any Environmental Law, that could reasonably be expected to have a Material Adverse Effect.
(vi) To the best knowledge of SSCC and any Borrower, there is no asbestos in, on, or at any Real Properties or any facility or equipment of SSCC, any Borrower or any of their respective Subsidiaries, except to the extent that the presence of, or exposure to, such material could not reasonably be expected to have a Material Adverse Effect.
(vii) As of the Closing Date, to the knowledge of SSCC and any Borrower, none of the Real Properties are (i) listed or proposed for listing on the National Priorities List under CERCLA or (ii) listed in the Comprehensive Environmental Response, Compensation, Liability Information System List promulgated pursuant to CERCLA.
(viii) To the knowledge of SSCC and any Borrower, there are no events, conditions, circumstances, activities, practices, incidents, actions or plans that could reasonably be anticipated to interfere with or prevent compliance with any Environmental Law, or which may give rise to liability under any Environmental Law, or otherwise form the basis of any claim, action, demand, suit, proceeding, hearing or notice of violation, study or investigation, based on or related to the manufacture, processing, distribution, use, generation, treatment, storage, disposal, transport, shipping or handling, the emission, discharge, release or threatened release into the environment of, or exposure to, any Hazardous Material that could reasonably be expected to have a Material Adverse Effect.
(b) Since the date of this Agreement, there has been no change in the status of the matters disclosed on Schedule 8.15 that, individually or in the aggregate, could reasonably be expected to have, a Material Adverse Effect.
8.17. Security Documents. (a) The Guarantee and Collateral Agreement, upon execution and delivery thereof by the parties thereto, will create in favor of the Security Agent, for the ratable benefit of the Secured Parties, a legal, valid and enforceable security interest in the Collateral (as defined therein) (other than vessels) and proceeds thereof and (i) when the Pledged Collateral (as defined therein) is delivered to the Security Agent or the Prior Agent, together with instruments of transfer duly endorsed in blank, the Guarantee and Collateral Agreement shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the U.S. Loan Parties in such Pledged Collateral, in each case prior and superior in right to any other Person, other than with respect to Permitted Liens and other than as provided in the Intercreditor
Agreement with respect to Term Priority Collateral, and (ii) when financing statements in appropriate form have been duly filed in the offices specified on Schedule 8.17(a), the Lien created under the Guarantee and Collateral Agreement (other than with respect to the aforesaid Pledged Collateral) will constitute a fully perfected Lien on, and security interest in, all right, title and interest of the U.S. Loan Parties in such Collateral, and the proceeds thereof, to the extent perfection can be obtained by filing UCC financing statements, in each case prior and superior in right to any other Person, other than with respect to Permitted Liens and other than as provided in the Intercreditor Agreement with respect to the Term Priority Collateral.
(b) When the IP Security Agreements are duly filed with the United States Patent and Trademark Office and the United States Copyright Office, as applicable, and when financing statements in appropriate form have been duly filed in the offices specified on Schedule 8.17(a), the security interest created thereunder shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the U.S. Loan Parties in the registered intellectual property described therein and owned by the applicable U.S. Loan Parties and in which a security interest may be perfected by filing a security agreement in the United States, in each case prior and superior in right to any other Person, other than with respect to Permitted Liens and other than as provided in the Intercreditor Agreement (it being understood that subsequent recordings in the United States Patent and Trademark Office and the United States Copyright Office may be necessary to perfect a Lien on registered trademarks, trademark applications, designs, patents, patent applications and copyrights acquired by a Loan Party after the Funding Date).
(c) When executed and delivered, each Canadian Security Document will be effective to create in favor of the Security Agent for the ratable benefit of the Secured Parties a legal, valid and enforceable security interest (or, in the case of Quebec, hypothec) in all right, title and interest of the Canadian Loan Parties in the Collateral described in each such Canadian Security Document and (i) when the Pledged Collateral (as defined therein) is delivered to the Security Agent, together with instruments of transfer duly endorsed in blank, the Canadian Guarantee and Collateral Agreement shall constitute a fully perfected first priority Lien on, and security interest in, all right, title and interest of the Canadian Loan Parties in such Pledged Collateral, in each case prior and superior in right to any other Person (other than Canadian Priority Payables), and (ii) and when financing statements (or, in the case of Quebec, registration statements) in appropriate form are filed in the offices specified in Schedule 8.17(a), each such Canadian Security Document will constitute a fully perfected (or, in the case of Quebec, opposable) security interest (or, in the case of Quebec, hypothec) in all right, title and interest in all of the Collateral described in such Security Document (other than, with respect to the Canadian Guarantee and Collateral Agreement, the Pledged Collateral (as defined therein)) to the extent perfection (or, in the case of Quebec, opposability) can be obtained by filing PPSA financing statements (or, in the case of Quebec, registration statements), prior and superior to the rights of any other Person, except for rights and obligations secured by Permitted Liens (it being understood that no representation is made under this clause (c) as to (A) any such Collateral that is subject to a Canadian Security Document governed by the laws of a jurisdiction other than Canada or (B) the creation, validity, perfection (or opposability) or priority (or ranking) of any Lien to the extent that such matters are determined under the law of a jurisdiction outside Canada).
(d) The Mortgages, upon execution and delivery thereof by the parties thereto, will create in favor of the Administrative Agent, for the ratable benefit of the beneficiaries named therein, a legal, valid and enforceable Lien on all of the U.S. Loan Parties’ right, title and interest in and to the Mortgaged Properties thereunder and the proceeds thereof, and when the Mortgages are duly filed or registered in the appropriate recording offices where such Mortgaged Properties are located or as otherwise reasonably requested by the Administrative Agent, the Mortgages will constitute a fully perfected or published Lien on, and security interest or hypothec in, all right, title and interest of the U.S. Loan Parties in such Mortgaged Properties and the proceeds thereof, in each case prior and superior in right to any other Person, other than with respect to Permitted Liens or other encumbrances permitted by the relevant Mortgage.
(e) Each Security Document, other than any Security Document referred to in the preceding paragraphs of this Section, upon execution and delivery thereof by the parties thereto and the making of the filings and taking of the other actions provided for therein, will be effective under applicable law to create in favor of the Administrative Agent, for the ratable benefit of the Secured Parties, a valid and enforceable security interest in all rights, title and interest of the Loan Parties in the Collateral subject thereto, prior and superior in right to any other Person, other than with respect to Permitted Liens and other than as provided in the Intercreditor Agreement with respect to the Term Priority Collateral.
(i) a Person that is listed in the annex to, or it otherwise subject to the provisions of, the Executive Order;
(ii) a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;
(iii) a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;
(iv) a Person that commits, threatens or conspires to commit or supports “terrorism” as defined in the Executive Order; or
(v) a Person that is named as a “specially designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website or any replacement website or other replacement official publication of such list.
(b) Neither Holdings nor any of its Subsidiaries and, to the knowledge of Holdings and each Borrower, no agent of Holdings or any of its Subsidiaries acting on behalf of Holdings or any of its Subsidiaries, as the case may be, (i) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of a Person described in Section 8.24(a), (ii) deals in, or otherwise engages in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order, or (iii) engages in or conspires 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.
(b) Except where the failure to do so could not be reasonably expected to have a Material Adverse Effect, (i) do or cause to be done all things necessary to preserve, renew and keep in full force and effect the rights, licenses, permits, trademarks, trade names, privileges and franchises necessary or desirable in the normal conduct of its business, and (ii) at all times keep and maintain all property useful and necessary in its business in good working order and condition.
(a) within 90 days after the end of each fiscal year, its consolidated balance sheet and related statements of operations, stockholders’ equity and cash flows, showing the financial condition of Holdings and its consolidated Subsidiaries as of the close of such fiscal year and the results of its operations and the operations of such Subsidiaries during such fiscal year, all audited by Ernst & Young LLP or other independent auditors of recognized national standing and accompanied by an opinion of such accountants (which shall not contain any material qualification or exception (other than “going concern” qualifications or exceptions relating to the Bankruptcy Proceedings in such opinion with respect to the fiscal year ended December 31, 2009) to the effect that such consolidated financial statements fairly present in all material respects the financial condition and results of operations of Holdings and its Subsidiaries on a consolidated basis in accordance with GAAP;
(b) within 45 days after the end of each of the first three fiscal quarters of each fiscal year, its unaudited consolidated balance sheet and related statements of operations, stockholders’ equity and cash flows, showing the financial condition of Holdings and its consolidated Subsidiaries as of the close of such fiscal quarter and the results of its operations and the operations of such Subsidiaries during such fiscal quarter and the then-elapsed portion of the fiscal year (it being understood that such information shall be in reasonable detail and certified by a Financial Officer of Holdings as fairly presenting in all material respects the financial condition and results of operations of Holdings and its Subsidiaries on a consolidated basis in accordance with GAAP, subject to normal year-end audit adjustments and the absence of notes);
(c) within 30 days after the commencement of, and within 30 days after the end of each calendar month ending during, a Compliance Period, the monthly unaudited consolidated balance sheet and related consolidated statement of income of Holdings and its
Subsidiaries on a consolidated basis in accordance with GAAP for such period, subject to normal year-end audit adjustments and the absence of notes, together with a summary list of Capital Expenditures and a calculation of Consolidated EBITDA for such calendar month, in each case, certified by a Financial Officer of Holdings as being prepared on a consistent basis with its accounting and bookkeeping practices;
(d) (i) concurrently with any delivery of financial statements under paragraph (a) or (b) above, a compliance certificate in the form of Exhibit G signed by a Financial Officer of Holdings and on behalf of Holdings (A) certifying that, after reasonable inquiry, to the knowledge of such Financial Officer no Default or Event of Default has occurred or, if a Default or an Event of Default has occurred, specifying the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto, (B) demonstrating compliance with the covenants contained in Sections 10.01, 10.02, 10.03, 10.04, 10.06, 10.09 and 10.16 (setting forth, for the purposes of such certificate, calculations of the Consolidated Fixed Charge Coverage Ratio for such period irrespective of whether a Compliance Period exists at such time) and (C) certifying that no Material Subsidiary exists (other than the Loan Parties) or if a Material Subsidiary (other than a Loan Party) does exist, a description of such Material Subsidiary, in each case at the end of such fiscal quarter or year, as the case may be;
(ii) concurrently with any delivery of financial statements under paragraph (c) above, a compliance certificate signed by a Financial Officer of Holdings in the form of Exhibit G certifying on behalf of Holdings in reasonable detail the calculations required to establish whether Holdings and its Subsidiaries were in compliance with the provisions of Section 10.16 (setting forth, for the purposes of such certificate, calculations of the Consolidated Fixed Charge Coverage Ratio for such period), at the end of such fiscal month;
(e) concurrently with any delivery of financial statements under paragraph (a) above, a certificate of the accounting firm opining on such statements (which certificate may be limited to accounting matters and disclaim responsibility for legal interpretations) stating that during the course of their examination of such financial statements, they obtained no knowledge of any Default or Event of Default, except as specified in such certificate;
(f) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials (other than (i) the exhibits to registration statements and (ii) any registration statements on Form S-8 or its equivalent) filed by Holdings or any of its Subsidiaries with the Securities and Exchange Commission, or any Governmental Authority succeeding to any of or all the functions of such Commission, or with any national securities exchange, or distributed to any such Person’s shareholders (other than to Holdings or any of its Subsidiaries), as the case may be;
(g) in the case of Holdings, as soon as available, and in any event no later than 60 days after the end of each fiscal year, a consolidated annual plan, prepared in accordance with Holdings’ normal accounting procedures applied on a consistent basis, for the next fiscal year of Holdings containing quarterly detail, including projected quarterly borrowing base levels for such fiscal year;
(h) promptly after Holdings’ or any of its Subsidiaries’ receipt thereof, a copy of any “management letter” received from its certified public accountants and management’s response thereto;
(i) (i) not later than 5:00 P.M. (New York time) on or before the 20th day of each month from and after the Closing Date (or, from and after the Funding Date, no later than the last Business Day of each week during any period in which a Weekly Borrowing Base Period is in effect) and (ii) within 5 Business Days following the consummation of a Significant Asset Sale or the occurrence of a material casualty event with respect to ABL Priority Collateral, a Borrowing Base Certificate setting forth each Borrowing Base (in each case with supporting calculations in reasonable detail), which shall be prepared (A) as of the last Business Day of February, 2010 in the case of the initial Borrowing Base Certificate on the Closing Date and (B) as of the last Business Day of the preceding month in the case of each subsequent Borrowing Base Certificate (or, if any such Borrowing Base Certificate is delivered weekly, as of the last Business Day of the week preceding such delivery, in which case the calculation thereunder with respect to Inventory shall be based upon good faith estimates by the Loan Parties) and, in the case of sub-clause (ii) above, after giving effect to such event. Each such Borrowing Base Certificate shall include such supporting information as may be reasonably requested from time to time by the Co-Collateral Agents;
(j) at the time of delivery of any Borrowing Base Certificate, (w) a summary aged trial balance of Accounts by customer, (x) upon the request of the Co-Collateral Agents, a summary of accounts payable (including detail for the top 15 vendors) indicating which accounts payable are more than thirty (30) days past due, (y) a summary inventory listing by category (in form and scope consistent with the form reviewed by the Collateral Agent prior to the Closing Date, or otherwise satisfactory in form and scope to the Co-Collateral Agents), and (z) a reconciliation of Accounts and inventory to the general ledger and to the Borrowing Base Certificate delivered pursuant to clause (i) of this Section 9.04; provided, however, when a Compliance Period is in effect (A) the information required to be delivered pursuant to the preceding clauses (w) and (x) (other than any such delivery in respect of the last week of any month during a Weekly Borrowing Base Period) shall be based upon each such Loan Party’s good faith estimate and (B) in lieu of the information required to be delivered pursuant to preceding clause (x), Holdings shall provide any alternative detail that the Co-Collateral Agents may reasonably request that such Loan Parties can produce with commercially reasonable efforts; provided further that with respect to the Borrowing Base Certificates to be delivered to the Administrative Agent and the Co-Collateral Agents prior to the Funding Date the foregoing information shall not be required;
(k) promptly following the Administrative Agent’s request therefor, all documentation and other information that the Administrative Agent reasonably requests on its behalf or on behalf of any Lender in order to comply with its on-going obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act;
(l) promptly from time to time, such other information regarding the operations, business affairs, collateral and financial condition of Holdings and its Subsidiaries, or
compliance with the terms of any Loan Document, as the Administrative Agent or any Lender may reasonably request; and
(m) information required to be delivered pursuant to this Section shall be deemed to have been delivered if such information, or one or more annual or quarterly reports containing such information (including, in the case of certifications required pursuant to clause (b) above, the certifications accompanying any such quarterly report pursuant to Section 302 of the Sarbanes-Oxley Act of 2002), shall have been posted by the Administrative Agent on an IntraLinks or similar site to which the Lenders have been granted access or shall be available on the website of the Securities and Exchange Commission at http://www.sec.gov. Information required to be delivered pursuant to this Section may also be delivered by electronic communications pursuant to procedures approved by the Administrative Agent.
(a) any Event of Default or Default, specifying the nature and extent thereof and the corrective action (if any) taken or proposed to be taken with respect thereto;
(b) the filing or commencement of, or any notice to SSCC, any Borrower or any of their Subsidiaries of the intention of any Person to file or commence, any action, suit or proceeding (whether at law or in equity or by or before any Governmental Authority or any arbitrator) against SSCC, any Borrower or any Affiliate thereof (i) that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect or (ii) with respect to any Loan Document;
(c) any development that has resulted in, or could reasonably be anticipated to result in, a Material Adverse Effect;
(d) the occurrence of any ERISA Event that, alone or together with other ERISA Events, could reasonably be expected to result in increased liability of Holdings, any Borrower, any Loan Party, any of their respective Subsidiaries and ERISA Affiliates in an aggregate amount more than $30,000,000 greater than the liability as of the Closing Date estimated in good faith with reference to the following:
(i) the Plans’ and Multiemployer Plans’ funded status as of the most recent valuation or other statement of financial condition prior to the Closing Date; or
(ii) withdrawal liability with respect to a Multiemployer Plan as of the most recent estimate of withdrawal liability for such Multiemployer Plan received before the Closing Date;
(e) any material casualty or other insured damage to any material portion of any Collateral (including Mortgaged Property) or the commencement of any action or proceeding for the taking or expropriation of any Collateral (including Mortgaged Property) or
any material part thereof or material interest therein under power of eminent domain or by condemnation or similar proceeding; and
(f) the commencement of a Dominion Period, a Compliance Period or a Weekly Borrowing Base Period.
(b) Holdings will, and will cause each of its Subsidiaries to, permit a third-party appraiser and a third-party consultant selected by the Co-Collateral Agents (and, to the extent such third-party appraiser is not Great American Group and/or such third-party consultant is not KPMG LLP, reasonably satisfactory to Holdings) to, upon the request of the Co-Collateral Agents, conduct (at the reasonable cost of the Borrowers), (x) an appraisal of the Inventory of the Loan Parties and (y) a collateral examination of the Inventory and Accounts of the Loan Parties, in each case, in scope reasonably satisfactory to the Co-Collateral Agents; provided, however, so long as no Event of Default exists, the Co-Collateral Agents may only make up to two requests in respect of each of clause (x) and (y) above during each fiscal year (or, during any period (A) commencing on the date on which the Excess Availability is less than the greater of (i) 20.0% of the Total Commitment as then in effect and (ii) $110,000,000 for a period of five consecutive Business Days and (B) ending on the first date thereafter on which the Excess Availability has been equal to or greater than the greater of (i) 20.0% of the Total Commitment as then in effect and (ii) $110,000,000 for 45 consecutive days, up to three requests in respect of each of clause (x) and (y) above during each fiscal year), in each case at the reasonable cost of the Borrowers.
(b) Cause (i) each Domestic Subsidiary and Canadian Subsidiary of Holdings that is or becomes a Material Subsidiary, (ii) each Domestic Subsidiary and Canadian Subsidiary of Holdings that is or becomes a direct parent of any such Material Subsidiary and (iii) each other Domestic Subsidiary of Holdings that guarantees the obligations under the Term Loan Facility, to, as promptly as practicable, and in any event within 30 days after the occurrence of such event or status, notify the Administrative Agent thereof and cause the Collateral and Guarantee Requirements to be satisfied with respect to such Domestic Subsidiary or Canadian Subsidiary of Holdings, as the case may be, and direct parent thereof as, subject to the proviso in this paragraph (b), a U.S. Subsidiary Guarantor or Canadian Subsidiary Guarantor, as the case may be, and with respect to any Equity Interests in or Indebtedness of such Domestic Subsidiary or Canadian Subsidiary of Holdings, as the case may be, owned by any Loan Party; provided that, to the extent requested by the Administrative Agent, such Domestic Subsidiary or Canadian Subsidiary, as the case may be, (x) shall be required to execute and deliver to the Administrative Agent a Joinder Agreement pursuant to which such Domestic Subsidiary shall become a U.S. Borrower or such Canadian Subsidiary shall become a Canadian Borrower, as the case may be, and (y) shall take all action in connection therewith as would otherwise have been required to cause the Collateral and Guarantee Requirements to be satisfied as if such Domestic Subsidiary had been a U.S. Borrower or such Canadian Subsidiary had been a Canadian Borrower, as the case may be, on the Funding Date.
(c) Subject to the final paragraph set forth in the definition of “Collateral and Guarantee Requirement”, from time to time, each Borrower will, at its cost and expense, promptly secure the applicable Secured Obligations by pledging or creating, or causing to be pledged or created, perfected security interests with respect to such of the assets and properties of the Loan Parties as either the Administrative Agent or the Required Lenders shall reasonably request (it being understood that, subject to the limitations set forth in this paragraph (c), it is the intent of the parties that the applicable Secured Obligations shall be secured by substantially all of the assets of the U.S. Loan Parties (including real and personal properties acquired after the Funding Date), all of the ABL Priority Collateral of the Canadian Loan Parties and all of the Equity Interests of Canadian Loan Parties directly held by any Canadian Loan Party; provided, however that notwithstanding anything to the contrary set forth in this Agreement or any other
Loan Document, (i) no leasehold mortgages or deeds of trust or fixture filings shall be required with respect to any leasehold interest of any Loan Party and (ii) no security interests shall be required to be pledged or created with respect to (A) properties set forth on Schedule 9.09(c), (B) any After-Acquired Mortgage Property that is subject to an existing mortgage (or any extension or refinancing thereof) or any After-Acquired Mortgage Property with a Fair Market Value of less than $5,000,000, (C) subject to paragraph (e) below, any Real Property located in the State of New York and (D) any assets located outside of the United States and Canada. Such security interests and Liens will be created under the Security Documents and other security agreements, mortgages, deeds of trust and other instruments and documents in form and substance reasonably satisfactory to the Administrative Agent, and each Borrower shall deliver or cause to be delivered to the Lenders all such instruments and documents (including customary legal opinions, title insurance policies or title opinions and lien searches) as the Administrative Agent shall reasonably request to evidence compliance with this paragraph (c).
(d) Notwithstanding anything to the contrary in paragraph (c) above, no security interests shall be required to be created pursuant to paragraph (c) above by any U.S. Loan Party with respect to any After-Acquired Mortgage Property with a fair market value (as determined by the applicable U.S. Loan Party in its reasonable judgment, it being understood that the purchase price shall be indicative thereof) (the “Fair Market Value”) equal to or greater than $5,000,000, unless and until the aggregate Fair Market Value of all items of After-Acquired Mortgage Property with a Fair Market Value equal to or greater than $5,000,000 and excluded pursuant to this paragraph (d) (and not granted as security for the U.S. Secured Obligations pursuant to the next sentence) is at least $50,000,000 in the aggregate for all U.S. Loan Parties. On each occasion that the Fair Market Value of all items of After-Acquired Mortgage Property described in the immediately preceding sentence shall be at least $50,000,000, Holdings and each other U.S. Borrower shall create, or shall cause to be created, security interests on all such property (and not merely the portion of the property in excess of $50,000,000) to secure the U.S. Secured Obligations (and thereafter, such property shall be disregarded for purposes of the calculation under the immediately preceding sentence) other than such property located in the State of New York.
(e) Upon the written request of the Administrative Agent, Holdings shall cause a Mortgage to be granted in favor of the Security Agent for the benefit of the Secured Parties, by the holder of any fee title in respect of any Real Property owned by a U.S. Loan Party which is located in the State of New York and, to the extent a Prior Agent exists, is subject to a Lien in favor of a Prior Agent, together with title insurance policy and such other documents relating to such Mortgage as reasonably requested by the Administrative Agent.
(b) Furnish to the Administrative Agent prompt written notice of (i) the acquisition by any U.S. Loan Party of, or any real property otherwise becoming, a property that is required to become a Mortgaged Property after the Funding Date and (ii) the acquisition by any Loan Party of any other material assets after the Funding Date, other than any assets constituting Collateral under the Security Documents in which the Security Agent shall have a valid, legal and perfected security interest (with the priority contemplated by the applicable Security Document) upon the acquisition thereof.
(c) Each year, at the time of delivery of annual financial statements with respect to the preceding fiscal year pursuant to Section 9.04(a), Holdings shall deliver to the Administrative Agent a certificate executed by a Responsible Officer of Holdings setting forth the information required pursuant to the Perfection Certificate or confirming that there has been no change in such information since the date of the Perfection Certificate delivered on the Funding Date or the date of the most recent certificate delivered pursuant to this paragraph (c).
(d) Cause all cash owned by each Borrower and the other Loan Parties at any time (other than Excluded Accounts) to be held in deposit accounts, securities accounts or commodities accounts maintained with a Domestic or Canadian office of any depositary institution, securities intermediary or commodity intermediary, as the case may be, in the name of one or more Loan Parties and will, in each case as promptly as practicable, notify the Administrative Agent of the existence of any deposit account, securities account or commodities account maintained by a Loan Party in respect of which a Control Agreement is required to be in effect pursuant to clause (h) of the definition of the term “Collateral and Guarantee Requirement” but is not yet in effect.
(b) Upon discovery of the presence on any of the real properties of any Hazardous Material that is in material violation of, or that could reasonably be expected to result in material liability under, any Environmental Law, in each case that could reasonably be expected to have a Material Adverse Effect, take or cause to be taken all necessary steps to initiate and expeditiously complete all remedial, corrective and other responsive action to the extent required pursuant to Environmental Law, and keep the Administrative Agent reasonably informed of such actions and the results thereof.
(a) the Indebtedness created hereunder and under the other Loan Documents;
(b) the Indebtedness (other than Indebtedness under the Term Loan Facility) existing on the Funding Date after giving effect to the consummation of the Plan of Reorganization and which is contemplated by the Plan of Reorganization on such date and any Permitted Refinancing Indebtedness in respect of thereof;
(c) Indebtedness consisting of Permitted Unsecured Notes issued on or prior to the Funding Date, provided that the requirements of Section 2.09(c) and (d) of the Term Loan Credit Agreement as in effect on the date hereof are satisfied in connection therewith, and any Permitted Refinancing Indebtedness in respect of thereof;
(d) intercompany loans and advances permitted by Section 10.04 and which, (i) if owed to a U.S. Loan Party, are evidenced by a promissory note and pledged pursuant to the Guarantee and Collateral Agreement and (ii) if owed by a Loan Party, are subordinated to the Loan Document Obligations on terms reasonably satisfactory to the Administrative Agent;
(e) Indebtedness of any Foreign Subsidiary of Holdings and any Guarantees thereof, provided that such Indebtedness shall not be Guaranteed by or otherwise be recourse to any Loan Party, except as permitted by Section 10.04(c) or (k); provided further that the aggregate principal amount of such Indebtedness at any time outstanding shall not exceed $35,000,000;
(f) Indebtedness under the Term Loan Facility, together with any Permitted Refinancing Indebtedness with respect thereto, including Guarantees thereof, in an aggregate principal amount not at any time in excess of $1,600,000,000 (as reduced by the aggregate principal amount (in each case, at the time of issuance thereof) of (i) Permitted Unsecured Notes permitted by paragraph (c) above and (ii) Permitted Notes permitted by paragraph (m) below), provided that any incremental financings in excess of $1,200,000,000 (including any incremental financings in excess of $1,200,000,000 incurred through Permitted Refinancing Indebtedness) under the Term Loan Facility shall be on substantially the same terms (other than fees and other pricing terms (other than interest rates) and, subject to pro forma compliance with the Incurrence Test, interest rates and, provided that the incremental financing shall not have a Weighted Average Life to Maturity shorter than the Weighted Average Life to Maturity of the Term Loans in existence immediately prior to such incremental financing, maturity date), as in effect for the Term Loan Facility immediately prior to the effectiveness of such incremental facility or any Permitted Refinancing Indebtedness in respect of the Term Loan Facility, as the case may be;
(g) Indebtedness in respect of (i) performance, surety, appeal or similar bonds, completion guarantees or similar instruments, including letters of credit and bankers acceptances incurred for such purposes (and not for the purpose of borrowing money), in each case provided in the ordinary course of business, (ii) Hedging Agreements entered into in the ordinary course of business and not for speculative purposes and (iii) agreements providing for indemnification, adjustment of purchase price or similar obligations, or from guarantees or letters of credit, surety bonds or performance bonds securing any obligations pursuant to such agreement, incurred in connection with the disposition of any business, assets or Subsidiary of Holdings;
(h) (i) Capital Lease Obligations and Attributable Indebtedness, (ii) Indebtedness created, incurred or assumed in respect of the purchase, improvement, repair or construction of property, provided that such Indebtedness is created, incurred or assumed within 180 days after the earlier of (x) the placement in service of such property or (y) the final payment on such property, and (iii) Indebtedness consisting of industrial revenue, environmental control and other similar bonds, and Guarantees of and letters of credit supporting such Indebtedness, provided that the aggregate amount of the Indebtedness and Attributable Indebtedness created, incurred or assumed pursuant to this paragraph (h) at any time outstanding shall not exceed $150,000,000;
(i) Indebtedness incurred to pay annual premiums for property and casualty insurance policies maintained by Holdings or any of its Subsidiaries in the ordinary course of business not exceeding in an aggregate amount at any time outstanding $75,000,000;
(j) Indebtedness of any Person acquired by Holdings or any of its Subsidiaries in a Permitted Acquisition (“Acquisition Indebtedness”) and assumed by Holdings or such Subsidiary pursuant to such acquisition (including any Permitted Refinancing
Indebtedness incurred in respect thereof at the time of assumption thereof or from time to time thereafter), provided that (i) such Indebtedness was not incurred in contemplation of such acquisition, (ii) the aggregate principal amount of such Indebtedness and Permitted Refinancing Indebtedness at any time outstanding shall not exceed $50,000,000, (iii) such Indebtedness and any Permitted Refinancing Indebtedness in respect thereof shall not be secured by any assets other than the assets securing the acquired Indebtedness prior to such acquisition and (iv) immediately after the incurrence thereof and giving pro forma effect thereto, the Interest Coverage Ratio shall not be less than the Interest Coverage Ratio immediately prior to such incurrence;
(k) Guarantees with respect to bonds issued to support workers’ compensation, or performance, surety, statutory or appeal bonds and other similar obligations (other than Indebtedness) incurred by Holdings or any of its Subsidiaries in the ordinary course of business;
(l) Indebtedness in the form of any earnout or other similar contingent payment obligation incurred in connection with an acquisition permitted hereunder;
(m) Indebtedness consisting of Permitted Notes, provided that (i) the Net Cash Proceeds from the issuance and sale thereof are applied to the mandatory prepayment of the Term Loans under the Term Loan Facility, (ii) such Permitted Notes are exchanged for Term Loans under the Term Loan Facility of one or more tranches pursuant to a Permitted Debt Exchange or (iii) to the extent an amount of such Net Cash Proceeds not in excess of the available Incremental Commitment Amount (as defined in the Term Loan Credit Agreement as in effect on the date hereof) immediately prior to the time of such issuance of sale are not so applied, the available Incremental Commitment Amount (as defined in the Term Loan Credit Agreement as in effect on the date hereof) is permanently reduced by an amount equal to the amount of such Net Cash Proceeds not applied pursuant to sub-paragraph (i) or (ii) above;
(n) Permitted Timber Financings in an aggregate principal amount at any time outstanding not in excess of $10,000,000;
(o) Indebtedness of Smurfit-Stone Puerto Rico in an aggregate principal amount at any time outstanding not to exceed $10,000,000 and the Guarantee thereof by Holdings on an unsecured basis; and
(p) Other Indebtedness of Holdings or any of its Subsidiaries in an aggregate principal amount at any time outstanding not in excess of $75,000,000.
(i) Permitted Liens;
(ii) Liens created under the Loan Documents;
(iii) Liens created under or pursuant to the Term Loan Facility Documents securing Indebtedness permitted under Section 10.01(f), provided that any such Liens on the Collateral and rights and remedies with respect thereto are at all times subject to the Intercreditor Agreement (or a successor intercreditor agreement having the same terms as the Intercreditor Agreement or such other terms reasonably acceptable to the Administrative Agent);
(iv) Liens existing as of the Closing Date that are not discharged on the Funding Date and that are listed on Schedule 10.02(a)(iv), provided that (A) such Liens shall apply only to the property or assets to which they apply on the Closing Date and (B) such Liens shall secure only (x) those obligations that they secured on the Closing Date and (y) refinancings of such secured obligations permitted hereunder so long as the principal amount of obligations secured under this clause (iv) does not exceed the sum of the principal amount of such secured obligations being refinanced plus the amount of any premium required to be paid thereon as a result of, and any interest, fees and costs incurred in, such refinancing;
(v) Liens securing Indebtedness permitted by Section 10.01(h), provided that any such Lien shall apply only to the property that is the subject of such Indebtedness and, if such Indebtedness was incurred to finance the acquisition, improvement, repair or construction of such property, the principal amount of Indebtedness secured by any such Lien shall at no time exceed 100% of the fair market value (as determined in good faith by Holdings or a Subsidiary of Holdings, as applicable) of the such property at the time it was so acquired, improved, repaired or constructed;
(vi) Liens securing Indebtedness permitted by Section 10.01(i), provided that such Liens attach only to insurance policies and proceeds thereof;
(vii) Liens securing Indebtedness constituting mortgage or purchase money financings, Capital Lease Obligations, industrial revenue bonds or similar financings assumed or incurred pursuant to Section 10.01(j) in connection with any acquisition permitted hereunder, provided that (A) such Liens attach only to property or assets acquired in connection with such acquisition, (B) such Liens were not created in contemplation of such acquisition and (C) such Liens shall secure only those obligations that they secure at the time of such acquisition and Permitted Refinancing Indebtedness in respect thereof;
(viii) Liens on property or assets owned by Foreign Subsidiaries of Holdings securing Indebtedness permitted under Section 10.01(e) and Liens on property or assets owned by Smurfit-Stone Puerto Rico and securing Indebtedness permitted under Section 10.01(o), provided that no such Liens shall apply to any assets constituting ABL Priority Collateral or any Equity Interests of a Canadian Loan Party directly held by a Canadian Loan Party;
(ix) Liens created under any agreement relating to the sale, transfer or other disposition of assets permitted hereunder, provided that such Liens relate solely to the assets to be sold, transferred or otherwise disposed;
(x) any Lien consisting of a lease of personal property of such Person to customers of such Person, if such lease constitutes an Investment permitted under Section 10.04(h);
(xi) Liens on assets of Holdings or any Subsidiary of Holdings securing up to $30,000,000 of Indebtedness permitted by Section 10.01(p) or the Incurrence Test, provided that no such Lien shall apply to any assets constituting Collateral;
(xii) Liens on timber properties securing Permitted Timber Financings permitted under Section 10.01(n);
(xiii) extensions, renewals or replacements of any Lien referred to in clause (v), (vi) or (vii) above, provided that such extension, renewal or replacement is limited to the Indebtedness and property originally secured and encumbered thereby;
(xiv) Liens securing Indebtedness under Permitted Second Lien Notes permitted under Section 10.01(m) and Permitted Refinancing Indebtedness in respect thereof, provided that any such Liens on the Collateral and rights and remedies with respect thereto are at all times subject to the Intercreditor Agreement (or a successor intercreditor agreement having the same terms as the Intercreditor Agreement or such other terms reasonably acceptable to the Administrative Agent); and
(xv) Liens not otherwise permitted by the foregoing clauses of this paragraph (a) securing obligations in an aggregate amount outstanding at any time not in excess of $20,000,000, provided that no such Liens shall apply to any assets constituting ABL Priority Collateral or any Equity Interests of a Canadian Loan Party directly held by a Canadian Loan Party.
