Blucora Annual Report 2015

Plain-text annual report

BLUCORA, INC. FORM 10-K (Annual Report) Filed 02/24/16 for the Period Ending 12/31/15 Address 10900 NE 8TH STREET SUITE 800 BELLEVUE, WA 98004 4258821602 CIK 0001068875 Telephone Symbol BCOR SIC Code 7374 - Computer Processing and Data Preparation and Processing Services Industry Computer Services Sector Technology Fiscal Year 12/31 http://www.edgar-online.com © Copyright 2016, EDGAR Online, Inc. All Rights Reserved. Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use. Table of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549 FORM 10-K(Mark One)ýANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year endedDecember 31, 2015ORoTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 000-25131BLUCORA, INC.(Exact name of registrant as specified in its charter)Delaware 91-1718107(State or other jurisdiction ofincorporation or organization) (IRS EmployerIdentification No.) 10900 NE 8th Street, Suite 800, Bellevue, Washington 98004(Address of principal executive offices) (Zip code)Registrant’s telephone number, including area code:(425) 201-6100 Securities registered pursuant to Section 12(b) of the Act:Title of each class Name of each exchange on which registeredCommon Stock, par value $0.0001 per share NASDAQ Global Select MarketSecurities registered pursuant to Section 12(g) of the Act: None(Title of Class)Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No ýIndicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No ýIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past90 days. Yes ý No oIndicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to besubmitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post suchfiles). Yes ý No oIndicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not becontained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment tothis Form 10-K. oIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of“large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.Large accelerated filer ýAccelerated fileroNon-accelerated filer oSmaller reporting company o (Do not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No ýThe aggregate market value of the Common Stock held by non-affiliates of the registrant outstanding as of June 30, 2015 , based upon the closing price of Common Stockon June 30, 2015 as reported on the NASDAQ Global Select Market, was $620.8 million . Common Stock held by each officer and director (or his or her affiliate) has beenexcluded because such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.As of February 16, 2016 , 41,207,155 shares of the registrant’s Common Stock were outstanding.DOCUMENTS INCORPORATED BY REFERENCEPart III incorporates certain information by reference from the definitive proxy statement to be filed by the registrant in connection with the 2016 Annual Meeting ofStockholders (the “Proxy Statement ”).Table of ContentsTABLE OF CONTENTSPart I PageItem 1.Business3Item 1A.Risk Factors9Item 1B.Unresolved Staff Comments27Item 2.Properties27Item 3.Legal Proceedings27Item 4.Mine Safety Disclosures27 Part II Item 5.Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities28Item 6.Selected Financial Data29Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations30Item 7A.Quantitative and Qualitative Disclosures About Market Risk50Item 8.Financial Statements and Supplementary Data51Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure86Item 9A.Controls and Procedures86Item 9B.Other Information88 Part III Item 10.Directors, Executive Officers and Corporate Governance89Item 11.Executive Compensation89Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters89Item 13.Certain Relationships and Related Transactions, and Director Independence89Item 14.Principal Accounting Fees and Services89 Part IV Item 15.Exhibits, Financial Statement Schedules90 Signatures 2Table of ContentsThis report contains forward-looking statements that involve risks and uncertainties. The statements in this report that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Words such as “anticipate, ” “believe, ” “plan, ”“expect, ” “future, ” “intend, ” “may, ” “will, ” “should, ” “estimate, ” “predict, ” “potential, ” “continue,” and similar expressions identify forward-lookingstatements, but the absence of these words does not mean that the statement is not forward-looking. These forward-looking statements include, but are not limitedto, statements regarding projections of our future financial performance; trends in our businesses; our future business plans and growth strategy, including ourplans to expand, develop, or acquire particular operations or businesses; and the sufficiency of our cash balances and cash generated from operating, investing,and financing activities for our future liquidity and capital resource needs.Forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that may cause our results, levels of activity,performance, achievements, and prospects to be materially different from those expressed or implied by such forward-looking statements. These risks,uncertainties, and other factors include, among others, those identified under Item 1A, "Risk Factors," and elsewhere in this report. You should not rely onforward-looking statements, which speak only as of the date of this Annual Report on Form 10-K. We do not undertake any obligation to update any forward-looking statement to reflect new information, events, or circumstances after the date of this Annual Report on Form 10-K or to reflect the occurrence ofunanticipated events.PART IITEM 1. BusinessOverviewBlucora, Inc. ( “Blucora” ) is a leading provider of technology-enabled financial solutions to consumers, small business owners, and tax professionals.Through our operating companies, HD Vest, Inc. (“ HD Vest ”) and TaxAct, Inc. (“ TaxAct ”), we provide leading products in wealth management and taxpreparation services and help millions of individuals manage their financial lives.In addition, Blucora operates an internet search and content business through our InfoSpace LLC subsidiary (“ InfoSpace ”) and an e-commerce businessthrough the operations of Monoprice, Inc. (“ Monoprice ”). See "Our History" below for further information related to such businesses and the classification ofeach within discontinued operations.Our common stock is listed on the NASDAQ Global Select Market under the symbol “BCOR.”All references in this report to “Blucora,” the “Company,” “we,” “our,” or “us” are to Blucora, Inc.Our HistoryBlucora began in 1996 under the name InfoSpace, Inc. Over the next two decades, InfoSpace operated a number of digital businesses in search, directory,online commerce, media, and mobile infrastructure markets, with operations since 2008 focusing on search services and content (our “Search and Contentbusiness”).In January 2012, InfoSpace, Inc. acquired TaxAct, a leading provider of digital tax preparation solutions for consumers, small business owners, and taxprofessionals (our “Tax Preparation business”). In connection with this acquisition, InfoSpace, Inc. changed its name to Blucora, Inc. in June 2012.In August 2013, Blucora acquired Monoprice, Inc., which sells self-branded electronics and accessories to both consumers and businesses (our “E-Commerce business”).On October 14, 2015, Blucora announced the acquisition of HD Vest, which closed on December 31, 2015 . Through its subsidiaries, HD Vest operates thelargest U.S. tax-professional-oriented independent broker-dealer, providing wealth management solutions to financial advisors nationwide (our “WealthManagement” business). As part of that announcement, we also stated our plans to divest the Search and Content and E-Commerce businesses, in order to focusmore strategically on the technology-enabled financial solutions market (the “ Strategic Transformation ”).As a result of the Strategic Transformation, the results of operations of the Search and Content and E-Commerce businesses have been classified asdiscontinued operations for all periods presented in this report. See " Note 4: Discontinued Operations " of the Notes to Consolidated Financial Statements in PartII Item 8 of this report for additional information. In3Table of Contentsaddition, as of December 31, 2015, we have two reportable segments: the Wealth Management segment, which is comprised of the HD Vest business, and the TaxPreparation segment, which is comprised of the TaxAct business.See " Note 2: Summary of Significant Accounting Policies " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additionalinformation on the Tax Preparation business and its revenue. See " Note 12: Segment Information " of the Notes to Consolidated Financial Statements in Part IIItem 8 of this report for information regarding revenue, operating income, and assets for our Tax Preparation business.Our BusinessesWealth Management BusinessOur Wealth Management business distributes products and services through financial advisors who affiliate with HD Vest’s subsidiaries as independentcontractors. HD Vest provides financial advisors with an integrated platform of brokerage, investment advisory and insurance services to assist in making eachfinancial advisor a financial service center for his/her clients. HD Vest generates revenue primarily through commissions, quarterly investment advisory fees basedon assets under management, and other fees.HD Vest has established a leading brokerage and technology platform focused on tax and accounting professionals, maintaining an independent network ofapproximately 4,600 financial advisors with branch offices in all 50 states. HD Vest's financial advisors provide financial solutions to more than 360,000 clientswith approximately $37 billion of assets as of December 31, 2015 .HD Vest was founded to help certified public accountants ( “CPAs” ) and tax professionals integrate investment planning services into their practices. Thecompany believes that tax and accounting professionals, with their existing client relationships and in-depth knowledge of their clients’ financial situations, have acompetitive advantage and are better positioned than competitors to provide financial solutions. HD Vest primarily recruits independent CPAs and taxprofessionals with established tax practices and offers specialized training and support, which allows them to join the HD Vest platform as independent financialadvisors. HD Vest's specialized model provides an open-architecture investment platform and technology tools to help financial advisors identify investmentopportunities for their clients, while the long-standing tax advisory relationships provide a large source of possible investment clients. This results in anexperienced and stable network of financial advisors, who have multiple revenue-generating options to diversify their earnings sources.Tax Preparation BusinessOur Tax Preparation business provides digital do-it-yourself ( “DDIY” ) tax preparation solutions for consumers, small business owners, and taxprofessionals. TaxAct generates revenue primarily through its online service at www.TaxAct.com.TaxAct, a top-three provider of digital tax preparation solutions, has leveraged its strong brand, comprehensive suite of tax preparation solutions, and provenonline lead generation capabilities to enable the filing of more than 60 million federal consumer tax returns since 2000. TaxAct operates as the value player in itsmarket, with a mission to empower people to navigate the complexities of tax preparation with ease and accuracy at a fair price.We had four DDIY product offerings for consumers for tax year 2014: a free federal edition that handled simple and complex returns; the free federal editionplus a paid state edition; a "deluxe" product offering that contained all of the features of the free federal edition plus taxpayer phone support, import capabilities,return preparation assistance tools, and enhanced reporting; and an "ultimate" product offering that contained all of the deluxe offering features plus the ability tofile a state return. Our small business DDIY product offering consisted of easy-to-use interview-based tax filing solutions for small business owners. TaxAct offersits products with a price lock guarantee, whereby the price at the start of the tax return filing process holds until the return is filed, rather than pricing the product atthe time that the tax return is filed. We believe this price lock guarantee ensures price transparency and differentiates TaxAct from its competitors. In addition tothese core offerings, TaxAct also offers ancillary services such as refund payment transfer, data archive services, audit defense, stored value cards, and other add-on services. TaxAct's value proposition and established reputation attract value-conscious and unsatisfied customers away from competitor platforms and onto theTaxAct platform.TaxAct’s professional tax preparer software allows professional tax preparers to prepare and file individual and business returns for their clients. TaxActoffers flexible pricing and packaging options that help tax professionals save money by paying only for what they need. In addition, the professional tax preparersoftware includes valuable features that tax professionals4Table of Contentscount on to maximize their efficiency and productivity, including the option of entering data directly into tax forms, utilizing the question-and-answer interviewmethod to enter data, or easily toggling between the two data entry methods.Discontinued OperationsAs previously announced, we intend to divest our Search and Content and E-Commerce businesses in the first half of 2016 as part of the StrategicTransformation. As such, our InfoSpace and Monoprice businesses have been classified as discontinued operations.Our Search and Content business, InfoSpace, primarily offers search services to users of our owned and operated and distribution partners’ web properties, aswell as online content. Search services provided through our owned and operated web properties include services through websites such as Dogpile.com,WebCrawler.com, and HowStuffWorks.com. Search services provided to our distribution partners include services to a network of distribution partners through therespective web properties of those distribution partners, which are generally private-labeled and customized to address the unique requirements of each distributionpartner. Our Search and Content revenue primarily consists of advertising revenue generated through end-users clicking on paid listings included in the searchresult displays, as well as from advertisements appearing on our HowStuffWorks.com website. The paid listings, as well as algorithmic search results, are primarilysupplied by Google, Yahoo!, and Bing, whom we refer to as our “Search Customers.” See "Risks Related to our Discontinued Operations" in Part I Item 1A of thisreport for additional information regarding the risks associated with the concentration of our search customers and related revenue.Our E-Commerce business, Monoprice, is an online retailer of self-branded electronics and accessories to both consumers and businesses. Monoprice offersits products for sale through the www.monoprice.com website, where the majority of our E-Commerce revenue is derived, and fulfills those orders from ourwarehouses in Rancho Cucamonga, California and Hebron, Kentucky, the latter of which commenced operations in September 2015. We also sell our productsthrough reseller and marketplace agreements. Consumers are able to access and purchase products 24 hours a day from the convenience of a computer or a mobiledevice. Monoprice’s team of customer service representatives assists customers primarily by online chat or email. Nearly all sales are to customers located in theUnited States.Growth StrategyOur evolving growth strategy for HD Vest and TaxAct includes participating in favorable industry trends and executing growth strategies that we believe willresult in customer and advisor retention and growth beyond that of the broader markets in which we operate.Favorable Industry Trends•Wealth Management Industry Trends - We believe that HD Vest is and will be the beneficiary of several positive industry trends, including growth ofinvestable assets driven by baby boomers’ retirement accounts, a continued migration to independent advisor channels, and a continued shift towardhousehold use of financial advisors.