(b) Enter into any agreement prohibiting the creation or assumption of any Lien upon properties or assets, whether now owned or hereafter acquired, except any such restriction that exists under (i) this Agreement, (ii) agreements governing any Indebtedness of Foreign Subsidiaries of Holdings permitted hereunder, (iii) any documents governing secured Indebtedness permitted hereunder, provided that such restrictions only relate to the assets securing such Indebtedness, (iv) any documents governing Indebtedness permitted under Section 10.01(j), (m) or (p), provided that such restrictions are customary market terms for similar credits and do not restrict the granting of Liens to secure Indebtedness incurred under this Agreement or the Term Loan Facility, (v) restrictions by reason of customary provisions contained in leases, licenses, governmental contracts and similar agreements entered into in the ordinary course of business, provided that such restrictions are limited to the property or assets subject to such leases, licenses, contracts or agreements), and (vi) any agreement with respect to a permitted sale or disposition of any assets, provided such restrictions are limited to the assets to be sold or disposed of.
(a) Permitted Investments;
(b) loans, advances or other Investments made by (i) Holdings or any Subsidiary of Holdings to or in any Loan Party or any wholly owned Domestic Subsidiary or any wholly owned Canadian Subsidiary of Holdings, provided that any such Investments by a Loan Party to or in any such Subsidiary that is not a Loan Party (x) complies with the requirements of Section 10.13 and (y) are in an aggregate amount not to exceed $5,000,000 outstanding at any time and (ii) any Foreign Subsidiary of Holdings (other than a Canadian Subsidiary of Holdings) to or in any other Foreign Subsidiary of Holdings;
(c) loans, advances or other Investments made to or in any Subsidiary of Holdings (other than a Loan Party, a Wholly-Owned Domestic Subsidiary or a Wholly-Owned Canadian Subsidiary of Holdings), and Guarantees of obligations of any such Subsidiary, in an aggregate amount not to exceed $25,000,000 outstanding at any time;
(d) Investments consisting of non-cash consideration received in connection with a sale of assets permitted under Section 10.13;
(e) Investments by SSCC, each Borrower and their respective Subsidiaries in existence on the Closing Date in the capital stock of their respective Subsidiaries;
(f) Investments consisting of Equity Interests, securities or notes received in settlement of accounts receivable incurred in the ordinary course of business from a customer that Holdings or any Subsidiary of Holdings has reasonably determined is unable to make cash payments in accordance with the terms of such account receivable;
(g) accounts receivable created or acquired, and deposits, prepayments and other credits to suppliers made, in the ordinary course of business;
(h) any Investments consisting of (i) any contract pursuant to which Holdings or any Subsidiary of Holdings obtains the right to cut, harvest or otherwise acquire timber on property owned by any other Person, whether or not the Borrower’s or such Subsidiary’s obligations under such contract are evidenced by a note or other instrument, or (ii) loans or advances to customers of Holdings or any Subsidiary of Holdings, including leases of personal property of Holdings or such Subsidiary to such customers, provided that the contracts, loans and advances constituting permitted Investments pursuant to this paragraph (h) shall not exceed $20,000,000 at any time outstanding;
(i) prepaid expenses and lease, utility, workers’ compensation, performance and other similar deposits made in the ordinary course of business;
(j) loans to officers and employees not to exceed $5,000,000 at any time outstanding;
(k) so long as the Payment Conditions are satisfied both before and after giving effect to such Investments, Holdings and its Subsidiaries may make additional Investments not otherwise permitted under this Section 10.04;
(l) Investments constituting Guarantees permitted under Section 10.01 and Investments permitted under Section 10.05(f); and
(m) Investments consisting of Hedging Agreements permitted hereunder.
(a) if at the time thereof and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing, (i) any Domestic Subsidiary of Holdings may merge into or consolidate with, liquidate or dissolve into, or sell, transfer, assign, lease, sublease or otherwise dispose of all or substantially all of its assets to, any U.S. Borrower in a transaction in which such U.S. Borrower is the surviving corporation, (ii) any Domestic Subsidiary of Holdings (other than any U.S. Borrower) may merge into or consolidate with, liquidate or dissolve into, or sell, transfer, assign, lease, sublease or otherwise dispose of all or substantially all of its assets to, any Wholly-Owned Domestic Subsidiary of Holdings (other than any U.S. Borrower) in a transaction in which the surviving corporation is a Wholly-Owned Domestic Subsidiary of Holdings and (iii) any Canadian Subsidiary of Holdings may merge into or consolidate or amalgamate with, liquidate or dissolve into, or sell, transfer, assign, lease, sublease or otherwise dispose of all or substantially all of its assets to, any Canadian Borrower in a transaction in which such Canadian Borrower is the surviving corporation, (iv) any Canadian Subsidiary of Holdings (other than any Canadian Borrower) may merge into or consolidate or amalgamate with, liquidate or dissolve into, or sell, transfer, assign, lease, sublease or otherwise dispose of all or substantially all of its assets to, any wholly owned Canadian Subsidiary of Holdings (other than any Canadian Borrower) in a transaction in which the surviving entity is a Wholly-Owned Canadian Subsidiary of Holdings; provided that, in each case, (x) if any Person other than a Wholly-Owned Domestic Subsidiary of Holdings or Wholly-Owned Canadian Subsidiary of Holdings, as the case may be, receives any consideration, such transaction is also permitted by Section 10.04 and (y) the surviving entity shall, at the time of such merger or consolidation, be in compliance with the requirements of Section 9.09(b);
(b) if at the time thereof and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing, (i) any Wholly-Owned Foreign Subsidiary of Holdings (other than any Canadian Subsidiary of Holdings) may merge into, amalgamate or consolidate with, liquidate or dissolve into, or sell, transfer, assign, lease, sublease or otherwise dispose of all or substantially all of its assets to, any Canadian Loan Party in a transaction in which the surviving entity is such Canadian Loan Party and (ii) any Wholly-Owned Foreign Subsidiary of Holdings (other than any Canadian Subsidiary of Holdings) may merge into, amalgamate or consolidate with, liquidate or dissolve into, or sell, transfer, assign, lease, sublease or otherwise dispose of all or substantially all of its assets to, any other Wholly-Owned Foreign Subsidiary of Holdings (other than a Canadian Loan Party) in a transaction in which the surviving entity is a Wholly-Owned Foreign Subsidiary of Holdings, provided that no Person other than a Loan Party or a Wholly-Owned Foreign Subsidiary of Holdings receives any consideration and the Collateral and Guarantee Requirement shall be satisfied with respect to voting Equity Interests of such surviving or acquiring Foreign Subsidiary of Holdings that are owned by a Loan Party;
(c) the Funding Date Merger and the other transactions contemplated by the Plan of Reorganization as described in the Disclosure Statement on the Closing Date may be consummated on or prior to the Funding Date;
(d) purchases of inventory, equipment and real property in the ordinary course of business;
(e) Investments permitted by Section 10.04; and
(f) any Loan Party may acquire all or substantially all the assets of a Person or line of business, unit or division of such Person, in each case primarily located in the United States or Canada, or not less than 100% of the Equity Interests of such a Person (other than directors’ qualifying shares) (in each case referred to herein as the “Acquired Entity”); provided that (i) the Acquired Entity shall be in a similar line of business as that of Holdings and its Subsidiaries, (ii) the acquisition shall not be preceded by, or effected pursuant to, an unsolicited tender offer or proxy solicitation, (iii) at the time of such transaction both before and immediately after giving effect thereto, no Event of Default or Default shall have occurred and be continuing, (iv) the Payment Conditions are satisfied at the time of such acquisition and after giving pro forma effect thereto and (v) upon consummation of such acquisition, the Acquired Entity and each Domestic Subsidiary and Canadian Subsidiary of Holdings thereof shall become a Loan Party if such Acquired Entity or Subsidiary would be a Material Subsidiary based on a pro forma calculation for the most recent period of four consecutive fiscal quarters in respect of which financial statements have been delivered; and Holdings and each Borrower shall comply, and shall cause their respective Subsidiaries to comply, with the other provisions of Section 9.09 applicable to such Acquired Entity or Subsidiary, or to its Equity Interests, substantially concurrently with the consummation of such acquisition or by such later date reasonably agreed by the Administrative Agent with respect to specific compliance items (any acquisition of an Acquired Entity meeting all of the criteria set forth in this paragraph (f) being referred to herein as a “Permitted Acquisition”).
(b) Notwithstanding the provisions of paragraph (a) above:
(i) the transactions contemplated by the Plan of Reorganization to occur on the Funding Date may be consummated on the Funding Date;
(ii) Holdings may make Restricted Payments so long as the Payment Conditions are satisfied both before and after giving effect to such Restricted Payments;
(iii) Holdings may make Restricted Payments for the repurchase, retirement or other acquisition for value of Equity Interests of Holdings held by any future, present or former employee or director of Holdings or any of its Subsidiaries pursuant to any employee or director equity plan, employee or director stock option plan or any other employee or director benefit plan of Holdings or its Subsidiaries, provided that the aggregate amount of such Restricted Payments in any fiscal year shall not exceed $5,000,000, provided that at the time of any such Restricted Payment made pursuant to this clause (iii) and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing; and
(iv) Holdings may make Restricted Payments in any fiscal year commencing on or after January 1, 2011, so long as (x) immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing and (y) the aggregate amount of such Restricted Payments made pursuant to this clause (iv) shall not exceed (A) the lesser of (1) the Borrower’s Portion of Excess Cash Flow (as defined in the Term Loan Credit Agreement (as in effect on the date hereof)) and (2) the sum of (aa) $30,000,000 plus (bb) so long as Excess Availability (on the date of such Restricted Payment after giving effect to any Loans incurred (or to be incurred) or Letters of Credit issued (or to be issued) on such date) shall exceed 20% of the Total Commitment as then in effect, $20,000,000 minus (B) the aggregate principal amount of Term Loans theretofore purchased pursuant to Section 10.09(iv).
(b) Cause or suffer to exist any amendment, restatement, supplement or other modification to the certificate of incorporation (including any certificate of designation with respect to any preferred stock) or by-laws of (or, in each case an equivalent organizational
document) Holdings or any Subsidiary of Holdings without the prior written consent of the Required Lenders, unless such amendment, restatement, supplement or modification is not materially adverse to the interests of the Lenders hereunder or under the other Loan Documents (provided that the foregoing will not prohibit the consummation of the Funding Date Merger).
(b) Notwithstanding anything to the contrary in this Agreement, Holdings shall not transfer any of its assets to any Subsidiary of Holdings and none of the Subsidiaries of Holdings shall transfer any of its assets to any other Subsidiary of Holdings unless (i) in the case of any asset or assets constituting Collateral, such asset or assets is transferred to a Loan Party and the Administrative Agent is satisfied that the Liens created under the Security Documents on such asset or assets shall be in full force and effect, or (ii) in the case of any asset or assets not constituting Collateral, such transfer is permitted as an Investment under Section 10.04 or is permitted under Section 10.05.
(b) Permit on any day in any fiscal quarter of Holdings, the aggregate amount of cash held by Domestic Subsidiaries of Holdings in deposit accounts (other than Excluded Deposit Accounts) that are not subject to Control Agreements to exceed $15,000,000, unless, during the 30-day period after the last day of such fiscal quarter, one or more of such Domestic Subsidiaries of Holdings are designated by Holdings as a Material Subsidiary pursuant to clause (c) of the definition thereof and enter into Control Agreements, with respect to their deposit
accounts referred to above, so that, if such Control Agreement has been in effect at all times during such fiscal quarter, such $15,000,000 threshold would not have been exceeded on any day.
(a) any representation or warranty made or deemed made in any Loan Document, or any representation, warranty, statement or information contained in any report, certificate, financial statement or other instrument furnished pursuant to any Loan Document, shall prove to have been false or misleading in any material respect when so made, deemed made or furnished;
(b) default shall be made in the payment of any principal of (or Face Amount of in the case of any B/A Instrument) any Loan, Note or Unpaid Drawing when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or by acceleration thereof or otherwise;
(c) default shall be made in the payment of any interest on any Loan, Note or Unpaid Drawing or any Fee or any other amount (other than an amount referred to in paragraph (b) above) due under any Loan Document, when and as the same shall become due and payable, and such default shall continue unremedied for a period of three Business Days, in the case of payment of any such interest or Fee, or 10 Business Days in the case of payment of any such other amount;
(d) default shall be made in the due observance or performance by Holdings or any other Borrower of any covenant, condition or agreement contained in Sections 9.01 (with respect to Holdings or any other Borrower), 9.04(i), 9.04(j), 9.05(a), 9.05(f), 9.07, 9.13 or in Section 10;
(e) default shall be made in the due observance or performance by any Loan Party or any of their respective Subsidiaries of any covenant, condition or agreement contained in any Loan Document (other than those defaults specified in paragraph (b), (c) or (d) above) and such default shall continue unremedied for a period of 30 days (or 15 days solely in the case of Section 9.04(a), 9.04(b), 9.04(c) or 9.04(d)) after written notice thereof from the Administrative Agent or any Lender to Holdings;
(f) Holdings, any other Borrower or any Subsidiary of Holdings shall (i) fail to pay any principal or interest, regardless of amount, due in respect of any Material Indebtedness, when and as the same shall become due and payable (after giving effect to any applicable grace period), or (ii) fail to observe or perform any other term, covenant, condition or agreement contained in any agreement or instrument evidencing or governing any such Indebtedness (after giving effect to any applicable grace period), if the effect of any failure referred to in this clause (ii) is to cause, or to permit the holder or holders of such Indebtedness or a trustee on its or their behalf to cause, such Indebtedness to become due prior to its stated maturity, provided that this paragraph (f) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or asset securing such Indebtedness;
(g) at any time after the Funding Date, an involuntary proceeding shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (i) relief in respect of Holdings, any other Borrower, any other Loan Party or any Material Subsidiary of Holdings, or of a substantial part of the property or assets of any such Person, under any Insolvency Law, (ii) the appointment of a receiver, interim receiver, receiver and manager, trustee, custodian, sequestrator, conservator or similar official for any such Person or for a substantial part of the property or assets of any such Person or (iii) the winding-up or liquidation of any such Person; and such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(h) Holdings, any other Borrower, any other Loan Party or any Material Subsidiary of Holdings shall (i) voluntarily commence any proceeding or file any petition seeking relief under any Insolvency Law, (ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or the filing of any petition described in paragraph (g) above, (iii) apply for or consent to the appointment of a receiver, interim receiver, receiver and manager, trustee, custodian, sequestrator, conservator or similar official for any such Person or for a substantial part of the property or assets of any such Person, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors, (vi) become unable, admit in writing its inability or fail generally to pay its debts as they become due or (vii) take any action for the purpose of effecting any of the foregoing;
(i) one or more judgments for the payment of money, individually or in the aggregate, in an amount in excess of $30,000,000 (in each case to the extent not adequately covered by insurance proceeds as to which the insurance company has acknowledged coverage pursuant to a writing reasonably satisfactory to the Administrative Agent), shall be rendered against Holdings, any other Borrower or any of their respective Subsidiaries or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, vacated, discharged or satisfied;
(j) an ERISA Event shall have occurred that, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in increased liability of Holdings, any other Borrower, any other Loan Party, any of their respective Subsidiaries and ERISA Affiliates in an aggregate amount more than $30,000,000 greater than the liability as of the Closing Date reasonably estimated by the Required Lenders in good faith attributable to either of the following:
(i) the Plans’ and Multiemployer Plans’ funded status as of the most recent valuation or other statement of financial condition prior to the Closing Date; or
(ii) withdrawal liability with respect to a Multiemployer Plan as of the most recent estimate of withdrawal liability for such Multiemployer Plan received before the Closing Date;
(k) there shall have occurred a Change in Control or Holdings, any other Borrower or any of their respective Subsidiaries shall make any mandatory prepayment, repurchase or redemption or make any offer to make any such mandatory prepayment, repurchase or redemption of any Indebtedness in an aggregate outstanding principal amount in excess of $30,000,000 on account of any “Change of Control” (however designated) referred to in the indenture, agreement or other instrument governing such Indebtedness;
(l) any Lien purported to be created by any Security Document shall cease to be, or shall be asserted by any Loan Party not to be, a valid, perfected first priority (or, in the case of the Term Priority Collateral, second priority, but second in priority only in respect of the obligations under the Term Loan Facility or Permitted Notes) Lien on (i) any Collateral (except as otherwise expressly provided in this Agreement or such Security Document) with a fair market value or book value (whichever is greater) in excess, individually or in the aggregate, of $100,000,000, or (ii) any ABL Priority Collateral (except as otherwise expressly provided in this Agreement or such Security Document) with a fair market value or book value (whichever is greater) in excess, individually or in the aggregate, of $50,000,000, in each case, except to the
extent that any such loss of perfection, priority or rank results from the failure of the Security Agent to maintain possession of certificates representing securities pledged under the Security Documents or otherwise take any action within its control (including the filing of UCC continuation statements or similar filings or registrations under the applicable laws of any other jurisdiction);
(m) any Loan Document shall not be for any reason, or shall be asserted by the Loan Party (except as otherwise expressly provided in this Agreement or such Loan Document) not to be, in full force and effect and enforceable in all material respects in accordance with its terms; or
(n) the Loan Document Obligations shall cease to constitute, or shall be asserted by any Loan Party (except as otherwise expressly provided in this Agreement or such Loan Document) not to constitute, senior indebtedness under the subordination provisions of any subordinated Indebtedness of any Loan Party, or any such subordination provisions shall be invalidated or otherwise cease to be a legal, valid and binding obligation of the parties thereto, enforceable in accordance with its terms.
(i) first, to all amounts owing to the Security Agent pursuant to any of the Loan Documents in its capacity as such in respect of (x) the preservation of Collateral or its security interest in the Collateral or (y) the exercise of any remedies provided in the last paragraph of Section 11.01;
(ii) second, to the extent proceeds remain after the application pursuant to preceding clause (i), to all amounts owing to any Agent pursuant to any of the Loan Documents in its capacity as such;
(iii) third, to the extent proceeds remain after the application pursuant to preceding clauses (i) and (ii), to an amount equal to the outstanding Primary U.S. Loan Party Obligations shall be paid to the Secured Parties as provided in Section 11.02(e), with each Secured Party receiving an amount equal to its outstanding Primary U.S. Loan Party Obligations or, if the proceeds are insufficient to pay in full all such Primary U.S. Loan Party Obligations, its Pro Rata Share of the amount remaining to be distributed;
(iv) fourth, to the extent proceeds remain after the application pursuant to preceding clauses (i) through (iii), inclusive, to an amount equal to the outstanding Primary Obligations (including Primary Obligations which are also Canadian Loan Party Obligations) shall be paid to the Secured Parties as provided in Section 11.02(e), with each Secured Party receiving an amount equal to its outstanding Primary Obligations (including Primary Obligations which are also Canadian Loan Party Obligations) or, if the proceeds are insufficient to pay in full all such Primary Obligations (including Primary Obligations which are also Canadian Loan Party Obligations), its Pro Rata Share of the amount remaining to be distributed;
(v) fifth, to the extent proceeds remain after the application pursuant to preceding clauses (i) through (iv), inclusive, to an amount equal to the outstanding Secondary U.S. Loan Party Obligations shall be paid to the Secured Parties as provided in Section 11.02(e), with each Secured Party receiving an amount equal to its outstanding Secondary U.S. Loan Party Obligations or, if the proceeds are insufficient to pay in full
all such Secondary U.S. Loan Party Obligations, its Pro Rata Share of the amount remaining to be distributed;
(vi) sixth, to the extent proceeds remain after the application pursuant to preceding clauses (i) through (v), inclusive, to an amount equal to the outstanding Secondary Obligations (including Secondary Obligations which are also Canadian Loan Party Obligations) shall be paid to the Secured Parties as provided in Section 11.02(e), with each Secured Party receiving an amount equal to its outstanding Secondary Obligations (including Secondary Obligations which are also Canadian Loan Party Obligations) or, if the proceeds are insufficient to pay in full all such Secondary Obligations (including Secondary Obligations which are also Canadian Loan Party Obligations), its Pro Rata Share of the amount remaining to be distributed;
(vii) seventh, to the extent proceeds remain after the application pursuant to preceding clauses (i) through (vi), inclusive, to an amount equal to the outstanding Tertiary Obligations shall be paid to the Secured Parties as provided in Section 11.02(e), with each Secured Party receiving an amount equal to its outstanding Tertiary Obligations or, if the proceeds are insufficient to pay in full all such Tertiary Obligations, its Pro Rata Share of the amount remaining to be distributed; and
(viii) eighth, to the extent proceeds remain after the application pursuant to preceding clauses (i) through (vii), inclusive, and following the Discharge of Revolving Credit Obligations, to the extent that the Term Loan Agent shall have notified the Administrative Agent that the Discharge of Term Loan Credit Obligations (as defined in the Intercreditor Agreement) has occurred, to the relevant Loan Party, their successors or assigns, or as a court of competent jurisdiction may otherwise direct or as otherwise required by the Intercreditor Agreement.
(b) When payments to Secured Parties are based upon their respective Pro Rata Shares (other than in respect of Tertiary Obligations), the amounts received by such Secured Parties hereunder shall be applied (for purposes of making determinations under this Section 11.02 only) (i) first, to their Primary Obligations and (ii) second, to their Secondary Obligations. If any payment to any Secured Party of its Pro Rata Share of any distribution would result in overpayment to such Secured Party, such excess amount shall instead be distributed in respect of the unpaid Primary Obligations or Secondary Obligations, as the case may be, of the other Secured Parties, with each Secured Party whose Primary Obligations or Secondary Obligations, as the case may be, have not been paid in full to receive an amount equal to such excess amount multiplied by a fraction the numerator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of such Secured Party and the denominator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of all Secured Parties entitled to such distribution.
(c) Each of the Secured Parties, by their acceptance of the benefits hereof and of the Security Documents executed by a Loan Party, agrees and acknowledges that if the Secured Parties receive a distribution on account of undrawn amounts with respect to Letters of Credit issued under this Agreement (which shall only occur after all Unpaid Drawings have been paid in full), such amounts shall be paid to the Administrative Agent and held by it, for the equal and ratable benefit of the Secured Parties, as cash security for the repayment of Secured Obligations owing by the Loan Parties to the Secured Parties as such. If any amounts are held as cash security pursuant to the immediately preceding sentence, then upon the termination of all outstanding Letters of Credit under this Agreement, and after the application of all such cash security to the repayment of all other Secured Obligations owing by the Loan Parties to the Secured Parties after giving effect to the termination of all such Letters of Credit, if there remains any excess cash, such excess cash shall be returned by the Administrative Agent to the Security Agent for distribution in accordance with Section 11.02(a).
(d) Subject to the terms of the Intercreditor Agreement, all payments required to be made hereunder shall be made (x) if to the Lender Creditors, to the Administrative Agent for the account of the Lender Creditors, (y) if to the Hedging Creditors, to the trustee, paying agent or other similar representative (each, a “Representative”) for the Hedging Creditors or, in the absence of such a Representative, directly to the Hedging Creditors and (z) if to the Cash Management Creditors, directly to the Cash Management Creditors.
(e) For purposes of applying payments received in accordance with this Section 11.02, the Security Agent shall be entitled to rely upon (i) the Administrative Agent, (ii) the Representative or, in the absence of such a Representative, upon the Hedging Creditors and
(iii) the Cash Management Creditors for a determination (which the Administrative Agent and each other Secured Party agrees (or shall agree) to provide upon request of the Security Agent) of the outstanding Secured Obligations of the Loan Parties owed to the Secured Parties. Unless it has received written notice from a Secured Party to the contrary, the Administrative Agent, in furnishing information pursuant to the preceding sentence, and the Security Agent, in acting hereunder, shall be entitled to assume that no Secondary Obligations are outstanding. Unless it has written notice from a Hedging Creditor or a Cash Management Creditor to the contrary, the Security Agent, in acting hereunder, shall be entitled to assume that no Secured Hedging Agreements or Secured Cash Management Agreements are in existence.
(f) Subject to the other limitations (if any) set forth herein and in the other Loan Documents, it is understood that the Loan Parties shall remain liable (as and to the extent set forth in the Loan Documents) to the extent of any deficiency between the amount of the proceeds of the Collateral and the aggregate amount of the Secured Obligations of the Loan Parties.
(g) It is understood and agreed by each Loan Party and each Secured Party that the Security Agent shall have no liability for any determinations made by it in this Section 11.02 (including, without limitation, as to whether given Collateral constitutes Term Priority Collateral or ABL Priority Collateral), in each case except to the extent resulting from the gross negligence or willful misconduct of the Security Agent (as determined by a court of competent jurisdiction in a final and non-appealable decision). Each Loan Party and each Secured Party also agrees that the Security Agent may (but shall not be required to), at any time and in its sole discretion, and with no liability resulting therefrom, petition a court of competent jurisdiction regarding any application of Collateral in accordance with the requirements hereof and of the Intercreditor Agreement, and the Security Agent shall be entitled to wait for, and may conclusively rely on, any such determination.
(h) Notwithstanding anything to the contrary contained in this Agreement or any other Loan Document, the Canadian Loan Parties shall not be required to repay or prepay, or to guarantee, nor shall any proceeds in respect of Collateral of the Canadian Loan Parties and payments by the Canadian Loan Parties be applied to, direct obligations (excluding obligations as guarantor of the Canadian Loan Parties) of the U.S. Loan Parties.
(b) Notwithstanding any other provision of this Agreement or any provision of any other Loan Document, the Syndication Agent, the Documentation Agents, the Lead Arrangers and the Senior Managing Agents are named as such for recognition purposes only, and in its capacity as such shall have no powers, duties, responsibilities or liabilities with respect to this Agreement or the other Loan Documents or the transactions contemplated hereby and thereby; it being understood and agreed that the Syndication Agent, the Documentation Agents, the Lead Arrangers and the Senior Managing Agents shall be entitled to all indemnification and reimbursement rights in favor of the Administrative Agent as, and to the extent, provided for under Sections 12.06 and 13.01. Without limitation of the foregoing, the Syndication Agent, the Documentation Agents, the Lead Arrangers and the Senior Managing Agents shall not, solely by reason of this Agreement or any other Loan Documents, have any fiduciary relationship in respect of any Lender or any other Person.
(b) Upon any such notice of resignation by the Administrative Agent, the Required Lenders shall appoint a successor Administrative Agent hereunder and under the other Loan Documents who shall be a commercial bank or trust company reasonably acceptable to Holdings, which acceptance shall not be unreasonably withheld or delayed (provided that the Holdings’ approval shall not be required if a Default or an Event of Default then exists).
(c) If a successor Administrative Agent shall not have been so appointed within such 15 Business Day period, the Administrative Agent, with the consent of Holdings (which consent shall not be unreasonably withheld or delayed, provided that Holdings’ consent shall not be required if a Default or an Event of Default then exists), shall then appoint a successor Administrative Agent who shall serve as Administrative Agent hereunder or thereunder until such time, if any, as the Required Lenders appoint a successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed pursuant to clause (b) or (c) above by the 20th Business Day after the date such notice of resignation was given by the Administrative Agent, the Administrative Agent’s resignation shall become effective and the Required Lenders shall thereafter perform all the duties of the Administrative Agent hereunder and/or under any other Loan Document until such time, if any, as the Required Lenders appoint a successor Administrative Agent as provided above.
(e) The Required Lenders may at any time when the Administrative Agent has become the subject of a proceeding under Debtor Relief Law, or had a receiver, conservator, trustee or custodian appointed for it, upon no less than thirty (30) days’ prior notice, replace the Administrative Agent. The successor Administrative Agent shall not be the subject of a
proceeding under the Debtor Relief Law, or had a receiver, conservator, trustee or custodian appointed for it and shall succeed to and become vested with all of the rights, powers, privileges and duties of the replaced Administrative Agent, and the replaced Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents. The fees payable by the Borrowers to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrowers and such successor. The provisions of this Section 12 and Section 13.01 shall continue in effect for the benefit of such replaced Administrative Agent, its sub-agents and their respective Affiliates in respect of any actions taken or omitted to be taken by any of them while the replaced Administrative Agent was acting as Administrative Agent. Any such replacement of an Administrative Agent hereunder shall automatically, and with no further action required on the part of the Administrative Agent, constitute the resignation of the Administrative Agent in its capacity as an Issuing Lender, the Swingline Lender and the Fronting Lender, in which case the replaced Administrative Agent (x) shall not be required to issue any further Letters of Credit, make any additional Swingline Loans or fund any Specified Foreign Currency Loan hereunder and (y) shall maintain all of its rights as Issuing Lender, Swingline Lender or Fronting Lender, as the case may be, with respect to any Letters of Credit issued by it, Swingline Loans made by it, or Specified Foreign Currency Loans funded by it, prior to the date of such replacement.
(f) Upon a resignation, replacement or removal of the Administrative Agent pursuant to this Section 12.09, the Administrative Agent shall remain indemnified to the extent provided in this Agreement and the other Loan Documents and the provisions of this Section 12 (and the analogous provisions of the other Loan Documents) shall continue in effect for the benefit of the Administrative Agent for all of its actions and inactions while serving as the Administrative Agent hereunder and under the other Loan Documents.
(g) Any Co-Collateral Agent may resign at any time upon written notice to Holdings, the Administrative Agent and each Lender and the resignation of such Co-Collateral Agent shall become effective immediately upon the delivery of such written notice.
(h) (i) If the Commitments of General Electric Capital Corporation are less than 50% of the Commitments of the Administrative Agent or General Electric Capital Corporation is a Defaulting Lender, General Electric Capital Corporation may be removed as a Co-Collateral Agent by Holdings or the Required Lenders upon written notice to it as Co-Collateral Agent and with such removal to become effective immediately upon the delivery of such written notice, (ii) if the Commitments of JPMorgan Chase Bank, N.A. are less than 50% of the Commitments of the Administrative Agent or JPMorgan Chase Bank, N.A. is a Defaulting Lender, JPMorgan Chase Bank, N.A. may be removed as a Co-Collateral Agent by Holdings or the Required Lenders upon written notice to it as Co-Collateral Agent and with such removal to become effective immediately upon the delivery of such written notice.
(i) Upon a resignation or removal of any Co-Collateral Agent pursuant to Section 12.09(g) or (h), any Co-Collateral Agent shall remain indemnified to the extent provided in this Agreement and the other Loan Documents and the provisions of this Section 12 (and the analogous provisions of the other Loan Documents) shall continue in effect for the benefit of such Co-Collateral Agent for all of its actions and inactions while serving as such Co-Collateral Agent hereunder and under the other Loan Documents.
(b) The Lenders hereby authorize and direct the Security Agent, at its option and in its discretion, to release or subordinate (as the case may be) any Lien granted to or held by the Security Agent upon any Collateral and the Guarantees under the Guarantee and Collateral Agreement and/or Canadian Guarantee and Collateral Agreement (i) upon termination of the Total Commitment (and all Letters of Credit and Bankers’ Acceptances (or the obligations in an amount of 105% of outstanding stated amounts are cash collateralized), and payment and satisfaction of all of the Obligations (other than inchoate indemnification obligations and other contingent obligations not due and payable) at any time arising under or in respect of this Agreement or the Loan Documents or the transactions contemplated hereby or thereby, (ii) constituting property being sold or otherwise disposed of (to Persons other than Holdings and its Subsidiaries) upon the sale or other disposition thereof in compliance with Section 10.13, or consummation of any transaction permitted hereunder as a result of which any Guarantor (other than SSCE, SSCC or any other Borrower) ceases to be a Subsidiary of Holdings, (iii) if approved, authorized or ratified in writing by the Required Lenders (or all of the Lenders hereunder, to the extent required by Section 13.12) or (iv) as otherwise may be expressly provided in the relevant Security Documents or in the Intercreditor Agreement. Upon request by the Administrative Agent at any time, the Lenders will confirm in writing the Security Agent’s authority to release particular types or items of Collateral pursuant to this Section 12.10.
(c) The Security Agent shall have no obligation whatsoever to the Lenders or to any other Person to assure that the Collateral exists or is owned by any Loan Party or is cared for, protected or insured or that the Liens granted to the Security Agent herein or pursuant hereto have been properly or sufficiently or lawfully created, perfected, protected or enforced or are entitled to any particular priority, or to exercise or to continue exercising at all or in any manner or under any duty of care, disclosure or fidelity any of the rights, authorities and powers granted or available to the Security Agent in this Section 12.10, in any of the Security Documents or in the Intercreditor Agreement, it being understood and agreed that in respect of the Collateral, or any act, omission or event related thereto, the Security Agent may act in any manner it may deem appropriate, in its sole discretion, given the Security Agent’s own interest in the Collateral as one of the Lenders and that the Security Agent shall have no duty or liability whatsoever to the Lenders, except for its gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision).
(d) The Security 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, or delegate any and all such rights and powers to, any one or more sub-agents, trustees or third parties appointed by the Security Agent. The Security Agent (and any such sub-agent, trustee or third party) may perform any and all of its duties and exercise its rights and powers by or through their respective Affiliates. The exculpatory and indemnification provisions of this Section 12 and Section 13.01 shall apply to any such sub-agent, trustee or third party and to their respective Affiliates to the same extent that such provisions apply to the Security Agent.
(b) To the full extent permitted by applicable law, each of Holdings and the other Borrowers shall not assert, and hereby waives, any claim against any Indemnified Person, on any theory of liability, for special, indirect, consequential or incidental damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof. No Indemnified Person shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby, except to the extent the liability of such Indemnified Person results from such Indemnified Person’s (or its related parties’) gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision).
(c) The provisions of this Section 13.01 shall remain operative and in full force and effect regardless of the expiration of the term of this Agreement, the consummation of the transactions contemplated hereby, the repayment of any of the Loans, termination of any Commitments, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of the Administrative Agent or any Lender. All amounts due under this Section 13.01 shall be payable promptly after written demand therefor.