•Tax Preparation Industry Trends - TaxAct participates in the consumer DDIY tax preparation solutions market, which is the fastest growing segment inthe tax preparation industry and is bolstered by a growing millennial population that continues to adopt technology-enabled financial solutions thatdrive value and ease in their everyday lives.Executing our Growth Strategies•Innovate Continuously - As emerging technology and market trends change the way people manage their financial lives, our solutions also evolve. Theretention and growth of our customer and advisor base are dependent, in part, upon our ability to deliver technology-enabled financial solutions thatoptimize user experience and capitalize on current technology.•Offer a Comprehensive Product Suite - The products and services offered by HD Vest and TaxAct constitute a comprehensive suite of financialsolutions. We believe that continued expansion of financial solutions, whether proprietary or third party, will be a source of growth for each business. Inaddition, the combination of HD Vest and TaxAct provides meaningful cross-selling opportunities for both businesses, further contributing to customerand advisor retention and growth.5Table of Contents•Continue to Provide Quality Customer Support, Education, and Training - A key element of our HD Vest business model is the ongoing education andtraining of tax professionals, which enables them to become financial advisors and effectively manage a growing wealth management practice. HD Vestprovides these tax professionals with the resources and support to build confidence and competence, enabling them to grow assets under administration.The importance of quality customer support and education also flows through to our TaxAct business, where a seasoned tax support team providessupport and education to consumers and tax professionals.Research and DevelopmentOur tax preparation products are delivered primarily via software and online platforms. Since the markets for software and online technology arecharacterized by rapid technological change, shifting customer needs and frequent new product introductions and enhancements, a continuous high level ofinvestment is required to innovate and quickly develop new products and services as well as enhance existing offerings. Our product development efforts arebecoming more important than ever as people and businesses are increasingly connected by technology and expect access to services at any place or time. Ourresearch and development expenses from the Tax Preparation business were $4.8 million in 2015 , $2.8 million in 2014 , and $2.6 million in 2013 . These amountsexclude any amounts spent on research and development by the HD Vest business prior to our acquisition of this business.SeasonalityOur Tax Preparation business is highly seasonal, with a significant portion of our annual revenue for such services earned in the first four months of our fiscalyear. We anticipate that the seasonal nature of that part of the businesses will continue in the foreseeable future.CompetitionWe face intense competition in all markets in which our businesses operate. Many of our competitors or potential competitors have substantially greaterfinancial, technical, and marketing resources, larger customer bases, longer operating histories, more developed infrastructures, greater brand recognition, betteraccess to vendors, and more established relationships. Our competitors may be able to adopt more aggressive pricing policies, develop and expand their productand service offerings more rapidly, adapt to new or emerging technologies more quickly, take advantage of acquisitions and other opportunities more readily,achieve greater economies of scale, and devote greater resources to the marketing and sale of their products and services than we can. For our businesses to besuccessful, we must be competitive in the Wealth Management and Tax Preparation markets, as described in more detail below.Wealth Management CompetitionAs a result of the HD Vest acquisition, we will face additional competition in the wealth management industry, which is a highly competitive global industry.We and our financial advisors will compete directly with a variety of financial institutions, including traditional wirehouses, independent broker-dealers, registeredinvestment advisors, asset managers, banks and insurance companies, and direct distributors. Mergers and acquisitions have resulted in consolidation in the wealthmanagement industry. As a result, many of our competitors may have greater financial resources, broader and deeper distribution capabilities, and a morecomprehensive offering of products and services. We and our financial advisors will compete directly with those companies for the provision of products andservices to clients, as well as for retention and hiring of financial advisors.We believe that our competitive position in the wealth management industry is a function of our ability to:•offer high-quality advice and competitive product pricing;•offer a value proposition (in terms of brand recognition, reputation, and financial advisor payouts) that issufficient to recruit and retain financial advisors;•offer products that are attractive to financial advisors and their clients;•negotiate competitive compensation arrangements with third-parties, including vendors, suppliers, and product sponsors;•develop and react to new technology, services and regulation in the financial services industry; and•put in place a sufficient support and service network required to support our financial advisors and clients.6Table of ContentsTax Preparation CompetitionOur TaxAct business operates in a very competitive marketplace. There are many competing software products and online services. Intuit’s TurboTax andH&R Block's products and services have a significant percentage of the software and online service market. Our TaxAct business must also compete with alternatemethods of tax preparation, including "pencil and paper" do-it-yourself return preparation by individual filers and storefront tax preparation services, includingboth local tax preparers and large chains such as H&R Block, Liberty, and Jackson Hewitt. Finally, our TaxAct business faces the risk that state or federal taxingagencies will offer software or systems to provide direct access for individual filers that will reduce the need for TaxAct’s software and services.We believe that our competitive position in the market for tax preparation software and services is a function of our ability to:•offer competitive pricing;•continue to offer high-quality, easy-to-use, and accessible software and services that are compelling to consumers;•market the software and services in a cost effective way; and•offer ancillary services that are attractive to users.Discontinued OperationsIn the online search market, we face competition from multiple sources, including our Search Customers. In particular, Google, Yahoo!, and Bing(Microsoft) collectively control a significant majority of the consumer-facing online search market serviced by our owned and operated sites and those of ourdistribution partners. Each of these three companies provides search results to our search services in addition to competing for Internet users. Our distributionpartners also compete with us for Internet users. We also compete with our Search Customers and other content providers for contracts with new and existingdistribution partners. Our E-Commerce business operates in a very competitive marketplace with low barriers to entry. Our competitors that offer similar productsinclude existing well-known brands that operate online e-commerce sites and offline retail stores, as well as new entrants to the e-commerce market.Privacy and Security of Customer Information and TransactionsOur TaxAct business is subject to various federal, state and international laws and regulations and to financial institution and healthcare providerrequirements relating to the privacy and security of the personal information of customers and employees. We are also subject to laws and regulations that apply tothe Internet, behavioral tracking and advertising, mobile applications and messaging, telemarketing, email activities, data hosting and retention, financial and healthinformation, and credit reporting. Additional laws in all of these areas are likely to be passed in the future, which could result in significant limitations on orchanges to the ways in which we can collect, use, host, store, or transmit the personal information and data of our customers or employees, communicate with ourcustomers, and deliver products and services, or may significantly increase our compliance costs. As our business expands to new industry segments and new usesof data that are regulated for privacy and security, or to countries outside the United States that have strict data protections laws, our compliance requirements andcosts will increase.Through a privacy policy framework designed to be consistent with globally recognized privacy principles, we comply with United States federal and othercountry guidelines and practices to help ensure that customers and employees are aware of, and can control, how we use information about them. The TaxAct.comwebsite and its online products have been certified by TRUSTe, an independent organization that operates a website and online product privacy certificationprogram representing industry standard practices to address users’ and regulators’ concerns about online privacy. We also use privacy statements to provide noticeto customers of our privacy practices, as well as provide them the opportunity to furnish instructions with respect to use of their personal information. Weparticipate in industry groups whose purpose is to develop or shape industry best practices, and to influence public policy for privacy and security.To address security concerns, we use security safeguards to help protect the systems and the information customers give to us from loss, misuse andunauthorized alteration. Whenever customers transmit sensitive information, such as credit card information or tax return data, through one of our websites orproducts, we use industry standards to encrypt the data as it is transmitted to us. We work to protect our systems from unauthorized internal or external accessusing numerous commercially available computer security products as well as internally developed security procedures and practices.7Table of ContentsHD Vest’s subsidiaries are subject to privacy regulation under federal and state law, which has been, and will continue to be, an area of focus for regulators.Governmental RegulationBlucora is a publicly traded company that is subject to Securities and Exchange Commission ( “SEC” ) and NASDAQ Global Select Market rules andregulations regarding public disclosure, financial reporting, internal controls, and corporate governance. The adoption of the Sarbanes-Oxley Act of 2002, as wellas the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( “Dodd-Frank Act” ), have significantly expanded the nature andscope of these rules and regulations.Our Wealth Management and Tax Preparation segments are subject to federal and state government requirements, including regulations related to consumerprotection, user privacy, security, pricing, taxation, intellectual property, labor, advertising, broker-dealers, securities, investment advisors, asset management,insurance, listing standards and product and services quality. In addition, our Wealth Management business is subject to certain additional financial industryregulations and supervision, including by the SEC, the Financial Industry Regulatory Authority ( “ FINRA ” ), state securities and insurance regulators, and otherregulatory authorities. We also offer certain other products and services to small businesses and consumers, which are also subject to regulatory requirements. Aswe expand our products and services, both domestically and internationally, we may become subject to additional government regulation. Further, regulators mayadopt new laws or regulations or their interpretation of existing laws or regulations may differ from ours or expand to cover additional products and services. Theseincreased regulatory requirements could impose higher regulatory compliance costs, limitations on our ability to provide some services in some states or countries,and liabilities that might be incurred through lawsuits or regulatory penalties. See the section entitled "Risks Common to our Businesses" in Part I Item 1A of thisreport for additional information regarding the potential impact of governmental regulation on our operations and results.We are subject to federal and state laws and government regulations concerning employee safety and health and environmental matters. The OccupationalSafety and Health Administration, the Environmental Protection Agency, and other federal and state agencies have the authority to promulgate regulations that mayhave an impact on our operations.Intellectual PropertyOur success depends significantly upon our technology and intellectual property rights. We seek to protect such rights and the value of our corporate brandsand reputation through a variety of measures, including: domain name registrations, confidentiality and intellectual property assignment agreements withemployees and third parties, protective contractual provisions, and laws regarding copyrights, patents, trademarks, and trade secrets. We hold multiple issuedpatents and registered trademarks in the United States and in various foreign countries and we apply for additional patents and trademarks as business needsrequire. We may not be successful in obtaining issuance or registration for such applications or in maintaining existing patents and trademarks. In addition, issuedpatents and registered marks may not provide us with any competitive advantages. We may be unable to adequately or cost-effectively protect or enforce ourintellectual property rights, and failure to do so could weaken our competitive position and negatively impact our business and financial results. If others claim thatour products infringe their intellectual property rights, we may be forced to seek expensive licenses, re-engineer our products, engage in expensive and time-consuming litigation, or stop marketing and licensing our products. See the section entitled "Risks Common to our Businesses" in Part I Item 1A of this report foradditional information regarding protecting and enforcing intellectual property rights by us and third parties against us.EmployeesAs of December 31, 2015 , we had 772 full-time employees, of which 298 were part of our Search and Content and E-Commerce businesses. None of ouremployees are represented by a labor union, and we consider employee relations to be positive. There is significant competition for qualified personnel in theindustries in which we operate, particularly for software development and other technical staff. We believe that our future success will depend in part on ourcontinued ability to hire and retain qualified personnel.AcquisitionsOur acquisition of HD Vest closed on December 31, 2015 . TaxAct acquired SimpleTax Software Inc. (“ SimpleTax ”) on July 2, 2015 and BalanceFinancial, Inc. (“ Balance Financial ”) on October 4, 2013 . For further detail on these acquisitions, see " Note 3: Business Combinations " of the Notes toConsolidated Financial Statements in Part II Item 8 of this report.8Table of ContentsCompany Internet Site and Availability of SEC FilingsOur corporate website is located at www.blucora.com. We make available on that site, as soon as reasonably practicable, our Annual Reports on Form 10-K,Quarterly Reports on Form 10-Q, proxy statements, Current Reports on Form 8-K, other reports filed with or furnished to the U.S. Securities and ExchangeCommission (the “ SEC ”), as well as any amendments to those filings. Our SEC filings, as well as our Code of Ethics and Conduct and other corporate governancedocuments, can be found in the Investor Relations section of our site and are available free of charge. Information on our website is not part of this Annual Reporton Form 10-K. In addition, the SEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regardingus and other issuers that file electronically with the SEC.ITEM 1A. Risk FactorsR ISKS A SSOCIATED W ITH OUR S TRATEGIC T RANSFORMATIONAs a result of the HD Vest Acquisition, we may face significant disruptions, business conflicts, inefficiencies, and other related risks.On October 14, 2015, we announced that Blucora had entered into a definitive agreement to acquire