(b) Notwithstanding the foregoing, any Lender (or any Lender together with one or more other Lenders) may (x) assign all or a portion of its Commitments under a Tranche and related outstanding Obligations (or, if the Commitments with respect to the relevant Tranche have terminated, outstanding Obligations) hereunder to (i) (A) its parent company and/or any affiliate of such Lender which is at least 50% owned by such Lender or its parent company or (B) one or more other Lenders or any affiliate of any such other Lender which is at least 50% owned by such other Lender or its parent company (provided that any fund (which fund, together with its Affiliates, has a combined capital and surplus in excess of $500,000,000) that invests in loans and is managed or advised by the same investment advisor of another fund which is a Lender (or by an Affiliate of such investment advisor) shall be treated as an affiliate of such other Lender for the purposes of this sub-clause (x)(i)(B)); provided that no such assignment may be made to any such Person that is, or would at such time constitute, a Defaulting Lender or (ii) in the case of any Lender that is a fund that invests in loans, any other fund (which fund, together with its Affiliates, has a combined capital and surplus in excess of $500,000,000) that invests in loans managed or advised by the same investment advisor of any Lender or by an Affiliate of such investment advisor or (y) assign all, or if less than all, a portion equal to at least $5,000,000, in each case in the aggregate for the assigning Lender or assigning Lenders, of such Commitments and related outstanding Obligations (or, if the Commitments with respect to the relevant Tranche have terminated, outstanding Obligations) hereunder to one or more Eligible Transferees (treating any fund that invests in loans and any other fund that invests in loans and is managed or advised by the same investment advisor of such fund or by an Affiliate of such investment advisor as a single Eligible Transferee), each of which assignees shall become a party to this Agreement as a Lender by execution of an Assignment and Assumption Agreement, provided that (t) at such time, Schedule 1.01(a) shall be deemed modified to reflect the Commitments and/or outstanding Revolving Loans, as the case may be, of such new Lender and of the existing Lenders, (u) upon the surrender of the relevant Notes by the assigning Lender (or, upon such assigning Lender’s indemnifying the applicable Borrowers for any lost Note pursuant to a customary indemnification agreement) new Notes will be issued, at the Borrowers’ joint and several expense, to such new Lender and to the assigning Lender upon the request of such new Lender or assigning Lender, such new Notes to be in conformity with the requirements of Section 2.05 (with appropriate modifications) to the extent needed to reflect the revised Commitments and/or outstanding Revolving Loans, as the case may be, (v) the consents (not to
be unreasonably withheld, delayed or conditioned) of each Issuing Lender, the Swingline Lender and, unless such assignment is to a Person that will not be a Participating Specified Foreign Currency Lender, the Fronting Lender, shall be required in connection with any such assignment, (w) the consent of the Administrative Agent and, so long as no Default or Event of Default then exists, Holdings, shall be required in connection with any such assignment pursuant to clause (y) above (such consents, in any case, not to be unreasonably withheld, delayed or conditioned) provided that Holdings shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within 5 Business Days after having received notice thereof, (x) the Administrative Agent shall receive at the time of each such assignment, from the assigning or assignee Lender, the payment of a non-refundable assignment fee of $3,500, (y) each assignment by any Participating Specified Foreign Currency Lender shall require a Specified Foreign Currency Participation Settlement with respect to such Participating Specified Foreign Currency Lender unless the Fronting Lender agrees in its sole discretion that the respective assignee shall succeed such Participating Specified Foreign Currency Lender as a Participating Specified Foreign Currency Lender itself, in which case such assignee shall acquire the Specified Foreign Currency Participation of the respective assignor and (z) no such transfer or assignment will be effective until recorded by the Administrative Agent on the Register pursuant to Section 13.15. To the extent of any assignment pursuant to this Section 13.04(b), the assigning Lender shall be relieved of its obligations hereunder with respect to its assigned Commitments and outstanding Revolving Loans. At the time of each assignment pursuant to this Section 13.04(b) to a Person which is not already a Lender hereunder and which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for Federal income tax purposes, the respective assignee Lender shall, to the extent legally entitled to do so, provide to Holdings and the Administrative Agent the appropriate Internal Revenue Service Forms (and, if applicable, a Section 5.04(b)(ii) Certificate) described in Section 5.04(b). In addition, at the time of each assignment pursuant to this Section 13.04(b) to a Person which is not already a Lender hereunder, the respective assignee Lender shall, to the extent legally entitled to do so and at the reasonable request of Holdings, file any certificate or document or furnish to the relevant Borrower and the Administrative Agent, such certificate or document that may be necessary to establish any available exemption from, or reduction of, any Taxes, as described in Section 5.04(c). To the extent that an assignment of all or any portion of a Lender’s Commitments and related outstanding Obligations pursuant to Section 2.13 or this Section 13.04(b) would, at the time of such assignment, result in increased costs under Section 2.10 or 3.06 from those being charged by the respective assigning Lender prior to such assignment, then the Borrowers shall not be obligated to pay such increased costs (although the Borrowers, in accordance with and pursuant to the other provisions of this Agreement, shall be obligated to pay any other increased costs of the type described above resulting from changes after the date of the respective assignment). A Lender may only assign all or a portion of its Commitments hereunder if that assignment would result in at least two Lenders under this Agreement.
(c) Nothing in this Agreement shall prevent or prohibit any Lender from pledging its Loans and Notes hereunder to a Federal Reserve Bank in support of borrowings made by such Lender from such Federal Reserve Bank and, with prior notification to the Administrative Agent (but without the consent of the Administrative Agent or Holdings), any Lender which is a fund may pledge all or any portion of its Loans and Notes to its trustee or to a collateral agent providing credit or credit support to such Lender in support of its obligations to
such trustee, such collateral agent or a holder of such obligations, as the case may be. No pledge pursuant to this clause (c) shall release the transferor Lender from any of its obligations hereunder.
(d) Any Lender which assigns all of its Commitments and/or Revolving Loans hereunder in accordance with Section 13.04(b) shall cease to constitute a “Lender” hereunder, except with respect to indemnification provisions under this Agreement (including, without limitation, Sections 2.10, 2.11, 3.06, 5.04, 12.06, 13.01 and 13.06), which shall survive as to such assigning Lender.
(b) Each of the Lenders agrees that, if it should receive any amount hereunder (whether by voluntary payment, by realization upon security, by the exercise of the right of setoff or banker’s lien, by counterclaim or cross action, by the enforcement of any right under the Loan Documents, or otherwise), which is applicable to the payment of the principal of, or interest on, the Loans, Unpaid Drawings, Commitment Fees or Letter of Credit Fees, of a sum which with respect to the related sum or sums received by other Lenders is in a greater proportion than the total of such Obligation then owed and due to such Lender bears to the total of such Obligation then owed and due to all of the Lenders immediately prior to such receipt, then such Lender receiving such excess payment shall purchase for cash without recourse or warranty from the other Lenders an interest in the Obligations of the respective Loan Party to such Lenders in such amount as shall result in a proportional participation by all the Lenders in
such amount; provided that if all or any portion of such excess amount is thereafter recovered from such Lenders, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein, the provisions of the preceding Sections 13.06(a) and (b) shall be subject to the express provisions of Section 2.19 and of this Agreement which require, or permit, differing payments to be made to Non-Defaulting Lenders as opposed to Defaulting Lenders.
(b) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
(b) The obligation of each Lender to make Loans, and the obligation of each Issuing Lender to issue Letters of Credit shall arise on the date (the “Funding Date”) which occurs after the Closing Date on which the conditions contained in Sections 6.02 and 7 are met to the satisfaction of the Administrative Agent and the Required Lenders. Unless the Administrative Agent has received actual notice from any Lender that the conditions described in the preceding sentence have not been met to its satisfaction, upon the Administrative Agent’s good faith determination that the conditions described in the immediately preceding sentence have been met, then the Funding Date shall be deemed to have occurred, regardless of any subsequent determination that one or more of the conditions thereto had not been met (although the occurrence of the Funding Date shall not release Holdings, any Borrower or any other Loan Party from any liability for failure to satisfy one or more of the applicable conditions contained in Section 6.02). The Administrative Agent will give Holdings, the other Borrowers and each Lender prompt written notice of the occurrence of the Funding Date.
(b) If, in connection with any proposed change, waiver, discharge or termination of or to any of the provisions of this Agreement as contemplated by clauses (i) through (vi), inclusive, of the first proviso to Section 13.12(a), the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained, then the Borrowers shall have the right, so long as all non-consenting Lenders whose individual consent is required are treated as described below, to replace each such non-consenting Lender or Lenders with one or more Replacement Lenders pursuant to Section 2.13 so long as at the time of such replacement, each such Replacement Lender consents to the proposed change, waiver, discharge or termination, provided, that the Borrowers shall not have the right to replace a Lender solely as a result of the exercise of such Lender’s rights (and the withholding of any required consent by such Lender) pursuant to the third proviso to Section 13.12(a).
(c) Notwithstanding anything to the contrary contained in clause (a) above of this Section 13.12, the Borrowers, the Administrative Agent, the Security Agent and each Incremental Lender may, in accordance with the provisions of Section 2.14 enter into an Incremental Commitment Agreement, provided that after the execution and delivery by the Borrowers, the Administrative Agent, the Security Agent and each such Incremental Lender of such Incremental Commitment Agreement, such Incremental Commitment Agreement may thereafter only be modified in accordance with the requirements of clause (a) above of this Section 13.12.
(d) If a fee is to be paid by any Borrower in connection with any waiver or amendment hereunder, the agreement evidencing such amendment or waiver may (but shall not be required to), at the discretion of Administrative Agent, provide that only Lenders executing such agreement by a specified date may share in such fee (and in such case may (but shall not be required to), at the discretion of Administrative Agent, be divided among the applicable Lenders on a pro rata basis without including the interests of any Lenders which have not timely executed such agreement).
(b) Holdings and the other Borrowers hereby acknowledge and agree that each Lender may share with any of its affiliates, and such affiliates may share with such Lender, any information related to Holdings or any of its Subsidiaries (including, without limitation, any non-public customer information regarding the creditworthiness of Holdings and its Subsidiaries), provided such Persons shall be subject to the provisions of this Section 13.16 to the same extent as such Lender.
(b) THE PROVISIONS OF THIS SECTION 13.18 ARE NOT INTENDED TO SUMMARIZE ALL RELEVANT PROVISIONS OF THE INTERCREDITOR AGREEMENT, THE FORM OF WHICH IS ATTACHED AS AN EXHIBIT TO THIS AGREEMENT. REFERENCE MUST BE MADE TO THE INTERCREDITOR AGREEMENTS ITSELF TO UNDERSTAND ALL TERMS AND CONDITIONS THEREOF.
EACH LENDER IS RESPONSIBLE FOR MAKING ITS OWN ANALYSIS AND REVIEW OF THE INTERCREDITOR AGREEMENT AND THE TERMS AND PROVISIONS THEREOF, AND NEITHER THE ADMINISTRATIVE AGENT NOR ANY OF ITS AFFILIATES MAKES ANY REPRESENTATION TO ANY LENDER AS TO THE SUFFICIENCY OR ADVISABILITY OF THE PROVISIONS CONTAINED IN THE INTERCREDITOR AGREEMENT.
(b) If there is a change in the rate of exchange prevailing between the Judgment Currency Conversion Date and the date of actual payment of the amount due, each Borrower covenants and agrees to pay, or cause to be paid, such additional amounts, if any (but in any event not a lesser amount), as may be necessary to ensure that the amount paid in the
Judgment Currency, when converted at the rate of exchange prevailing on the date of payment, will produce the amount of the Obligation Currency which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial award at the rate or exchange prevailing on the Judgment Currency Conversion Date.
(c) For purposes of determining any rate of exchange for this Section, such amounts shall include any premium and costs payable in connection with the purchase of the Obligation Currency.
(i) in the case of a Hedging Agreement, such Hedging Agreement is either (x) in effect on the Funding Date with a counterparty that is a Hedging Creditor or (y) entered into after the Funding Date with any counterparty that is a Hedging Creditor at the time such Hedging Agreement is entered into; and
(ii) in the case of a Cash Management Agreement, such Cash Management Agreement is either (x) in effect on the Funding Date with a Cash Management Creditor or (y) entered into after the Funding Date with a Cash Management Creditor at the time such Cash Management Agreement is entered into;
(a) all U.S. Facility Obligations to repay principal of, interest on, and all other amounts with respect to, all U.S. Facility Revolving Loans, U.S. Facility Swingline Loans, U.S. Facility Letters of Credit and all other U.S. Facility Obligations pursuant to
this Agreement and each other Loan Document (including, without limitation, all fees, indemnities, taxes and other U.S. Facility Obligations in connection therewith or in connection with the related Commitments) shall constitute the joint and several obligations of each of the U.S. Borrowers. In addition to the direct (and joint and several) obligations of the U.S. Borrowers with respect to U.S. Facility Obligations as described above, all such U.S. Facility Obligations shall be guaranteed pursuant to, and in accordance with the terms of, the Guarantee and Collateral Agreement, provided that the obligations of a U.S. Borrower with respect to the U.S. Facility Obligations as described above shall not be limited by any provision of the Guarantee and Collateral Agreement entered into by such U.S. Borrower;
(b) all Canadian Facility Obligations owing by any U.S. Borrower to repay principal of, interest on, and all other amounts with respect to, all Canadian Facility Revolving Loans and Canadian Facility Swingline Loans borrowed by any U.S. Borrower, all Canadian Facility Letters of Credit issued for the account of any U.S. Borrower and all other Canadian Facility Obligations owing by any U.S. Borrower pursuant to this Agreement and each other Loan Document (including, without limitation, all fees, indemnities, taxes and other Canadian Facility Obligations in connection therewith or in connection with the related Canadian Facility Commitments) shall constitute the joint and several obligations of each of the U.S. Borrowers. In addition to the direct (and joint and several) obligations of the U.S. Borrowers with respect to Canadian Facility Obligations as described above, all such Canadian Facility Obligations owing by any U.S. Borrower shall be guaranteed pursuant to, and in accordance with the terms of, the Guarantee and Collateral Agreement, provided that the obligations of a U.S. Borrower with respect to the Canadian Facility Obligations as described above shall not be limited by any provision of the Guarantee and Collateral Agreement entered into by such U.S. Borrower; and
(c) all Canadian Facility Obligations owing by any Canadian Borrower to repay principal of, interest on, and all other amounts with respect to, all Canadian Facility Revolving Loans and Canadian Facility Swingline Loans borrowed by any Canadian Borrower, all Canadian Facility Letters of Credit issued for the account of any Canadian Borrower and all other Canadian Facility Obligations owing by any Canadian Borrower pursuant to this Agreement and each other Loan Document (including, without limitation, all fees, indemnities, taxes and other Canadian Facility Obligations in connection therewith or in connection with the related Canadian Facility Commitments) shall constitute the joint and several obligations of each of the Canadian Borrowers. In addition to the direct (and joint and several) obligations of the Canadian Borrowers with respect to Canadian Facility Obligations as described above, all such Canadian Facility Obligations owing by any Canadian Borrower shall be guaranteed pursuant to, and in accordance with the terms of, the Guarantee and Collateral Agreement and Canadian Guarantee and Collateral Agreement, provided that the obligations of a Canadian Borrower with respect to the Canadian Facility Obligations as described above shall not be limited by any provision of the Canadian Guarantee and Collateral Agreement entered into by such Canadian Borrower.
(a) exercise or refrain from exercising any rights against any other Borrower or any Guarantor or others or otherwise act or refrain from acting;
(b) release or substitute any other Borrower, endorsers, Guarantors or other obligors;
(c) settle or compromise any of the Borrower Obligations of any other Borrower or any other Loan Party, any security therefor or any liability (including any of those hereunder) incurred directly or indirectly in respect thereof or hereof, and may subordinate the payment of all or any part thereof to the payment of any liability (whether due or not) of any Borrower to its creditors other than the Lenders;
(d) apply any sums paid by any other Borrower or any other Person, howsoever realized to any liability or liabilities of such other Borrower or other Person regardless of what liability or liabilities of such other Borrower or other Person remain unpaid; and/or
(e) consent to or waive any breach of, or act, omission or default under, this Agreement or any of the instruments or agreements referred to herein, or otherwise, by any other Borrower or any other Person.
(a) The Fronting Lender and the Participating Specified Foreign Currency Lenders shall settle (a “Specified Foreign Currency Participation Settlement”) by payments in respect of the Specified Foreign Currency Participations as follows: So long as any Specified Foreign Currency Loans are outstanding, Specified Foreign Currency Participation Settlements shall be effected upon the request of the Fronting Lender through the Administrative Agent on such Business Days as requested by the Fronting Lender and as the Administrative Agent shall specify by a notice by telecopy, telephone or similar form of notice to each Participating Specified Foreign Currency Lender requesting such Specified Foreign Currency Participation Settlement (each such date on which a Specified Foreign Currency Participation Settlement occurs herein called a “Specified Foreign Currency Participation Settlement Date”), such notice to be delivered no later than 2:00 p.m. (New York time) at least one Business Day prior to the requested Specified Foreign Currency Participation Settlement Date; provided that the Fronting Lender shall have the option but not the obligation to request a Specified Foreign Currency Participation Settlement Date and, in any event, shall not request a Specified Foreign Currency Participation Settlement Date prior to the occurrence of an Event of Default; provided further, that if (x) such Event of Default is cured or waived in writing in accordance with the terms hereof, (y) no Obligations have yet been declared due and payable under Section 11.01 and (z) the Administrative Agent has actual knowledge of such cure or waiver, all prior to the Administrative Agent’s giving notice to the Participating Specified Foreign Currency Lenders of the first Specified Foreign Currency Participation Settlement Date under this Agreement, then the Administrative Agent shall not give notice to the Participating Specified Foreign Currency Lenders of a Specified Foreign Currency Participation Settlement Date based upon such cured or waived Event of Default. If on any Specified Foreign Currency Participation Settlement Date the total principal amount of the Specified Foreign Currency Loans made or deemed made by the Fronting Lender during the period ending on (but excluding) such Specified Foreign Currency Participation Settlement Date and commencing on (and including) the immediately preceding Specified Foreign Currency Participation Settlement Date (or the Funding Date in the case of the period ending on the first Specified Foreign Currency Participation Settlement Date) (each such period herein called a “Specified Foreign Currency Participation Settlement Period”) is greater than the principal amount of Specified Foreign Currency Loans repaid during such Specified Foreign Currency Participation Settlement Period to the Fronting Lender, each Participating Specified Foreign Currency Lender under a Tranche shall pay to the Fronting Lender (through the Administrative Agent), no later than 11:00 a.m. (New York time) on such Specified
Foreign Currency Participation Settlement Date, an amount equal to such Participating Specified Foreign Currency Lender’s ratable share of the amount of such excess under such Tranche. If in any Specified Foreign Currency Participation Settlement Period the outstanding principal amount of the Specified Foreign Currency Loans repaid to the Fronting Lender in such period exceeds the total principal amount of the Specified Foreign Currency Loans made or deemed made by the Fronting Lender during such period, the Fronting Lender shall pay to each Participating Specified Foreign Currency Lender under a Tranche (through the Administrative Agent) on such Specified Foreign Currency Participation Settlement Date an amount equal to such Participating Specified Foreign Currency Lender’s ratable share of such excess under such Tranche. Specified Foreign Currency Participation Settlements in respect of Specified Foreign Currency Loans shall be made in the respective Available Currency in which such Specified Foreign Currency Loan was funded on the Specified Foreign Currency Participation Settlement Date for such Specified Foreign Currency Loans.
(b) If any Participating Specified Foreign Currency Lender fails to pay to the Fronting Lender on any Specified Foreign Currency Participation Settlement Date the full amount required to be paid by such Participating Specified Foreign Currency Lender to the Fronting Lender on such Specified Foreign Currency Participation Settlement Date in respect of such Participating Specified Foreign Currency Lender’s Specified Foreign Currency Participation (such Participating Specified Foreign Currency Lender’s “Specified Foreign Currency Participation Settlement Amount”) with the Fronting Lender, the Fronting Lender shall be entitled to recover such unpaid amount from such Participating Specified Foreign Currency Lender, together with interest thereon (in the same respective currency or currencies as the relevant Specified Foreign Currency Loans) at the Base Rate plus the Applicable Margin for Base Rate Loans plus, if such unpaid amount is not paid within one Business Day after such Specified Foreign Currency Participation Settlement Date, 2.00%. Without limiting the Fronting Lender’s rights to recover from any Participating Specified Foreign Currency Lender any unpaid Specified Foreign Currency Participation Settlement Amount payable by such Participating Specified Foreign Currency Lender to the Fronting Lender, the Administrative Agent shall also be entitled to withhold from amounts otherwise payable to such Participating Specified Foreign Currency Lender an amount equal to such Participating Specified Foreign Currency Lender’s unpaid Specified Foreign Currency Participation Settlement Amount owing to the Fronting Lender and apply such withheld amount to the payment of any unpaid Specified Foreign Currency Participation Settlement Amount owing by such Participating Specified Foreign Currency Lender to the Fronting Lender.
(a) any lack of validity or enforceability of this Agreement or any of the other Loan Documents or of any Loans, against the Borrowers or any other Loan Party;
(b) the existence of any claim, setoff, defense or other right which the Borrowers or any other Loan Party may have at any time against the Administrative Agent, any Participating Specified Foreign Currency Lender, or any other Person, whether in connection with this Agreement, any Specified Foreign Currency Loans, the transactions contemplated herein or any unrelated transactions;
(c) any application or misapplication of any proceeds of any Specified Foreign Currency Loans;
(d) the surrender or impairment of any security for any Specified Foreign Currency Loans;
(e) the occurrence of any Default or Event of Default;
(f) the commencement or pendency of any events specified in Section 11.01(g) or (h), in respect of Holdings, the other Borrowers or any of their respective Subsidiaries or any other Person; or
(g) the failure to satisfy the applicable conditions precedent set forth in Section 6 or 7.
(a) CAM: the mechanism for the allocation and exchange of interests in the Loans, participations in Letters of Credit and collections thereunder established under Section 16.02.
(b) CAM Exchange: the exchange of the U.S. Facility Lenders’ interests and the Canadian Facility Lenders’ interests provided for in Section 16.02.
(c) CAM Exchange Date: the first date after the Closing Date on which there shall occur (i) any event described in Section 11.01(g) or (h) with respect to any Borrower, (ii) an acceleration of Loans and termination of the Total Commitment pursuant to Section 11.01 or (iii) the failure by any Borrower to repay any amounts due under any Tranche of Loans on the Revolving Loan Maturity Date.
(d) CAM Percentage: as to each Lender, such Lender’s RL Percentage of the Total Commitment immediately prior to the CAM Exchange Date and the termination of the Total Commitment.
(e) Designated Obligations: all Obligations of the Borrowers with respect to (i) principal and interest under the Loans, (ii) Unpaid Drawings under Letters of Credit and interest thereon and (iii) all Fees.
(f) Revolver Facilities: the facility established under the U.S. Facility Commitments and the Canadian Facility Commitments, and “Revolver Facility” means any one of such Revolver Facilities.
(i) the U.S. Facility Commitments and the Canadian Facility Commitments shall have terminated in accordance with Section 11.01,
(ii) each U.S. Facility Lender shall fund its participation in any outstanding Swingline Loans and Agent Advances in accordance with Sections 2.01(b) and (e), and each Canadian Facility Lender shall fund its participation in any outstanding Swingline Loans and Agent Advances in accordance with Section 2.01(b) and Section 2.01(e), respectively,
(iii) each U.S. Facility Lender shall fund its participation in any Unpaid Drawings made under the applicable U.S. Facility Letters of Credit pursuant to Section 3.04, and each Canadian Facility Lender shall fund its participation in any Unpaid Drawings made under the applicable Canadian Facility Letters of Credit pursuant to Section 3.04,
(iv) each Participating Foreign Currency Lender shall fund its Specified Foreign Currency Participation in any Specified Foreign Currency Loans pursuant to Section 15.02, and
(v) the Lenders shall purchase, at the U.S. Dollar Equivalent of par, interests in the Designated Obligations under each Revolver Facility (and shall make payments in U.S. Dollars to the Administrative Agent for reallocation to other Lenders to the extent necessary to give effect to such purchases) and shall assume the obligations to reimburse each Issuing Lender for unreimbursed drawings under outstanding Letters of Credit under such Revolver Facility such that, in lieu of the interests of each Lender in the Designated Obligations under the U.S. Facility Commitments and the Canadian Facility Commitments in which it shall participate immediately prior to the CAM Exchange Date, such Lender shall own an interest equal to such Lender’s CAM Percentage in each component of the Designated Obligations immediately following the CAM Exchange.
(b) Each Lender and each Person acquiring a participation from any Lender as contemplated by Section 13.04 hereby consents and agrees to the CAM Exchange. Each Borrower agrees from time to time to execute and deliver to the Lenders all such promissory notes and other instruments and documents as the Administrative Agent shall reasonably request to evidence and confirm the respective interests and obligations of Lenders after giving effect to the CAM Exchange, and each Lender agrees to surrender any promissory notes originally received by it in connection with its Loans under this Agreement to the Administrative Agent against delivery of any promissory notes so executed and delivered; provided that the failure of any Lender to deliver or accept any such promissory note, instrument or document shall not affect the validity or effectiveness of the CAM Exchange.
(c) As a result of the CAM Exchange, from and after the CAM Exchange Date, each payment received by the Administrative Agent pursuant to any Loan Document in respect of any of the Designated Obligations shall be distributed to Lenders, pro rata in accordance with their respective CAM Percentages.
(d) In the event that on or after the CAM Exchange Date, the aggregate amount of the Designated Obligations shall change as a result of the making of a disbursement under a Letter of Credit by an Issuing Lender that is not reimbursed by the applicable Borrowers, then each Lender shall promptly reimburse such Issuing Lender for its CAM Percentage of such unreimbursed payment.
SECTION 1. Names. (a) Attached hereto as Schedule 1 is (i) the exact legal name of each Grantor, as such name appears in its document of formation, (ii) each other legal name such Grantor has had in the past five years, including the date of the relevant name change and (iii) each other name, including trade names and similar appellations, such Grantor or any of its divisions or other business units has used in connection with the conduct of its business or the ownership of its properties at any time during the past five years.
(b) Except as set forth on Schedule 1, no Grantor has changed its identity or corporate structure in any manner within the past five years. Changes in identity or corporate structure include mergers, consolidations and acquisitions, as well as any change in form, nature or jurisdiction of organization. With respect to any such change that has occurred within the past five years, Schedules 1 and 2A set forth the information required by Sections 1 and 2 of this Certificate as to each acquiree or constituent party to such merger, consolidation or acquisition.
SECTION 2. Locations. (a) Attached hereto as Schedule 2A is the (i) jurisdiction of formation and the form of organization of each Grantor, (ii) organizational identification number, if any, assigned to such Grantor by such jurisdiction, (iii) address (including the county) of the chief executive office of such Grantor, (iv) the Federal Taxpayer Identification Number of each Grantor and (v) whether each Grantor is a Transmitting Utility as defined under the Uniform Commercial Code (“UCC”) (indicating such Grantor with an “*”).
SECTION 3. Unusual Transactions. All Accounts have been originated by the Grantors and all Inventory has been acquired by the Grantors in the ordinary course of business.
SECTION 4. File Search Reports. File search reports have been obtained from (i) the UCC filing office related to each location of a Grantor identified on Schedule 2A and (ii) the county recorder’s office relating to the county where each Mortgaged Property is located, except as otherwise agreed to by the Administrative Agent in accordance with the final paragraph of the definition of the term “Collateral and Guarantee Requirement” in the Credit Agreement.
SECTION 5. UCC Filings. UCC financing statements have been prepared for filing in the appropriate UCC filing office related to the jurisdiction of formation for each Grantor. Attached hereto as Schedule 5 is a true and correct list of each such filing and the UCC filing office in which such filing is to be made. All filing fees and taxes payable in connection with the filings described in this Section 5 have been paid or will be paid promptly after the Funding Date.
SECTION 6. Equity Interests. Attached hereto as Schedule 6 is a true and correct list of all the Equity Interests that each Grantor is required to pledge under the Guarantee and Collateral Agreement, specifying the issuer and certificate number (if any) of, and the number and percentage of ownership represented by, such Equity Interests, and indicating with a “*” such Equity Interests of any limited liability company or limited partnership that has not opted to have such Equity Interests treated as “Securities” under the UCC.
SECTION 7. Debt Instruments. Attached hereto as Schedule 7 is a true and correct list of all debt instruments and other Indebtedness that each Grantor is required to pledge under the Guarantee and Collateral Agreement, specifying any promissory notes or intercompany notes evidencing such debt instruments or Indebtedness.
SECTION 8. Mortgage Filings. Attached hereto as Schedule 8 is a true and correct list, with respect to all Mortgaged Property, of (a) the exact name of the Person that owns such property, as such name appears in its certificate of organization, (b) if different from the name identified pursuant to clause (a) above, the exact name of the current record owner of such property, as such name appears in the records of the county recorder’s office for such property identified pursuant to clause (c) below and (c) the county recorder’s office in which a mortgage with respect to such property must be filed or recorded in order for the Security Agent to obtain a perfected security interest therein.
SECTION 9. Intellectual Property. Attached hereto as Schedule 9, in proper form for filing with the United States Patent and Trademark Office or the United States Copyright Office, as applicable, is a true and correct list of each Grantor’s (i) registrations for and applications for registration of Copyrights in the United States Copyright Office, (ii) material Copyright Licenses, (iii) issued Patents and applications for Patents in the United States Patent and Trademark Office and (iv) registrations for and applications for registration of Trademarks in the United States Patent and Trademark Office, in each case, including the name of the registered owner or owner of the application, registration or application number, expiration date (if applicable) and a brief description thereof and with respect to (ii) above, the name and address of the licensor and the licensee.
SECTION 10. Commercial Tort Claims. Set forth on Schedule 10 is a true and correct list of claims that exceed $5,000,000 in reasonable estimated value arising in tort with respect to which any Grantor is claimant and which arose in the course of such Grantor’s business, including a brief description thereof.
SECTION 11. Deposit Accounts, Securities Accounts and Commodities Accounts. Attached hereto as Schedule 11 is a true and correct list of Deposit Accounts, Securities Accounts and Commodities Accounts maintained by each Grantor, including the name and address of the depositary institution, Securities Intermediary or Commodities Intermediary holding the account, as applicable, the type of account, the account number , whether such account is required to be subject to a Control Agreement pursuant to the Credit Agreement and, if not, why it is not so required.
SECTION 12. Vessels. Set forth below is a list of all vessels with a fair market value in excess of $250,000 (provided that in the case the aggregate fair market value of all vessels owned by the Grantors does not exceed $2,500,000, no such listing is required) owned by each Grantor including (i) the name, official number, weight, length, width and height, regulation patent number, radio call letters and flag country of each such vessel, (ii) the name of the Grantor that owns such vessel and (iii) the fair market value apportioned to such vessel:
SECTION 13. Aircraft. Set forth below is a list of all aircraft with a fair market value in excess of $250,000 (provided that in the case the aggregate fair market value of all aircraft owned by the Grantors does not exceed $2,500,000, no such listing is required) owned by each Grantor including (i) the name, manufacturer, model, serial number and federal registration number of each such aircraft (including each airframe, engine and propeller), (ii) the name of the Grantor that owns such aircraft (including each airframe, engine and propeller) and (iii) the fair market value apportioned to such aircraft (including each airframe, engine and propeller):
Schedule 2B
Other Addresses (Books or Records)
Schedule 2C
Other Addresses (Collateral)
Schedule 2D
Other Addresses
ARTICLE I
Definitions
Section 1.01. New York UCC. All capitalized terms used without definition herein that are defined in the UCC as in effect in the State of New York shall have the meanings specified therein.
Section 1.02. Other Defined Terms. As used in the Agreement, the following terms shall have the following meanings:
(a) payment in full in cash of the principal of and interest (including interest accruing on or after the commencement of any Insolvency or Liquidation Proceeding, whether or not such interest would be allowed in such Insolvency or Liquidation Proceeding) on all such Obligations (other than Cash Management and Hedging Obligations);
(b) payment in full in cash of all other Obligations (other than Cash Management and Hedging Obligations) of such Class that are due and payable or otherwise accrued and owing at or prior to the time such principal and interest are paid (other than claims, causes of action or other liabilities in respect of which no claim or demand for payment has been made at such time);
(c) termination or expiration of all commitments, if any, to extend credit that would give rise to Obligations (other than Cash Management and Hedging Obligations) of such Class;
(d) termination or cash collateralization of all letters of credit and bankers’ acceptances the reimbursement or payment obligations in respect of which constitute Obligations (other than Cash Management and Hedging Obligations) of such Class (any such cash collateralization to be in an amount and manner reasonably satisfactory to the Agent for such Class of Obligations, but in no event shall such amount be greater than 105% of the aggregate undrawn face amount in the case of letters of credit or 105% of the principal amount in the case of bankers’ acceptances);
(e) adequate provision (as agreed to by each Agent or otherwise determined by a court of competent jurisdiction) has been made for any contingent or unliquidated Obligations (other than Cash Management and Hedging Obligations) of such Class in respect of claims, causes of action or other monetary liabilities that have been asserted, or threatened in writing (and which would reasonably be expected to be asserted), against the Secured Parties of such Class, and of which the Agent of such Class shall have informed the other Agents in writing concurrently with the satisfaction of each of the requirements set forth in clauses (a) through (d) above; and
(f) in the case of the Discharge of the Revolving Credit Obligations, to the extent that the requirements set forth above have been satisfied with the proceeds of a foreclosure on Collateral or other enforcement action by the Revolving Credit Agent with respect to the Revolving Credit Obligations under the Revolving Credit Collateral Documents, the payment in full in cash of all Revolving Credit Cash Management and Hedging Obligations that are due and payable at such time.
Section 1.03. Terms Generally. The definitions of terms set forth herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time Amended (subject to any restrictions on such Amendments set forth herein), (b) any definition of or reference to any statute, regulation or other law herein shall be construed (i) as referring to such statute, regulation or other law as from time to time Amended (including by succession of comparable successor statutes, regulations or other laws) and (ii) to include all official rulings and interpretations thereunder having the force of law or with which affected Persons customarily comply, (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, and (f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.
ARTICLE II
Lien Priorities
Section 2.01. Relative Priorities. Notwithstanding (a) the date, time, method, manner or order of grant, attachment or perfection of any Junior Lien or Prior Lien on any Common Collateral, (b) any provision of the UCC or any other applicable law or of the Term Loan Credit Documents, the Revolving Credit Documents or any Permitted Notes Documents, (c) any defect or deficiency in, or failure to perfect, any Prior Lien, (d) the possession or control by any Agent or any bailee of all or any part of the Common Collateral or (e) any other circumstance whatsoever, each Agent, on behalf of itself and its Related Secured Parties, hereby agrees that:
(i) any Prior Lien on any Common Collateral now or hereafter held by or on behalf of any Prior Agent or any Prior Secured Party or any agent or trustee therefor, regardless of how acquired, whether by grant, possession, statute, operation of law, court order, subrogation or otherwise, shall be senior in all respects and prior to all Junior Liens on such Common Collateral; and
(ii) any Junior Lien on any Common Collateral now or hereafter held by or on behalf of any Junior Agent or any Junior Secured Party or any agent or trustee therefor, regardless of how acquired, whether by grant, possession, statute, operation of law, court order, subrogation or otherwise, shall be junior and subordinated in all respects to all Prior Liens on such Common Collateral.
Section 2.02. Prohibition on Contesting Liens. Each Agent, on behalf of itself and its Related Secured Parties, agrees that none of them will (and hereby waives any right to) contest or support any other Person in contesting, in any proceeding (including any Insolvency or Liquidation Proceeding), the perfection, priority, validity or enforceability of any Prior Lien or any Junior Lien, the validity or enforceability of any Credit Documents or Obligations, the relative rights and duties of the Agents and Secured Parties granted or established under the Credit Documents or the provisions of this Agreement; provided that nothing in this Agreement shall be construed to prevent or impair the right of any Agent or Secured Party to enforce this Agreement (including the priority of Liens set forth in Section 2.01).
Section 2.03. No New Liens. Whether or not any Insolvency or Liquidation Proceeding has been commenced by or against SSCC or any other Grantor, SSCC and the other parties hereto agree that none of SSCC and any other Grantor shall grant, and no Secured Party shall accept, any additional Lien on any asset of SSCC or such other Grantor to secure any Obligation unless SSCC or such other Grantor has granted or concurrently grants a Lien on such asset to secure the other outstanding Obligations (all such Liens to have the relative priorities set forth herein based on whether the assets subject to such additional Liens constitute ABL Collateral or Non-ABL Collateral); provided that, with respect to any Lien granted under a Term Loan Credit Mortgage or a Permitted Notes Mortgage with respect to any real property located in the State of New York, such Lien may be granted without a prior or concurrent grant of a Lien thereon to secure the Revolving Credit Obligations so long as, prior to the grant of such Lien under such Term Loan Credit Mortgage or Permitted Notes Mortgage, SSCC or the applicable Grantor shall have given notice thereof to the Revolving Credit Agent and the Revolving Credit Agent shall have notified SSCC that, pursuant to its authority under the Revolving Credit Agreement, the Revolving Credit Agent shall forego such grant of a Lien to secure the Revolving Credit Obligations; provided further that, with respect to any Lien granted under a Term Loan Collateral Document or a Revolving Credit Collateral Document with respect to any Rule 3-16 Collateral, such Lien may be granted without a prior or concurrent grant of a Lien thereon to secure the Permitted Notes Obligations so long as, prior to the grant of such Lien under such Term Loan Credit Collateral Document or Revolving Credit Collateral Document, SSCC or the applicable Grantor shall have given notice thereof to the Permitted Notes Agent and the Permitted Notes Agent shall have notified SSCC that, pursuant to its authority under the Permitted Notes Documents, the Permitted Notes Agent shall forego such grant of a Lien to secure the Permitted Notes Obligations. If a Junior Agent or a Junior Secured Party shall (nonetheless and in breach hereof) hold any Lien on any assets of any Grantor securing any Junior Obligations that are not also subject to a Lien in respect of the Prior Obligations under the Prior Credit Documents and if the Discharge of Prior Obligations has not occurred, then such Junior Agent shall, without the need for any further consent of any party and notwithstanding anything to the contrary in any other document, be deemed to also hold and have held such Lien for the benefit of the Prior Agents as a security for the Prior Obligations (subject to the lien priority and the other terms hereof)
and shall promptly following knowledge thereof notify the Prior Agents in writing of the existence of such Lien and in any event take such actions as may be reasonably requested by any Prior Agent to assign or release such Liens to such Prior Agent (and/or its designee) as security for the applicable Prior Obligations; provided that if the instructions of the Prior Agents conflict, the request of the Controlling Agent shall control. If a Prior Agent or a Prior Secured Party shall (nonetheless and in breach hereof) hold any Lien on any assets of any Grantor securing any Prior Obligations that are not also subject to a Lien in respect of the Junior Obligations under the Junior Credit Documents and if the Discharge of such Junior Obligations has not occurred, then such Prior Agent shall, without the need for any further consent of any party and notwithstanding anything to the contrary in any other document, be deemed to also hold and have held such Lien for the benefit of the Junior Agents as a security for the Junior Obligations (subject to the lien priority and the other terms hereof) and shall promptly following knowledge thereof notify the Junior Agents in writing of the existence of such Lien. To the extent that the foregoing provisions are not complied with for any reason, without limiting any other rights and remedies available to any Prior Agent or any Prior Secured Parties, each Junior Agent, for itself and on behalf of its Related Secured Parties, agrees that any amounts received by or distributed to any of them pursuant to or as a result of Liens granted in contravention of this Section shall be subject to Section 4.02. In furtherance of the foregoing, and without limiting Section 8.10, each Grantor agrees, upon request by the Agent with respect to Obligations of any Class, to identify the Collateral of any other Class that could reasonably constitute Common Collateral and the Grantors with respect thereto. For the avoidance of doubt and subject to Section 5.09, in the event letters of credit or bankers’ acceptances are cash collateralized in connection with the Discharge of Obligations of a Class pursuant to clause (d) of the definition of Discharge, such cash collateral shall no longer be required to secure the Obligations of any other Class.
Section 2.04. Effectiveness of Lien Priorities. Each of the parties hereto acknowledges that the Lien priorities provided for in this Agreement shall not be affected or impaired in any manner whatsoever, including, without limitation, on account of: (i) the invalidity, irregularity or unenforceability of all or any part of the Credit Documents; (ii) any amendment, change or modification of any Credit Documents; or (iii) any impairment, modification, change, exchange, release or subordination of or limitation on, any liability of, or stay of actions or lien enforcement proceedings against, SSCC or any Loan Party under a Credit Document, or its property, or its estate in bankruptcy resulting from any bankruptcy, arrangement, readjustment, composition, liquidation, rehabilitation, similar proceeding or otherwise involving or affecting any Secured Party.
ARTICLE III
Enforcement
Section 3.01. Exercise of Remedies. (a) Until the Discharge of Prior Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against SSCC or any other Grantor, each Junior Agent and each Junior Secured Party will not:
(i) exercise or seek to exercise any rights or remedies with respect to any Common Collateral subject to any Prior Lien (including the exercise of any right of setoff or any right under any lockbox agreement, account control agreement, landlord waiver or bailee’s letter or similar agreement or arrangement to which such Junior Agent or such Junior Secured Party is a party) or institute or commence, or join with any Person (other than the Controlling Agent) in commencing, any action or proceeding with respect to such rights or remedies (including any action of foreclosure, enforcement, collection or execution);
(ii) contest, protest or object to any foreclosure proceeding or action brought by any Prior Agent or any Prior Secured Party or any other exercise by any Prior Agent or any Prior Secured Party of any rights and remedies relating to any Common Collateral subject to such Prior Agent’s or such Prior Secured Party’s Prior Lien, whether under the applicable Prior Credit Documents or otherwise; or
(iii) object to the forbearance by any Prior Agent or any Prior Secured Party from bringing or pursuing any foreclosure proceeding or action or any other exercise of any rights or remedies relating to any Common Collateral subject to such Prior Agent’s or such Prior Secured Party’s Prior Lien;
(b) Subject to the terms and conditions of this Agreement, until the Discharge of Prior Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against SSCC or any other Grantor, the Controlling Agent and Controlling Secured Parties shall have the exclusive right to enforce rights, exercise remedies (including setoff and the right to credit bid their debt) and make determinations regarding any release, Disposition or restrictions with respect to any Common Collateral subject to their Prior Liens without any consultation with or the consent of any other Agent or its Related Secured Parties; provided that the Liens of such other Agent and its Related Secured Parties on such Common Collateral shall remain on the Proceeds of such Common Collateral released or Disposed of, subject to the relative priorities set forth in Article II. In exercising rights and remedies with respect to the Common Collateral subject to their Prior Liens, the Controlling Agent and each Controlling Secured Party may enforce the provisions of the applicable Prior Credit Documents and exercise remedies thereunder, all in such order and in such manner as they may determine in the exercise of their sole discretion. Such exercise and enforcement shall include the right of any agent appointed by them to sell or otherwise Dispose of such Common Collateral upon foreclosure, to incur expenses in connection with such sale or Disposition and to exercise all the rights and remedies of a secured creditor under the UCC and of a secured creditor under Bankruptcy Laws of any applicable jurisdiction.
(c) Notwithstanding the foregoing provisions of this Section, any Junior Agent and any Junior Secured Party may:
(i) file a claim or statement of interest with respect to its Junior Obligations in any Insolvency or Liquidation Proceeding that has been commenced by or against SSCC or any other Grantor;
(ii) take any action (not adverse to the priority status of any Prior Liens on the Common Collateral or the rights of any Prior Agent or any Prior Secured Party to exercise rights and remedies in respect thereof) in order to create, perfect, preserve or protect its Junior Lien on the Common Collateral;
(iii) file any necessary responsive or defensive pleadings in opposition to any motion, claim, adversary proceeding or other pleading made by any Person objecting to or otherwise seeking the disallowance of the claims of the Junior Secured Parties, including any claims secured by the Common Collateral, if any, in each case in accordance with the terms of this Agreement;
(iv) vote on any plan of reorganization and file any proof of claim in an Insolvency or Liquidation Proceeding or otherwise, in each case, in accordance with the terms of this Agreement, with respect to the Common Collateral subject to any Prior Liens;
(v) exercise their rights and remedies as unsecured creditors, as provided in paragraph (e) of this Section; and
(vi) exercise the rights and remedies provided for in Section 6.03.
(d) Each Junior Agent, for itself and on behalf of its Related Secured Parties:
(i) agrees that it and such Junior Secured Parties will not take any action that would hinder or delay any exercise of rights or remedies under the Prior Credit Documents with respect to, or the realization of the full value of, the Common Collateral on which any Prior Agent has Prior Liens or would otherwise
be prohibited hereunder, including any Disposition of any Common Collateral subject to any Prior Lien, whether by foreclosure or otherwise, or that would limit, invalidate, avoid or set aside any Prior Lien or Prior Collateral Document with respect to the Common Collateral or change the priority of Liens set forth in Section 2.01;
(ii) agrees that it and such Junior Secured Parties will not, until the Discharge of Prior Obligations has occurred, assert and hereby waives, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to any Common Collateral subject to any Prior Lien or any other similar rights a junior secured creditor may have under applicable law;
(iii) waives any and all rights it or such Junior Secured Parties may have as junior lien creditors or otherwise to object to the manner in which any Prior Agent or any Prior Secured Party seeks to enforce or collect any Prior Obligations or to enforce or realize on the Prior Liens undertaken in accordance with this Agreement, regardless of whether any action or failure to act by or on behalf of such Prior Agent or such Prior Secured Party is adverse to the interests of the Junior Secured Parties; and
(iv) acknowledges and agrees that no covenant, agreement or restriction contained in any Junior Collateral Documents or any other Junior Credit Document (other than this Agreement) shall be deemed to restrict in any way the rights and remedies of any Prior Agent or any Prior Secured Party with respect to the Common Collateral subject to any Prior Lien as set forth in this Agreement and the Prior Credit Documents.
(e) Except to the extent inconsistent with this Agreement, any Junior Agent and any Junior Secured Party may exercise rights and remedies available to it as an unsecured creditor of SSCC or any other Grantor in accordance with the terms of the applicable Junior Credit Documents and applicable law; provided that in the event that any Junior Secured Party becomes a judgment Lien creditor in respect of any Common Collateral subject to any Prior Lien as a result of its enforcement of its rights as an unsecured creditor with respect to the applicable Junior Obligations, such judgment Lien shall be subject to the terms of this Agreement to the same extent as the other Liens securing the Junior Obligations. Nothing in this Agreement shall prohibit the receipt by any Junior Agent or any Junior Secured Party of the required or permitted payments of interest, principal and other amounts owed in respect of the Junior Obligations so long as such receipt is not the direct or indirect result of the exercise by such Junior Agent or such Junior Secured Party of rights or remedies as a secured creditor (including the exercise of any right of setoff) or enforcement in contravention of this Agreement of any Junior Lien held by any of them. Nothing in this Agreement shall be construed to impair or otherwise adversely affect (i) any rights or remedies the Term Loan Credit Agent or any Term Loan Credit Secured Party may have (1) with respect to any Non-ABL Collateral subject to a Term Loan Credit Lien and (2) following the Discharge of the
Revolving Credit Obligations, with respect to any ABL Collateral subject to a Term Loan Credit Lien, (ii) rights or remedies the Revolving Credit Agent or any Revolving Credit Secured Party may have (1) with respect to any ABL Collateral subject to a Revolving Credit Lien and (2) following the Discharge of the Term Loan Credit Obligations and the Discharge of the Permitted Notes Obligations, with respect to any Non-ABL Collateral subject to a Revolving Credit Lien and (iii) any rights or remedies the Permitted Notes Agent or any Permitted Notes Secured Party may have (1) following the Discharge of the Term Loan Credit Obligations, with respect to any Non-ABL Collateral subject to a Permitted Notes Lien and (2) following the Discharge of Revolving Credit Obligations and the Discharge of the Term Loan Credit Obligations, with respect to any ABL Collateral subject to a Permitted Notes Lien.
(f) Subject to Section 2.03 in the case of clause (i) below, nothing in this Agreement shall restrict the Revolving Credit Agent or any Revolving Credit Secured Party from exercising any right or remedy or taking any other action with respect to (i) Revolving Credit Collateral that does not constitute Common Collateral and (ii) any Canadian Collateral.
ARTICLE IV
Payments
Section 4.01. Application of Proceeds. So long as the Discharge of Prior Obligations has not occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against SSCC or any other Grantor, Common Collateral or Proceeds thereof received in connection with the sale or other disposition of, or collection on, such Common Collateral upon any exercise of remedies shall, subject to Section 5.09, be applied to the applicable Prior Obligations in the order, if any, required by Sections 2.01 and 6.07 and otherwise as specified in the relevant Prior Credit Documents. Upon the Discharge of Prior Obligations, the Controlling Agent shall deliver to the Rising Prior Agent any Common Collateral and Proceeds of Common Collateral held by it in the form in which received, with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct, to be applied by such Rising Prior Agent to its related Class of Obligations in the order, if any, required by Sections 2.01 and 6.07 and otherwise as specified in the relevant Collateral Documents.
Section 4.02. Payments Over in Violation of Agreement. So long as the Discharge of Prior Obligations has not occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against SSCC or any other Grantor, if any Junior Agent or any Junior Secured Party receives any Common Collateral subject to any Prior Lien or any Proceeds of any such Common Collateral in connection with (i) the exercise of any right or remedy (including any right of setoff) relating to such Collateral in contravention of this Agreement or (ii) the transfer of such Common Collateral or Proceeds to such Junior Agent or such Junior Secured Party by any Person holding a Lien on such Collateral that is subordinated to the Lien of such Junior Agent or such Junior Secured Party, such Collateral or Proceeds shall be segregated and held in trust and forthwith paid over to the Controlling Agent for the benefit of the Controlling Secured
Parties, in the form in which received, with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct. The Controlling Agent is hereby authorized to make any such endorsements as agent for the Junior Agents or Junior Secured Parties (such authorization being coupled with an interest and irrevocable until the Discharge of Prior Obligations has occurred).
ARTICLE V
Other Agreements
Section 5.01. Releases. (a) If in connection with the exercise of the Controlling Agent’s remedies (including any Dispositions in connection with such exercise) in respect of any Common Collateral subject to its Prior Liens, the Controlling Agent, for itself or on behalf of the Controlling Secured Parties, releases its Prior Liens on any part of such Common Collateral, then the Junior Liens on such Common Collateral shall be automatically, unconditionally and simultaneously released; provided that such Junior Liens shall remain on the Proceeds of such Common Collateral, subject to the relative priorities set forth in Article II. Each Junior Agent, for itself and on behalf of its Related Secured Parties, agrees promptly to execute and deliver to the Controlling Agent or the applicable Grantor such termination statements, releases and other documents as the Controlling Agent or such Grantor may request to confirm such release.
(b) If, with respect to any Class of Obligations constituting Junior Obligations, in connection with any sale, lease, exchange, transfer or other disposition of any Common Collateral (collectively, a “Disposition”) permitted under the terms of all the Prior Credit Documents (other than in connection with the exercise of the Controlling Agent’s remedies in respect of Common Collateral as provided in paragraph (a) above), the Controlling Agent, for itself or on behalf of the Controlling Secured Parties, releases any of its Prior Liens on any part of such Common Collateral (other than (i) in connection with the Discharge of Prior Obligations or (ii) after the occurrence and during the continuance of any Event of Default under the Junior Credit Documents of such Class), then the Junior Liens of the Junior Agent and the Junior Secured Parties of such Class on such Collateral shall be automatically, unconditionally and simultaneously released; provided that if such Prior Liens of the Controlling Agent and the Controlling Secured Parties continue to apply to the Proceeds of such Disposition, the Junior Liens of such Class continue to apply to such Proceeds, subject to the relative priorities set forth in Article II. The Junior Agent with respect to such Class of Obligations, for itself or on behalf of its Related Secured Parties, promptly shall execute and deliver to the Controlling Agent or the applicable Grantor such termination statements, releases and other documents as the Controlling Agent or such Grantor may request to confirm such release.
(c) Until the Discharge of Prior Obligations has occurred, each Junior Agent, for itself and on behalf of its Related Secured Parties, hereby irrevocably constitutes and appoints the Controlling Agent and any officer or agent of the Controlling Agent, with full power of substitution, as its true and lawful attorney-in-fact with full power and authority in the name, place and stead of such Junior Agent or its Related
Secured Parties or in the Controlling Agent’s own name, from time to time in the Controlling Agent’s discretion, for the purpose of carrying out the terms of this Section, to take any and all action and to execute any and all documents and instruments which may be necessary or appropriate to accomplish the purposes of this Section with respect to Common Collateral subject to its prior Lien, including any endorsements or other instruments of transfer or release.
(d) Until the Discharge of Prior Obligations has occurred, to the extent that any Prior Agent or Prior Secured Parties release any Prior Lien on Common Collateral and any such Lien is later reinstated, then each Junior Agent with respect to such Common Collateral, for itself and on behalf of its Related Secured Parties, shall have, and hereby is hereby granted, a Lien on such Common Collateral, subject to the lien subordination provisions of this Agreement.
Section 5.02. Insurance. Until the Discharge of Prior Obligations has occurred, subject to the terms of, and the rights of the Grantors under, the applicable Prior Credit Documents, the Controlling Agent and Controlling Secured Parties shall have the right to adjust settlements for any insurance policy covering any Common Collateral subject to their Prior Liens in the event of any loss thereunder and to approve any award granted in any condemnation or similar proceeding (or any deed in lieu of condemnation) affecting such Common Collateral. Until the Discharge of Prior Obligations has occurred, subject to the terms of, and the rights of the Grantors under, the Prior Credit Documents, all proceeds of any such policy and any such award (or any payments with respect to a deed in lieu of condemnation) if in respect to (a) Non-ABL Collateral, shall be paid to (i) the Term Loan Credit Agent for the benefit of the Term Loan Credit Secured Parties, (ii) following the Discharge of the Term Loan Credit Obligations, the Designated Permitted Notes Agent for the benefit of the Permitted Notes Secured Parties, (iii) following the Discharge of the Term Loan Credit Obligations and the Discharge of the Permitted Notes Obligations, the Revolving Credit Agent for the benefit of the Revolving Credit Secured Parties and (iv) following the Discharge of all Obligations, to the owner of the subject property, such other Person as may be entitled thereto or as a court of competent jurisdiction may otherwise direct and (b) ABL Collateral, shall be paid to (i) the Revolving Credit Agent for the benefit of the Revolving Credit Secured Parties, (ii) following the Discharge of the Revolving Credit Obligations, the Term Loan Credit Agent for the benefit of the Term Loan Credit Secured Parties, (iii) following the Discharge of the Revolving Credit Obligations and the Discharge of the Term Loan Credit Obligations, the Designated Permitted Notes Agent with respect to such series for the benefit of the Permitted Notes Secured Parties and (iv) following the Discharge of all Obligations, to the owner of the subject property, such other Person as may be entitled thereto or as a court of competent jurisdiction may otherwise direct. Until the Discharge of Prior Obligations has occurred, if any Junior Agent or any Junior Secured Party shall, at any time, receive any proceeds of any such insurance policy or any such award or payment in contravention of this Agreement, it shall segregate and hold in trust and forthwith pay such proceeds over to the Controlling Agent in accordance with Section 4.02.
Section 5.03. Amendments to Prior Credit Documents and Junior Credit Documents. (a) Each Prior Credit Document may be Amended in accordance with the terms thereof, and all Indebtedness under each Prior Credit Document may be Refinanced in accordance with the terms thereof, except, in each case, as prohibited under the Junior Credit Documents as in effect on the date hereof and as Amended from time to time (but without giving effect to any Amendment that prohibits or restricts the Amendment of any Prior Credit Document or the Refinancing of any Indebtedness under any Prior Credit Document to a greater extent than the provisions of such Junior Credit Documents in effect on the date hereof). No Amendment of any Prior Credit Document shall affect the Lien subordination or other provisions of this Agreement.
(b) Each Junior Credit Document may be Amended in accordance with the terms thereof, and all Indebtedness under each Junior Credit Document may be Amended or Refinanced in accordance with the terms thereof, except, in each case, as prohibited under the Prior Credit Documents as in effect on the date hereof and as Amended from time to time (but without giving effect to any Amendment that prohibits or restricts the Amendment of any Junior Credit Document or the Refinancing of any Indebtedness under any Junior Credit Document to a greater extent than the provisions of such Prior Credit Documents in effect on the date hereof). No Amendment of any Junior Credit Document shall affect the Lien subordination or other provisions of this Agreement.
(c) Without in any way limiting the generality of Section 7.03 (but subject to the rights of SSCC and the other Grantors under the Prior Credit Documents and subject to the provisions of Section 5.03(a)), any Prior Agent or any Prior Secured Party may, at any time and from time to time in accordance with the applicable Prior Credit Documents and applicable law, without the consent of, or notice to, any Junior Agent or any Junior Secured Party, without incurring any liabilities or obligations to any Junior Agent or any Junior Secured Party and without impairing or releasing the Lien priorities and other benefits provided in this Agreement (even if any right of subrogation or other right or remedy of any Junior Agent or any Junior Secured Party is affected, impaired or extinguished thereby) do any one or more of the following:
(i) change the manner, place or terms of payment or change or extend the time of payment of, or Amend the terms of, any of the Prior Obligations or any Prior Lien on any Collateral or guarantee thereof or any liability of SSCC or any other Grantor, or any liability incurred directly or indirectly in respect thereof (including any increase in or extension of the Prior Obligations, without any restriction as to the tenor or terms of any such increase or extension) or otherwise amend, renew, exchange, extend, modify or supplement in any manner any Prior Liens held by the Prior Agents or the Prior Secured Parties, the Prior Obligations or any of the Prior Credit Documents;
(ii) sell, exchange, release, surrender, realize upon, enforce or otherwise deal with in any manner and in any order any part of the Collateral subject to its Prior Lien or any liability of SSCC or any other Grantor to the Prior Agents or the
Prior Secured Parties, or any liability incurred directly or indirectly in respect thereof;
(iii) settle or compromise any Prior Obligation or any other liability of SSCC or any other Grantor or any security therefor or any liability incurred directly or indirectly in respect thereof and apply any sums by whomsoever paid and however realized to any liability (including the Prior Obligations) in any manner or order; and
(iv) exercise or delay in or refrain from exercising any right or remedy against SSCC, any other Grantor or any other Person or any Collateral, elect any remedy and otherwise deal freely with SSCC, any other Grantor or any Collateral subject to its Prior Lien and any liability incurred directly or indirectly in respect thereof.
(d) In the event that the Controlling Agent of any Class enters into any amendment, waiver or consent in respect of any of the Collateral Documents of such Class for the purpose of adding to, or deleting from, or waiving or consenting to any departures from any provisions of, any such Collateral Document or changing in any manner the rights of such Controlling Agent, its Related Secured Parties, SSCC or any other Grantor thereunder (including the release of any Liens permitted by Section 5.01(a) or (b)), then such amendment, waiver or consent shall apply automatically to any comparable provision of the Collateral Documents relating to the relevant Prior Lien Collateral to the extent securing any Junior Obligations without the consent of any Junior Agents or any Junior Secured Parties and without any action by any Junior Agents, SSCC or any other Grantor; provided, however, that (i) no such amendment, waiver or consent shall (A) remove assets subject to the Junior Liens or release any such Junior Liens, except to the extent that such release is permitted or required by Section 5.01(a) or (b) and provided that there is a concurrent release of the corresponding Liens on the Common Collateral securing the Obligations held by the Controlling Secured Parties and in respect of which such Controlling Secured Parties are the obligees, (B) amend, modify or otherwise affect the rights or duties of any Junior Agent without its prior written consent or (C) permit Liens on the Common Collateral (other than DIP Financing Liens) which are not permitted under the terms of the Credit Documents related to such Junior Obligations and (ii) written notice of such amendment, waiver or consent shall have been given to the Junior Agents.
(e) Without the prior written consent of the Prior Agent, no Junior Collateral Documents may be amended, supplemented or otherwise modified or entered into to the extent such amendment, supplement or modification, or the terms of any new Junior Collateral Document, would contravene the provisions of this Agreement.
Section 5.04. Legend. SSCC and each Grantor agrees, and each Agent acknowledges, that each Junior Collateral Document shall include the following language (or language to similar effect approved by the Controlling Agent):
Section 5.05. Bailee for Perfection. (a) Each Prior Agent agrees to hold that part of the Common Collateral on which it holds a Prior Lien and that is in its possession or control, or in the possession or control of its agents or bailees (such Collateral being the “Pledged Collateral”), as collateral agent for its Related Secured Parties and as gratuitous bailee and, with respect to such Common Collateral that cannot be perfected in such manner, as agent for, the other Agents (such bailment or agency being intended, among other things, to satisfy the requirements of Sections 8-301(a)(2) and 9-313(c) of the UCC) and any assignee thereof solely for the purpose of perfecting the security interests granted under the applicable Credit Documents, subject to the terms and conditions of this Section. Each Junior Agent agrees (a) to hold any part of the Pledged Collateral of which it obtains possession or control (including through any of its agents or bailees) as collateral agent for the Prior Secured Parties and Junior Secured Parties and any assignees of the foregoing solely for the purpose of perfecting the security interest granted under the applicable Prior Credit Documents, subject to the terms and conditions of this Section and (b) as soon as practicable after it (or any of its agents or bailees) obtains possession of any Common Collateral, deliver or cause to be delivered such Common Collateral, together with any necessary endorsements, to the Controlling Agent so as to allow such Controlling Agent to obtain control of such Common Collateral and cooperate with such Controlling Agent to assign control over such Common Collateral to the Controlling Agent (or its agents or bailees).
(b) No Prior Agent shall have any obligation whatsoever to the Junior Agents or the Junior Secured Parties to ensure that any Pledged Collateral is genuine or owned by any of the Grantors or to preserve rights or benefits of any Person except as expressly set forth in this Section. The duties or responsibilities of any Agent to the other Agents or the Other Secured Parties under this Section shall be limited solely to holding Pledged Collateral in its possession or under its control as gratuitous bailee or agent in
accordance with this Section and delivering such Pledged Collateral upon the Discharge of Prior Obligations as provided in paragraph (d) below.
(c) No Prior Agent, acting pursuant to this Section, shall have by reason of any Credit Document, this Agreement or any other document a fiduciary relationship in respect of any other Agent or any Secured Party, or any liability to any other Agent or any Secured Party, absent gross negligence or willful misconduct on the part of such Prior Agent.
(d) Upon the Discharge of Prior Obligations, the Controlling Agent as in effect immediately prior to such Discharge of Prior Obligations shall transfer possession of such Common Collateral physically held by such Controlling Agent (or any agent, bailee or designee thereof (other than any other Agent)) and otherwise shall take commercially reasonable actions (in each case at the sole cost and expense of the Grantors) to transfer possession or control of such other Common Collateral or any such account to the Rising Prior Agent (to the extent the Rising Prior Agent has a Priority Lien on such Common Collateral or account after giving effect to any prior or concurrent releases of Liens) including, in the case of any deposit or securities account or securities account holding Common Collateral maintained with such Controlling Agent, taking commercially reasonable actions to enter into a control agreement in favor of the Rising Agent, or transferring all cash and other assets in such account to (i) one or more depositary institutions or securities intermediaries that enter into such a control agreement or (ii) an account maintained by the Rising Prior Agent (or on terms otherwise reasonably acceptable to the Rising Prior Agent)). Notwithstanding anything to the contrary herein, if, for any reason, any Junior Obligations remain outstanding upon the Discharge of Prior Obligations, all rights of the Controlling Agent as in effect immediately prior to such Discharge of Prior Obligations, hereunder and under the applicable Collateral Documents (1) with respect to the delivery and control of any part of the Common Collateral subject to a Prior Lien of such Controlling Agent, and (2) to direct, instruct, vote upon or otherwise influence the maintenance or disposition of such Common Collateral, shall immediately, and (to the extent permitted by law) without further action on the part of either of the Rising Agent or such Controlling Agent, pass to the Rising Agent, who shall thereafter hold such rights for the benefit of its Related Secured Parties.
(e) Subject to the terms of this Agreement, so long as the Discharge of Prior Obligations has not occurred, the Controlling Agent shall be entitled to deal with the Pledged Collateral or Collateral within its “control” in accordance with the terms of this Agreement and the applicable Prior Credit Documents as if the Junior Liens of the Junior Agents and the Junior Secured Parties did not exist.
Section 5.06. Entry Upon Premises by Controlling Agent. (a) If the Revolving Credit Agent shall take any action to exercise its rights or remedies (including any action of foreclosure, enforcement, collection or execution) with respect to the ABL Collateral (“ABL Collateral Enforcement Actions”), each other Agent (subject to a prior written request by the Revolving Credit Agent to the applicable Agent (the “ABL Collateral Enforcement Notice”)) (i) shall cooperate with any efforts on the part of the
Revolving Credit Agent (and with its officers, employees, representatives and agents) (at the sole cost and expense of the Revolving Credit Agent and the Revolving Credit Secured Parties (but with the Grantors’ reimbursement and indemnity obligation with respect thereto as provided in the Revolving Credit Documents, which shall not be limited hereby)) and subject to the condition that the other Agents and the Other Secured Parties shall have no obligations or duty to take any action or refrain from taking any action that could reasonably be expected to result in the incurrence of any liability or damage to such other Agents or Other Secured Parties to conduct ABL Collateral Enforcement Actions with respect to the ABL Collateral and to complete the processing of any Inventory (including work-in-process) included in the ABL Collateral and to assemble the ABL Collateral and process, ship, produce, store, complete, supply, lease, sell or otherwise handle, deal with, or dispose of, in any lawful manner, the ABL Collateral, (ii) shall not hinder or restrict in any respect the Revolving Credit Agent from taking ABL Collateral Enforcement Actions, from completing the manufacturing and processing of, and turning into finished goods, any ABL Collateral (including raw materials and work-in-process) and assembling the ABL Collateral or shipping, producing, storing, completing, supplying, leasing, selling or otherwise handling, dealing with or disposing of, in any lawful manner, the ABL Collateral and (iii) shall permit the Revolving Credit Agent, its agents, employees, advisers and representatives, at the sole cost and expense of the Revolving Credit Secured Parties (but with the Grantors’ reimbursement and indemnity obligation with respect thereto as provided in the Revolving Credit Documents, which shall not be limited hereby), to enter upon and use the Non-ABL Collateral (including manufacturing, storage and transportation facilities and equipment, computers, records, documents and files and Intellectual Property) for a period not to exceed 180 days after the later of (i) date on which such Agent (other than the Revolving Credit Agent) shall obtain possession and control of such Non-ABL Collateral and (ii) the date of delivery of the ABL Collateral Enforcement Notice, for purposes of (A) assembling and storing the ABL Collateral and completing the manufacturing and processing of, and turning into finished goods, any ABL Collateral (including raw materials and work-in-process), (B) selling any or all of the ABL Collateral located on such Non-ABL Collateral, whether in bulk, in lots or to customers in the ordinary course of business or otherwise, (C) removing and transporting any or all of the ABL Collateral located in or on such Non-ABL Collateral, (D) otherwise shipping, storing, leasing, selling or otherwise handling, dealing with, assembling or disposing of, in any lawful manner, the ABL Collateral and (E) taking reasonable actions to protect, secure and otherwise enforce the rights or remedies of the Revolving Credit Agent and the Revolving Credit Secured Parties (including with respect to any ABL Collateral Enforcement Actions) in and to the ABL Collateral; provided, however, that nothing contained in this Agreement shall restrict the Non-ABL Controlling Agent (or any other Agent at the instruction of the Non-ABL Controlling Agent) from selling, assigning or otherwise transferring any Non-ABL Collateral prior to the expiration of such 180 day period if the purchaser, assignee or transferee agrees to be bound by the provisions of this Section in writing (for the benefit of the Revolving Credit Agent and the Revolving Credit Secured Parties). It is agreed that if any stay or other order prohibiting the exercise of rights or remedies with respect to the ABL Collateral has been entered by a court of competent jurisdiction, such 180 day period shall be tolled during the pendency
of any such stay or other order; provided that after the 180th day following the date on which the Non-ABL Controlling Agent (or any other Agent at the instruction of the Non-ABL Controlling Agent) shall obtain possession and control of any Non-ABL Collateral, such period shall terminate as to such Non-ABL Collateral if the Non-ABL Controlling Agent shall determine in good faith and advise the Revolving Credit Agent that the continuance of such period would prevent a contemplated sale of such Non-ABL Collateral or materially reduce the price obtainable in such sale. Notwithstanding anything in this paragraph to the contrary, each Agent (other than the Revolving Credit Agent) and its Related Secured Parties (i) shall have no obligation to exercise rights or remedies that may be available to them under the applicable Credit Documents and (ii) shall be required to permit the Revolving Credit Agent, and its agents, advisers and representatives, to enter upon and use the Non-ABL Collateral only to the extent such Agent or such Related Secured Parties have possession and control of such Non-ABL Collateral.