HDV Holdings, Inc., the holding company for the groupof companies that comprise the Wealth Management business, for $611.9 million , including cash acquired and subject to adjustments (the “HD Vest Acquisition”). For further discussion of the terms of the HD Vest Acquisition, see the "Strategic Transformation" section in Part II Item 7 and " Note 3: Business Combinations" of the Notes to Consolidated Financial Statements in Part II Item 8 of this annual report. We expect to face certain risks in connection with the HD VestAcquisition, including the following:•Uncertainty and disruptions may negatively impact HD Vest’s relationships with its employees, its financial advisors, or those advisors’ relationshipswith their clients, which could materially harm HD Vest's financial condition and results of operations;•We may fail to realize the anticipated benefits of the HD Vest Acquisition (including the expected operational, revenue, and cost synergies with our TaxPreparation business and the level of revenue and profitability growth that we are expecting), whether attributable to regulatory limitations, operationalrealities, or otherwise;•We may face difficulties, including loss of key employees, disruptions in our ongoing operations, and diversion of our and HD Vest’s management’sattention from ongoing operations and opportunities, in integrating the operations, technologies, products, services, IT systems, controls, and policiesand procedures of HD Vest and in upgrading our internal control over financial reporting and disclosure controls and procedures to incorporate the HDVest operations;•The failure to retain key management responsible for the operations of HD Vest could materially and adversely impact those operations, particularlydue to the fact that our management team at the corporate level lacks significant experience in the financial services industry;•Even if we retain HD Vest’s key management and other employees, we will need to attract and retain additional management resources to continueimplementing our change in strategy to a company focused on the technology-enabled financial solutions market;•The market for the financial advisors upon whom HD Vest relies is extremely competitive, and failing to retain these individuals would undermine theanticipated benefits of the HD Vest Acquisition, and could also significantly increase our recruiting and retention costs;•Our management’s attention may be diverted from the daily operations of our existing businesses and from the execution of our plans to divest theInfoSpace and Monoprice businesses;•Our financial results may be materially and adversely impacted by cash expenses and non-cash charges incurred in connection with the HD VestAcquisition or in the future if goodwill or other intangible assets we acquired in the HD Vest Acquisition become impaired in the future;•Notwithstanding the due diligence investigation we performed in connection with the HD Vest Acquisition, HD Vest may have liabilities, losses, orother exposures (including regulatory risks) for which we do not have adequate insurance coverage, indemnification, or other protection; and•We incurred substantial additional indebtedness to finance the HD Vest Acquisition, which will increase our vulnerability to increased debt servicerequirements should interest rates rise, reducing the amount of expected cash9Table of Contentsflow available for other purposes, including capital expenditures and acquisitions, and limiting our flexibility in planning for, or reacting to, changes inour businesses and industries.Our financial and operating results may suffer if we are unsuccessful in integrating HD Vest, and any new businesses or technologies associatedwith HD Vest may not be complementary to our current operations or leverage our current infrastructure and operational experience.The process of integrating HD Vest and technologies associated with it involves numerous risks that could materially and adversely affect our results ofoperations or stock price, including:•expenses related to the acquisition process and impairment charges to goodwill and other intangible assets related to the acquisition;•diversion of management’s or other key personnel’s attention from current operations and other business concerns and potential strain on financial andmanagerial controls and reporting systems and procedures;•disruption of our ongoing businesses, including impairment of existing relationships with employees, distributors, suppliers, or customers;•difficulties in assimilating the operations, products, technology, information systems, and management and other personnel of HD Vest that result inunanticipated allocation of resources, costs, or delays;•the dilutive effect on earnings per share as a result of issuances of stock, incurring operating losses, and the amortization of intangible assets for HDVest;•stock volatility due to investors' uncertainty regarding the value of HD Vest;•higher debt service costs and a decline in stockholder equity in the event of poor financial performance;•diversion of capital from other uses;•failure to achieve the anticipated benefits of the acquisition in a timely manner, or at all; and•adverse outcome of litigation matters or other contingent liabilities assumed in or arising out of the acquisition.Developing or acquiring a business or technology, and then integrating it with our other operations, is complex, time-consuming, and expensive. Thesuccessful integration of an acquisition requires, among other things, that we: retain key personnel; maintain and support preexisting supplier, distribution, andcustomer relationships; and integrate accounting and support functions. The complexity of the technologies and operations being integrated and the disparatecorporate cultures and/or industries being combined may increase the difficulties of integrating an acquired technology or business.We may face significant challenges in our plans to divest our InfoSpace and Monoprice businesses.As part of our Strategic Transformation announcement, we outlined plans to divest our InfoSpace and Monoprice businesses, because they no longer alignwith our new strategic focus on the technology-enabled financial solutions industry. These planned divestitures pose risks and challenges that could materially andadversely impact our business, financial condition, and results of operations, including:•The uncertainty resulting from our announced plans to divest InfoSpace and Monoprice could cause significant disruptions in their businesses,including loss of key Search Customers, distribution partners, and suppliers or employees, that could harm the business, financial condition, and resultsof operations of our Search and Content and E-Commerce segments and make it difficult to complete the divestitures;•Efforts to divest InfoSpace and Monoprice may divert our management’s attention from our ongoing operations and the integration of HD Vest;•We may be unable to identify suitable buyers of either business on acceptable terms, or at all;•There are significant risks and uncertainties in the sales process, including the timing and uncertainty of completion of any transaction and thefulfillment of closing conditions, some of which may be outside of our control;•Any significant delay in the completion of these divestitures, or the failure to complete the divestitures, may negatively impact our ability to implementour new strategic focus, delay repayment of indebtedness, negatively impact our ability to achieve our previously announced plans to reduce corporateoperating expenses, and may impact our capital allocation priorities;10Table of Contents•Our results of operations may be negatively impacted by cash expenses and non-cash charges incurred in connection with the planned divestitures ofInfoSpace and Monoprice, including retention and severance costs, transaction expenses, and asset impairment charges, which expenses and chargescould be substantial whether or not we are able to divest these businesses; and•Even if we succeed in divesting InfoSpace or Monoprice, the terms of any transaction may require us to retain certain liabilities or provide thepurchaser with certain indemnification protection that could expose us to continued risks of these businesses.R ISKS A SSOCIATED W ITH OUR B USINESSESOur financial condition and results of operations may be materially and adversely affected by market fluctuations and by economic, political, andother factors.Our financial condition and results of operations have been, and may in the future be, materially and adversely affected by market conditions and byeconomic and other factors. Such factors, which can be global, national or local in nature, include: political, social, economic and market conditions; theavailability and cost of capital (whether debt or equity); the level and volatility of equity prices, commodity prices and interest rates, currency values and othermarket indices; technological changes and events; U.S. and foreign government fiscal and tax policies; U.S. and foreign government ability, real or perceived, toavoid defaulting on government securities; inflation; investor sentiment and confidence in the financial markets; decline and stress or recession in the U.S. andglobal economies generally; terrorism and armed conflicts; and natural disasters such as weather catastrophes and widespread health emergencies. Furthermore,changes in consumer economic variables, such as the number and size of personal bankruptcy filings, the rate of unemployment, decreases in property values, andthe level of consumer confidence and consumer debt, may substantially affect consumer loan levels and credit quality, which, in turn, could impact client activity inall of our businesses. These factors also may have an impact on our ability to achieve our strategic objectives, including our divestiture of InfoSpace andMonoprice.In particular, because the majority of our Tax Preparation business revenue and all of our Wealth Management business revenue is derived from sales withinthe U.S., economic conditions in the U.S. have an even greater impact on us than companies with a more diverse international presence. Challenging economictimes could cause potential new customers not to purchase or to delay purchasing of our products and services, and could cause our existing customers todiscontinue purchasing or delay upgrades of our existing products and services, thereby negatively impacting our revenues and future financial results. Pooreconomic conditions and high unemployment have caused, and could in the future cause, a significant decrease in the number of tax returns filed, which may havea significant effect on the number of tax returns we prepare and file. In addition, weakness in the end-user consumer and small business markets could negativelyaffect the cash flow of our distributors and resellers who could, in turn, delay paying their obligations to us, which could increase our credit risk exposure and causedelays in our recognition of revenue or future sales to these customers. Any of these events could materially harm our business and our future financial results.In addition, our Wealth Management business operates in the U.S. and global capital and credit markets and derives a substantial portion of its revenue fromfees based on client assets. Therefore, fluctuations in the U.S. and global equity and debt markets can have a significant impact on HD Vest’s revenues andearnings. As a result, these factors could materially and adversely impact our financial condition and results of operations.We believe that investment performance is an important factor in the success of our Wealth Management business. Poor investment performance couldimpair our revenues and earnings, as well as our prospects for growth. Clients do not have long-term obligations to us and can terminate their relationships with usor our financial advisors at will. Our clients can also reduce the aggregate amount of their assets managed by us or shift their funds to other types of accounts withdifferent rate structures, for any number of reasons, including investment performance, changes in prevailing interest rates, changes in investment preferences,changes in our (or our financial advisors’) reputation in the marketplace, changes in client management or ownership, loss of key investment managementpersonnel and financial market performance. A reduction in managed assets, and the associated decrease in revenues and earnings, could have a material adverseeffect on our business, financial condition, and financial results.Future revenue growth depends upon our ability to adapt to technological change and successfully introduce new and enhanced products andservices.The tax preparation and wealth management industries are characterized by rapidly changing technology, evolving industry standards, and frequent newproduct introductions. Our competitors in such industries offer new and enhanced11Table of Contentsproducts and services every year. Consequently, client expectations are constantly changing. We must successfully innovate and develop or offer new products andfeatures to meet evolving client needs and demands, while continually updating our technology infrastructure. We must devote significant resources to continue todevelop our skills, tools, and capabilities in order to capitalize on existing and emerging technologies. Our inability to quickly and effectively innovate ourproducts, services, and infrastructure could harm our business and financial results.Our Tax Preparation business also faces potential competition from the public sector, where we face the risk of federal and state taxing authorities developingsoftware or other systems to facilitate tax return preparation and electronic filing at no charge to taxpayers. These or similar programs may be introduced orexpanded in the future, which may cause us to lose customers and revenue. Although the Free File Alliance has kept the federal government from being a directcompetitor to our tax offerings, we anticipate that governmental encroachment at both the federal and state levels may present a continued competitive threat to ourbusiness for the foreseeable future. The current agreement with the Free File Alliance is scheduled to expire in October 2020.Our online tax preparation products and services have historically been provided through desktop computers, but the number of people who access similarofferings through mobile devices has increased dramatically in the past few years. We have limited experience to date in mobile platform development, and ourexisting user experience may not be compelling on mobile devices. Given the speed at which new devices and platforms are being released, it is difficult to predictthe problems we may encounter in developing versions of our products and services for use on newly developed devices, and we may need to devote significantresources to the creation, support, and maintenance of new user experiences. If we are slow to develop products and services that are compatible with these newdevices, particularly if we cannot do so as quickly as our competitors, our market share will decline. In addition, such new products and services may not succeedin the marketplace, resulting in lost market share, wasted development costs, and damage to our brands.If we are unable to develop, manage, and maintain critical third party business relationships for our Tax Preparation and Wealth Managementbusinesses, those businesses may be materially and adversely affected.Our Tax Preparation and Wealth Management businesses are dependent on the strength of our business relationships and our ability to continue to develop,maintain, and leverage new and existing relationships. We rely on various third party partners, including software and service providers, suppliers, vendors,distributors, contractors, financial institutions, and licensing partners, among others, in many areas of these businesses to deliver our services and products. Incertain instances, the products or services provided through these third party relationships may be difficult to replace or substitute, depending on the level ofintegration of the third party’s products or services into, or with, our offerings and/or the general availability of such third party’s products and services. Inaddition, there may be few or no alternative third party providers or vendors in the market. The failure of third parties to provide acceptable and