(b) If the Revolving Credit Agent elects to enter upon and use the Non-ABL Collateral as provided in paragraph (a) of this Section, it shall take all reasonable efforts (and shall direct its agents, advisers and representatives to take all reasonable efforts) to avoid, to the extent reasonably practicable, interference with the operation of the Non-ABL Collateral. Subject to the Non-ABL Controlling Agent having obtained possession and control of any of the Non-ABL Collateral, any Agent (other than the Revolving Credit Agent) may instruct the Revolving Credit Agent in writing to remove all ABL Collateral from such Non-ABL Collateral by the end of the 180 day period referred to in paragraph (a) of this Section, whereupon, at the end of such 180 day period, the Revolving Credit Agent shall, at the sole cost and expense of the Revolving Credit Secured Parties (but with the Grantors’ reimbursement and indemnity obligation with respect thereto as provided in the Revolving Credit Documents, which shall not be limited hereby), remove the ABL Collateral from the Non-ABL Collateral; provided that no stay or other order prohibiting such removal has been entered by a court of competent jurisdiction (it being understood and agreed that the running of such 180 day period shall be tolled during the pendency of any such stay or other order). If the Revolving Credit Agent does not remove the ABL Collateral from the Non-ABL Collateral by the end of such 180 day period (or such longer period as such a stay or other order is in effect), the Non-ABL Controlling Agent may cause the ABL Collateral to be removed and, thereafter, store the ABL Collateral in such location or locations as the Non-ABL Controlling Agent shall deem advisable pending repossession by the Revolving Credit Agent. Any costs reasonably incurred by any Agent (other than the Revolving Credit Agent) or its Related Secured Parties by virtue of such removal and storage shall be paid by the Revolving Credit Secured Parties (but with the Grantors’ reimbursement and indemnity obligation with respect thereto, as provided in the Revolving Credit Documents, which shall not be limited hereby). The Non-ABL Controlling Agent agrees to notify the Revolving Credit Agent of the location or locations to which any of the ABL Collateral shall have been removed by it pursuant to the foregoing provisions.
(c) During the period of actual occupation, use or control by the Revolving Credit Agent, or its agents, advisers or representatives, of any Non-ABL Collateral, the Revolving Credit Secured Parties shall be obligated hereunder to
(i) reimburse the Agents (other than the Revolving Credit Agent) for all utilities, insurance and all other operating costs of such Non-ABL Collateral during any such period of actual occupation, use or control (calculated on a per diem basis based upon a fraction, the numerator of which shall be the actual number of days of such occupation, use or control and the denominator of which shall be 365 days) to the extent the same are actually paid by such Agent or its Related Secured Parties, (ii) repair at their expense any physical damage to such Non-ABL Collateral directly resulting from such occupancy, use or control, and leave such Non-ABL Collateral in substantially the same condition as it was at the commencement of such occupancy, use or control, ordinary wear and tear excepted, and (iii) indemnify and hold harmless any Agent and its Related Secured Parties from and against any losses, claims, liabilities, costs or expenses directly resulting from such occupancy, use or control or from any acts or omissions of the Revolving Credit Agent or its agents, employees, advisers or representatives in connection therewith, absent gross negligence or willful misconduct on the part of such Agent or such Related Secured Parties. Notwithstanding the foregoing, in no event shall the Revolving Credit Secured Parties have any liability to the Agents (other than the Revolving Credit Agent) and its Related Secured Parties pursuant to this Section as a result of any condition (including any environmental condition, claim or liability) on or with respect to the Non-ABL Collateral existing prior to the date of the exercise by the Revolving Credit Agent of its rights under this Section, and the Revolving Credit Secured Parties shall have no duty or liability to maintain the Non-ABL Collateral in a condition or manner better than that in which it was maintained prior to the use thereof by the Revolving Credit Agent or its agents, employees, advisers or representatives, or for any diminution in the value of the Non-ABL Collateral that results solely from ordinary wear and tear resulting from the use of the Non-ABL Collateral by the Revolving Credit Agent or its agents, advisers or representatives in the manner and for the time periods specified under this Section. Without limiting the rights granted in this Section, the Revolving Credit Agent and the Revolving Credit Secured Parties shall cooperate with the Non-ABL Controlling Agent in connection with any efforts made by it to sell the Non-ABL Collateral.
Section 5.07. Rights under Permits, Licenses and Intellectual Property. Each Agent (other than the Revolving Credit Agent) (a) consents (without any representation, warranty or obligation whatsoever) to the grant by any Grantor to the Revolving Credit Agent of a non-exclusive royalty-free license to use any permit, license or Intellectual Property of such Grantor that is subject to a Lien held by any such Agent (or any permit, license or Intellectual Property acquired by such purchaser, assignee or transferee from any Grantor, as the case may be) in connection with the enforcement of any Revolving Credit Lien held by the Revolving Credit Agent upon any Revolving Credit Collateral and (b) agrees that if the Revolving Credit Agent shall require rights available under any permit, license or Intellectual Property controlled by such Agent, or any of its Affiliates, in order to realize on any ABL Collateral, such Agent shall take all such actions as shall be available to it, consistent with applicable law and reasonably requested by the Revolving Credit Agent, to make such rights available to the Revolving Credit Agent. The Revolving Credit Agent agrees that if any Agent (other than the Revolving Credit Agent) shall require rights available under any permit or license controlled by the Revolving Credit Agent in order to realize on any Non-ABL Collateral,
the Revolving Credit Agent shall take all such actions as shall be available to it, consistent with applicable law and reasonably requested by such Agent, to make such rights available to such Agent. Each Agent agrees that any sale or other transfer of any Common Collateral consisting of Intellectual Property upon any exercise of remedies shall be made expressly subject to the rights to be made available pursuant to this Section in writing (for the benefit of each other Agent and the Related Secured Parties).
Section 5.08. Permitted Notes. (a) To the extent, but only to the extent, permitted by the provisions of the then existing Credit Documents, SSCC may incur Indebtedness in the form of Permitted Notes, which shall be secured by (i) the Non-ABL Collateral on a second lien, junior and subordinated basis to the Term Loan Credit Obligations and on a senior basis to the Revolving Credit Obligations and (ii) the ABL Collateral on a third lien, junior and subordinated basis to both the Term Loan Credit Obligations and the Revolving Credit Obligations, if and subject to the condition that (A) such Permitted Notes are not secured by any property or assets of SSCC or any Subsidiary other than property or assets constituting Term Loan Credit Collateral, (B) such Permitted Notes are not guaranteed by any Subsidiaries other than the Term Loan Credit Guarantors and (C) the Agent of any such Permitted Notes (each a “Permitted Notes Agent”), acting on behalf of the holders of such Permitted Notes (such Permitted Notes Agent and the holders in respect of any such Permitted Notes being referred to as the “Permitted Notes Secured Parties”), becomes a party to this Agreement as a Permitted Notes Agent and by satisfying conditions (i) through (vi), as applicable, of the immediately succeeding paragraph.
(b) In order for a Permitted Notes Agent of any Series to become a party to this Agreement:
(i) such Permitted Notes Agent shall have executed and delivered a Joinder Agreement substantially in the form of Exhibit II (with such changes as may be reasonably approved by the other Agents) pursuant to which it becomes an Agent hereunder, and the Permitted Notes of such Series and the related Permitted Note Secured Parties become subject hereto and bound hereby;
(ii) SSCC shall have delivered to each existing Agent (A) true and complete copies of each of the Permitted Note Documents relating to such Permitted Notes, certified as being true and correct by an officer of SSCC and (B) a certificate of an officer of SSCC that the Permitted Notes can be issued without violating any of the Term Loan Documents, Revolving Credit Documents or Permitted Notes Documents of any existing Series of Permitted Notes;
(iii) all filings, recordations and/or amendments or supplements to the Permitted Notes Collateral Documents related to such Permitted Notes necessary or desirable in the reasonable opinion of the existing Agents to confirm and perfect the appropriate priority Liens with respect to the applicable Collateral securing the Permitted Notes Obligations relating to such Permitted Notes shall have been made, executed and/or delivered (or, with respect to any such filings or recordations, reasonably acceptable provisions to perform such filings or
recordings have been taken in the reasonable judgment of the Controlling Agent), and all fees and taxes in connection therewith shall have been paid (or reasonably acceptable provisions to make such payments have been taken in the reasonable judgment of the Controlling Agent); and
(iv) the Permitted Notes Documents related to such Permitted Notes shall provide, in a manner reasonably satisfactory to the existing Agents, that each Permitted Notes Secured Party of such Series will be subject to and bound by the provisions of this Agreement in its capacity as a holder of such Permitted Notes Obligations.
Section 5.09. When Discharge of Obligations Deemed Not To Have Occurred. If SSCC or any other Grantor shall enter into any Refinancing of any Class of Obligations (the Class of Obligations so Refinanced, “Refinanced Obligations”) (other than the Permitted Notes) that is (a) permitted by the Credit Documents with respect to each other Class and (b) secured by Liens on Common Collateral securing such Refinanced Obligations, then a Discharge of the Obligations of such Class shall be deemed not to have occurred for all purposes of this Agreement and, subject to the next sentence, from and after the date on which the Notice of New Refinancing Obligations referred to below in this Section is delivered to each other Agent, (i) the obligations under such Refinancing of such Refinanced Obligations (the “Refinancing Obligations”) shall automatically be treated as Prior Obligations and/or Junior Obligations (to the same extent and with the same priority and rights with respect to the Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable, as the Refinanced Obligations), (ii) the Liens securing such Refinancing Obligations shall be treated as Prior Liens and/or Junior Liens (to the same extent as the corresponding Liens with respect to the Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable, securing the Refinanced Obligations) for all purposes of this Agreement, including for purposes of the provisions governing Lien priorities and rights in respect of Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable, set forth herein, and (iii) the collateral agent for such Refinancing Obligations (the “New Agent”) shall be a Prior Agent and/or Junior Agent for all purposes of this Agreement (to the same extent as the Agent for the Refinanced Obligations with respect to the Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable). If the Obligations of any Class shall be Refinanced (other than the Permitted Notes) in part but not in whole, then (A) both the remaining Obligations of such Class and the Refinancing Obligations shall have the status of the Obligations of such Class hereunder, (B) the Liens on any Common Collateral securing the Refinancing Obligations shall constitute Prior Liens and/or Junior Liens to the same extent as the Liens on such Common Collateral constituting Non-ABL Collateral and ABL Collateral, as applicable, securing such remaining Obligations of such Class (it being understood and agreed that the relative rights of, and priorities of the Liens securing, the obligations under such Refinancing Obligations and such remaining Obligations of such Class shall not be governed by this Agreement) and (C) the original Agent of such Class and the New Agent of such Class shall each have the rights and obligations of the original Agent with respect to the Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable, hereunder; provided, that (x) in the event any determinations made or notices
given hereunder by the original Agent and the New Agent of such Class shall conflict, the determination made or notice given by the Agent of such Class representing the greater amount of Obligations of such Class shall control and (y) any Pledged Collateral held by either Agent of such Class shall be held by it both in its own right and as bailee of the other Agent of such Class (in accordance with the provisions and subject to the limitations set forth in Section 5.05), as their interests may appear. Upon receipt of a notice (the “Notice of New Refinancing Obligations”) stating that SSCC or any Grantor has Refinanced the Obligations of any Class (other than through the Permitted Notes) on a secured basis as provided above (which notice shall include the identity of the New Agent of such Class, the original Agent of such Class and each other Agent shall promptly enter into such documents and agreements (including Amendments to this Agreement) as SSCC or such New Agent shall reasonably request in order to provide to the New Agent the rights contemplated hereby. As a condition to its ability to enforce this Agreement, the New Agent of any Class shall agree in a writing addressed to each other Agent, for the benefit of such other Agent’s Related Secured Parties, and, if any portion of the original Obligations of such Class shall remain outstanding, to the original Agent of such Class , for the benefit of the original Agent’s Related Secured Parties, to be bound by the terms of this Agreement. The provisions of this Section are intended to ensure that (i) the Liens on any Common Collateral securing the Refinancing Obligations of each Class (other than the Permitted Notes) will have the same priorities relative to the Liens on such Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable, securing the Obligations of each other Class as the Liens that secured such Refinanced Obligations of such Class prior to such Refinancing and (ii) the parties benefited by the Liens on any Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable, securing any Refinancing Obligations of a Class (other than the Permitted Notes) will have the same rights and obligations relative to the parties holding Liens on such Common Collateral securing the Obligations of each other Class as the parties that were benefited by the Liens on such Common Collateral constituting Non-ABL Collateral or ABL Collateral, as applicable, that secured such Refinanced Obligations, and such provisions shall be construed accordingly. Notwithstanding anything to the contrary and for the avoidance of doubt, if the Revolving Credit Agreement is terminated in its entirety and an Incremental Revolving Facility is established, then the Revolving Credit Obligations shall be deemed not to have been Refinanced and shall instead be deemed to have been Discharged for all purposes of this Agreement.
Section 5.10. Canadian Intercompany Notes. The parties hereto acknowledge and agree that, notwithstanding the status of the Canadian Intercompany Notes as Non-ABL Collateral, each of the Term Loan Credit Agent and each Permitted Notes Agent, on behalf of itself and its respective Related Secured Parties, agrees that (a) neither it nor any such Related Secured Parties (nor any of the Secured Parties under and as defined in the Canadian Intercompany Notes Documents) will exercise any rights or remedies against, or otherwise seek to realize on, any Canadian Collateral securing any Canadian Intercompany Note at any time prior to the Discharge of the Revolving Credit Obligations and (b) any Proceeds or other amounts received by the Term Loan Agent or any Permitted Notes Agent, or any of their respective Related Secured Parties (or any Secured Party under and as defined in the Canadian Intercompany Notes Documents) as a
result of any exercise of rights or remedies against or realization upon any Canadian Collateral securing any Canadian Intercompany Note at any time prior to the Discharge of the Revolving Credit Obligations shall be segregated and held in trust and forthwith paid over to the Revolving Credit Agent, for the benefit of the Revolving Credit Secured Parties, in the form in which received, with any necessary endorsements, and shall be applied to satisfy and discharge the Revolving Credit Obligations (with any amount remaining after the Discharge of the Revolving Credit Obligations to be applied (i) FIRST in the manner specified in the relevant Term Loan Credit Document and (ii) SECOND, following the Discharge of Term Loan Credit Obligations, in the manner specified in the Permitted Notes Documents).
Section 5.11. Cash Management and Hedging Obligations. SSCC and each Grantor acknowledges and agrees that (a) no Term Loan Credit Cash Management and Hedging Obligations shall be designated as Revolving Credit Cash Management and Hedging Obligations and (b) no Revolving Credit Cash Management and Hedging Obligations shall be designated as Term Loan Credit Cash Management and Hedging Obligations.
Section 5.12. Access to Information. If any Agent (other than the Revolving Credit Agent) takes actual possession of any documentation of a Grantor (whether such documentation is in the form of a writing or is stored in any data equipment or data record in the physical possession of such Agent), then upon request of the Revolving Credit Agent and reasonable advance notice, such Agent will, unless prohibited by contract or law, permit the Revolving Credit Agent or its representative to inspect and copy such documentation if and to the extent the Revolving Credit Agent certifies to such Agent that:
(a) such documentation contains or may contain information necessary or appropriate, in the good faith opinion of the Revolving Credit Agent, to the enforcement of the Revolving Credit Agent’s Liens upon any ABL Collateral; and
(b) the Revolving Credit Agent and the Revolving Credit Secured Parties are entitled to receive and use such information under applicable law and, in doing so, will comply with all obligations imposed by law or contract in respect of the disclosure or use of such information.
ARTICLE VI
Insolvency or Liquidation Proceedings
Section 6.01. Cash Collateral and DIP Financing. (a) This Agreement will continue in full force and effect notwithstanding the commencement of any proceeding under the Bankruptcy Code or any other Federal, state or foreign bankruptcy, insolvency, receivership or similar law by or against SSCC or any other Grantor.
(b) If SSCC or any Grantor becomes subject to a case under the Bankruptcy Code and, as debtor(s)-in-possession, moves for approval of financing
(including on a priming basis) (“DIP Financing”) to be provided by one or more lenders under Section 364 of the Bankruptcy Code or the use of cash collateral as defined in Section 363 of the Bankruptcy Code or any similar Bankruptcy Law, each Junior Agent, on behalf of itself and its Related Secured Parties, agrees that it will raise no objection or oppose or contest (or join with or support any third party opposing, objecting or contesting) to any such financing or to the Liens on the Prior Lien Collateral securing the same (“DIP Financing Liens”) or to any use of cash collateral constituting Prior Lien Collateral and will not request adequate protection or any other relief in connection therewith (except, as expressly agreed by the Controlling Agent or to the extent permitted by Section 6.03), unless the Controlling Agent or Controlling Secured Parties then oppose or object to such DIP Financing or such DIP Financing Liens or use of such cash collateral (and, to the extent that such DIP Financing Liens are senior to, or rank pari passu with, Prior Liens on such Prior Collateral, each Junior Agent will, for itself and on behalf of the other Junior Secured Parties, subordinate the Junior Liens on such Collateral to the Prior Liens and the DIP Financing Liens on the same basis as the Junior Liens are subordinated to the Prior Liens under this Agreement (and all obligations relating thereto)), so long as, in connection with the grant of any DIP Financing Liens, the Junior Secured Parties retain Liens on all the Prior Lien Collateral with the same priority in relation to the Prior Liens as existed prior to the commencement of the case under the Bankruptcy Code.
(c) Each Junior Agent, on behalf of itself and its Related Secured Parties, agrees that it will not object to or oppose a sale or other disposition of any Prior Lien Collateral (or any portion thereof) under Section 363 of the Bankruptcy Code or any other provision of the Bankruptcy Code free and clear of its Liens (subject to attachment of proceeds with respect to the Junior Lien on such Prior Lien Collateral in favor of such Junior Agent in the same order and manner as otherwise set forth herein) or other claims under Section 363 of the Bankruptcy Code if the Controlling Agent or the Controlling Secured Parties shall have consented to such sale or disposition of such Prior Collateral.
(d) If, in connection with any judicial or insolvency proceeding, debt obligations of the reorganized debtor secured by Liens upon any property of the reorganized debtor are distributed pursuant to a plan of reorganization or similar dispositive restructuring plan, both on account of the Prior Obligations and the Junior Obligations, then, to the extent the debt obligations distributed on account of the Prior Obligations and on account of the Junior Obligations are secured by Liens upon the same property, the provisions of this Agreement will survive the distribution of such debt obligations pursuant to such plan and will apply with like effect to the Liens securing such debt obligations.
Section 6.02. Relief from the Automatic Stay. Until the Discharge of Prior Obligations has occurred, each Junior Agent, on behalf of itself and its Related Secured Parties, agrees that none of them shall seek (or support any other Person seeking) relief from the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of any Common Collateral subject to a Prior Lien without the prior written consent of each Prior Agent. Each Junior Agent, on behalf of itself and its Related Secured Parties, agrees that none of them shall oppose (or support any other
Person opposing) any motion of the Controlling Agent seeking relief from the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of any Common Collateral subject to its Prior Lien.
Section 6.03. Adequate Protection. Each Junior Agent, on behalf of itself and its Related Secured Parties, agrees that it will not contest any request by any Prior Agent or any other Prior Secured Party for adequate protection with respect to their Prior Liens on Common Collateral or contest any objection by a Prior Agent or any other Prior Secured Party to any motion, relief, action or proceeding based on such Prior Agent or other Prior Secured Party claiming a lack of adequate protection with respect to their Prior Liens on Common Collateral. Notwithstanding the foregoing, if a Prior Agent or any Prior Secured Party is granted adequate protection in the form of additional collateral in connection with any use of cash collateral constituting Prior Collateral or DIP Financing secured by Prior Collateral, then each Junior Agent, on behalf of itself and its Related Secured Parties, may seek or request adequate protection in the form of a Lien on such additional collateral, which Lien will be junior and subordinated to the Liens securing the Prior Obligations and such DIP Financing (and all obligations related thereto) on the same basis as the other Junior Liens are subordinated to the Prior Liens under this Agreement. In the event a Junior Agent or any other Junior Secured Party seeks or requests adequate protection in respect of Junior Obligations and such adequate protection is granted in the form of additional collateral, then such Junior Agent, on behalf of itself and its Related Secured Parties, agrees that the Prior Agents and the Prior Secured Parties and any such DIP Financing shall also be granted a senior Lien on such additional collateral as security for the Prior Obligations and for any such DIP Financing and that any Lien on such additional collateral securing the Junior Obligations shall be junior and subordinated to the Lien on such collateral securing the Prior Obligations (and any such DIP Financing and related obligations) and to any other Liens granted to the Prior Secured Parties as adequate protection on the same basis as the other Liens on Common Collateral securing the Junior Obligations are so subordinated to the Liens on Common Collateral securing the Prior Obligations under this Agreement.
Section 6.04. No Waiver. Subject to Sections 3.01(c) and 3.01(e), nothing contained herein shall prohibit or in any way limit any Prior Agent or any Prior Secured Party from objecting in any Insolvency or Liquidation Proceeding or otherwise to any action taken by any Junior Agent or any of its Related Secured Parties, including the seeking by any such Junior Agent or any such Related Secured Party of adequate protection or the asserting by any such Junior Agent or any such Related Secured Party of any of its rights and remedies under the applicable Junior Credit Documents or otherwise, in each case to the extent affecting such Prior Agent’s or such Prior Secured Parties’ rights in its Prior Lien Collateral.
Section 6.05. Avoidance Issues. If any Prior Secured Party is required in any Insolvency or Liquidation Proceeding or otherwise to turn over or otherwise pay to the estate of SSCC or any other Grantor any amount paid in respect of Prior Obligations (a “Recovery”), then such Prior Secured Party shall be entitled to a reinstatement of the applicable Prior Obligations with respect to all such recovered amounts. If this Agreement shall have been terminated prior to such Recovery, this Agreement shall be
reinstated in full force and effect, and such prior termination shall not diminish, release, discharge, impair or otherwise affect the obligations of the parties hereto from such date of reinstatement.
Section 6.06. Post-Petition Interest. (a) Each Junior Agent agrees, on behalf of itself and its Related Secured Parties, that none of them shall oppose or seek to challenge any claim by any Prior Agent or any Prior Secured Party for allowance in any Insolvency or Liquidation Proceeding of Prior Obligations consisting of post-petition interest, fees or expenses to the extent of the value of such Prior Agent’s or such Prior Secured Party’s Prior Lien on its Prior Lien Collateral, without regard to the existence of the Junior Lien of any Junior Agent or any Junior Secured Party on such Prior Lien Collateral (it being understood and agreed that such value will be determined without regard to the existence of the Junior Liens on the Prior Collateral).
(b) Each Prior Agent agrees, on behalf of itself and its Related Secured Parties, that none of them shall oppose or seek to challenge any claim by any Junior Agent or any Prior Secured Party for allowance in any Insolvency or Liquidation Proceeding of Junior Obligations consisting of post-petition interest, fees or expenses to the extent of the value of such Junior Agent’s or such Junior Secured Party’s Junior Lien on such Prior Agent’s Prior Lien Collateral (it being understood and agreed that such value will be determined only after taking into account the Prior Liens on the Prior Lien Collateral and all Prior Obligations secured thereby (including post-petition interest, fees and expenses)).
Section 6.07. Separate Grants of Security and Separate Classification. Each Agent, for itself and on behalf of its Related Secured Parties, acknowledges and agrees that (a) the grants of Liens pursuant to applicable Collateral Documents constitute separate and distinct grants of Liens; and (b) because of, among other things, their differing rights in the ABL Collateral and the Non-ABL Collateral, the Term Loan Credit Obligations, Revolving Credit Obligations and the Permitted Notes Obligations are fundamentally different from one another and must be separately classified in any plan of reorganization proposed or adopted in an Insolvency or Liquidation Proceeding (other than any such plan of reorganization that provides for the payment in full and in cash of the aggregate principal amount of (and accrued interest, fees, premiums and expenses under) the Term Loan Credit Obligations, the Revolving Credit Obligations and Permitted Notes Obligations). To further effectuate the intent of the parties as provided in the immediately preceding sentence, if it is held that the claims of one or more of the Term Loan Credit Secured Parties, Revolving Credit Secured Parties and the Permitted Notes Secured Parties or any of them in respect of any ABL Collateral or Non-ABL Collateral constitute only one secured claim (rather than separate classes of secured claims), then each of the parties hereto hereby acknowledges and agrees that, as set forth in Section 2.01 and as contemplated by Section 4.01, all distributions shall be made as if there were separate classes of secured claims against the Grantors in respect of such ABL Collateral or Non-ABL Collateral (with the effect being that, to the extent that the aggregate value of such ABL Collateral or Non-ABL Collateral is sufficient (for this purpose ignoring all claims held by the Junior Secured Parties), the Controlling Secured Parties shall be entitled to receive, in addition to amounts otherwise distributed to them in
respect of principal, pre-petition interest and other claims, all amounts owing in respect of post-petition interest, fees and expenses (including any additional interest payable pursuant to the applicable Prior Credit Documents arising from or related to a default) that are disallowed as a claim in any Insolvency or Liquidation Proceeding before any distribution in respect of ABL Collateral or Non-ABL Collateral, as the case may be, is made in respect of the claims held by the Junior Secured Parties, with each Junior Agent, for itself and on behalf of its Related Secured Parties, hereby acknowledging and agreeing to turn over to (i) FIRST the Controlling Agent, for itself and on behalf of the Controlling Secured Parties and (ii) SECOND, following the Discharge of Obligations with respect to the Controlling Agent, the Rising Prior Agent (if any) for itself and on behalf of such Rising Agent’s Related Secured Parties, amounts otherwise received or receivable by them to the extent necessary to effectuate the intent of this sentence (with respect to the payment of post-petition interest, fees and expenses), even if such turnover has the effect of reducing the claim or recovery of the Junior Secured Parties).
Section 6.08. Voting. Each of the parties hereto acknowledges and agrees that no Junior Agent or Junior Secured Party shall be required to vote to approve any plan of reorganization with respect to any Grantor for any reason or to agree that any provision of any Junior Credit Document shall survive the effectiveness of any plan of reorganization with respect to any Grantor in an Insolvency or Liquidation Proceeding.
Section 6.09. Application. This Agreement shall be applicable prior to and after the commencement of any Insolvency or Liquidation Proceeding. All references herein to any Grantor shall apply to any trustee for such Person and such Person as debtor in possession. The relative rights as to the Common Collateral and proceeds thereof shall continue after the filing thereof on the same basis as prior to the date of the petition, subject to any court order approving the financing of, or use of cash collateral by, any Grantor.
Section 6.10. Waiver. Except as to claims arising under this Agreement, each Junior Agent, for itself and on behalf of its Related Secured Parties, waives any claim it may hereafter have against any Prior Secured Party arising out of (i) the election of any Prior Secured Party of the application of Section 1111(b)(2) of the Bankruptcy Code, or (ii) in any Insolvency or Liquidation Proceeding, the grant in any cash collateral or financing arrangement of a security interest, subject to the Prior Liens of such Prior Secured Party, in connection with the Common Collateral.
ARTICLE VII
Reliance; Waivers; Etc.
Section 7.01. Reliance. Other than any reliance on the terms of this Agreement, each Agent, on behalf of its Related Secured Parties, acknowledges that such Related Secured Parties have, independently and without reliance on any other Agent or any other Secured Party, and based on documents and information deemed by them to be appropriate, made their own credit analysis and decision to enter into the Credit Documents applicable to such Agent and such Related Secured Parties and be bound by
the terms of this Agreement and agrees, on behalf of its Related Secured Parties, that such Related Secured Parties will continue to make their own credit decisions in taking or not taking any action under such Credit Documents or this Agreement.
Section 7.02. No Warranties or Liability. Each Agent, on behalf of itself and its Related Secured Parties, acknowledges and agrees that the other Agents and their respective Related Secured Parties have made no express or implied representation or warranty, including with respect to the execution, validity, legality, completeness, collectibility or enforceability of any of the applicable Credit Documents, the ownership of any Collateral or the perfection or priority of any Liens thereon. Except as otherwise provided herein, the Secured Parties of each Class will be entitled to manage and supervise their respective loans and extensions of credit under the applicable Credit Documents with respect to such Class in accordance with law and as they may otherwise, in their sole discretion, deem appropriate. No Agent or any of its Related Secured Parties shall have any duty to any other Agent or its Related Secured Parties to act or refrain from acting in a manner which allows, or results in, the occurrence or continuance of an event of default or default under any agreements with SSCC or any other Grantor (including any Credit Documents), regardless of any knowledge thereof which they may have or be charged with.
Section 7.03. No Waiver of Lien Priorities. (a) No right of any Agent or any of its Related Secured Parties to enforce any provision of this Agreement or any Credit Document shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of SSCC or any other Grantor or by any act or failure to act by any Agent or Secured Party, or by any noncompliance by any Person with the terms, provisions and covenants of this Agreement, any of the Credit Documents or any Canadian Intercompany Note Documents, regardless of any knowledge thereof that such Agent or any of its Related Secured Parties may have or be otherwise charged with.
(b) Except as otherwise provided herein, each Junior Agent, on behalf of itself and its Related Secured Parties, agrees that Prior Agent and the Prior Secured Parties shall have no liability to such Junior Agent or any such Related Secured Party, and any Junior Agent, on behalf of itself and its Related Secured Parties, hereby waives any claim against any Prior Agent or any Prior Secured Party, arising out of any and all actions which any Prior Agent or any Prior Secured Party may take or permit or omit to take with respect to:
(i) the Prior Credit Documents (other than this Agreement) applicable to such Prior Agent or Prior Secured Party;
(ii) the collection of the Prior Obligations (other than in violation of the express provisions of this Agreement) applicable to such Prior Agent or Prior Secured Party; or
(iii) the foreclosure upon, or sale, liquidation or other disposition of, any Collateral subject to any Prior Agents’ or Prior Secured Parties’ Prior Liens.
Section 7.04. Obligations Unconditional. All rights, interests, agreements and obligations of the Prior Agents and the Prior Secured Parties and the Junior Agents and the Junior Secured Parties hereunder (and the rights and obligations of the parties hereto set forth in Section 5.05 with respect to the Canadian Collateral) shall remain in full force and effect irrespective of:
(a) any lack of validity or enforceability of any Prior Credit Document or any Junior Credit Document;
(b) except as otherwise expressly set forth in this Agreement, any change in the time, manner or place of payment of, or in any other terms of, the Prior Obligations or the Junior Obligations, or any Amendment, including any increase in the amount thereof, whether by course of conduct or otherwise, of the terms of any Prior Credit Document or any Junior Credit Document;
(c) except as otherwise expressly set forth in this Agreement, any exchange of any security interest in any Collateral or any other collateral, or any Amendment, whether in writing or by course of conduct or otherwise, of all or any of the Prior Obligations or Junior Obligations or any guarantee thereof;
(d) the commencement of any Insolvency or Liquidation Proceeding in respect of SSCC or any other Grantor;
(e) any other circumstances that otherwise might constitute a defense available to, or a discharge of, SSCC or any other Grantor in respect of any Prior Agent, any Prior Obligations, any Prior Secured Party, any Junior Agent, any Junior Obligations or any Junior Secured Party in respect of this Agreement; or
(f) any circumstance that might constitute a defense available to, or a discharge of, SSCC or any other Grantor in respect of any security interest in the Canadian Collateral or the Canadian Intercompany Notes.
ARTICLE VIII
Miscellaneous
Section 8.01. Conflicts. In the event of any conflict between the provisions of this Agreement and the provisions of any Credit Documents or the Canadian Intercompany Notes Documents, the provisions of this Agreement shall govern and control.
Section 8.02. Effectiveness; Continuing Nature of this Agreement; Severability. This Agreement shall become effective when executed and delivered by the parties hereto. This is a continuing agreement of lien subordination, and the Secured Parties of any Class may continue, at any time and without notice to any Agent or Secured Party of any other Class to extend credit and other financial accommodations and lend monies to or for the benefit of SSCC or any Grantor constituting Obligations of such Class in reliance hereon. Each Agent, on behalf of itself and its Related Secured Parties, hereby waives any right it or any of them may have under applicable law to revoke this Agreement or any of the provisions hereof. The terms of this Agreement shall survive, and shall continue in full force and effect, in any Insolvency or Liquidation Proceeding. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall not invalidate the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. All references to SSCC or any other Grantor shall include SSCC or such Grantor as debtor and debtor-in-possession and any receiver or trustee for SSCC or any other Grantor (as the case may be) in any Insolvency or Liquidation Proceeding. Without limiting the generality of the foregoing, this Agreement is intended to constitute and shall be deemed to constitute a “subordination agreement” within the meaning of Section 510(a) of the Bankruptcy Code and is intended to be and shall be interpreted to be enforceable to the maximum extent permitted pursuant to applicable nonbankruptcy law.
Section 8.03. Amendments; Waivers. No Amendment of any of the provisions of this Agreement shall be effective unless the same shall be in writing and signed on behalf of each party hereto or its authorized agent and each waiver, if any, shall be a waiver only with respect to the specific matter involved and shall in no way impair the rights of the parties making such waiver or the obligations of the other parties to such party in any other respect or at any other time; provided that additional Grantors may be added as parties hereto in accordance with the provisions of Section 8.18. Notwithstanding the foregoing, none of SSCC or any other Grantor shall have any right to consent to or approve any Amendment of any provision of this Agreement (and its signature thereto shall not be required) except to the extent its rights or obligations are affected; provided that SSCC shall be provided with written notice of (and fully executed copies of) all Amendments of any provision of this Agreement.