high qualityproducts, services, and technologies or to update their products, services, and technologies may result in a disruption to our business operations, which maymaterially reduce our revenues and profits, cause us to lose customers and clients, and damage our reputation. Alternative arrangements and services may not beavailable to us on commercially reasonable terms or we may experience business interruptions upon a transition to an alternative partner. Our Wealth Management business distributes certain investment and insurance products through distribution agreements with third-party financialinstitutions, including banks, mutual funds, and insurance companies. These products are sold by our financial advisors, who are independent contractors.Maintaining and deepening relationships with these unaffiliated distributors and financial advisors is an important part of our growth strategy because strong third-party distribution arrangements enhance our ability to market our products and increase our assets under management, revenues, and profitability. There can be noassurance that the distribution and financial advisor relationships we have established will continue. Our distribution partners and financial advisors may cease tooperate, consolidate, institute cost-cutting efforts, or otherwise terminate their relationship with us. Any such reduction in access to third-party distributors andfinancial advisors may have a material adverse effect on our ability to market our products and to generate revenue in our Wealth Management segment.Access to investment and insurance product distribution channels is subject to intense competition due to the large number of competitors and products in thebroker-dealer, investment advisory and insurance industries. Relationships with distributors are subject to periodic negotiation that may result in increaseddistribution costs and/or reductions in the amount of revenue we realize based on sales of particular products or client assets. In addition, regulatory changes maynegatively impact our revenues and profits related to particular products or services. Any increase in the costs to distribute our products or reduction in the type oramount of products made available for sale, or revenue associated with those products, may have a material adverse effect on our revenues and profitability.12Table of ContentsThe Tax Preparation and Wealth Management markets are very competitive, and failure to effectively compete will materially and adversely affectour financial results.Our Tax Preparation business operates in a very competitive marketplace. There are many competing software products and online services. Intuit’sTurboTax and H&R Block’s products and services have a significant percentage of the software and online service market. Our Tax Preparation business must alsocompete with alternate methods of tax preparation, including "pencil and paper" do-it-yourself return preparation by individual filers and storefront tax preparationservices, including both local tax preparers and large chains such as H&R Block, Liberty, and Jackson Hewitt. Finally, our Tax Preparation business faces the riskthat state or federal taxing agencies will offer software or systems to provide direct access for individual filers that will reduce the need for TaxAct’s software andservices. Our financial results may materially suffer if we cannot continue to offer software and services that have quality and ease-of-use that are compelling toconsumers; market the software and services in a cost-effective manner; offer ancillary services that are attractive to users; and develop the software and services ata low enough cost to be able to offer them at a competitive price point.The wealth management industry in which HD Vest operates is highly competitive, and we may not be able to maintain our clients, financial advisors,distribution network, or the terms on which we provide our products and services. HD Vest competes based on a number of factors, including name recognition,service, the quality of investment advice, investment performance, technology, product offerings and features, price, and perceived financial strength. Competitorsin the wealth management industry include broker-dealers, banks, asset managers, insurers, and other financial institutions. Many of these competitors have greatermarket share, offer a broader range of products and have greater financial resources. In addition, over time certain sectors of the wealth management industry havebecome considerably more concentrated, as financial institutions involved in a broad range of financial services have been acquired by or merged into other firms.This consolidation could result in our competitors gaining greater resources, and we may experience pressures on our pricing and market share as a result of thesefactors and as some of our competitors seek to increase market share by reducing prices.Our operation systems and network infrastructure is subject to significant and constantly evolving cybersecurity or other technological risks, andthe security measures that we have implemented to secure confidential and personal information may be breached; a potential breach may pose risks tothe uninterrupted operation of our systems, expose us to mitigation costs, litigation, investigation and penalties by authorities, claims by persons whoseinformation was disclosed, and damage to our reputation.We collect and retain certain sensitive personal data. Our Tax Preparation and Wealth Management businesses collect, use, and retain large amounts ofconfidential personal and financial information from their customers and clients, including information regarding income, assets, family members, credit cards, taxreturns, bank accounts, social security numbers, and healthcare. Maintaining the integrity of these systems and networks is critical to the success of our businessoperations, including the retention of our customers, clients and advisors, and to the protection of our proprietary information and our customers' and clients’personal information. A major breach of our systems or those of our third-party service providers may have materially negative consequences for our businesses,including possible fines, penalties and damages, reduced demand for our services, harm to our reputation and brands, further regulation and oversight by federal orstate agencies, and loss of our ability to provide financial transaction services or accept and process customer credit card orders or tax returns. We may detect, orwe may receive notices from customers or clients or public or private agencies that they have detected, vulnerabilities in our servers, our software, or third-partysoftware components that are distributed with our products. The existence of vulnerabilities, even if they do not result in a security breach, may harm customer andclient confidence and require substantial resources to address, and we may not be able to discover or remediate such security vulnerabilities before they areexploited.We are subject to laws, regulations, and industry rules relating to the collection, use, and security of user data. We expect regulation in this area to increase.As a result of our current data protection policies and practices may not be sufficient and thus may require modification. New regulations may require notificationto customers, clients, or employees of a security breach, restrict our use of personal information, and hinder our ability to acquire new, or market to, existingcustomers and clients. As our business continues to expand to new industry segments that may be more highly regulated for privacy and data security, ourcompliance requirements and costs may increase. We have incurred, and may continue to incur, significant expenses to comply with privacy and security standardsand protocols imposed by law, regulation, industry standards, and contractual obligations.In addition, hackers may develop and deploy viruses, worms, and other malicious software programs that can be used to attack our offerings. Although weutilize network and application security measures, internal controls, and physical security procedures to safeguard our systems, there can be no assurance that asecurity breach, intrusion, or loss or theft of personal information will not occur. Any such incident may materially harm our business, reputation, and futurefinancial results and may require us to expend significant resources to address these problems, including notification under data privacy regulations. In addition,our employees (including temporary and seasonal employees) and contractors may have access to sensitive and13Table of Contentspersonal information of our customers, clients, and employees. While we conduct background checks of our employees and these other individuals and limit accessto systems and data, it is possible that one or more of these individuals may circumvent these controls, resulting in a security breach. In addition, we rely on thirdparty vendors to host certain of our sensitive and personal information and data. While we conduct due diligence on these third party partners with respect to theirsecurity and business controls, we may not have the ability to effectively monitor or oversee the implementation of these control measures, and, in any event,individuals or third parties may be able to circumvent and/or exploit vulnerabilities that may exist in these security and business controls, resulting in a loss ofsensitive and personal customer, client, or employee information and data.Despite the measures we have taken and may in the future take to address and mitigate cybersecurity and technology risks, we cannot assure that our systemsand networks will not be subject to breaches or interference. Any such event may result in operational disruptions as well as unauthorized access to or thedisclosure or loss of our proprietary information or our customers’ and clients’ personal information, which in turn may result in legal claims, regulatory scrutinyand liability, reputational damage, the incurrence of costs to eliminate or mitigate further exposure, the loss of customers, clients, or advisors, or other damage toour business. While we maintain cyber liability insurance that provides both third-party liability and first-party liability coverages, this insurance is subject toexclusions and may not be sufficient to protect us against all losses. In addition, the trend toward broad consumer and general public notification of such incidentscould exacerbate the harm to our business, financial condition, or results of operations. Even if we successfully protect our technology infrastructure and theconfidentiality of sensitive data, we may incur significant expenses in connection with our responses to any such attacks as well as the adoption, implementation,and maintenance of appropriate security measures. We could also suffer harm to our business and reputation if attempted security breaches are publicized. Wecannot be certain that advances in criminal capabilities, discovery of new vulnerabilities, attempts to exploit vulnerabilities in our systems, data thefts, physicalsystem or network break-ins, inappropriate access, or other developments will not compromise or breach the technology or other security measures protecting thenetworks and systems used in connection with our businesses.Our website and transaction management software, data center systems, or the systems of third-party co-location facilities and cloud serviceproviders could fail or become unavailable or otherwise be inadequate, which could materially harm our reputation and result in a material loss ofrevenues and current or potential customers and clients.Any system interruptions that result in the unavailability or unreliability of our websites, transaction processing systems, or network infrastructure couldmaterially reduce our revenue and impair our ability to properly process transactions. We use both internally developed and third-party systems, including cloudcomputing and storage systems, for our online services and certain aspects of transaction processing. Some of our systems are relatively new and untested and thusmay be subject to failure or unreliability. Any system unavailability or unreliability may cause unanticipated system disruptions, slower response times,degradation in customer satisfaction, additional expense, or delays in reporting accurate financial information.Our data centers and cloud service could be susceptible to damage or disruption, which could have a material adverse effect on our business, financialcondition, and financial results. Our Tax Preparation and Wealth Management businesses have disaster recovery centers but if their primary data centers fail andthose disaster recovery centers do not fully restore the failed environments, our business will suffer. In particular, if such interruption occurs during the tax season,the revenue of our Tax Preparation business would be materially and adversely impacted.Our systems and operations, and those of our third-party service providers, could be damaged or interrupted by fire, flood, earthquakes, other naturaldisasters, power loss, telecommunications failure, internet breakdown, break-in, human error, software bugs, hardware failures, malicious attacks, computerviruses, computer denial of service attacks, terrorist attacks, or other events beyond our control. Such damage or interruption may affect internal and externalsystems that we rely upon to provide our services, take and fulfill customer orders, handle customer service requests, and host other products and services. Duringthe period in which services are unavailable, we will be unable or severely limited in our ability to generate revenues, and we may also be exposed to liability fromthose third parties to whom we provide services. We could face significant losses as a result of these events, and our business interruption insurance may not beadequate to compensate us for all potential losses.A drop in our investment performance could materially and adversely affect our revenues and profitability.Investment performance is a key competitive factor for our Wealth Management segment. Strong investment performance helps to increase client retentionand generate sales of products and services. There can be no assurance as to how future investment performance will compare to our competitors, and historicalperformance is not indicative of future returns. Any drop or perceived drop in investment performance, on an absolute or relative basis, could cause a decline insales of mutual funds and other investment products, an increase in redemptions and the termination of asset management relationships. These14Table of Contentsimpacts may reduce our aggregate amount of assets under management and reduce management fees. Poor investment performance could also adversely affect ourability to expand the distribution of our products through independent financial advisors.Restrictions on or litigation regarding financial products may materially harm our financial results.In our Tax Preparation business, we generate revenue from certain financial products related to our tax preparation software and services. These productsinclude prepaid debit cards on which a tax filer may receive his or her tax refund and the ability of certain of our users to have the fees for our services deductedfrom their tax refund. Any regulation of these products by state or federal governments, or any competing products offered by state and federal tax collectionagencies, could materially and adversely impact our revenue from these financial products. In addition, litigation brought by consumers or state or federal agenciesrelating to these products may result in additional restrictions on the offering of these products. To the extent that any such additional restrictions or legal claimsrestrict our ability to offer such products, our financial results may materially suffer.Our Wealth Management business offers products sponsored by third parties, including but not limited mutual funds, insurance, annuities and alternativeinvestments. These products are subject to complex regulations that change frequently. Although HD Vest has controls in place to facilitate compliance with suchregulations, there can be no assurance that its interpretation of the regulations will be consistent with various regulators’ interpretations, that its procedures will beviewed as adequate by regulatory examiners, or