Section 8.04. Information Concerning Financial Condition of SSCC and Subsidiaries. Each Agent, on behalf of its Related Secured Parties, acknowledges that none of the Agents or the Secured Parties shall be responsible for keeping any other Agent or Secured Party informed of (a) the financial condition of SSCC and the Subsidiaries or (b) any other circumstances bearing upon the risk of nonpayment of the Term Loan Credit Obligations, the Revolving Credit Obligations or the Permitted Notes Obligations. No Agent or any Secured Party shall have any duty to advise any other Agent or any other Secured Party of information known to it regarding such condition or any such circumstances or otherwise. In the event any Agent or any other Secured Party, in its sole discretion, undertakes at any time or from time to time to provide any such information to any other Agent or any other Secured Party, it shall be under no obligation:
(a) to make, and no Agent and any Secured Party shall make, any express or implied representation or warranty, including with respect to the accuracy, completeness, truthfulness or validity of any such information so provided;
(b) to provide any additional information or to provide any such information on any subsequent occasion;
(c) to undertake any investigation; or
(d) to disclose any information which such party wishes to maintain confidential or is otherwise required to maintain confidential.
Section 8.05. Subrogation. Subject to the Discharge of the Prior Obligations, with respect to the value of any payments or distributions in cash, property or other assets that any Junior Agent or any Junior Secured Party pays over to any Prior Agent or any Prior Secured Party under the terms of this Agreement, such Junior Agent or such Junior Secured Party shall be subrogated to the rights of such Prior Agent or such Prior Secured Party; provided that each Junior Agent, on behalf of itself and the Junior Secured Parties, hereby agrees not to assert or enforce all such rights of subrogation it may acquire as a result of any payment hereunder until the Discharge of Prior Obligations has occurred. SSCC and the other Grantors acknowledge and agree that the value of any payments or distributions in cash, property or other assets received by any Junior Agent or any Junior Secured Party that are paid over to any Prior Agent or any Prior Secured Party pursuant to this Agreement shall not reduce any of the applicable Junior Obligations.
Section 8.06. Application of Payments. All payments received by any Prior Agent or any Prior Secured Parties may be applied, reversed and reapplied, in whole or in part, to such part of the Prior Obligations as shall be provided in the applicable Prior Credit Documents. Each Junior Agent, on behalf of itself and its Related Secured Parties, assents to any extension or postponement of the time of payment of the Prior Obligations or any part thereof and to any other indulgence with respect thereto, to any substitution, exchange or release of any security which may at any time secure any part of the Prior Obligations and to the addition or release of any other Person primarily or secondarily liable therefor.
Section 8.07. Governing Law; Jurisdiction; Consent to Service of Process. (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTIONS 5-1401 AND 5-1402 OF TITLE 14 OF THE NEW YORK GENERAL OBLIGATIONS LAW BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAWS RULES THEREOF.
(b) Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the non-exclusive jurisdiction of any New York State court or Federal court of the United States sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or
for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that any party hereto may otherwise have to bring any action or proceeding relating to this Agreement in the courts of any jurisdiction.
(c) Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any New York State or Federal court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 8.09. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
Section 8.08. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.08.
Section 8.09. Notices. All notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile, addressed to the recipients at their addresses set forth in Schedule I hereto, or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt.
Section 8.10. Further Assurances. Each Agent, on behalf of itself and its Related Secured Parties and the other parties hereto agree that each of them shall take such further actions and shall execute and deliver such additional documents and instruments (in recordable form, if requested) as any Agent may reasonably request to effectuate the terms of and the Lien priorities contemplated by this Agreement.
Section 8.11. Successors and Assigns. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the permitted successors and assigns of such party; and all covenants, promises and agreements by or on behalf of each Agent, each Secured Party, SSCC and any Subsidiary party hereto that are contained in this Agreement shall bind and inure to the benefit of their respective successors and assigns.
Section 8.12. Specific Performance. Each of the Term Loan Credit Agent, the Revolving Credit Agent and any Permitted Notes Agent may demand specific performance of this Agreement. Each of the Term Loan Credit Agent, on behalf of itself and the Term Loan Credit Secured Parties, the Revolving Credit Agent, on behalf of itself and the Revolving Credit Secured Parties, and any Permitted Notes Agent, on behalf of itself and the applicable Permitted Notes Secured Parties, hereby irrevocably waives any defense based on the adequacy of a remedy at law and any other defense which might be asserted to bar the remedy of specific performance in any action brought by the Term Loan Credit Agent, the Term Loan Credit Secured Parties, the Revolving Credit Agent, the Revolving Credit Secured Parties, any Permitted Notes Agent or the Permitted Notes Secured Parties, as the case may be.
Section 8.13. Headings. Article and Section headings used herein are for convenience of reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement.
Section 8.14. Counterparts. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement or any document or instrument delivered in connection herewith by facsimile or electronic imaging means shall be effective as delivery of a manually executed counterpart of this Agreement or such other document or instrument, as applicable.
Section 8.15. Authorization. By its signature, each Person executing this Agreement on behalf of a party hereto represents and warrants to the other parties hereto that it is duly authorized to execute this Agreement.
Section 8.16. No Third Party Beneficiaries. This Agreement and the rights and benefits hereof shall inure to the benefit of each of the parties hereto and its respective successors and assigns, including each of the Term Loan Credit Secured Parties, the Revolving Credit Secured Parties and the Permitted Notes Secured Parties. Nothing in this Agreement shall impair, as between SSCC, the other Grantors or any other Revolving Credit Loan Parties, on the one hand, and the Agents and Secured Parties
of each Class, on the other hand, the obligations of SSCC, the other Grantors and the other Revolving Credit Loan Parties to pay principal, interest, fees and other amounts as provided in the Credit Documents of the applicable Class.
Section 8.17. Provisions Solely To Define Relative Rights. The intercreditor provisions of this Agreement are and are intended solely for the purpose of defining the relative rights of (a) the Term Loan Credit Agent and the Term Loan Credit Secured Parties, (b) the Revolving Credit Agent and the Revolving Credit Secured Parties and (c) the Permitted Notes Agents and the Permitted Notes Secured Parties. Nothing in this Agreement (i) is intended to or shall impair the obligations of SSCC, the other Grantor or the other Revolving Credit Loan Party, which are absolute and unconditional, to pay the Obligations of each Class as and when the same shall become due and payable in accordance with their terms or (ii) shall relieve any Grantor from the performance of any term, covenant, condition or agreement on such Grantor’s part to be performed or observed under or in respect of any of the Collateral pledged by it or from any liability to any Person under or in respect of any of such Collateral or impose any obligation on any Agent to perform or observe any such term, covenant, condition or agreement on such Grantor’s part to be so performed or observed or impose any liability on any Agent for any act or omission on the part of such Grantor relative thereto or for any breach of any representation or warranty on the part of such Grantor contained in this Agreement or any Credit Document, or in respect of the Collateral pledged by it. The obligations of each Grantor contained in this paragraph shall survive the termination of this Agreement and the discharge of such Grantor’s other obligations hereunder. Each Agent acknowledges and agrees that no other Agent has made any representation or warranty with respect to the execution, validity, legality, completeness, collectability or enforceability of any other Credit Documents. Except as otherwise provided in this Agreement, each of the Agents will be entitled to manage and supervise their respective extensions of credit to SSCC or any of its Subsidiaries in accordance with law and their usual practices, modified from time to time as they deem appropriate.
Section 8.18. Additional Grantors. Pursuant to the Term Loan Credit Documents, Revolving Credit Documents and the Permitted Notes Documents certain Subsidiaries not party hereto on the date hereof are required to become a party hereto as a “Grantor”. Upon the execution and delivery by any Subsidiary of an instrument in the form of Exhibit I hereto, any such Subsidiary shall become a party hereto and a Grantor hereunder with the same force and effect as if originally named as such herein. The execution and delivery of any such instrument shall not require the consent of any other party hereto. The rights and obligations of each party hereto shall remain in full force and effect notwithstanding the addition of any new Grantor as a party to this Agreement.
Section 8.19. Term Loan Credit Agent and Revolving Credit Agent. It is understood and agreed that (a) JPMorgan Chase Bank, N.A. (“JPM”) is entering into this Agreement in its capacity as administrative agent under the Term Loan Credit Documents and the provisions of Article VIII of the Term Loan Credit Agreement applicable to JPM as administrative agent thereunder shall also apply to JPM as Term Loan Credit Agent hereunder and (b) Deutsche Bank AG New York (“DB”) is entering in this Agreement in its capacity as collateral agent under the Revolving Credit Documents and the provisions
of Section 12 of the Revolving Credit Agreement applicable to DB as collateral agent thereunder shall also apply to DB as Revolving Credit Agent hereunder.
ARTICLE I
Definitions
(b) The rules of construction specified in Section 1.03 of the Credit Agreement also apply to this Agreement.
SECTION 1.03. References to “UCC”. To the extent required in the context of the pledge of Equity Interests in the Canadian entities referred to in Section 3.01(a)(ii) below, (i) any term defined herein by reference to the “UCC” shall also have any extended, alternative or analogous meaning given to such term in applicable Canadian personal property security, securities transfer and other laws, in all cases for the extension, preservation or betterment of the security and rights of the Administrative Agent, and (ii) all references herein to a financing statement, continuation statement, amendment or termination statement shall be deemed to refer also to the analogous documents used under applicable Canadian personal property security laws.
(b) To the fullest extent permitted by applicable law, each Guarantor waives any defense based on or arising out of any defense of any Borrower or any other Guaranteed Party or the unenforceability of the U.S. Secured Obligations or any part thereof from any cause, or the cessation from any cause of the liability of any Borrower or any other Guaranteed Party, other than the indefeasible payment in full in cash of all the U.S. Secured Obligations. The Security Agent and the other Secured Parties may, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the U.S. Secured Obligations, make any other accommodation with any Borrower or any other Guaranteed Party or exercise any other right or remedy available to them against any Borrower or any other Guaranteed Party, without affecting or impairing in any way the liability of any Guarantor hereunder except to the extent the U.S. Secured Obligations have been fully and indefeasibly paid in full in cash. To the fullest extent permitted by applicable law, each Guarantor waives any defense arising out of any such election even though such election operates, pursuant to applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of such Guarantor against any Borrower or any other Guaranteed Party, as the case may be, or any security.
(a) the shares of capital stock and other Equity Interests of (i) each Guarantor (other than Holdings) owned by such Grantor including those listed on Schedule II, (ii) SSC Canada (or, if applicable, each Foreign Subsidiary of Holdings that owns, directly or indirectly, any Equity Interests of SSC Canada and the Equity Interests of which are owed directly by such Grantor) owned by such Grantor on the date hereof and listed on Schedule II, (iii) each other Foreign Subsidiary of Holdings that is a Material Subsidiary and the Equity Interests of which are owned directly by such Grantor including those listed on Schedule II and (iv) any other Equity Interests obtained in the future by such Grantor in (A) any Domestic Subsidiary of Holdings that is a Material Subsidiary, (B) SSC Canada (or, if applicable, each Foreign Subsidiary of Holdings that owns, directly or indirectly, any Equity Interests of SSC Canada and the Equity Interests of which are owed directly by such Grantor) and (C) any Foreign Subsidiary of Holdings that is a Material Subsidiary and the Equity Interests of which are owned directly by such Grantor, and the certificates representing all such Equity Interests (all such Equity Interests referred to in clauses (i), (ii), (iii), and (iv) above being referred to as the “Pledged Equity Interests”); provided that the Pledged Equity Interests shall not include (x) to the extent that applicable law requires that a Subsidiary issue directors’ qualifying shares, any such qualifying shares, and (y) more than 65% of the issued and outstanding voting Equity Interests of SSC Canada or any other Foreign Subsidiary of Holdings;
(b) (i) the promissory notes owned by it on the date hereof and listed opposite the name of such Grantor on Schedule II, (ii) each promissory note evidencing intercompany Indebtedness among Holdings and/or any Subsidiary (including amounts owed in connection with the intercompany settlements with respect to collections from accounts receivable and inventory of U.S. Loan Parties deposited into accounts of Canadian Loan Parties and other intercompany receivables) owned by and owed to such Grantor after the date hereof and (iii) each other promissory note evidencing Indebtedness on or after the date hereof owed to such Grantor other than Indebtedness in
a principal amount of less than $5,000,000, so long as the aggregate principal amount of Indebtedness not so pledged under this exclusion does not exceed $10,000,000 (the promissory notes referenced in the preceding clauses (i), (ii) and (iii) being referred to as the “Pledged Debt Securities”) ;
(c) subject to Section 3.06, all payments of principal or interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of, in exchange for or upon the conversion of, and all other Proceeds received in respect of, the securities referred to in clauses (a) and (b) above; and
(d) all Proceeds of any of the foregoing (the items referred to in clauses (a), (b), (c) and (d) of this Section 3.01 above being collectively referred to as the “Pledged Collateral”) .
(b) Each Grantor will cause any Indebtedness for borrowed money owed to such Grantor by Holdings and/or any Subsidiary (including amounts owed in connection with the intercompany settlements with respect to collections from accounts receivable and inventory of U.S. Loan Parties deposited into accounts of Canadian Loan Parties and other intercompany receivables) (other than any Investment Property on deposit with a Securities Intermediary) to be evidenced by a duly executed promissory note that is pledged and delivered to the Security Agent (or the Term Loan Agent or Permitted Notes Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement) pursuant to the terms hereof.
(c) Upon delivery to the Security Agent, (i) any Pledged Securities shall be accompanied by undated stock powers duly executed in blank or other instruments of transfer reasonably satisfactory to the Security Agent and by such other instruments and documents as the Security Agent may reasonably request and (ii) all other property comprising part of the Pledged Collateral shall be accompanied by proper instruments of assignment duly executed by the applicable Grantor and such other instruments or documents as the Security Agent may reasonably request. Each delivery of Pledged Securities after the date of this Agreement shall be accompanied by a schedule describing the Pledged Securities so delivered, which schedule shall be attached hereto as a
supplement to Schedule II and made a part hereof; provided that failure to attach any such schedule hereto shall not affect the validity of such pledge of such Pledged Securities.
(d) The assignment, pledges and security interests granted in Section 3.01 are granted as security only and shall not subject the Security Agent or any other Secured Party to, or in any way alter or modify, any obligation or liability of any Grantor with respect to or arising out of the Pledged Collateral.
(a) Schedule II correctly sets forth, as of the Funding Date, with respect to each Grantor, (i) all of the Equity Interests owned by such Grantor and required to be pledged hereunder on the Funding Date, the percentage of the issued and outstanding units of each class of the Equity Interests of the issuer thereof so represented by the Pledged Equity Interests and the number of each certificate representing the same and (ii) all promissory notes owned by each Grantor and required to be pledged hereunder on the Funding Date;
(b) the Pledged Equity Interests and Pledged Debt Securities, in each case issued by Subsidiaries, have been duly and validly authorized and issued by the issuers thereof and (i) in the case of Pledged Equity Interests, are fully paid and nonassessable and (ii) in the case of Pledged Debt Securities, are legal, valid and binding obligations of the issuers thereof, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law;
(c) except for the security interests granted hereunder, each of the Grantors (i) is and, subject to any sales, transfers or other dispositions, and mergers, consolidations and amalgamations, made in compliance with the Credit Agreement, will continue to be the direct owner, beneficially and of record, of the Pledged Securities indicated on Schedule II as owned by such Grantor, (ii) holds the same free and clear of all Liens (other than Permitted Liens and other Liens contemplated in the Intercreditor Agreement), (iii) except for Liens contemplated in the Intercreditor Agreement, will not pledge or hypothecate, or otherwise create a consensual Lien on, the Pledged Collateral, and (iv) will defend its title or interest thereto or therein against any and all Liens (other than the Lien created by this Agreement, Permitted Liens and Liens contemplated in the Intercreditor Agreement), however arising, of all Persons whomsoever;
(d) except for restrictions and limitations imposed by the Loan Documents, the Term Loan Credit Documents, the Permitted Notes Documents, the Intercreditor Agreement or applicable laws (including securities laws) generally, and expect for the requirement in the articles or other constating
documents of any Canadian Subsidiary for the approval of the directors and/or shareholders of such Canadian Subsidiary for any transfers of its shares, the Pledged Collateral is and will continue to be freely transferable and assignable, and none of the Pledged Collateral is or will be subject to (i) any option, right of first refusal, shareholders agreement or charter or by-law provisions that might prohibit, impair, delay (except pursuant to any applicable notice or like provisions) or otherwise adversely affect the pledge of such Pledged Collateral hereunder, the sale or disposition thereof pursuant hereto or the exercise by the Security Agent of its rights and remedies hereunder with respect thereto, or (ii) any other contractual restriction of any nature that might prohibit the pledge of such Pledged Collateral hereunder or prohibit or in any material manner impair, delay or otherwise adversely affect the sale or disposition of such Pledged Collateral pursuant hereto or the exercise by the Security Agent of its rights and remedies hereunder with respect thereto;
(e) each of the Grantors has the power and authority to pledge the Pledged Collateral pledged by it hereunder in the manner hereby done or contemplated;
(f) no consent or approval of any Governmental Authority, any securities exchange or any other Person was or is necessary to the validity of the pledge effected hereby (other than such as have been obtained and are in full force and effect);
(g) by virtue of the execution and delivery by the Grantors of this Agreement, when any Pledged Securities are delivered to the Security Agent or Prior Agent in accordance with this Agreement and the Intercreditor Agreement, the Security Agent will obtain a legal, valid and perfected lien upon and security interest in such Pledged Securities as security for the payment and performance of the U.S. Secured Obligations; and
(h) the pledge effected hereby is, subject to the terms of the Intercreditor Agreement, effective to vest in the Security Agent, for the benefit of the Secured Parties, the rights of the Security Agent in the Pledged Collateral as set forth herein.
(i) Each Grantor shall be entitled to exercise any and all voting and/or other rights and powers inuring to an owner of Pledged Equity Interests or Pledged Debt Securities or any part thereof for any purpose consistent with the terms of this Agreement, the Credit Agreement and the other Loan Documents; provided that such rights and powers shall not be exercised in any manner that could reasonably be expected to materially and adversely affect the rights inuring to a holder of any Pledged Equity Interests or Pledged Debt Securities or the rights and remedies of any of the Security Agent or the other Secured Parties under this Agreement, the Credit Agreement or any other Loan Document or the ability of the Security Agent or the Secured Parties to exercise the same.
(ii) The Security Agent shall execute and deliver to each Grantor, or cause to be executed and delivered to such Grantor, all such proxies, powers of attorney and other instruments as such Grantor may reasonably request for the purpose of enabling such Grantor to exercise the voting rights and powers it is entitled to exercise pursuant to paragraph (i) above and to receive the cash dividends, interest, principal and other distributions it is entitled to receive and retain pursuant to paragraph (iii) below.
(iii) Each Grantor shall be entitled to receive and retain any and all dividends, interest, principal, cash, instruments and other property and all distributions from time to time received, receivable or otherwise paid on or distributed in respect of, in exchange for or upon conversion of, the Pledged Equity Interests or Pledged Debt Securities to the extent and only to the extent that such dividends, interest, principal and other distributions are permitted by, and otherwise paid or distributed in accordance with, the terms and conditions of the Credit Agreement, the other Loan Documents and applicable laws; provided
that any noncash dividends, interest, principal or other distributions that would constitute Pledged Equity Interests or Pledged Debt Securities, whether resulting from a subdivision, combination or reclassification of the outstanding Equity Interests of the issuer of any Pledged Securities or received in exchange for Pledged Securities or any part thereof, or in redemption thereof, or as a result of any merger, consolidation, acquisition or other exchange of assets to which such issuer may be a party or otherwise, shall be and become part of the Pledged Collateral, and, if received by any Grantor, shall not be commingled by such Grantor with any of its other funds or property but shall be held separate and apart therefrom, shall be held in trust for the benefit of the Security Agent and shall be forthwith delivered to the Security Agent in the same form as so received (with any necessary endorsement).
(b) Upon the occurrence and during the continuance of an Event of Default, after the Security Agent shall have notified the Grantors in writing of the suspension of their rights under paragraph (a)(iii) above, all rights of any Grantor to dividends, interest, principal or other distributions that such Grantor is authorized to receive pursuant to paragraph (a)(iii) above, and the obligations of the Security Agent under paragraph (a)(ii) above, shall cease, and all such rights shall thereupon become vested in the Security Agent, which shall, subject to the terms of the Intercreditor Agreement, have the sole and exclusive right and authority to receive and retain such dividends, interest, principal or other distributions. All dividends, interest, principal or other distributions received by any Grantor contrary to the provisions of this Section 3.06 shall be held in trust for the benefit of the Security Agent, shall be segregated from other property or funds of such Grantor and, subject to the rights of the Term Loan Agent and the Permitted Notes Agent under the Intercreditor Agreement, shall be forthwith delivered to the Security Agent upon demand in the same form as so received (with any necessary endorsement). Any and all money and other property paid over to or received by the Security Agent pursuant to the provisions of this paragraph (b) shall be retained by the Security Agent in an account to be established by the Security Agent upon receipt of such money or other property and shall be applied in accordance with the provisions of Section 5.02. After all Events of Default have been cured or waived and Holdings has delivered to the Security Agent a certificate to that effect, the Security Agent shall promptly repay to each Grantor (without interest) all dividends, interest, principal or other distributions that such Grantor would otherwise be permitted to retain pursuant to the terms of paragraph (a)(iii) above and that remain in such account.
(c) Upon the occurrence and during the continuance of an Event of Default, after the Security Agent shall have notified the Grantors in writing of the suspension of their rights under paragraph (a)(i) above, all rights of any Grantor to exercise the voting and consensual rights and powers it is entitled to exercise pursuant to paragraph (a)(i) above, and the obligations of the Security Agent under paragraph (a)(ii) above, shall cease, and all such rights shall thereupon become, subject to the rights of the Term Loan Agent and the Permitted Notes Agent under the Intercreditor Agreement, vested in the Security Agent, which shall have the sole and exclusive right and authority to exercise such voting and consensual rights and powers; provided that, unless otherwise directed by the Required Lenders, the Security Agent shall have the right from time to
time following and during the continuance of an Event of Default to permit the Grantors to exercise such rights.
(d) Any notice given by the Security Agent to the Grantors suspending their rights under paragraph (a) of this Section 3.06 (i) may be given by telephone if promptly confirmed in writing, (ii) may be given to one or more of the Grantors at the same or different times and (iii) may suspend the rights of the Grantors under paragraph (a)(i) or paragraph (a)(iii) in part without suspending all such rights (as specified by the Security Agent in its sole and absolute discretion) and without waiving or otherwise affecting the Security Agent’s right to give additional notices from time to time suspending other rights so long as an Event of Default has occurred and is continuing.
SECTION 3.07. Restriction on Transfer. If the constating documents of any issuer (other than a ULC) of any Pledged Securities restrict the transfer of such Pledged Securities, then the applicable Grantor will deliver to the Security Agent a certified copy of a resolution of the directors, shareholders, unitholders or partners of such issuer, as applicable, consenting to the transfer(s) contemplated by this Agreement, including any prospective transfer of such Pledged Securities by the Security Agent on enforcement of its rights under this Agreement.
SECTION 3.08. ULC Shares. Each Grantor acknowledges that certain Collateral may now or in the future consist of ULC Shares, and that it is the intention of the Security Agent and each Grantor that the Security Agent should not under any circumstances prior to realization thereon be held to be a “member” or a “shareholder”, as applicable, of a ULC for the purposes of any ULC Laws. Therefore, notwithstanding any provisions to the contrary contained in this Agreement, the Credit Agreement or any other Loan Document, where a Grantor is the registered owner of ULC Shares that are Collateral, such Grantor will remain the sole registered owner of such ULC Shares until such time as such ULC Shares are effectively transferred into the name of the Security Agent or any other Person on the books and records of the applicable ULC. Accordingly, such Grantor shall be entitled to receive and retain for its own account any dividend on or other distribution, if any, in respect of such ULC Shares (other than any dividend or distribution comprised of additional ULC Shares of such issuer, which shall be delivered to the Security Agent to hold hereunder) and shall have the right to vote such ULC Shares and to control the direction, management and policies of the applicable ULC to the same extent as such Grantor would if such ULC Shares were not pledged to the Security Agent hereunder. Nothing in this Agreement, the Credit Agreement or any other Loan Document is intended to, and nothing in this Agreement, the Credit Agreement or any other Loan Document shall, constitute the Security Agent or any Person other than such Grantor as a member or shareholder of a ULC for the purposes of any ULC Laws (whether listed or unlisted, registered or beneficial), until upon the occurrence and during the continuance of an Event of Default, the Security Agent shall have notified such Grantor in writing of the suspension of its rights under Section 3.06(a) and further steps are taken pursuant hereto or thereto to register the Security Agent or such other Person, as specified in such notice, as the holder of the ULC Shares. To the extent any provision hereof would have the effect of constituting the Security Agent as a member or a shareholder, as applicable, of any ULC prior to such time, such provision shall be severed
herefrom and shall be ineffective with respect to ULC Shares that are Collateral without otherwise invalidating or rendering unenforceable this Agreement or invalidating or rendering unenforceable such provision insofar as it relates to Collateral that is not ULC Shares. Except upon the exercise of rights of the Security Agent to sell, transfer or otherwise dispose of ULC Shares in accordance with this Agreement, such Grantor shall not cause or permit, or enable an issuer that is a ULC to cause or permit, the Security Agent to: (a) be registered as a shareholder or member of such issuer; (b) have any notation entered in its favour in the share register of such issuer; (c) be held out as a shareholder or member of such issuer; (d) receive, directly or indirectly, any dividends, property or other distributions from such issuer by reason of the Security Agent holding a security interest in the ULC Shares; or (e) act as a shareholder of such issuer, or exercise any rights of a shareholder, including the right to attend a meeting of shareholders of such issuer or to vote the ULC Shares
(i) all Accounts;
(ii) all Chattel Paper (including, without limitation, all Tangible Chattel Paper and all Electronic Chattel Paper);
(iii) all cash and all Deposit Accounts and all monies deposited therein;
(iv) all Equipment (including all Fixtures);
(v) all Documents;
(vi) all General Intangibles (including Intellectual Property);
(vii) all Instruments;
(viii) all Inventory;
(ix) all Investment Property (including all Commodities Contracts, Commodities Accounts, Securities and Securities Accounts and Security Entitlements or Financial Assets credited thereto);
(x) all Letter of Credit Rights (whether or not the respective letter of credit is evidenced by a writing);
(xi) all Commercial Tort Claims described on Schedule IV, as such Schedule may be supplemented from time to time;
(xii) Contracts, together with all Contract Rights arising thereunder;
(xiii) all Goods;
(xiv) all Supporting Obligations;
(xv) all books and Records pertaining to the Article 9 Collateral; and
(xvi) all products and Proceeds of the foregoing (including, without limitation, all insurance and claims for insurance effected or held for the benefit of the Grantors or the Secured Parties in respect thereof and all collateral security and guarantees given by any Person with respect to any of the foregoing).
(b) Each Grantor hereby irrevocably authorizes the Security Agent at any time and from time to time to file in any relevant jurisdiction any financing statements (including fixture filings with respect to Fixtures appurtenant to any Mortgaged Property) with respect to the Article 9 Collateral or any part thereof and amendments thereto that (i) indicate the Collateral as all assets of such Grantor or words of similar effect as being of an equal or lesser scope or with greater detail, and (ii) contain the information required by Article 9 of the Uniform Commercial Code or other applicable law of each applicable jurisdiction for the filing of any financing statement or amendment, including (A) whether such Grantor is an organization, the type of organization and any organizational identification number issued to such Grantor and (B) in the case of a financing statement filed as a fixture filing or covering Article 9 Collateral constituting minerals or the like to be extracted or timber to be cut, a sufficient description of the real property to which such Article 9 Collateral relates. Each Grantor agrees to provide such information to the Security Agent promptly upon request.
(c) The Security Interest is granted as security only and shall not subject the Security Agent or any other Secured Party to, or in any way alter or modify, any obligation or liability of any Grantor with respect to or arising out of the Article 9 Collateral.
(d) Notwithstanding anything herein to the contrary, in no event shall the security interest granted hereunder attach to (i) any shares of capital stock or other Equity Interests (other than those subject to Article III) held by any Grantor with respect to which a grant of a security interest is prohibited or shall constitute or result in a breach or termination under the terms of, or a default under, any contract or agreement relating to such capital stock or Equity Interests, (ii) any contract or other agreement to which any Grantor is a party or to any of its rights, title or interest arising thereunder if and for so long as the grant of such security interest is prohibited or shall constitute or result in a breach or termination under the terms of, or a default under, any such contract or agreement (other than to the extent that any such term would be rendered ineffective pursuant to Section 9-406, 9-407, 9-408 or 9-409 of the New York UCC or any other applicable law or principles of equity), (iii) any rights, assets or property to the extent and for so long as any valid enforceable law or regulation applicable to such rights, assets or property prohibits the creation of a security interest therein and (iv) any rights, assets or property to the extent and for so long as the grant of such security interest would result in material and adverse tax consequences; provided, however, that such security interest shall attach immediately at such time as (A) with respect to clauses (i) and (ii), the condition causing such prohibition, unenforceability, breach or termination shall be remedied or shall otherwise cease to exist, (B) with respect to clause (iii), the expiration of such prohibition and (C) with respect to clause (iv), the termination or lapse of such result, and, to the extent severable, shall attach immediately to any portion of such contract, agreement, rights, assets or property that does not result in any of the consequences specified in this paragraph, including any Proceeds of such contract, agreement, rights, assets or property.
(a) Each Grantor has good and valid rights in and title to the Article 9 Collateral with respect to which it has purported to grant a Security Interest hereunder and has full power and authority to grant to the Security Agent the Security Interest in such Article 9 Collateral pursuant hereto and to execute, deliver and perform its obligations in accordance with the terms of this Agreement, without the consent or approval of any other Person other than any consent or approval that has been obtained.
(b) The U.S. Perfection Certificate has been duly prepared, completed and executed and the information set forth therein, including the exact legal name of each Grantor, is correct and complete in all material respects as of the Funding Date. The Uniform Commercial Code financing statements (including fixture filings, as applicable) prepared by the Security Agent based upon the information provided to the Security Agent in the U.S. Perfection Certificate for filing in each governmental, municipal or other office specified in Schedule 2 to the U.S. Perfection Certificate (or specified by
notice from Holdings to the Security Agent after the Funding Date in the case of filings, recordings or registrations required by Section 9.09 of the Credit Agreement), are all the filings, recordings and registrations (other than filings required to be made in the United States Patent and Trademark Office and the United States Copyright Office in order to perfect the Security Interest in Article 9 Collateral consisting of United States Patents, Trademarks and Copyrights and other than filings, recordings or registrations with respect to federally documented vessels, registered vehicles and railcars and other similar rolling stock) that are necessary to publish notice of and protect the validity of and to establish a legal, valid and perfected security interest in favor of the Security Agent (for the benefit of the Secured Parties) in respect of all Article 9 Collateral in which the Security Interest may be perfected by filing a Uniform Commercial Code financing statement in the United States (or any political subdivision thereof), and no further or subsequent filing, refiling, recording, rerecording, registration or reregistration is necessary in the United States for any such Article 9 Collateral, except as provided under applicable law with respect to the filing of continuation statements. Each Grantor shall execute and deliver to the Security Agent on the date hereof each of the IP Security Agreements, containing (i) in the case of the Patent and Trademark Security Agreement, a description of all Article 9 Collateral consisting of the United States Patents and a description of all Article 9 Collateral consisting of United States registered Trademarks (and Trademarks for which United States registration applications are pending) and (ii) in the case of the Copyright Security Agreement, a description of all Article 9 Collateral consisting of Copyrights, for recording by the United States Patent and Trademark Office and the United States Copyright Office pursuant to 35 U.S.C. § 261, 15 U.S.C. § 1060 or 17 U.S.C. § 205 and the regulations thereunder, as applicable, to protect the validity of and to establish a legal, valid and perfected security interest in favor of the Security Agent (for the benefit of the Secured Parties) in respect of all Article 9 Collateral consisting of United States Patents, Trademarks and Copyrights in which a security interest may be perfected by filing, recording or registration in the United States Patent and Trademark Office or the United State Copyright Office, and no further or subsequent filing, refiling, recording, rerecording, registration or reregistration is necessary in the United States for any such United States Patents, Trademarks and Copyrights (other than such actions as are necessary to perfect the Security Interest with respect to any Article 9 Collateral consisting of Patents, Trademarks and Copyrights (or registration or application for registration thereof) acquired or developed after the date hereof).
(c) The Security Interest constitutes (i) a legal and valid security interest in all the Article 9 Collateral securing the payment and performance of the U.S. Secured Obligations, (ii) subject to the filings described in Section 4.02(b), a perfected security interest in all Article 9 Collateral in which a security interest may be perfected by filing Uniform Commercial Code financing statements in the United States (or any political subdivision thereof) and (iii) a security interest that shall be perfected in all Article 9 Collateral in which a security interest may be perfected upon the receipt and recording of the IP Security Agreements with the United States Patent and Trademark Office and the United States Copyright Office, as applicable, on or promptly after the Funding Date. The Security Interest is and shall be prior to any other Lien on any of the Article 9 Collateral, other than Permitted Liens or as otherwise contemplated in the Intercreditor Agreement.
(d) The Article 9 Collateral is owned by the Grantors free and clear of any Lien, except for Permitted Liens or other Liens contemplated in the Intercreditor Agreement. None of the Grantors has filed or consented to the filing of (i) any financing statement or analogous document under the Uniform Commercial Code or any other applicable laws covering any Article 9 Collateral, or (ii) any assignment in which any Grantor assigns any Collateral as security or any security agreement or similar instrument covering any Article 9 Collateral with the United States Patent and Trademark Office or the United States Copyright Office, except in each case of clauses (i) and (ii) for Permitted Liens or as otherwise contemplated in the Intercreditor Agreement.
(e) Schedule III hereto sets forth, as of the date hereof, for each Grantor (i) all United States registered Patents and Patent applications owned by such Grantor, including the name of the registered owner, type, registration or application number and the expiration date (if already registered) thereof, (ii) all United States registered Trademarks and Trademark applications owned by such Grantor, including the name of the registered owner, the registration or application number and the expiration date (if already registered) thereof, and (iii) all United States registered Copyrights and Copyright applications owned by such Grantor, including the name of the registered owner, title and, if applicable, the registration number of each such Copyright or Copyright application.
(f) Schedule IV hereto sets forth, as of the date hereof, each Commercial Tort Claim in respect of which a compliant or a counterclaim has been filed by any Grantor seeking damages that exceed $5,000,000 in reasonable estimated value and which arose in the course of such Grantor’s business.