that the operating subsidiaries will be deemed to be in compliance with regulatory requirements in all materialrespects. If products sold by the firm were not to perform as anticipated due to market factors or otherwise, or if the product sponsor became insolvent or isotherwise unable to meet its obligations, this would likely result in material litigation and regulatory action against HD Vest relating to its sales of those products.Registered investment advisors have fiduciary obligations that require us and our advisors to act in the best interests of our clients and to disclose anymaterial conflicts of interest. We may face liabilities for actual or alleged breaches of legal duties to clients with respect to the suitability of the financial productswe make available in our open architecture product platform or the investment advice of our financial advisors.Unanticipated changes in income tax rates, deduction types, or taxation structure may materially and adversely affect our Tax Preparationbusiness.Changes in the way that state and federal governments structure their taxation regimes may materially and adversely affect our financial results. Theintroduction of a simplified or flattened taxation structure may make our services less necessary or attractive to individual filers. We also face risk from thepossibility of increased complexity in taxation structures, which may encourage some of our customers to seek professional tax advice instead of using oursoftware or services. In the event that such changes to tax structures cause us to lose market share, our results may materially suffer.If our Tax Preparation business fails to process transactions effectively or fails to adequately protect against disputed or potential fraudulentactivities, our revenue and earnings may be materially harmed.Our Tax Preparation business processes a significant volume and dollar value of transactions on a daily basis, particularly during tax season. Due to the sizeand volume of transactions that we handle, effective processing systems and controls are essential to ensure that transactions are handled appropriately. Despite ourefforts, it is possible that we may make errors or that fraudulent activity may affect our services. In addition to any direct damages and fines that may result fromany such problems, which may be substantial, a loss of confidence in our controls may materially harm our business and damage our brand. The systemssupporting our Tax Preparation business are comprised of multiple technology platforms, some of which are difficult to scale. If we are unable to effectivelymanage our systems and processes, we may be unable to process customer data in an accurate, reliable, and timely manner, which may materially harm ourbusiness.15Table of ContentsThe seasonality of our Tax Preparation business requires a precise development and release schedule and any delays or issues with accuracy orquality may damage our reputation and materially harm our future financial results.Our tax preparation software and online service must be ready to launch in final form near the beginning of each calendar year to take advantage of the fulltax season. We must update the code for our software and service on a precise schedule each year to account for annual changes in tax laws and regulations andensure that the software and service are accurate. Delayed and unpredictable changes to federal and state tax laws and regulations can cause an already tightdevelopment cycle to become even more challenging. If we are unable to meet this precise schedule and we launch our software and service late, we risk losingcustomers to our competitors. If we cannot develop our software with a high degree of accuracy and quality, we risk errors in the tax returns that are generated.Such errors could result in loss of reputation, lower customer retention, or legal claims, fees, and payouts related to the warranty on our software and service.Risk management policies and procedures for our Tax Preparation and Wealth Management business may not be fully effective in identifying ormitigating risk exposure in all market environments or against all types of risk, including employee and financial advisor misconduct.We are subject to the risks of errors and misconduct by our employees and financial advisors, such as fraud, non-compliance with policies, recommendingtransactions that are not suitable, and improperly using or disclosing confidential information. Although we have internal controls in place, these issues are difficultto detect in advance and deter, and could materially harm our business, results of operations or financial condition. We are further subject to the risk ofnonperformance or inadequate performance of contractual obligations by third-party vendors of products and services that are used in our businesses. Managementof operational, legal and regulatory risks requires, among other things, policies and procedures to record properly and verify a large number of transactions andevents, and these policies and procedures may not be fully effective in mitigating our risk exposure in all market environments or against all types of risk.Insurance and other traditional risk-shifting tools may be held by or available to us in order to manage certain exposures, but they are subject to terms such asdeductibles, coinsurance, limits and policy exclusions, as well as the risk of counterparty denial of coverage, default or insolvency.Increased government regulation of our business may harm our operating results.We are subject to federal, state, and local laws and regulations that affect our activities, including, without limitation, areas of labor, advertising, tax, financialservices, data privacy and security requirements, digital content, consumer protection, real estate, billing, promotions, quality of services, intellectual propertyownership and infringement, anti-corruption, foreign exchange controls and cash repatriation restrictions, anti-competition, environmental, health, andsafety. There have been significant new regulations and heightened focus by the government on many of these areas, as well as in areas such as insurance andhealthcare (including, for example, the Affordable Care Act). As we complete our Strategic Transformation and expand our products and services and revise ourbusiness models, we may become subject to additional government regulation or increased regulatory scrutiny. Regulators may adopt new laws or regulations ortheir interpretation of existing laws or regulations may differ from ours as well as the laws of other jurisdictions in which we operate. These regulatoryrequirements could impose significant limitations, require changes to our business, require notification to customers, clients, or employees of a security breach,restrict our use of personal information, or cause changes in customer purchasing behavior that may make our business more costly, less efficient, or impossible toconduct, and may require us to modify our current or future products or services, which may materially harm our future financial results.The tax preparation industry continues to receive heightened attention from federal and state governments. New legislation, regulation, public policyconsiderations, changes in the cybersecurity environment, litigation by the government or private entities, or new interpretations of existing laws may result ingreater oversight of the tax preparation industry, restrict the types of products and services that we can offer or the prices we can charge, or otherwise cause us tochange the way we operate our Tax Preparation business or offer our tax preparation products and services. We may not be able to respond quickly to suchregulatory, legislative and other developments, and these changes may in turn increase our cost of doing business and limit our revenue opportunities. In addition,if our practices are not consistent with new interpretations of existing laws, we may become subject to lawsuits, penalties, and other liabilities that did notpreviously apply. We are also required to comply with a variety of state revenue agency standards in order to successfully operate our tax preparation andelectronic filing services. Changes in state-imposed requirements by one or more of the states, including the required use of specific technologies or technologystandards, may significantly increase the costs of providing those services to our customers and may prevent us from delivering a quality product to our customersin a timely manner and at an acceptable price.Our Wealth Management business is subject to certain additional financial industry regulations and supervision, including by the SEC, FINRA, statesecurities and insurance regulators, and other regulatory authorities. Our failure to comply with the16Table of Contentslaws, rules, and regulations promulgated by federal regulatory bodies and the regulatory authorities in each of the states and other jurisdictions in which we dobusiness could result in the restriction of the ongoing conduct or growth, or even liquidation of, parts of our business and otherwise materially impact our financialcondition, results of operations, and liquidity. These regulatory authorities continuously review legislative and regulatory initiatives and may adopt new or revisedlaws, regulations, or interpretations, and there can also be no assurance that other federal or state agencies will not attempt to further regulate our business. TheDodd-Frank Act, enacted into law in 2010, called for sweeping changes in the supervision and regulations of the wealth management industry. Regulatorsimplementing the Dodd-Frank Act have adopted, proposed to adopt, and will in the future adopt regulations that we expect will materially impact the manner inwhich we will market HD Vest products and services, manage HD Vest operations, and interact with regulators.In addition, the Department of Labor ( “DOL” ) has proposed regulations seeking to change the definition of who is a fiduciary under the EmployeeRetirement Income Security Act of 1974, as amended ( “ERISA” ), and how such advice must be provided to account holders in ERISA plans and individualretirement accounts ( “IRAs” ). These regulations are expected to focus on conflicts of interest related to recommendations made by financial advisors to clientsholding qualified accounts and also on how financial advisors are able to solicit rollovers. IRAs make up a majority of HD Vest's assets under management andadministration. We cannot predict whether or when the regulations may be finalized, or how any final regulations may differ from the previously proposedregulations. DOL recently sent the regulations to the Office of Management and Budget for review, which could mean final regulations are imminent. The finalregulations may negatively impact how we receive fees, how we compensate our advisors, how we are able to retain advisors, and how we design our investmentproducts and services for accounts covered by the rule, any of which could materially and adversely impact our results of operations.Our ability to comply with all applicable laws, rules and regulations, and interpretations is largely dependent on our establishment and maintenance ofcompliance, audit, and reporting systems and procedures, as well as our ability to attract and retain qualified compliance, audit, and risk management personnel.While we have adopted systems, policies, and procedures reasonably designed to comply or facilitate compliance with all applicable laws, rules and regulations,and interpretations, these systems, policies, and procedures may not be fully effective. There can be no assurance that we will not be subject to investigations,claims, or other actions or proceedings by regulators or third-parties with respect to our past or future compliance with applicable laws, rules, and regulations, theoutcome of which may have a material adverse effect on our financial condition and results of operations.HD Vest distributes its products and services through financial advisors who affiliate with the firm as independent contractors. There can be no assurance thatlegislative, judicial, or regulatory (including tax) authorities will not introduce proposals or assert interpretations of existing rules and regulations that wouldchange, or at least challenge, the classification of our financial advisors as independent contractors. Although we believe we have properly classified our advisorsas independent contractors, the U.S. Internal Revenue Service or other U.S. federal or state authorities or similar authorities may determine that we havemisclassified our advisors as independent contractors for employment tax or other purposes and, as a result, seek additional taxes from us or attempt to imposefines and penalties, which could have a material adverse effect on our business model, financial condition, and results of operations.Our business depends on our strong reputation and the value of our brands, which could be negatively impacted by poor performance.Developing and maintaining awareness of our brands is critical to achieving widespread acceptance of our existing and future products and services and is animportant element in attracting new customers and clients. Adverse publicity (whether or not justified) relating to regulatory proceedings or other events oractivities attributed to our businesses, our employees, our vendors, or our partners may tarnish our reputation and reduce the value of our brands. In addition, if weare unable to successfully integrate HD Vest or if we are unable to develop awareness of the HD Vest brand, our reputation could be damaged. Damage to ourreputation and loss of brand equity may reduce demand for our products and services and have a material adverse effect on our future financial results. Suchdamage also would require additional resources to rebuild our reputation and restore the value of the brands.If others claim that our services infringe their intellectual property rights, we may be forced to seek expensive licenses, reengineer our services,engage in expensive and time-consuming litigation, or stop marketing and licensing our services.Companies and individuals with rights relating to the technology industry have frequently resorted to litigation regarding intellectual property rights. Theseparties have in the past made and may in the future make claims against us alleging infringement of patents, copyrights, trademarks, trade secrets, or otherintellectual property or proprietary rights, or alleging unfair competition or violations of privacy or publicity rights. Responding to any such claims could be time-consuming, result17Table of Contentsin costly litigation, divert management’s attention, cause product or service release delays, or require removal or redesigning of our products or services, paymentof damages for infringement, or entry into royalty or licensing agreements. Our technology, services, and products may not be able to withstand any third-partyclaims or rights against their use. In some cases, the ownership or scope of an entity’s or person’s rights is unclear. In addition, the ownership or scope of suchrights may be altered by changes in the legal landscape, such as through developments in U.S. or international intellectual property laws or regulations or throughcourt, agency, or regulatory board decisions. If a successful claim of infringement were made against us and we could not develop non-infringing technology orcontent, or license the infringed or similar technology or content, on a timely and cost-effective basis, our financial condition and results of operations could bematerially and adversely affected.We do not regularly conduct patent searches to determine whether the technology used in our products or services infringes patents held by third parties.Patent searches may not return every issued patent or patent application that may be deemed relevant to a particular product or service. It is therefore difficult todetermine, with any level of certainty, whether a particular product or service may be construed as infringing a current or future U.S. or foreign patent.We rely heavily on our technology and intellectual property, but we may be unable to adequately or cost-effectively protect or enforce ourintellectual property rights, thereby weakening our competitive position and negatively impacting our business and financial results. We may have tolitigate to enforce our intellectual property