(b) Each Grantor agrees to maintain, at its own cost and expense, such complete and accurate records with respect to the Article 9 Collateral owned by it as is consistent with its current practices and in accordance with such prudent and standard practices used in industries that are the same as or similar to those in which such Grantor is engaged and, at such time or times, after the occurrence and during the continuance of an Event of Default as the Security Agent may reasonably request, promptly to prepare
and deliver to the Security Agent a duly certified schedule or schedules in form and detail satisfactory to the Security Agent showing the identity, amount and location of any and all Article 9 Collateral.
(c) Each Grantor shall, at its own expense, take any and all actions reasonably necessary to defend title to the Article 9 Collateral against all Persons and to defend the Security Interest of the Security Agent in the Article 9 Collateral and the priority thereof against any Liens other than any Permitted Lien or other Liens contemplated in the Intercreditor Agreement.
(d) Each Grantor agrees, at its own expense, to execute, acknowledge, deliver and cause to be duly filed all such further instruments and documents and take all such actions as the Security Agent may from time to time reasonably request to better assure, preserve, protect and perfect the Security Interest and the rights and remedies created hereby, including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of the Security Interest and the filing of any financing statements (including fixture filings) or other documents in connection herewith or therewith.
(e) The Security Agent and such Persons as the Security Agent may reasonably designate shall have the right, at the Grantors’ own cost and expense, to inspect the Article 9 Collateral, all records related thereto (and to make extracts and copies from such records) and the premises upon which any of the Article 9 Collateral is located, to discuss the Grantors’ affairs with the officers of the Grantors and their independent accountants, all in accordance with and subject to the terms and conditions relating to inspections as set forth in Section 9.06 of the Credit Agreement, and to verify under reasonable procedures the validity, amount, quality, quantity, value, condition and status of, or any other matter relating to, the Article 9 Collateral, including, in the case of Accounts or Article 9 Collateral in the possession of any third person, by contacting, with advance notice to and in coordination with the Grantors (unless an Event of Default has occurred and is continuing) Account Debtors or the third person possessing such Article 9 Collateral for the purpose of making such a verification. The Security Agent shall have the absolute right to share any information it gains from such inspection or
verification with any Lender (it being understood that any such information shall be deemed to be “Confidential Information” subject to the provisions of Section 13.16 of the Credit Agreement).
(f) At its option, the Security Agent may discharge past due taxes, assessments, charges, fees, Liens, security interests or other encumbrances at any time levied or placed on the Article 9 Collateral and not permitted pursuant to the Credit Agreement, and may pay for the maintenance and preservation of the Article 9 Collateral to the extent any Grantor fails to do so as required by the Credit Agreement or this Agreement after written notice thereof is delivered to Holdings by the Security Agent, and each Grantor jointly and severally agrees to reimburse the Security Agent on demand for any payment made or any expense incurred by the Security Agent pursuant to the foregoing authorization; provided that nothing in this paragraph (f) shall be interpreted as excusing any Grantor from the performance of, or imposing any obligation on the Security Agent or any Secured Party to cure or perform, any covenants or other promises of any Grantor with respect to taxes, assessments, charges, fees, Liens, security interests or other encumbrances and maintenance as set forth herein or in the other Loan Documents.
(g) Each Grantor shall remain liable to observe and perform all the conditions and obligations to be observed and performed by it under each contract, Agreement or instrument relating to the Article 9 Collateral, all in accordance with the terms and conditions thereof, and each Grantor jointly and severally agrees to indemnify and hold harmless the Security Agent and the Secured Parties from and against any and all liability for such performance.
(h) None of the Grantors shall make or permit to be made an assignment, pledge or hypothecation of the Article 9 Collateral or shall grant any other Lien in respect of the Article 9 Collateral, except as permitted by the Credit Agreement. None of the Grantors shall make or permit to be made any transfer of the Article 9 Collateral except that unless and until the Security Agent shall notify the Grantors in writing that an Event of Default shall have occurred and be continuing and that during the continuance thereof the Grantors shall not sell, convey, lease, assign, transfer or otherwise dispose of any Article 9 Collateral, the Grantors may use and dispose of the Article 9 Collateral in any lawful manner not inconsistent with the provisions of this Agreement, the Credit Agreement or any other Loan Document.
(i) None of the Grantors will, without the Security Agent’s prior written consent, grant any extension of the time of payment of any Accounts included in the Article 9 Collateral, compromise, compound or settle the same for less than the full amount thereof, release, wholly or partly, any Person liable for the payment thereof or allow any credit or discount whatsoever thereon, other than extensions, compromises, settlements, releases, credits or discounts granted or made in the ordinary course of business.
(j) The Grantors, at their own expense, shall maintain or cause to be maintained insurance covering physical loss or damage to the Inventory and Equipment
in accordance with the requirements set forth in Section 9.02 of the Credit Agreement. Each Grantor irrevocably makes, constitutes and appoints the Security Agent (and all officers, employees or agents designated by the Security Agent) as such Grantor’s true and lawful agent (and attorney-in-fact) for the purpose, during the continuance of an Event of Default, of making, settling and adjusting claims in respect of Article 9 Collateral under policies of insurance, endorsing the name of such Grantor on any check, draft, instrument or other item of payment for the proceeds of such policies of insurance and for making all determinations and decisions with respect thereto. In the event that any Grantor at any time or times shall fail to obtain or maintain any of the policies of insurance required hereby or to pay any premium in whole or part relating thereto, the Security Agent may, without waiving or releasing any obligation or liability of the Grantors hereunder or any Event of Default, in its sole discretion, upon notice to Holdings obtain and maintain such policies of insurance and pay such premium and take any other actions with respect thereto as the Security Agent deems advisable. All sums disbursed by the Security Agent in connection with this paragraph, including reasonable attorneys’ fees, court costs, expenses and other charges relating thereto, shall be payable, upon demand, by the Grantors to the Security Agent and shall be additional U.S. Secured Obligations secured hereby.
(k) Each Grantor shall maintain, in form and manner reasonably satisfactory to the Security Agent, records of its Chattel Paper and its books, records and documents evidencing or pertaining thereto.
(l) Each Grantor will keep and maintain at its own cost and expense accurate records of its Accounts and Contracts, including, but not limited to, originals or copies of all material documentation (including each Contract) with respect thereto, material records of all payments received, all credits granted thereon, all merchandise returned and all other dealings therewith, and such Grantor will make the same available, in accordance with and subject to the terms and conditions relating to inspections set forth in the Credit Agreement to the Security Agent for inspection at such Grantor’s own cost and expense. Upon the occurrence and during the continuance of an Event of Default and at the request of the Security Agent, such Grantor shall, at its own cost and expense, deliver all tangible evidence of its Accounts and Contract Rights (including, without limitation, all documents evidencing the Accounts and all Contracts) and such books and records to the Security Agent or to its representatives (copies of which evidence and books and records may be retained by such Grantor). If the Security Agent so directs, upon the occurrence and during the continuance of an Event of Default, such Grantor shall legend, in form and manner satisfactory to the Security Agent, the Accounts and the Contracts, as well as books, records and documents (if any) of such Grantor evidencing or pertaining to such Accounts and Contracts with an appropriate reference to the fact that such Accounts and Contracts have been assigned to the Security Agent and that the Security Agent has a security interest therein.
(m) Upon the occurrence and during the continuance of an Event of Default, if the Security Agent so directs any Grantor in writing, such Grantor agrees (x) to cause all payments on account of the Accounts and Contracts to be made directly to a Cash Collateral Account, (y) that the Security Agent may, at its option, directly notify
the obligors with respect to any Accounts and/or under any Contracts to make payments with respect thereto as provided in the preceding clause (x), and (z) that the Security Agent may enforce collection of any such Accounts and Contracts and may adjust, settle or compromise the amount of payment thereof, in the same manner and to the same extent as such Grantor. Without notice to or assent by any Grantor, the Security Agent may, upon the occurrence and during the continuance of an Event of Default, apply any or all amounts then in, or thereafter deposited in, a Cash Collateral Account toward the payment of the U.S. Secured Obligations in the manner provided in Section 5.02 of this Agreement. The reasonable costs and expenses of collection (including reasonable attorneys’ fees), whether incurred by a Grantor or the Security Agent, shall be borne by the relevant Grantor. The Security Agent shall deliver a copy of each notice referred to in the preceding clause (y) to the relevant Grantor, provided that the failure by the Security Agent to so notify such Grantor shall not affect the effectiveness of such notice or the other rights of the Security Agent created by this clause (m).
(n) Except as permitted by clause (i) above, each Grantor shall endeavor in accordance with reasonable business practices to cause to be collected from the account debtor named in each of its Accounts or obligor under any Contract, as and when due (including, without limitation, amounts which are delinquent, such amounts to be collected in accordance with generally accepted lawful collection procedures) any and all amounts owing under or on account of such Account or Contract, and apply forthwith upon receipt thereof all such amounts as are so collected to the outstanding balance of such Account or under such Contract.
(o) Anything herein to the contrary notwithstanding, each Grantor shall remain liable under each of the Accounts and Contracts to observe and perform all of the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement giving rise to such Accounts or such Contracts, as the case may be. Neither the Security Agent nor any other Secured Party shall have any obligation or liability under any Account (or any agreement giving rise thereto) or any Contract by reason of or arising out of this Agreement or the receipt by the Security Agent or any other Secured Party of any payment relating to such Account or Contract, as the case may be, pursuant hereto, nor shall the Security Agent or any other Secured Party be obligated in any manner to perform any of the obligations of any Grantor under or pursuant to any Account (or any agreement giving rise thereto) or any Contract, to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by them or as to the sufficiency of any performance by any party under any Account (or any agreement giving rise thereto) or any Contract, to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned to them or to which they may be entitled at any time or times.
(a) Instruments and Tangible Chattel Paper. In accordance with and in furtherance of Article III, if any Grantor shall at any time hold or acquire any Instruments (other than any Instrument with a face amount of less than $5,000,000 so long as the aggregate principal amount of Instruments under this exclusion does not exceed $10,000,000 ) or Tangible Chattel Paper with a value of $2,500,000 or more, such Grantor shall forthwith endorse, assign and deliver the same to the Security Agent (or the Term Loan Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement), accompanied by such instruments of transfer or assignment duly executed in blank as the Security Agent may from time to time reasonably request.
(b) Deposit Accounts. For each Deposit Account (or any other demand, time, savings, passbook or similar account whose jurisdiction (determined in accordance with Section 9-304 of the UCC) is within a State of the United States) that any Grantor at any time opens or maintains (other than Excluded Accounts but including each Term Sweep Account that is a Deposit Account), such Grantor shall cause the depositary bank to enter into a Control Agreement with such Grantor and the Security Agent (which Control Agreement may also be for the benefit of the Term Loan Agent); provided that so long as no Dominion Period then exists no Control Agreement shall be required to be entered into until the later of (A) the date that is 60 days after the Funding Date (or such later date as agreed in writing by the Administrative Agent in its sole discretion, or, with respect to any extension of the period for compliance with this paragraph beyond 90 days from the date that is 60 days after the Funding Date, as agreed in writing by the Co-Collateral Agents in their sole discretion) and (B) in the case of deposit accounts opened after the Funding Date, at the time of the establishment of the respective deposit account (or such later date as agreed in writing by the Administrative Agent in its sole discretion). The Security Agent agrees with each Grantor that the Security Agent shall not exercise dominion and control over, or give any instructions or withhold any withdrawal rights from any Grantor, with respect to such accounts or any funds in such accounts, unless an Event of Default or Dominion Period has occurred and is continuing.
(c) Investment Property. Except with respect to any Equity Interest issued by any Subsidiary, if any Grantor shall at any time hold or acquire any certificated securities (other than any Excluded Investment Property) required to be pledged hereunder, such Grantor shall forthwith endorse, assign and deliver the same to the Security Agent (or the Term Loan Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement), accompanied by such instruments of transfer or assignment duly executed in blank as the Security Agent may from time to time specify. Except with respect to any Equity Interest issued by any Subsidiary, if any securities (other than any Excluded Investment Property) now or hereafter acquired by any Grantor are uncertificated and are issued to such Grantor or its nominee directly by the issuer thereof, such Grantor shall promptly notify the Security Agent thereof and, at the Security Agent’s request and option, pursuant to an agreement in form and substance reasonably satisfactory to the Security Agent, (i) cause such securities to be certificated and
comply with the requirements of the foregoing sentence, (ii) cause the issuer to agree to comply with instructions from the Security Agent (or the Term Loan Agent or Permitted Notes Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement) as to such securities, without further consent of any Grantor or such nominee, or (iii) arrange for the Security Agent (or the Term Loan Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement), to become the registered owner of such securities. If any Grantor holds any Investment Property (other than any Excluded Investment Property), whether certificated or uncertificated, or other Investment Property (other than any Excluded Investment Property) now or hereafter acquired by any Grantor are held by such Grantor or its nominee through a Securities Intermediary or Commodity Intermediary, except with respect to any Equity Interest issued by any Subsidiary, Grantor shall promptly notify the Security Agent thereof and, at the Security Agent’s request and option, pursuant to a Control Agreement (which Control Agreement may also be for the benefit of the Term Loan Agent or Permitted Notes Agent) in form and substance reasonably satisfactory to the Security Agent, either (i) cause such Securities Intermediary or Commodity Intermediary, as the case may be, to agree to comply with Entitlement Orders or other Instructions from the Security Agent (or the Term Loan Agent or Permitted Notes Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement) to such Securities Intermediary as to such Security Entitlements or to apply any value distributed on account of any Commodity Contract as directed by the Security Agent (or the Term Loan Agent or Permitted Notes Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement) to such Commodity Intermediary, as the case may be, in each case without further consent of any Grantor, such nominee, or any other Person, or (ii) in the case of Financial Assets or other Investment Property (other than any Excluded Investment Property) held through a Securities Intermediary, arrange for the Security Agent (or the Term Loan Agent or a designated bailee for purposes of perfection, in accordance with the Intercreditor Agreement) to become the Entitlement Holder with respect to such Investment Property, with the Grantor being permitted, only with the consent of the Security Agent, to exercise rights to withdraw or otherwise deal with such Investment Property; provided that so long as no Dominion Period then exists no Control Agreement shall be required to be entered into pursuant to this Section 4.04(c) until the later of (A) the date that is 60 days after the Funding Date (or such later date as agreed in writing by the Administrative Agent in its sole discretion, or, with respect to any extension of the period for compliance with this paragraph beyond 90 days from the date that is 60 days after the Funding Date, as agreed in writing by the Co-Collateral Agents in their sole discretion) and (B) in the case of Securities Accounts and Commodities Accounts opened after the Funding Date, at the time of the establishment of the respective Securities Accounts or Commodities Accounts, as the case may be (or such later date as agreed in writing by the Administrative Agent in its sole discretion). The Security Agent agrees with each of the Grantors that the Security Agent (or the Term Loan Agent or Permitted Notes Agent or a designated bailee for purposes of perfection,
in accordance with the Intercreditor Agreement) shall not give any such Entitlement Orders or Instructions or directions to any such issuer, Securities Intermediary or Commodity Intermediary, and shall not exercise dominion and control over, or withhold its consent to, the exercise of any withdrawal or dealing rights by any Grantor, unless an Event of Default or Dominion Period has occurred and is continuing, or, after giving effect to any such investment and withdrawal rights, would occur.
(d) Intentionally Omitted.
(e) Electronic Chattel Paper and Transferable Records. If any Grantor at any time holds or acquires an interest in any Electronic Chattel Paper or any “transferable record”, as that term is defined in Section 201 of the Federal Electronic Signatures in Global and National Commerce Act, or in Section 16 of the Uniform Electronic Transactions Act as in effect in any relevant jurisdiction, such Grantor shall promptly notify the Security Agent thereof and, at the request of the Security Agent, and subject to the rights of the Term Loan Agent and Permitted Notes Agent under the Intercreditor Agreement, shall take such action as the Security Agent may reasonably request to vest in the Security Agent control under New York UCC Section 9-105 of such Electronic Chattel Paper or control under Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or, as the case may be, Section 16 of the Uniform Electronic Transactions Act, as so in effect in such jurisdiction, of such transferable record. The Security Agent agrees with such Grantor that the Security Agent will arrange, pursuant to procedures reasonably satisfactory to the Security Agent and so long as such procedures will not result in the Security Agent’s loss of control, for the Grantor to make alterations to the Electronic Chattel Paper or transferable record permitted under UCC Section 9-105 or, as the case may be, Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or Section 16 of the Uniform Electronic Transactions Act for a party in control to allow without loss of control, unless an Event of Default has occurred and is continuing or would occur after taking into account any action by such Grantor with respect to such Electronic Chattel Paper or transferable record.
(f) Letter-of-Credit Rights. If any Grantor is at any time a beneficiary under a letter of credit now or hereafter issued in favor of such Grantor with a face amount greater than $2,500,000, such Grantor shall promptly notify the Security Agent thereof and, at the request and option of the Security Agent, and subject to the rights of the Term Loan Agent and Permitted Notes Agent under the Intercreditor Agreement, such Grantor shall use commercially reasonable efforts to, pursuant to an agreement in form and substance reasonably satisfactory to the Security Agent, either (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to the Security Agent of the proceeds of any drawing under the letter of credit or (ii) arrange for the Security Agent to become the transferee beneficiary of the letter of credit, with the Security Agent agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be
paid to the applicable Grantor unless an Event of Default has occurred or is continuing.
(g) Commercial Tort Claims. If any Grantor shall at any time hold a Commercial Tort Claim in which such Grantor is claimant that exceeds $5,000,000 in reasonable estimated value, the Grantor shall promptly notify the Security Agent thereof in a writing signed by such Grantor, including a summary description of such claim, and grant to the Security Agent, subject to the rights of the Term Loan Agent and Permitted Notes Agent under the Intercreditor Agreement, in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to the Security Agent. Each such summary description delivered after the date of this Agreement shall be attached hereto as a supplement to Schedule IV and made a part hereof.
(h) Collateral Access Agreements. Each Grantor shall use commercially reasonable efforts to obtain a Collateral Access Agreement from (i) the lessor of each leased property which is leased by such Grantor or the mortgagee of any real property owned by such Grantor and which is subject to a mortgage or deed of trust (other than a mortgage or deed of trust that is contemplated in the Intercreditor Agreement), in each case where the fair market value of the Collateral located at such leased or mortgaged property exceeds $5,000,000 and (ii) the bailee or consignee with respect to any third party warehouse, processor converter facility or other similar location where Collateral with a fair market value exceeding $2,000,000 is stored or located, which agreement or letter shall provide access rights and shall otherwise be reasonably satisfactory in form and substance to the Security Agent. Each Grantor shall timely and fully pay and perform its obligations under all leases and other agreements with respect to each leased location or third party warehouse where any Collateral is or may be located, except where the failure to pay or perform could not reasonably be expected to have a Material Adverse Effect.
(i) Each Grantor will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Security Agent from time to time such vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, certificates, reports and other assurances or instruments and take such further steps, including any and all actions as may be necessary or required under the Federal Assignment of Claims Act, relating to its Accounts, Contracts, Instruments and other property or rights covered by the security interest hereby granted, as the Security Agent may reasonably require and consistent with the other terms and conditions of this Agreement and the Credit Agreement.
(b) Each Grantor (either itself or through its licensees or its sublicensees) will, for each Trademark material to the conduct of the business of Holdings and its Subsidiaries, taken as a whole, (i) maintain such Trademark in full force free from any claim of abandonment or invalidity for non-use, (ii) maintain the quality of products and services offered under such Trademark, (iii) display such Trademark with notice of Federal or foreign registration to the extent necessary and sufficient to establish and preserve its maximum rights under applicable law and (iv) not knowingly use or knowingly permit the use of such Trademark in violation of any third party rights, except where the failure to comply with the foregoing could not reasonably be expected to have a Material Adverse Effect.
(c) Each Grantor (either itself or through its licensees or sublicensees) will, for each work covered by a Copyright material to the business of Holdings and its Subsidiaries, taken as a whole, continue to publish, reproduce, display, adopt and distribute the work with appropriate copyright notice as necessary and sufficient to establish and preserve its maximum rights under applicable copyright laws, except where the failure to comply with the foregoing could not reasonably be expected to have a Material Adverse Effect.
(d) Each Grantor shall notify the Security Agent promptly if it knows or has reason to know that any Patent, Trademark or Copyright material to the conduct of the business of Holdings and its Subsidiaries, taken as a whole, may become abandoned, lost or dedicated to the public, or of any materially adverse determination or development (including the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office, United States Copyright Office or any court or similar office of any country) regarding such Grantor’s ownership of any Patent, Trademark or Copyright material to the conduct of the business of Holdings and its Subsidiaries, taken as a whole, its right to register the same, or its right to keep and maintain the same.
(e) Each Grantor agrees to promptly notify the Security Agent if such Grantor, either itself or through any agent, employee, licensee or designee, file an application for any Patent, Trademark or Copyright (or for the registration of any Trademark or Copyright) which is material to the Grantor’s business taken as a whole with the United States Patent and Trademark Office or the United States Copyright Office, and, upon request of the Security Agent, such Grantor agrees to execute and deliver IP Security Agreements (in a form similar to the IP Security Agreements executed and delivered on the date hereof) as the Security Agent may reasonably request to evidence the Security Agent’s security interest in such Patent, Trademark or Copyright, and each Grantor hereby appoints the Security Agent as its attorney-in-fact to execute
and file such agreements for the foregoing purposes, all acts of such attorney being hereby ratified and confirmed; such power, being coupled with an interest, is irrevocable.
(f) Each Grantor will take all reasonably necessary steps that are consistent with the practice in any proceeding before the United States Patent and Trademark Office, United States Copyright Office or any office or agency in any political subdivision of the United States, to maintain and pursue each material application relating to the Patents, Trademarks and/or Copyrights (and to obtain the relevant grant or registration) and to maintain each issued Patent and each registration of the Trademarks and Copyrights that is material to the conduct of the business of Holdings and the Subsidiaries, taken as a whole, including timely filings of applications for renewal, affidavits of use, affidavits of incontestability and payment of maintenance fees, and, if consistent with good business judgment, to initiate opposition, interference and cancelation proceedings against third parties; provided that, to the extent consistent with the Credit Agreement, no Grantor shall be obligated to pursue, preserve or maintain any Patent, Trademark or Copyright in the event such Grantor determines, in its reasonable business judgment, that the preservation of such Patent, Trademark or Copyright is no longer desirable in the conduct of its business.
(g) Upon and during the continuance of an Event of Default, each Grantor shall, if requested by the Security Agent, use its commercially reasonable efforts to obtain all requisite consents or approvals by the licensor of each Copyright License, Patent License or Trademark License to effect the assignment of all such Grantor’s right, title and interest thereunder to the Security Agent or its designee.
ARTICLE V
Remedies
ARTICLE VI
Indemnity, Subrogation and Subordination
(b) Each Guarantor and Grantor hereby agrees that all Indebtedness and other monetary obligations owed to it by, or by it to, as the case may be, any other Guarantor, Grantor or any other Subsidiary shall be fully subordinated to the indefeasible payment in full in cash of the U.S. Secured Obligations.
ARTICLE VII
Miscellaneous
(b) Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Security Agent and the U.S. Loan Party or U.S. Loan Parties with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with Section 13.12 of the Credit Agreement.
(b) Without limitation of its indemnification obligations under the other Loan Documents, each Grantor and each Guarantor jointly and severally agrees to indemnify the Security Agent against, and hold the Security Agent harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable counsel fees, disbursements and other charges, incurred by or asserted against the Security Agent arising out of, in connection with, or as a result of, the execution, delivery or performance of this Agreement or any claim, litigation, investigation or proceeding relating to any of the foregoing, or any agreement or instrument contemplated hereby, or to the Collateral, whether or not any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses have resulted from the gross negligence or wilful misconduct of the Security Agent.
(c) Any such amounts payable as provided hereunder shall be additional U.S. Secured Obligations secured hereby and by the other Security Documents. The provisions of this Section 7.03 shall remain operative and in full force and effect regardless of the termination of this Agreement or any other Loan Document, the consummation of the transactions contemplated hereby, the repayment of any of the U.S. Secured Obligations, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of the Security Agent or any other Secured Party. All amounts due under this Section 7.03 shall be payable on written demand therefor.
(b) Notwithstanding anything to the contrary contained in this Agreement, at any time that the U.S. Secured Obligations shall be secured by any real property located in the State of California, no Secured Party shall exercise any right of set-off, lien or counterclaim or take any court or administrative action or institute any proceedings to enforce any provision of this Agreement without the prior consent of the Security Agent or the Required Lenders or, to the extent required by Section 13.12 of the Credit Agreement, all of the Lenders, if such setoff or action or proceeding would or might (pursuant to Sections 580a, 580b, 580d and 726 of the California Code of Civil Procedure or Section 2924 of the California Civil Code, if applicable, or otherwise) affect or impair the validity, priority, or enforceability of the liens granted to the Security Agent pursuant to this Agreement or the other Security Documents or the enforceability of the Obligations hereunder, and any attempted exercise by any Secured Party or the Security Agent of any such right without obtaining such consent of the Required Lenders or the Security Agent shall be null and void. It is understood and agreed that the foregoing sentence of this Section 7.08(b) is for the sole benefit of the Secured Parties and may be amended, modified or waived in any respect by the Required Lenders (without any requirement of prior notice to or consent by any U.S. Loan Party or any other Person) and does not constitute a waiver of any rights against any U.S. Loan Party or against any Collateral.
(b) Each of the U.S. Loan Parties hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other U.S. Loan Document shall affect any right that the Security Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other U.S. Loan
Document against any Grantor or Guarantor, or its properties in the courts of any jurisdiction.
(c) Each of the U.S. Loan Parties hereby irrevocably and unconditionally waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) above. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 7.01. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
(b) A Subsidiary Party (other than any Borrower) shall automatically be released from its obligations hereunder and the Security Interest in the Collateral of such Subsidiary Party (other than any Borrower) shall be automatically released upon the consummation of any transaction permitted by the Credit Agreement as a result of which such Subsidiary Party (other than any Borrower) ceases to be a Subsidiary; provided that the Required Lenders shall have consented to such transaction (to the extent required by the Credit Agreement) and the terms of such consent did not provide otherwise.
(c) Upon any sale or other transfer by any Grantor of any Collateral that is permitted under the Credit Agreement (other than a sale or other transfer to a U.S. Loan Party), or upon the effectiveness of any written consent to the release of the security interest granted hereby in any Collateral pursuant to Section 12.10 of the Credit Agreement, the security interest in such Collateral shall be automatically released.
(d) At any time that a Grantor desires that the Security Agent take any action to acknowledge or give effect to any release of a Grantor or Collateral pursuant to the foregoing Section 7.13(a), (b) or (c), Holdings shall deliver to the Security Agent a certificate signed by a principal executive officer of Holdings stating that the release of the respective Grantor or Collateral is permitted pursuant to such Section 7.13(a), (b) or (c). In connection with any termination or release pursuant to paragraph (a), (b) or (c), the Security Agent shall execute and deliver to any Grantor, at such Grantor’s expense, all documents that such Grantor shall reasonably request to evidence such termination or release; provided, however, that (i) the Security Agent shall not be required to execute any such document on terms which, in its opinion, would expose it to liability or create any obligation or entail any consequence other than the release of such Liens without recourse or warranty, and (ii) such release shall not in any manner discharge, affect or impair the U.S. Secured Obligations or any Liens upon (or obligations of Holdings or any of the Subsidiaries in respect of) all interests in Collateral retained by Holdings or any of the Subsidiaries. Any execution and delivery of documents pursuant to this Section 7.13 shall be without recourse to or warranty by the Security Agent.
(e) The Security Agent shall have no liability whatsoever to any other Secured Party as the result of any release of any Subsidiary Party or Collateral by it in
accordance with (or which the Security Agent in good faith believes to be in accordance with) this Section 7.13.
(b) Each U.S. Loan Party hereby waives (to the fullest extent permitted by applicable law) all rights and benefits under Section 580a, 580b, 580d and 726 of the California Code of Civil Procedure. Each U.S. Loan Party hereby further waives (to the fullest extent permitted by applicable law), without limiting the generality of the foregoing or any other provision hereof, all rights and benefits which might otherwise be available to such U.S. Loan Party under Sections 2809, 2810, 2815, 2819, 2821, 2839, 2845, 2848, 2849, 2850, 2899 and 3433 of the California Civil Code.
(c) Until the U.S. Secured Obligations have been paid in full in cash, each U.S. Loan Party waives its rights of subrogation and reimbursement and any other rights and defenses available to such U.S. Loan Party by reason of Sections 2787 to 2855, inclusive, of the California Civil Code, including, without limitation, (1) any defenses such U.S. Loan Party may have to this Agreement by reason of an election of remedies by the Secured Parties and (2) any rights or defenses such U.S. Loan Party may have by reason of protection afforded to any Borrower or any other Guaranteed Party pursuant to the antideficiency or other laws of California limiting or discharging such Borrower’s or such other Guaranteed Party’s indebtedness, including, without limitation, Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure. In furtherance of such provisions, each U.S. Loan Party hereby waives all rights and defenses arising out of an election of remedies by the Secured Parties, even though that election of remedies, such as a nonjudicial foreclosure, destroys such U.S. Loan Party’s rights of subrogation and reimbursement against any Borrower or any other Guaranteed Party by the operation of Section 580d of the California Code of Civil Procedure or otherwise.
IN WITNESS WHEREOF, the parties hereto have duly executed this Patent and Trademark Security Agreement as of the day and year first above written.
IN WITNESS WHEREOF, the parties hereto have duly executed this Copyright Security Agreement as of the day and year first above written.
ARTICLE I
Representations, Warranties and Covenants of Mortgagor
SECTION 1.01. Title, Mortgage Lien. (a) Mortgagor has good and marketable fee simple title to the Mortgaged Property, subject only to Permitted Liens.
(b) The execution and delivery of this Mortgage is within Mortgagor’s corporate powers and has been duly authorized by all necessary corporate and, if required, stockholder action. This Mortgage has been duly executed and delivered by Mortgagor and constitutes a legal, valid and binding obligation of Mortgagor, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
(c) The execution, delivery and recordation of this Mortgage (i) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect and except filings necessary to perfect the lien of this Mortgage, (ii) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of Mortgagor or any order of any Governmental Authority, (iii) will not violate or result in a default under any indenture, agreement or other instrument binding upon Mortgagor or its assets, or give rise to a right thereunder to require any payment to be made by Mortgagor, and (iv) will not result in the creation or imposition of any Lien on any asset of Mortgagor, except the lien of this Mortgage.
(d) This Mortgage and the Uniform Commercial Code Financing Statements described in Section 1.09 of this Mortgage, when duly recorded in the public records identified in the U.S. Perfection Certificate will create a valid, perfected and enforceable lien upon and security interest in all of the Mortgaged Property.
(e) Mortgagor will forever warrant and defend its title to the Mortgaged Property, the rights of Mortgagee therein under this Mortgage and the validity and priority of the lien of this Mortgage thereon against the claims of all persons and parties except those having rights under Permitted Liens to the extent of those rights.
SECTION 1.02. Credit Agreement. This Mortgage is given pursuant to the Credit Agreement, the other Loan Documents, the Secured Hedging Agreements and the Secured Cash Management Agreements (collectively, the “Secured Debt Agreements”). Mortgagor expressly covenants and agrees to pay when due, and to timely perform, and to cause the other Loan Parties to pay when due, and to timely perform, the Obligations in accordance with the terms of the Secured Debt Agreements.
SECTION 1.03. Payment of Taxes, and Other Obligations. (a) Mortgagor will pay and discharge from time to time prior to the time when the same shall become delinquent, and before any interest or penalty accrues thereon or attaches thereto, all Taxes and other obligations with respect to the Mortgaged Property or any part thereof or upon the Rents from the Mortgaged Property or arising in respect of the occupancy, use or possession thereof in accordance with, and to the extent required by, the Credit Agreement.
(b) In the event of the passage of any state, Federal, municipal or other governmental law, order, rule or regulation subsequent to the date hereof (i) deducting from the value of real property for the purpose of taxation any lien or encumbrance thereon or in any manner changing or modifying the laws now in force governing the taxation of this Mortgage or
debts secured by mortgages or deeds of trust (other than laws governing income, franchise and similar taxes generally) or the manner of collecting taxes thereon and (ii) imposing a tax to be paid by Mortgagee, either directly or indirectly, on this Mortgage or any of the other Secured Debt Agreements, or requiring an amount of taxes to be withheld or deducted therefrom, Mortgagor will promptly (i) notify Mortgagee of such event, (ii) enter into such further instruments as Mortgagee may determine are reasonably necessary or desirable to obligate Mortgagor to make any additional payments necessary to put the Lenders and Secured Parties in the same financial position they would have been if such law, order, rule or regulation had not been passed and (iii) make such additional payments to Mortgagee for the benefit of the Lenders and Secured Parties.
SECTION 1.04. Maintenance of Mortgaged Property. Mortgagor will maintain the Improvements and the Personal Property in the manner required by the Credit Agreement.
SECTION 1.05. Insurance. Mortgagor will keep or cause to be kept the Improvements and Personal Property insured against such risks, and in the manner, described in Section 9.02 of the Credit Agreement and shall purchase such additional insurance as may be required from time to time pursuant to the Credit Agreement. Federal Emergency Management Agency Standard Flood Hazard Determination Forms will be purchased by Mortgagor for each Mortgaged Property. If any portion of the Mortgaged Property is located in an area identified as a special flood hazard area by Federal Emergency Management Agency or other applicable agency, Mortgagor will purchase flood insurance in an amount satisfactory to Mortgagee, but in no event less than the maximum limit of coverage available under the National Flood Insurance Act of 1968, as amended.
SECTION 1.06. Casualty Condemnation/Eminent Domain. Mortgagor shall give Mortgagee prompt written notice of any casualty or other damage to the Mortgaged Property or any proceeding for the taking of the Mortgaged Property or any portion thereof or interest therein under power of eminent domain or by condemnation or any similar proceeding in accordance with Section 9.05(e) of the Credit Agreement.