rights, which can be time consuming, expensive, and difficult to predict.To protect our rights in our services and technology, we rely on a combination of copyright and trademark laws, patents, trade secrets, confidentialityagreements with employees and third parties, and protective contractual provisions. We also rely on laws pertaining to trademarks and domain names to protect thevalue of our corporate brands and reputation. Despite our efforts to protect our proprietary rights, unauthorized parties may copy aspects of our services ortechnology, obtain and use information, marks, or technology that we regard as proprietary, or otherwise violate or infringe our intellectual property rights. Inaddition, it is possible that others could independently develop substantially equivalent intellectual property. If we do not effectively protect our intellectualproperty, or if others independently develop substantially equivalent intellectual property, our competitive position could be materially weakened.Effectively policing the unauthorized use of our services and technology is time-consuming and costly, and the steps taken by us may not preventmisappropriation of our technology or other proprietary assets. The efforts we have taken to protect our proprietary rights may not be sufficient or effective, andunauthorized parties may copy aspects of our services, use similar marks or domain names, or obtain and use information, marks, or technology that we regard asproprietary. In some cases, the ownership or scope of an entity’s or person’s rights is unclear and may also change over time, including through changes in U.S. orinternational intellectual property laws or regulations or through court, agency, or regulatory board decisions.We may have to litigate to enforce our intellectual property rights, to protect our trade secrets, or to determine the validity and scope of others’ proprietaryrights, which are sometimes not clear or may change. Litigation can be time-consuming and expensive, and the outcome can be difficult to predict.If we are unable to hire, retain, and motivate highly qualified employees, including our key employees, we may not be able to successfully manageour businesses.Our future success depends on our ability to identify, attract, hire, retain, and motivate highly skilled management, technical, sales and marketing, andcorporate development personnel, including personnel with experience and expertise in the wealth management, tax preparation, and technology industries tosupport our new strategic focus. Qualified personnel with experience relevant to our businesses are scarce, and competition to recruit them is intense. If we fail tosuccessfully hire and retain a sufficient number of highly qualified employees, we may have difficulties in supporting or expanding our businesses. Realignmentsof resources, reductions in workforce, or other operational decisions have created and could continue to create an unstable work environment and may have anegative effect on our ability to hire, retain, and motivate employees.As part of our announcement on October 14, 2015 with respect to the Strategic Transformation, we announced a leadership succession plan under whichWilliam J. Ruckelshaus will resign his position as President and Chief Executive Officer when a permanent successor has been identified. Following suchannouncement, our Board of Directors commenced and is currently engaged in a search process to identify, evaluate and select a new President and ChiefExecutive Officer to lead Blucora through the Strategic Transformation. Our business and operations are substantially dependent on the performance of our keyemployees. Changes of management or key employees may disrupt operations, which may materially and adversely affect our business and financial results ordelay achievement of our business objectives. In addition, if we lose the services of one or more key employees and are unable to recruit and retain a suitablesuccessor, we may not be able to successfully and18Table of Contentstimely manage our business or achieve our business objectives. There can be no assurance that any retention program we initiate will be successful at retainingemployees, including key employees.We use stock options, restricted stock units, and other equity-based awards to recruit and retain senior level employees. With respect to those employees towhom we issue such equity-based awards, we face a significant challenge in retaining them if the value of equity-based awards in aggregate or individually iseither not deemed by the employee to be substantial enough or deemed so substantial that the employee leaves after their equity-based awards vest. If our stockprice does not increase significantly above the exercise prices of our options, we may need to issue new equity-based awards in order to motivate and retain our keyemployees. We may undertake or seek stockholder approval to undertake other equity-based programs to retain our employees, which may be viewed as dilutive toour stockholders or may increase our compensation costs. There can be no assurance that any such programs, if approved by stockholders, or any other incentiveprograms, would be successful in motivating and retaining our employees.Restructuring and streamlining our business, including implementing reductions in workforce, discretionary spending, and other expensereductions, may materially harm our businesses.We have in the past found and may in the future find it advisable to take measures to streamline operations and reduce expenses, including, withoutlimitation, reducing our workforce or discontinuing products or businesses. For example, in connection with our Strategic Transformation (as described in the"Strategic Transformation" section in Part II Item 7 of this annual report), we have effected and will in the future effect significant reductions-in-force. Suchmeasures may place significant strains on our management and employees. We may also incur liabilities from these measures, including liabilities from earlytermination or assignment of contracts, potential failure to meet obligations due to loss of employees or resources, and resulting litigation. Such effects fromrestructuring and streamlining could have a materially negative impact on our business, financial condition, and financial results.We may seek to acquire companies or assets that complement our Wealth Management and Tax Preparation businesses, and our financial andoperating results may materially suffer if we are unsuccessful in completing any such acquisitions on favorable terms.We may seek to acquire companies or assets that complement our Wealth Management and Tax Preparation businesses. There can be no guarantee that anyof the opportunities that we evaluate will result in the purchase by us of any business or asset being evaluated, or that, if acquired, we will be able to successfullyintegrate such acquisition.If we are successful in our pursuit of any complementary acquisition opportunities, we intend to use available cash, debt and/or equity financing, and/or othercapital or ownership structures designed to diversify our capital sources and attract a competitive cost of capital, all of which may change our leverage profile.There are a number of factors that impact our ability to succeed in acquiring the companies and assets we identify, including competition for these companies andassets, sometimes from larger or better-funded competitors. As a result, our success in completing acquisitions is not guaranteed. Our expectation is that, to theextent we are successful, any acquisitions will be additive to our businesses, taking into account potential benefits of operational synergies. However, these newbusiness additions and acquisitions, if any, involve a number of risks and may not achieve our expectations, and, therefore, we could be materially and adverselyaffected by any such new business additions or acquisitions. There can be no assurance that the short or long-term value of any business or technology that wedevelop or acquire will be equal to the value of the cash and other consideration that we pay or expenses we incur.R ISKS R ELATED TO OUR F INANCING A RRANGEMENTSWe incurred debt in connection with our acquisitions of Monoprice and HD Vest and may incur future debt related to other complementaryacquisitions, which may materially and adversely affect our financial condition and future financial results.In connection with our acquisition of Monoprice, that company incurred debt under a November 2013 credit facility, of which $25.0 million was outstandingas of December 31, 2015 . In connection with our acquisition of HD Vest, TaxAct and HD Vest incurred debt under a December 2015 credit facility, of which$400.0 million was outstanding as of December 31, 2015 . The Monoprice and TaxAct-HD Vest credit facilities are non-recourse debts. The Monoprice creditfacility is guaranteed by Monoprice Holdings, Inc., and the TaxAct-HD Vest credit facility is guaranteed by TaxAct Holdings, Inc. and HD Vest Holdings, Inc., allof which are Blucora’s direct subsidiaries. These debts may materially and adversely affect our financial condition and future financial results by, among otherthings:19Table of Contents•increasing Monoprice’s, TaxAct’s, or HD Vest's vulnerability to downturns in their businesses, to competitive pressures, and to adverse economic andindustry conditions;•requiring the dedication of a portion of our expected cash from Monoprice’s, TaxAct’s, and HD Vest's operations to service the indebtedness, therebyreducing the amount of expected cash flow available for other purposes, including capital expenditures and complementary acquisitions;•requiring cash infusions from Blucora to Monoprice, TaxAct, or HD Vest if any or all are unable to meet their payment or other obligations under theapplicable credit facilities;•increasing our interest payment obligations in the event that interest rates rise dramatically; and•limiting our flexibility in planning for, or reacting to, changes in our businesses and our industries.These credit facilities impose restrictions on Monoprice, TaxAct, and HD Vest, including restrictions on their ability to create liens on their assets and on ourability to incur indebtedness, and require Monoprice, TaxAct, and HD Vest to maintain compliance with specified financial ratios. Their ability to comply withthese ratios may be affected by events beyond their control. In addition, these credit facilities include covenants, the breach of which may cause the outstandingindebtedness to be declared immediately due and payable. These debts, and our ability to repay them, may also negatively impact our ability to obtain additionalfinancing in the future and may affect the terms of any such financing.In addition, we or our subsidiaries may incur additional debt in the future to finance complementary acquisitions or for other purposes. Any additional debtmay result in risks similar to those discussed above related to the Monoprice and TaxAct-HD Vest debts or in other risks specific to the credit agreements enteredinto for those debts.We sold $201.25 million of Convertible Senior Notes in 2013, which may impact our financial results, result in the dilution of existing stockholders,and restrict our ability to take advantage of future opportunities.In March 2013, we sold $201.25 million aggregate principal amount of 4.25% Convertible Senior Notes (the “ Notes ”) due 2019. The accounting for theNotes results in the recognition of interest expense significantly more than the stated interest rate of the Notes and may result in volatility to our financial results.The Notes may be settled in a combination of cash or shares of common stock, indicating that the Notes contain liability and equity components. Upon issuance ofthe Notes, we were required to establish a separate initial value for the conversion option, the equity component, and bifurcate this value from the value attributableto the debt component of the Notes. As a result, for accounting purposes, we were required to treat the Notes as having been issued with a debt discount to theirprincipal amount. We are accreting the debt discount to interest expense ratably over the term of the Notes, which amounts to an effective interest rate in ourfinancial results that exceeds the stated interest rate of the Notes. This will reduce our earnings and could adversely affect the price at which our common stocktrades but will have no effect on the amount of cash interest paid to holders or on our cash flows.Our intent is to settle conversions of the Notes with cash for the principal amount of the debt and shares of common stock for any related conversionpremium. Shares associated with the conversion premium will be included in diluted earnings per share when the average stock price exceeds the conversion priceof the Notes and could adversely affect our diluted earnings per share and the price at which our common stock trades.The conditional conversion feature of the Notes, if triggered, and the requirement to repurchase the Notes upon a fundamental change, may adversely affectour financial condition and financial results. In the event the conditional conversion feature of the Notes is triggered, holders of the Notes will be entitled, at theiroption, to convert the Notes at any time during specified periods. If we undergo a fundamental change (as described in the applicable Indenture), subject to certainconditions, holders of the Notes may require us to repurchase all or part of their Notes for cash at a price equal to 100% of the principal amount of the Notes, plusaccrued and unpaid interest.The payment of the interest and the repayment of principal at maturity, conversion, or under a fundamental change will require the use of a substantialamount of our cash. If such cash is not available, we may be required to sell other assets or enter into alternate financing arrangements at terms that may or may notbe desirable. The existence of the Notes and the obligations we incurred by issuing them may hinder our ability to take advantage of certain future opportunities,such as engaging in future debt or equity financing activities, which may in turn reduce or impair our ability to acquire new businesses or invest in our existingbusinesses.20Table of ContentsExisting cash and cash equivalents, short-term investments, and cash generated from operations may not be sufficient to meet our anticipated cashneeds for servicing debt, working capital, and capital expenditures.Although we believe that existing cash and cash equivalents, short-term investments, and cash generated from operations will be sufficient to meet ouranticipated cash needs for servicing debt, working capital, and capital expenditures for at least the next 12 months, the underlying levels of revenues and expensesthat we project may not prove to be accurate. In March 2013, we sold $201.25 million aggregate principal amount of 4.25% Convertible Senior Notes due 2019. Inaddition, as of December 31, 2015 , Monoprice had $25.0 million outstanding under the credit facility entered into in November 2013, and HD Vest and TaxActhad $400.0 million outstanding under the credit facility entered into in December 2015. Servicing these debts will require the dedication of a portion of ourexpected cash flow from operations, thereby reducing the amount of our cash flow available for other purposes. In addition, our ability to make scheduledpayments of the principal of, to pay interest on, or to refinance our indebtedness depends on our future performance, which is subject to economic, financial,competitive, and other factors beyond our control. Our businesses may not continue to generate cash flow from operations in the future sufficient to service ourdebt and make necessary capital expenditures. If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as sellingassets, restructuring debt, or obtaining additional equity capital on terms that may be onerous or highly dilutive. Our ability to refinance our indebtedness willdepend on the capital markets and our financial condition and results at such time. We may not be able to engage in any of these activities or engage in theseactivities on desirable terms, which could result in a default on our debt obligations.In addition, we may evaluate complementary acquisitions of businesses, products, or technologies from time to time. Any such transactions, if completed,may use a significant portion of our cash balances and