SECTION 1.07. Assignment of Leases and Rents. (a) Mortgagor hereby irrevocably and absolutely grants, transfers and assigns all of its right title and interest in all Leases and Rents, together with any and all extensions and renewals of the Leases. Mortgagor has not assigned or executed any assignment of, and will not assign or execute any assignment of, any Leases or the Rents payable thereunder to anyone other than Mortgagee.
(b) All material Leases, if any, shall be subordinate to the lien of this Mortgage. Mortgagor will not enter into, modify or amend any Lease if such material Lease, as entered into, modified or amended, will not be subordinate to the lien of this Mortgage.
(c) Subject to Section 1.07(d), Mortgagor has assigned and transferred to Mortgagee all of Mortgagor’s right, title and interest in and to the Rents now or hereafter arising from each Lease heretofore or hereafter made or agreed to by Mortgagor, it being intended that this assignment establish, subject to Section 1.07(d), an absolute transfer and assignment of all Rents and all Leases to Mortgagee and not merely to grant a security interest therein. Subject to Section 1.07(d) and any applicable provisions of the Credit Agreement, Mortgagee
may in Mortgagor’s name and stead (with or without first taking possession of any of the Mortgaged Property personally or by receiver as provided herein) operate the Mortgaged Property and rent, lease or let all or any portion of any of the Mortgaged Property to any party or parties at such rental and upon such terms as Mortgagee shall, in its sole discretion, determine, and may collect and have the benefit of all of said Rents arising from or accruing at any time thereafter or that may thereafter become due under any Lease.
(d) So long as an Event of Default shall not have occurred and be continuing, Mortgagee will not exercise any of its rights under Section 1.07(c), and Mortgagor shall receive and collect the Rents accruing under any Lease; but after the happening and during the continuance of any Event of Default, Mortgagee may, at its option, receive and collect all Rents and enter upon the Premises and Improvements through its officers, agents, employees or attorneys for such purpose and for the operation and maintenance thereof. Mortgagor hereby irrevocably authorizes and directs each tenant, if any, and each successor, if any, to the interest of any tenant under any Lease, respectively, to rely upon any notice of a claimed Event of Default sent by Mortgagee to any such tenant or any of such tenant’s successors in interest, and thereafter to pay Rents to Mortgagee without any obligation or right to inquire as to whether an Event of Default actually exists and even if some notice to the contrary is received from the Mortgagor, who shall have no right or claim against any such tenant or successor in interest for any such Rents so paid to Mortgagee. Each tenant or any of such tenant’s successors in interest from whom Mortgagee or any officer, agent, attorney or employee of Mortgagee shall have collected any Rents, shall be authorized to pay Rents to Mortgagor only after such tenant or any of their successors in interest shall have received written notice from Mortgagee that the Event of Default is no longer continuing, unless and until a further notice of an Event of Default is given by Mortgagee to such tenant or any of its successors in interest.
(e) Mortgagee will not become a mortgagee in possession so long as it does not enter or take actual possession of the Mortgaged Property. In addition, Mortgagee shall not be responsible or liable for performing any of the obligations of the landlord under any Lease, for any waste by any tenant, or others, for any dangerous or defective conditions of any of the Mortgaged Property, for negligence in the management, upkeep, repair or control of any of the Mortgaged Property or any other act or omission by any other person.
(f) Mortgagor shall furnish to Mortgagee, within 30 days after a request by Mortgagee to do so, a written statement containing the names of all tenants, subtenants and concessionaires of the Premises or Improvements, the terms of any Lease, the space occupied and the rentals and/or other amounts payable thereunder.
SECTION 1.08. Restrictions on Transfers and Encumbrances. Mortgagor shall not directly or indirectly sell, convey, alienate, assign, lease, sublease, license, mortgage, pledge, encumber or otherwise transfer, create, consent to or suffer the creation of any lien, charge or other form of encumbrance upon any interest in or any part of the Mortgaged Property, or be divested of its title to the Mortgaged Property or any interest therein in any manner or way, whether voluntarily or involuntarily (other than resulting from a condemnation), or engage in any common, cooperative, joint, time-sharing or other congregate ownership of all or part thereof, except in each case in accordance with and to the extent permitted by the Credit
Agreement; provided, that Mortgagor may, in the ordinary course of business and in accordance with reasonable commercial standards, enter into easement or covenant agreements that relate to and/or benefit the operation of the Mortgaged Property and that do not materially and adversely affect the value, use or operation of the Mortgaged Property.
SECTION 1.09. Security Agreement. This Mortgage is both a mortgage of real property and a grant of a security interest in personal property, and shall constitute and serve as a “Security Agreement” within the meaning of the uniform commercial code as adopted in the state wherein the Premises are located (“UCC”). Mortgagor has hereby granted unto Mortgagee a security interest in and to all the Mortgaged Property described in this Mortgage that is not real property, and simultaneously with the recording of this Mortgage, Mortgagor has filed or will file UCC financing statements, and will file continuation statements prior to the lapse thereof, at the appropriate offices in the jurisdiction of formation of the Mortgagor to perfect the security interest granted by this Mortgage in all the Mortgaged Property that is not real property. Mortgagor hereby appoints Mortgagee as its true and lawful attorney-in-fact and agent, for Mortgagor and in its name, place and stead, in any and all capacities, to execute any document and to file the same in the appropriate offices (to the extent it may lawfully do so), and to perform each and every act and thing reasonably requisite and necessary to be done to perfect the security interest contemplated by the preceding sentence. Mortgagee shall have all rights with respect to the part of the Mortgaged Property that is the subject of a security interest afforded by the UCC in addition to, but not in limitation of, the other rights afforded Mortgagee hereunder and under the Security Agreement.
SECTION 1.10. Filing and Recording. Mortgagor will cause this Mortgage, the UCC financing statements referred to in Section 1.09, any other security instrument creating a security interest in or evidencing the lien hereof upon the Mortgaged Property and each UCC continuation statement and instrument of further assurance to be filed, registered or recorded and, if necessary, refiled, rerecorded and reregistered, in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to perfect the lien hereof upon, and the security interest of Mortgagee in, the Mortgaged Property until this Mortgage is terminated and released in full in accordance with Section 3.04 hereof. Mortgagor will pay all filing, registration and recording fees, all Federal, state, county and municipal recording, documentary or intangible taxes and other taxes, duties, imposts, assessments and charges, and all reasonable expenses incidental to or arising out of or in connection with the execution, delivery and recording of this Mortgage, UCC continuation statements any mortgage supplemental hereto, any security instrument with respect to the Personal Property, Permits, Plans and Warranties and Proceeds or any instrument of further assurance.
SECTION 1.11. Further Assurances. Upon demand by Mortgagee, Mortgagor will, at the cost of Mortgagor and without expense to Mortgagee, do, execute, acknowledge and deliver all such further acts, deeds, conveyances, mortgages, assignments, notices of assignment, transfers and assurances as Mortgagee shall from time to time reasonably require for the better assuring, conveying, assigning, transferring and confirming unto Mortgagee the property and rights hereby conveyed or assigned or intended now or hereafter so to be, or which Mortgagor may be or may hereafter become bound to convey or assign to Mortgagee, or for carrying out the intention or facilitating the performance of the terms of this Mortgage,
or for filing, registering or recording this Mortgage, and on demand, Mortgagor will also execute and deliver and hereby appoints Mortgagee as its true and lawful attorney-in-fact and agent, for Mortgagor and in its name, place and stead, in any and all capacities, to execute and file to the extent it may lawfully do so, one or more financing statements, chattel mortgages or comparable security instruments reasonably requested by Mortgagee to evidence more effectively the lien hereof upon the Personal Property and to perform each and every act and thing requisite and necessary to be done to accomplish the same.
SECTION 1.12. Additions to Mortgaged Property. All right, title and interest of Mortgagor in and to all extensions, improvements, betterments, renewals, substitutes and replacements of, and all additions and appurtenances to, the Mortgaged Property hereafter acquired by or released to Mortgagor or constructed, assembled or placed by Mortgagor upon the Premises or the Improvements, and all conversions of the security constituted thereby, immediately upon such acquisition, release, construction, assembling, placement or conversion, as the case may be, and in each such case without any further mortgage, conveyance, assignment or other act by Mortgagor, shall become subject to the lien and security interest of this Mortgage as fully and completely and with the same effect as though now owned by Mortgagor and specifically described in the grant of the Mortgaged Property above, but at any and all times Mortgagor will execute and deliver to Mortgagee any and all such further assurances, mortgages, conveyances or assignments thereof as Mortgagee may reasonably require for the purpose of expressly and specifically subjecting the same to the lien and security interest of this Mortgage.
SECTION 1.13. No Claims Against Mortgagee. Nothing contained in this Mortgage shall constitute any consent or request by Mortgagee, express or implied, for the performance of any labor or services or the furnishing of any materials or other property in respect of the Mortgaged Property or any part thereof, nor as giving Mortgagor any right, power or authority to contract for or permit the performance of any labor or services or the furnishing of any materials or other property in such fashion as would permit the making of any claim against Mortgagee in respect thereof.
SECTION 1.14. Fixture Filing. (a) Certain portions of the Mortgaged Property are or will become “fixtures” (as that term is defined in the UCC) on the Land, and this Mortgage, upon being filed for record in the real estate records of the county wherein such fixtures are situated, shall operate also as a financing statement filed as a fixture filing in accordance with the applicable provisions of said UCC upon such portions of the Mortgaged Property that are or become fixtures.
(b) The real property to which the fixtures relate is described in Exhibit A hereto. The record owner of the real property described in Exhibit A hereto is Mortgagor. The name, type of organization and jurisdiction of organization of the debtor for purposes of this financing statement are the name, type of organization and jurisdiction of organization of the Mortgagor set forth in the first paragraph of this Mortgage, and the name of the secured party for purposes of this financing statement is the name of the Mortgagee set forth in the first paragraph of this Mortgage. The mailing address of the Mortgagor/debtor is the address of the Mortgagor set forth in the first paragraph of this Mortgage. The mailing address of the Mortgagee/secured party from which information concerning the security interest hereunder
may be obtained is the address of the Mortgagee set forth in the first paragraph of this Mortgage. Mortgagor’s organizational identification number is 2123437.
ARTICLE II
Defaults and Remedies
SECTION 2.01. Events of Default. Any Event of Default under the Credit Agreement (as such term is defined therein) shall constitute an Event of Default under this Mortgage.
SECTION 2.02. Demand for Payment. If an Event of Default shall occur and be continuing, then, upon written demand of Mortgagee, Mortgagor will pay to Mortgagee all amounts due hereunder and under the Credit Agreement and the other Loan Documents and such further amount as shall be sufficient to cover the costs and expenses of collection, including attorneys’ fees, disbursements and expenses incurred by Mortgagee, and Mortgagee shall be entitled and empowered to institute an action or proceedings at law or in equity for the collection of the sums so due and unpaid, to prosecute any such action or proceedings to judgment or final decree, to enforce any such judgment or final decree against Mortgagor and to collect, in any manner provided by law, all moneys adjudged or decreed to be payable.
SECTION 2.03. Rights To Take Possession, Operate and Apply Revenues. (a) If an Event of Default shall occur and be continuing, Mortgagor shall, upon demand of Mortgagee, forthwith surrender to Mortgagee actual possession of the Mortgaged Property and, if and to the extent not prohibited by applicable law, Mortgagee itself, or by such officers or agents as it may appoint, may then enter and take possession of all the Mortgaged Property without the appointment of a receiver or an application therefor, exclude Mortgagor and its agents and employees wholly therefrom, and have access to the books, papers and accounts of Mortgagor.
(b) If Mortgagor shall for any reason fail to surrender or deliver the Mortgaged Property or any part thereof after such demand by Mortgagee, Mortgagee may to the extent not prohibited by applicable law, obtain a judgment or decree conferring upon Mortgagee the right to immediate possession or requiring Mortgagor to deliver immediate possession of the Mortgaged Property to Mortgagee, to the entry of which judgment or decree Mortgagor hereby specifically consents. Mortgagor will pay to Mortgagee, upon demand, all reasonable expenses of obtaining such judgment or decree, including reasonable compensation to Mortgagee’s attorneys and agents with interest thereon at the rate per annum applicable to overdue amounts under the Credit Agreement as provided in Section 2.08(b) of the Credit Agreement (the “Interest Rate”); and all such expenses and compensation shall, until paid, be secured by this Mortgage.
(c) Upon every such entry or taking of possession, Mortgagee may, to the extent not prohibited by applicable law, hold, store, use, operate, manage and control the Mortgaged Property, conduct the business thereof and, from time to time, (i) make all necessary and
proper maintenance, repairs, renewals, replacements, additions, betterments and improvements thereto and thereon, (ii) purchase or otherwise acquire additional fixtures, personalty and other property, (iii) insure or keep the Mortgaged Property insured, (iv) manage and operate the Mortgaged Property and exercise all the rights and powers of Mortgagor to the same extent as Mortgagor could in its own name or otherwise with respect to the same, or (v) enter into any and all agreements with respect to the exercise by others of any of the powers herein granted Mortgagee, all as may from time to time be directed or determined by Mortgagee to be in its best interest and Mortgagor hereby appoints Mortgagee as its true and lawful attorney-in-fact and agent, for Mortgagor and in its name, place and stead, in any and all capacities, to perform any of the foregoing acts. Mortgagee may collect and receive all the Rents, issues, profits and revenues from the Mortgaged Property, including those past due as well as those accruing thereafter, and, after deducting (i) all expenses of taking, holding, managing and operating the Mortgaged Property (including compensation for the services of all persons employed for such purposes), (ii) the costs of all such maintenance, repairs, renewals, replacements, additions, betterments, improvements, purchases and acquisitions, (iii) the costs of insurance, (iv) such taxes, assessments and other similar charges as Mortgagee may at its option pay, (v) other proper charges upon the Mortgaged Property or any part thereof and (vi) the compensation, expenses and disbursements of the attorneys and agents of Mortgagee, Mortgagee shall apply the remainder of the moneys and proceeds so received first to the payment of the Mortgagee for the satisfaction of the Obligations, and second, if there is any surplus, to Mortgagor, subject to the entitlement of others thereto under applicable law.
(d) Whenever, before any sale of the Mortgaged Property under Section 2.06, all Obligations that are then due shall have been paid and all Events of Default fully cured, Mortgagee will surrender possession of the Mortgaged Property back to Mortgagor, its successors or assigns. The same right of taking possession shall, however, arise again if any subsequent Event of Default shall occur and be continuing.
SECTION 2.04. Right To Cure Mortgagor’s Failure to Perform. Should Mortgagor fail in the payment, performance or observance of any term, covenant or condition required by this Mortgage or the Credit Agreement (with respect to the Mortgaged Property), Mortgagee may pay, perform or observe the same, and all payments made or costs or expenses incurred by Mortgagee in connection therewith shall be secured hereby and shall be, without demand, immediately repaid by Mortgagor to Mortgagee with interest thereon at the Interest Rate. Mortgagee shall be the judge using reasonable discretion of the necessity for any such actions and of the amounts to be paid. Mortgagee is hereby empowered to enter and to authorize others to enter upon the Premises or the Improvements or any part thereof for the purpose of performing or observing any such defaulted term, covenant or condition without having any obligation to so perform or observe and without thereby becoming liable to Mortgagor, to any person in possession holding under Mortgagor or to any other person.
SECTION 2.05. Right to a Receiver. If an Event of Default shall occur and be continuing, Mortgagee, upon application to a court of competent jurisdiction, shall be entitled as a matter of right to the appointment of a receiver to take possession of and to operate the Mortgaged Property and to collect and apply the Rents. The receiver shall have all of the rights and powers permitted under the laws of the state wherein the Mortgaged Property is
located. Mortgagor shall pay to Mortgagee upon demand all reasonable expenses, including receiver’s fees, reasonable attorney’s fees and disbursements, costs and agent’s compensation incurred pursuant to the provisions of this Section 2.05; and all such expenses shall be secured by this Mortgage and shall be, without demand, immediately repaid by Mortgagor to Mortgagee with interest thereon at the Interest Rate.
SECTION 2.06. Foreclosure and Sale. (a) If an Event of Default shall occur and be continuing, Mortgagee may elect to sell the Mortgaged Property or any part of the Mortgaged Property by exercise of the power of foreclosure or of sale granted to Mortgagee by applicable law or this Mortgage. In such case, Mortgagee may commence a civil action to foreclose this Mortgage, or it may proceed and sell the Mortgaged Property to satisfy any Obligation. Mortgagee or an officer appointed by a judgment of foreclosure to sell the Mortgaged Property, may sell all or such parts of the Mortgaged Property as may be chosen by Mortgagee at the time and place of sale fixed by it in a notice of sale, either as a whole or in separate lots, parcels or items as Mortgagee shall deem expedient, and in such order as it may determine, at public auction to the highest bidder. Mortgagee or an officer appointed by a judgment of foreclosure to sell the Mortgaged Property may postpone any foreclosure or other sale of all or any portion of the Mortgaged Property by public announcement at such time and place of sale, and from time to time thereafter may postpone such sale by public announcement or subsequently noticed sale. Without further notice, Mortgagee or an officer appointed to sell the Mortgaged Property may make such sale at the time fixed by the last postponement, or may, in its discretion, give a new notice of sale. Any person, including Mortgagor or Mortgagee or any designee or affiliate thereof, may purchase at such sale.
(b) The Mortgaged Property may be sold subject to unpaid taxes and Permitted Liens, and, after deducting all costs, fees and expenses of Mortgagee (including costs of evidence of title in connection with the sale), Mortgagee or an officer that makes any sale shall apply the proceeds of sale in the manner set forth in Section 2.08.
(c) Any foreclosure or other sale of less than the whole of the Mortgaged Property or any defective or irregular sale made hereunder shall not exhaust the power of foreclosure or of sale provided for herein; and subsequent sales may be made hereunder until the Obligations have been satisfied, or the entirety of the Mortgaged Property has been sold.
(d) If an Event of Default shall occur and be continuing, Mortgagee may instead of, or in addition to, exercising the rights described in Section 2.06(a) above and either with or without entry or taking possession as herein permitted, proceed by a suit or suits in law or in equity or by any other appropriate proceeding or remedy (i) to specifically enforce payment of some or all of the Obligations, or the performance of any term, covenant, condition or agreement of this Mortgage or any other Loan Document or any other right, or (ii) to pursue any other remedy available to Mortgagee, all as Mortgagee shall determine most effectual for such purposes.
SECTION 2.07. Other Remedies. (a) In case an Event of Default shall occur and be continuing, Mortgagee may also exercise, to the extent not prohibited by law, any or all of the remedies available to a secured party under the UCC.
(b) In connection with a sale of the Mortgaged Property or any Personal Property and the application of the proceeds of sale as provided in Section 2.08, Mortgagee shall be entitled to enforce payment of and to receive up to the principal amount of the Obligations, plus all other charges, payments and costs due under this Mortgage, and to recover a deficiency judgment for any portion of the aggregate principal amount of the Obligations remaining unpaid, with interest.
SECTION 2.08. Application of Sale Proceeds and Rents. After any foreclosure sale of all or any of the Mortgaged Property, Mortgagee shall, subject to the applicable provisions of the Intercreditor Agreement, receive and apply the proceeds of the sale, together with any Rents that may have been collected and any other sums that then may be held by Mortgagee under this Mortgage, in accordance with Section 11.02 of the Credit Agreement. The Mortgagee shall have absolute discretion as to the time of application of any such proceeds, moneys or balances in accordance with this Mortgage. Upon any sale of the Mortgaged Property by the Mortgagee (including pursuant to a power of sale granted by statute or under a judicial proceeding), the receipt of the Mortgagee or of the officer making the sale shall be a sufficient discharge to the purchaser or purchasers of the Mortgaged Property so sold and such purchaser or purchasers shall not be obligated to see to the application of any part of the purchase money paid over to the Mortgagee or such officer or be answerable in any way for the misapplication thereof.
SECTION 2.09. Mortgagor as Tenant Holding Over. If Mortgagor remains in possession of any of the Mortgaged Property after any foreclosure sale by Mortgagee, at Mortgagee’s election Mortgagor shall be deemed a tenant holding over and shall forthwith surrender possession to the purchaser or purchasers at such sale or be summarily dispossessed or evicted according to provisions of law applicable to tenants holding over.
SECTION 2.10. Waiver of Appraisement, Valuation, Stay, Extension and Redemption Laws. Mortgagor waives, to the extent not prohibited by law, (i) the benefit of all laws now existing or that hereafter may be enacted (x) providing for any appraisement or valuation of any portion of the Mortgaged Property and/or (y) in any way extending the time for the enforcement or the collection of amounts due under any of the Obligations or creating or extending a period of redemption from any sale made in collecting said debt or any other amounts due Mortgagee, (ii) any right to at any time insist upon, plead, claim or take the benefit or advantage of any law now or hereafter in force providing for any homestead exemption, stay, statute of limitations, extension or redemption, or sale of the Mortgaged Property as separate tracts, units or estates or as a single parcel in the event of foreclosure or notice of deficiency, and (iii) all rights of redemption, valuation, appraisement, stay of execution, notice of election to mature or declare due the whole of or each of the Obligations and marshaling in the event of foreclosure of this Mortgage.
SECTION 2.11. Discontinuance of Proceedings. In case Mortgagee shall proceed to enforce any right, power or remedy under this Mortgage by foreclosure, entry or otherwise, and such proceedings shall be discontinued or abandoned for any reason, or shall be determined adversely to Mortgagee, then and in every such case Mortgagor and Mortgagee shall be restored to their former positions and rights hereunder, and all rights, powers and remedies of Mortgagee shall continue as if no such proceeding had been taken.
SECTION 2.12. Suits To Protect the Mortgaged Property. Mortgagee shall have power (a) to institute and maintain suits and proceedings to prevent any impairment of the Mortgaged Property by any acts that may be unlawful or in violation of this Mortgage, (b) to preserve or protect its interest in the Mortgaged Property and in the Rents arising therefrom and (c) to restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid if the enforcement of or compliance with such enactment, rule or order would impair the security or be prejudicial to the interest of Mortgagee hereunder.
SECTION 2.13. Filing Proofs of Claim. In case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting Mortgagor, Mortgagee shall, to the extent permitted by law, be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of Mortgagee allowed in such proceedings for the Obligations secured by this Mortgage at the date of the institution of such proceedings and for any interest accrued, late charges and additional interest or other amounts due or that may become due and payable hereunder after such date.
SECTION 2.14. Possession by Mortgagee. Notwithstanding the appointment of any receiver, liquidator or trustee of Mortgagor, any of its property or the Mortgaged Property, Mortgagee shall be entitled, to the extent not prohibited by law, to remain in possession and control of all parts of the Mortgaged Property now or hereafter granted under this Mortgage to Mortgagee in accordance with the terms hereof and applicable law.
SECTION 2.15. Waiver. (a) No delay or failure by Mortgagee to exercise any right, power or remedy accruing upon any breach or Event of Default shall exhaust or impair any such right, power or remedy or be construed to be a waiver of any such breach or Event of Default or acquiescence therein; and every right, power and remedy given by this Mortgage to Mortgagee may be exercised from time to time and as often as may be deemed expedient by Mortgagee. No consent or waiver by Mortgagee to or of any breach or Event of Default by Mortgagor in the performance of the Obligations shall be deemed or construed to be a consent or waiver to or of any other breach or Event of Default in the performance of the same or of any other Obligations by Mortgagor hereunder. No failure on the part of Mortgagee to complain of any act or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall constitute a waiver by Mortgagee of its rights hereunder or impair any rights, powers or remedies consequent on any future Event of Default by Mortgagor.
(b) Even if Mortgagee (i) grants some forbearance or an extension of time for the payment of any sums secured hereby, (ii) takes other or additional security for the payment of any sums secured hereby, (iii) waives or does not exercise some right granted herein or under the Secured Debt Agreements, (iv) releases a part of the Mortgaged Property from this Mortgage, (v) agrees to change some of the terms, covenants, conditions or agreements of any of the Secured Debt Agreements, (vi) consents to the filing of a map, plat or replat affecting the Premises, (vii) consents to the granting of an easement or other right affecting the Premises or (viii) makes or consents to an agreement subordinating Mortgagee’s lien on the Mortgaged Property hereunder; no such act or omission shall preclude Mortgagee from
exercising any other right, power or privilege herein granted or intended to be granted in the event of any breach or Event of Default then made or of any subsequent default; nor, except as otherwise expressly provided in an instrument executed by Mortgagee, shall this Mortgage be altered thereby. In the event of the sale or transfer by operation of law or otherwise of all or part of the Mortgaged Property, Mortgagee is hereby authorized and empowered to deal with any vendee or transferee with reference to the Mortgaged Property secured hereby, or with reference to any of the terms, covenants, conditions or agreements hereof, as fully and to the same extent as it might deal with the original parties hereto and without in any way releasing or discharging any liabilities, obligations or undertakings.
SECTION 2.16. Waiver of Trial by Jury. To the fullest extent permitted by applicable law, Mortgagor and Mortgagee each hereby irrevocably and unconditionally waive trial by jury in any action, claim, suit or proceeding relating to this Mortgage and for any counterclaim brought therein. Mortgagor hereby waives all rights to interpose any counterclaim in any suit brought by Mortgagee hereunder and all rights to have any such suit consolidated with any separate suit, action or proceeding.
SECTION 2.17. Remedies Cumulative. No right, power or remedy conferred upon or reserved to Mortgagee by this Mortgage is intended to be exclusive of any other right, power or remedy, and each and every such right, power and remedy shall be cumulative and concurrent and in addition to any other right, power and remedy given hereunder or now or hereafter existing at law or in equity or by statute.
ARTICLE III
Miscellaneous
SECTION 3.01. Partial Invalidity. In the event any one or more of the provisions contained in this Mortgage shall for any reason be held to be invalid, illegal or unenforceable in any respect, such validity, illegality or unenforceability shall, at the option of Mortgagee, not affect any other provision of this Mortgage, and this Mortgage shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein or therein.
SECTION 3.02. Notices. All notices and communications hereunder shall be in writing and given to Mortgagor in accordance with the terms of the Credit Agreement at the address set forth on the first page of this Mortgage and to the Mortgagee as provided in the Credit Agreement.
SECTION 3.03. Successors and Assigns. All of the grants, covenants, terms, provisions and conditions herein shall run with the Premises and the Improvements and shall apply to, bind and inure to, the benefit of the permitted successors and assigns of Mortgagor and the successors and assigns of Mortgagee.
SECTION 3.04. Satisfaction and Cancelation. (a) The conveyance to Mortgagee of the Mortgaged Property as security created and consummated by this Mortgage shall be null and void upon the payment in full in cash of the Loans and all the other Loan Document Obligations (other than unasserted contingent and indemnification obligations), termination
of all Commitments and Incremental Commitments and reduction of all exposure under any Letters of Credit issued and any Bankers’ Acceptances to zero (or the making of other arrangements satisfactory to the issuers thereof).
(b) Upon any sale or other transfer by Mortgagor of all or any portion of the Mortgaged Property that is permitted under the Credit Agreement (other than a sale or other transfer to a U.S. Loan Party), or upon the effectiveness of any written consent to the release of the Lien granted hereby in all or any portion of the Mortgaged Property pursuant to Section 12.10 of the Credit Agreement, the Lien in all or such portion of the Mortgaged Property, as applicable, shall be automatically released.
(c) In connection with any termination or release pursuant to paragraph (a) or (b) of this Section 3.04, the Mortgagee shall execute and deliver to Mortgagor, at Mortgagor’s expense, all documents that Mortgagor shall reasonably request to evidence such termination or release; provided, however, that (i) the Mortgagee shall not be required to execute any such document on terms which, in its reasonable opinion, would expose it to liability or create any obligation or entail any consequence other than the release of such Liens without recourse or warranty, and (ii) such release shall not in any manner discharge, affect or impair the Obligations or any Liens upon (or obligations of the Mortgagor or any of the Subsidiaries in respect of) all interests in the Mortgaged Property (if any) retained by the Mortgagor or any of the Subsidiaries. Any execution and delivery of documents pursuant to this Section 3.04 shall be without recourse to or warranty by the Mortgagee.
SECTION 3.05. Definitions. The rules of construction specified in Section 1.02 of the Credit Agreement also apply to this Mortgage. As used in this Mortgage, the singular shall include the plural as the context requires and the following words and phrases shall have the following meanings: (a) “including” shall mean “including but not limited to”; (b) “provisions” shall mean “provisions, terms, covenants and/or conditions”; (c) “lien” shall mean “lien, charge, encumbrance, security interest, mortgage or deed of trust”; (d) “obligation” shall mean “obligation, duty, covenant and/or condition”; and (e) “any of the Mortgaged Property” shall mean “the Mortgaged Property or any part thereof or interest therein”. Any act that Mortgagee is permitted to perform hereunder may be performed at any time and from time to time by Mortgagee or any person or entity designated by Mortgagee. Any act that is prohibited to Mortgagor hereunder is also prohibited to all lessees of any of the Mortgaged Property. Each appointment of Mortgagee as attorney-in-fact for Mortgagor under the Mortgage is irrevocable, with power of substitution and coupled with an interest.
SECTION 3.06. Multisite Real Estate Transaction. Mortgagor acknowledges that this Mortgage is one of a number of Other Mortgages and Security Documents that secure the Obligations. Mortgagor agrees that the lien of this Mortgage shall be absolute and unconditional and shall not in any manner be affected or impaired by any acts or omissions whatsoever of Mortgagee, and without limiting the generality of the foregoing, the lien hereof shall not be impaired by any acceptance by the Mortgagee of any security for or guarantees of any of the Obligations hereby secured, or by any failure, neglect or omission on the part of Mortgagee to realize upon or protect any Obligation or indebtedness hereby secured or any collateral security therefor including the Other Mortgages and other Security Documents. The lien hereof shall not in any manner be impaired or affected by any release
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(except as to the property released), sale, pledge, surrender, compromise, settlement, renewal, extension, indulgence, alteration, changing, modification or disposition of any of the Obligations secured or of any of the collateral security therefor, including the Other Mortgages and other Security Documents or of any guarantee thereof, and Mortgagee may at its discretion foreclose, exercise any power of sale, or exercise any other remedy available to it under any or all of the Other Mortgages and other Security Documents without first exercising or enforcing any of its rights and remedies hereunder. Such exercise of Mortgagee’s rights and remedies under any or all of the Other Mortgages and other Security Documents shall not in any manner impair the indebtedness hereby secured or the lien of this Mortgage and any exercise of the rights or remedies of Mortgagee hereunder shall not impair the lien of any of the Other Mortgages and other Security Documents or any of Mortgagee’s rights and remedies thereunder. Mortgagor specifically consents and agrees that Mortgagee may exercise its rights and remedies hereunder and under the Other Mortgages and other Security Documents separately or concurrently and in any order that it may deem appropriate and waives any rights of subrogation.
SECTION 3.07. No Oral Modification. This Mortgage may not be changed or terminated orally. Any agreement made by Mortgagor and Mortgagee after the date of this Mortgage relating to this Mortgage shall be superior to the rights of the holder of any intervening or subordinate Mortgage, lien or encumbrance.
SECTION 3.08. Intercreditor Agreement. Notwithstanding anything herein to the contrary, the Liens granted to the Mortgagee under this Mortgage and the exercise of the rights and remedies of the Mortgagee hereunder are subject to the provisions of the Intercreditor Agreement. In the event of any conflict between the terms of the Intercreditor Agreement and this Mortgage, the terms of the Intercreditor Agreement shall govern and control.
SECTION 3.09. Reduction of Secured Amount. In the event the maximum principal amount secured by this Mortgage is less than the aggregate Obligations, then the amount secured hereby shall be reduced only by the last and final sums that Mortgagor or any other Loan Party repays with respect to the Obligations and shall not be reduced by any intervening repayments of the Obligations. So long as the balance of the Obligations exceeds the amount secured hereby, any payments of the Obligations shall not be deemed to be applied against, or reduce, the portion of the Obligations secured by this Mortgage.
SECTION 3.10. Future Advances. This Mortgage is given to secure the Obligations under, or in respect of, the Secured Debt Agreements and shall secure not only Obligations with respect to presently existing indebtedness under the foregoing documents and agreements but also any and all other Obligations which may hereafter be owing to the Secured Parties under the Secured Debt Agreements, however incurred, whether interest, discount or otherwise, and whether the same shall be deferred, accrued or capitalized, including future advances and re-advances and other obligations, pursuant to the Secured Debt Agreements, whether such advances or obligations are obligatory or to be made at the option of the Secured Parties, or otherwise, to the same extent as if such future advances or obligations were made on the date of the execution of this Mortgage. The Lien of this Mortgage shall be valid as to all Obligations secured hereby, including future advances and
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obligations, from the time of its filing for record in the recorder’s office of the county in which the Mortgaged Property is located. This Mortgage is intended to and shall be valid and have priority over all subsequent Liens and encumbrances, including statutory Liens, excepting solely taxes and assessments levied on the real estate, to the extent of the maximum amount secured hereby and Permitted Liens related thereto. Although this Mortgage is given to secure all future advances and obligations made by Mortgagee and/or the other Secured Parties to or for the benefit of the Borrowers, Mortgagor and/or the Mortgaged Property, whether obligatory or optional, Mortgagor and Mortgagee hereby acknowledge and agree that Mortgagee and the other Secured Parties are obligated by the terms of the Secured Debt Agreements to make certain future advances or obligations, including advances of a revolving nature, subject to the fulfillment of the relevant conditions set forth in the Secured Debt Agreements.
ARTICLE IV
Particular Provisions
SECTION 4.01. Applicable Law; Certain Particular Provisions. This Mortgage shall be governed by and construed in accordance with the internal law of the state where the Mortgaged Property is located, except that Mortgagor expressly acknowledges that by their terms, the Credit Agreement and other Loan Documents (aside from those Other Mortgages to be recorded outside New York) shall be governed by the internal law of the State of New York, without regard to principles of conflict of law. Mortgagor and Mortgagee agree to submit to jurisdiction and the laying of venue for any suit on this Mortgage in the state where the Mortgaged Property is located. The terms and provisions set forth in Appendix A attached hereto are hereby incorporated by reference as though fully set forth herein. In the event of any conflict between the terms and provisions contained in the body of this Mortgage and the terms and provisions set forth in Appendix A, the terms and provisions set forth in Appendix A shall govern and control.
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A. Documentation
B. Jurisdiction
D. Assumptions and Reliance on Factual Certificates
E. Opinions
F. Qualifications