marketable investments. If we are unable to liquidate our investments when we need liquidity forcomplementary acquisitions or for other business purposes, we may need to change or postpone such acquisitions or find alternative financing for them. We mayseek additional funding through public or private financings, through sales of equity, or through other arrangements. Our ability to raise funds may be materiallyand adversely affected by a number of factors, including factors beyond our control, such as economic conditions in the markets in which we operate and increaseduncertainty in the financial, capital, and credit markets. Adequate funds may not be available when needed or may not be available on favorable terms. If we raiseadditional funds by issuing equity securities, dilution to existing stockholders may result. If funding is insufficient at any time in the future, we may be unable, ordelayed in our ability, to develop or enhance our products or services, take advantage of business opportunities, or respond to competitive pressures, any of whichcould materially harm our business.R ISKS R ELATED TO OUR D ISCONTINUED O PERATIONSThe current challenges in the Search and Content business may continue.Our Search and Content business has faced significant challenges, beginning in early 2014 and continuing to the present. These challenges have resulted insignificant declines in the financial results for this business, and if current trends cannot be reversed, the ability of this business to operate profitably will besignificantly challenged in future periods. The continuing challenges include, among other things, limitations in InfoSpace's ability to monetize its mobileadvertising offering as a result of changes in our agreement with Google, losses of distribution partners, and suspended or limited access to its services for certaindistribution partners and our own sites due to regular monitoring of policy and compliance requirements. Although InfoSpace has addressed, to varying degrees,some of these challenges, it has been unable to address all of them, and additional issues have emerged, leading to continued and significant pressure on our Searchand Content business. These challenges may be exacerbated by our announcement that we intend to divest the Search and Content business. If InfoSpace is unableto successfully address its current challenges, or if new issues emerge, it is likely to see a continued material adverse effect on its Search and Content business, andour efforts to divest the business at a price we deem adequate, or at all, may be impaired.InfoSpace may be unable to compete successfully in the search market.InfoSpace faces intense competition in the search market. Many of its competitors have substantially greater financial, technical, and marketing resources,larger customer bases, longer operating histories, more developed infrastructures, greater brand recognition, better access to vendors, or more establishedrelationships in the industry than it has. Some of the companies that it competes with in the search market are currently Search Customers of InfoSpace, the loss ofany of which could harm its business. In addition, it may face increasing competition for search market share from new search startups, mobile search providers,and social media sites and applications. If InfoSpace is unable to match or exceed its competitors’ marketing reach and customer service experience, its businessmay not be successful and our ability to divest the business at a price we deem adequate, or at all, may be impaired.21Table of ContentsIn addition, InfoSpace's search business, and that of most of its distribution partners, is primarily based on searches conducted from browsers and otherapplications on desktop and laptop computers. As mobile phones, tablets, and other mobile devices increase in popularity, functionality, and usage, mobile searcheswill constitute an increasing percentage of the search market. Because InfoSpace's search business has been primarily focused on the desktop and laptop markets, itmay have less experience and capability in offering and monetizing mobile search services than its competitors. In addition, because it relies on its SearchCustomers to provide it with search results and advertisements, its ability to innovate for mobile search and to expand in that market is dependent on thecooperation of, and collaboration with, those Search Customers. Under the terms of its current agreement with Google, which took effect on April 1, 2014 and wassubsequently amended, InfoSpace's revenue share rate with respect to Google's mobile search advertisements is significantly lower than the revenue share rate fordesktop advertisements. As a result, InfoSpace has increased its usage of its other current advertising solutions for mobile and/or found additional mobileadvertising solutions and partners. Nonetheless, if InfoSpace cannot develop services and partners that allow it to sufficiently innovate for the mobile search marketand if its mobile advertising solutions monetize at a significantly lower level than its desktop advertising solutions, its ability to participate in the market shift tomobile search will be impaired, which will likely have a material adverse effect on its search business, its financial results, and our ability to divest the business at aprice we deem adequate, or at all.Most of InfoSpace's search services revenue is attributable to Google, and the loss or termination of its relationship, or a payment dispute with,Google or any other significant Search Customer would materially harm its business and financial results.If any existing or future significant Search Customer, such as Google, Yahoo!, or Bing, were to substantially reduce InfoSpace's revenue share rates orsubstantially reduce, eliminate, or increase the cost of the content it provides to InfoSpace or to its distribution partners, or if InfoSpace was to terminate orsubstantially reduce the extent of its relationship with any existing or future significant Search Customer, its business results could materially suffer and our abilityto divest the business at a price we deem adequate, or at all, may be impaired.Failure by InfoSpace or its search distribution partners to comply with the policies promulgated by Google, Yahoo!, and Bing may cause thatSearch Customer to temporarily or permanently suspend the use of its content or terminate its agreement with InfoSpace, or may require it to modify orterminate certain distribution relationships.If InfoSpace or its search distribution partners fail to meet the policies promulgated by Google, Yahoo!, or Bing for the use of their content, it may not beable to continue to use their content or provide the content to such distribution partners. InfoSpace's agreements with Google, Yahoo!, and Bing give them theability to suspend the use and the distribution of their content for non-compliance with their requirements and policies and, in the case of breaches of certain otherprovisions of their agreements, to terminate their agreements with InfoSpace immediately, regardless of whether such breaches could be cured. If InfoSpace'sSearch Customers were to suspend or terminate their agreements with us, it would not receive any revenue from any property of its or its distribution partner that isaffected by the suspended content, and the loss of such revenue could materially harm its business, financial condition and financial results.InfoSpace may be subject to liability for its use or distribution of information that it gathers or receives from third parties and indemnityprotections or insurance coverage may be inadequate to cover such liability.InfoSpace's search services obtain content and commerce information from third parties and link users, either directly through its own websites or indirectlythrough the web properties of its distribution partners, to third-party webpages and content in response to search queries and other requests. These services couldexpose InfoSpace to legal liability from claims relating to such third-party content and sites, the manner in which these services are distributed and displayed byInfoSpace or its distribution partners, or how the content provided by its Search Customers was obtained or provided by its Search Customers. This could subjectInfoSpace to legal liability for such things as defamation, negligence, intellectual property infringement, violation of privacy or publicity rights, and product orservice liability, among others. The laws or regulations of certain jurisdictions may also deem some content illegal, which also may expose it to liability.Regardless of the legal merits of any such claims, they could result in costly litigation, be time-consuming to defend, and divert management’s attention andresources. If there were a determination that InfoSpace had violated third-party rights or applicable law, it could incur substantial monetary liability, be required toenter into costly royalty or licensing arrangements (if available), or be required to change its business practices. InfoSpace is also subject to laws and regulations,both in the United States and abroad, regarding the collection and use of end user information and search-related data. If it does not comply with these laws andregulations, it may be exposed to legal liability, which could negatively impact its financial results and our ability to divest the business at a price we deemadequate, or at all, may be impaired.22Table of ContentsOur efforts to transition our Search and Content business may not be successful.As a result of the challenges discussed above, we have invested in initiatives to transition our Search and Content business to methods of monetization thatcan be more viable long term. These initiatives are targeted at business opportunities that we believe are promising, but the initiatives are still in their early stages,and there can be no assurance that we will identify viable alternate monetization methods, that we will successfully execute the changes necessary for thistransition, that this transition will occur on a time line sufficient to offset declines in the business, that we will identify and attract partners needed for thistransition, or that our Search Customers will permit the changes necessary for this transition. Our transition efforts may be set back by our announcement that weintend to divest our Search and Content business. If the current challenges continue and this transition is not successful, our Search and Content business will likelyexperience continued declines in its financial results, the ability of this business to operate profitably will be significantly challenged in future periods, and ourability to divest the business at a price we deem adequate, or at all, may be impaired.The electronics and accessories market is highly competitive, and failure to effectively compete will adversely affect our financial results.The electronics and accessories market in which our Monoprice business sells products is highly competitive. All of Monoprice’s products face competitionfrom many sellers of similar products, of which some sellers are much larger and more well-known than Monoprice. Monoprice attempts to offer products thatprovide similar quality and technology as those offered by its competitors, but at a lower price, and it attempts to do so with customer service and support thatequals or exceeds that of many of its competitors. Many of its competitors have significant competitive advantages over it that may materially and adversely affectits ability to successfully compete on price, quality, technology, service, or support, including larger scale, advanced research facilities, extensive experience in theindustry, proprietary intellectual property, greater financial resources, more advanced and extensive supply chain and distribution capacity, better service andsupport capability, and stronger relationships with suppliers and resellers. If Monoprice is unable to successfully compete on price, quality, technology, service, orsupport, it may not be able to attract and retain customers which would materially impact our financial results and our ability to divest the business at a price wedeem adequate, or at all.If Monoprice fails to accurately forecast customer demand, its inventory may either exceed demand or be insufficient to meet demand, which couldmaterially harm our financial results.Monoprice relies on its supplier network to manufacture its products, and as a result, it must forecast demand for its products well in advance of the sale ofthose products when placing orders from our suppliers. If its orders exceed eventual demand, it will have excess inventory, which will increase its inventorycarrying costs, may increase risk that those products will become obsolete prior to sale, and may result in write-offs and/or significant price reductions of thatinventory. If orders are insufficient to meet demand, Monoprice may not be able to adequately replace that inventory to meet all customer orders in a timelymanner, resulting in back-orders, potential lost sales, and negative customer experiences. Significant failure to accurately forecast customer demand may thusmaterially impact our short-term financial results and our ability to divest the business at a price we deem adequate, or at all.Monoprice depends on international third-party manufacturers to supply its electronics and accessories, and risks related to the manufacture andshipping of its products could materially and adversely affect its operations and financial results.Monoprice outsources most of the manufacturing of its electronics and accessories to suppliers in Asia. It relies on the performance of these suppliers, andany problems with such performance could result in cost overruns, delayed deliveries, shortages, poor quality control, intellectual property issues (both theft of itsintellectual property and infringement by its suppliers of the intellectual property of others), and compliance issues. Performance problems by its suppliers couldresult from many events, including the following: suppliers’ willful or unintentional breach of supply agreements; their failure to comply with applicable laws andregulations; labor unrest at their facilities; civil unrest; natural or human disasters at production or shipping facilities; equipment or other facility failures; theirinability to acquire sufficient quantities or qualities of components or raw materials at expected prices; infrastructure problems in their countries (e.g., power ortransportation infrastructure problems); their bankruptcy, insolvency, or other financial problems; and requests or requirements by their other customers that mayconflict with its requirements. In addition, because most of Monoprice's products are shipped from Asia, the company faces risks related to such shipping,including performance failures by its shipping partners and those of its suppliers, natural disasters, shipping equipment failure, and export and import regulationcompliance issues. In late 2014 and early 2015, Monoprice's ability to maintain adequate inventory was impacted by slowdowns in offloading container shipsresulting from23Table of Contentslabor disputes. These slowdowns could recur, with the result that the impact on Monoprice's ability to maintain inventory could be impaired.The performance of Monoprice's manufacturers, suppliers, and shippers is largely outside of its control. As the result of any performance failures, Monopricemay lose sales, or it may be required to adjust product designs, change production schedules, or develop suitable alternative contract manufacturers, suppliers, orshippers, which could result in delays in the delivery of products to its customers and/or increased costs. Any such delays, disruptions, or quality problems couldadversely impact its ability to sell its products, harm its reputation, impair its customer relationships, and materially and adversely affect our financial condition andresults of operations.Monoprice's electronics and accessories could experience quality or safety defects that could result in damage to our reputation, require it toprovide replacement products, or cause it to institute product recalls.We expect that all of Monoprice's electronics and accessories will meet or exceed all applicable standards for quality and safety. Monoprice monitors andattempts to address any quality or safety issues during the design and manufacturing processes, but some problems or defects may not be identified until afterintroduction and shipment of products to consumers. Resolving such problems or defects may result in increased costs related to production and shipment ofreplacement parts or products, increased customer support requirements, and redesign and manufacture of products. If Monoprice is unable to fix defects in atimely manner or adequately address quality control issues, its relationships with its customers may be impaired, its reputation may suffer, and it may losecustomers. If the problems or defects result in a significant safety hazard, Monoprice may be forced to institute a product recall, resulting in negative publicity, lossof reputation, administrative costs, distraction of personnel from regular duties, and recall, refund, and replacement expenses. In addition, such product recalls mayresult in disputes with suppliers and customers or lead to adverse proceedings such as arbitration or litigation, which can be costly and expensive and could have anegative impact on our ability to divest the business at a price we deem adequate, or at all.Product liability claims or regulatory actions could materially and adversely affect Monoprice's financial results or harm its reputation.As the seller of consumer products, Monoprice faces the possibility that there will be claims for losses or injuries caused by some of its products. In additionto the risk of substantial monetary judgments and penalties that could have a material effect on its financial condition and results of operations, product liabilityclaims or regulatory actions could result in negative publicity that could harm its reputation in the marketplace. Monoprice also could be required to recall andpossibly discontinue the sale of possible defective or unsafe products, which could result in adverse publicity and significant expenses. Although Monopricemaintains product liability insurance coverage, potential product liability claims may exceed the amount of coverage or could be excluded under the terms of thepolicy.O THER R ISKSOur stock price has been highly volatile and such volatility may continue.The trading price of our common stock has been highly volatile. Between January 1, 2014 and December 31, 2015 , our closing stock price ranged from$9.55 to $28.73 . On February 16, 2016 , the closing price of our common stock was $6.61 . Our stock price could decline or fluctuate significantly in response tomany factors, including the other risks discussed in this report and the following:•actual or anticipated variations in quarterly and annual results of operations;•impairment charges, changes in or loss of material contracts and relationships, dispositions or announcements of complementary acquisitions, or otherbusiness developments by us, our partners, or our competitors;•conditions or trends in the tax preparation, wealth management, search and content services, or e-commerce markets;•changes in general conditions in the U.S. and global economies or financial markets;•announcements of technological innovations or new services by us or our competitors;•changes in financial estimates or recommendations by securities analysts;•disclosures of any accounting issues, such as restatements or material weaknesses in internal control over financial reporting;24Table of Contents•equity issuances resulting in the dilution of stockholders;•the adoption of new regulations or accounting standards;•adverse publicity (whether justified or not) with respect to our business; and•announcements or publicity relating to litigation or governmental enforcement actions.In addition, the equities market has experienced extreme price and volume fluctuations, and our stock has been particularly susceptible to such fluctuations.Often, class action litigation has been instituted against companies after periods of volatility in the price of such companies’ stock. We have been defendants insuch class action litigation in prior periods and could be subject to future litigation, potentially resulting in substantial cost and diversion of management’s attentionand resources.Our financial results may fluctuate, which could cause our stock price to be volatile or decline.Our financial results have varied on a quarterly basis and are likely to continue to fluctuate in the future. These fluctuations could cause our stock price to bevolatile or decline. Many factors could cause our quarterly results to fluctuate materially, including but not limited to:•the inability of any of our businesses to meet our expectations;•the seasonality of our Tax Preparation business and the resulting large quarterly fluctuations in our revenues;•the success or failure of our Strategic Transformation and our ability to implement those initiatives in a cost effective manner;•the mix of revenues generated by existing businesses, discontinued operations or other businesses that we develop or acquire;•gains or losses driven by fair value accounting;•litigation expenses and settlement costs;•misconduct by employees and HD Vest financial advisors, which is difficult to detect and deter;•expenses incurred in finding, evaluating, negotiating, consummating, and integrating acquisitions;•impairment or negative performance of the many different industries and counterparties we rely on and are exposed to;•variable demand for our services, rapidly evolving technologies and markets, and consumer preferences;•any restructuring charges we may incur;•any economic downturn, which could result in lower acceptance rates on premium products and services offered by our Wealth Management businessand impact the commissions and fee revenues of our financial advisory services;•the level and mix of assets we have under management and administration, which are subject to fluctuation based on market conditions and clientactivity;•new court rulings, or the adoption of new laws, rules, or regulations, that adversely affect our tax preparation products and services, or our wealthmanagement offerings or that otherwise increase our potential liability or compliance costs;•impairment in the value of long-lived assets or the value of acquired assets, including goodwill, technology, and acquired contracts and relationships;and•the effect of changes in accounting principles or standards or in our accounting treatment of revenues or expenses.For these reasons, among others, you should not rely on period-to-period comparisons of our financial results to forecast our future performance.Furthermore, our fluctuating operating results may fall below the expectations of securities analysts or investors and financial results volatility could make us lessattractive to investors, either of which could cause the trading price of our stock to decline.25Table of ContentsIf there is a change in our ownership within the meaning of Section 382 of the Internal Revenue Code, our ability to use our net operating losscarryforwards (“ NOLs ”) may be severely limited or potentially eliminated.As of December 31, 2015 , we had federal NOLs of $521.1 million that will expire primarily between 2020 and 2024 . If we were to have a change ofownership within the meaning of Section 382 of the Internal Revenue Code (defined as a cumulative change of 50 percentage points or more in the ownershippositions of certain stockholders owning five percent or more of a company’s common stock over a three-year rolling period), then under certain conditions, theamount of NOLs we could use in any one year could be limited. Our certificate of incorporation imposes certain limited transfer restrictions on our common stockthat we expect will assist us in preventing a change of ownership and preserving our NOLs, but there can be no assurance that these restrictions will be sufficient.In addition, other restrictions on our ability to use the NOLs may be triggered by a merger or acquisition, depending on the structure of such a transaction. It is ourintention to limit the potential impact of these restrictions, but there can be no guarantee that such efforts will be successful. If we are unable to use our NOLsbefore they expire, or if the use of this tax benefit is severely limited or eliminated, there could be a material reduction in the amount of after-tax income and cashflow from operations, and it could have an effect on our ability to engage in certain transactions.Delaware law and our charter documents may impede or discourage a takeover, which could cause the market price of our shares to decline.We are a Delaware corporation and the anti-takeover provisions of Delaware law impose various impediments to the ability of a third party to acquire us,even if a change of control would be beneficial to our existing stockholders. For example, Section 203 of the Delaware General Corporation Law may discourage,delay, or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after theperson becomes an interested stockholder. In addition, our certificate of incorporation and bylaws contain provisions that may discourage, delay, or prevent a thirdparty from acquiring us without the consent of our board of directors, even if doing so would be beneficial to our stockholders. Provisions of our charter documentsthat could have an anti-takeover effect include:•the classification of our board of directors into three groups so that directors serve staggered three-year terms, which may make it difficult for apotential acquirer to gain control of our board of directors;•the requirement for super majority approval by stockholders for certain business combinations;•the ability of our board of directors to authorize the issuance of shares of undesignated preferred stock without a vote by stockholders;•the ability of our board of directors to amend or repeal our bylaws;•limitations on the removal of directors;•limitations on stockholders’ ability to call special stockholder meetings;•advance notice requirements for nominating candidates for election to our board of directors or for proposing matters that can be acted upon bystockholders at stockholder meetings; and•certain restrictions in our charter on transfers of our common stock designed to preserve our federal NOLs.At our 2009 annual meeting, our stockholders approved an amendment to our certificate of incorporation that restricts any person or entity from attempting totransfer our stock, without prior permission from the Board of Directors, to the extent that such transfer would (i) create or result in an individual or entitybecoming a five-percent stockholder of our stock, or (ii) increase the stock ownership percentage of any existing five-percent stockholder. This amendmentprovides that any transfer that violates its provisions shall be null and void and would require the purported transferee to, upon our demand, transfer the shares thatexceed the five percent limit to an agent designated by us for the purpose of conducting a sale of such excess shares. This provision in our certificate ofincorporation may make the acquisition of Blucora more expensive to the acquirer and could significantly delay, discourage, or prevent third parties from acquiringBlucora without the approval of our board of directors.26Table of ContentsITEM 1B. Unresolved Staff CommentsNone.ITEM 2. Properties All of our facilities are leased. We believe our properties are suitable and adequate for our present and anticipated near-term needs.Continuing operations: Our principal corporate office is located in Bellevue, Washington. The headquarters and data center facility for our HD Vest businessare in Irving, Texas, and we have a backup data center for our HD Vest business in Elk Grove, Illinois, along with multiple disaster recovery data center locationsacross the country through a third party vendor. The headquarters and data center facility for our TaxAct business are in Cedar Rapids, Iowa, and we have adisaster recovery data center for our TaxAct business in Waukee, Iowa.Discontinued operations: The primary operations for our InfoSpace business are located in Bellevue, Washington, with the exception of the HSW operations,which are located in Atlanta, Georgia. The headquarters and distribution facility for our E-Commerce business are in Rancho Cucamonga, California, with anadditional distribution facility located in Hebron, Kentucky.ITEM 3. Legal ProceedingsSee " Note 9: Commitments and Contingencies " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for information regardinglegal proceedings.ITEM 4. Mine Safety DisclosuresNone.27Table of ContentsPART IIITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesMarket for Our Common StockOur common stock trades on the NASDAQ Global Select Market under the symbol “BCOR.” The following table sets forth, for the periods indicated, thehigh and low sales prices for our common stock as reported by the NASDAQ Global Select Market. High LowYear ended December 31, 2015 First Quarter$15.04 $12.88Second Quarter$16.60 $13.65Third Quarter$16.20 $13.14Fourth Quarter$14.81 $9.55Year ended December 31, 2014 First Quarter$28.73 $19.11Second Quarter$19.85 $17.07Third Quarter$18.96 $15.24Fourth Quarter$17.04 $13.12On February 16, 2016 , the last reported sale price for our common stock on the NASDAQ Global Select Market was $6.61 per share.HoldersAs of February 16, 2016 , there were 413 holders of record of our common stock. A substantially greater number of holders are beneficial owners whoseshares are held of record by banks, brokers, and other financial institutions.DividendsThere were no dividends paid in 2015 and 2014 .Share RepurchasesSee " Note 10: Stockholders' Equity " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information regardingthe Company’s stock repurchase program. Share repurchase activity during the fourth quarter 2015 was as follows (in thousands, except per share data):PeriodTotal Number of SharesPurchased Average Price Paid per Share Total Number ofShares Purchased asPart of PubliclyAnnounced Plansor Programs Approximate Dollar Value ofShares that May Yet bePurchased under the Plansor ProgramsOctober 1-31, 2015— $— — $29,404November 1-30, 201510 $10.25 10 $29,299December 1-31, 201553 $10.58 53 $28,739Total63 $10.52 63 28Table of ContentsITEM 6. Selected Financial DataThe following data are derived from our audited consolidated financial statements and should be read along with "Management’s Discussion and Analysis ofFinancial Condition and Results of Operations" in Part II Item 7, our consolidated financial statements and notes in Part II Item 8, and other financial informationincluded elsewhere in this report. Years ended December 31, 2015 2014 2013 2012 2011Consolidated Statements of Operations Data:(In thousands, except per share data)Revenue(1) (2) $117,708 $103,719 $91,213 $62,105 $—Operating income (loss)(1) (2) (4,807) 4,603 (3,478) (13,138) (17,190)Other income (loss), net(1) (12,542) (13,489) (29,568) (6,630) 1,780Loss from continuing operations before income taxes (17,349) (8,886) (33,046) (19,768) (15,410)Income tax benefit(1) (3) 4,623 3,342 7,385 5,184 24,035Income (loss) from continuing operations (12,726) (5,544) (25,661) (14,584) 8,625Discontinued operations, net of income taxes(1) (5) (27,348) (30,003) 50,060 37,110 12,969Net income (loss) $(40,074) $(35,547) $24,399 $22,526 $21,594Net income (loss) per share - basic: Continuing operations $(0.31) $(0.13) $(0.62) $(0.36) $0.23Discontinued operations (0.67) (0.73) 1.21 0.92 0.34Basic net income (loss) per share $(0.98) $(0.86) $0.59 $0.56 $0.57Weighted average shares outstanding, basic 40,959 41,396 41,201 40,279 37,954Net income (loss) per share - diluted: Continuing operations $(0.31) $(0.13) $(0.62) $(0.36) $0.22Discontinued operations (0.67) (0.73) 1.21 0.92 0.34Diluted net income (loss) per share $(0.98) $(0.86) $0.59 $0.56 $0.56Weighted average shares outstanding, diluted 40,959 41,396 41,201 40,279 38,621Consolidated Balance Sheet Data (4) : Cash, cash equivalents, and investments $66,774 $293,588 $323,429 $162,295 $293,551Working capital(5) (6) (7) 174,571 299,431 140,100 142,311 282,102Total assets 1,299,548 865,775 969,677 581,699 394,809Total long-term liabilities(5) (6) (7) (8) 656,122 311,692 171,268 98,945 816Total stockholders’ equity 462,284 479,025 514,070 415,450 355,105(1) For a discussion of activity in 2013 through 2015 , see "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in Part IIItem 7 of this report.(2) On January 31, 2012, we acquired TaxAct.(3) In 2011, we recorded a reversal of $18.9 million of the valuation allowance related to our deferred tax assets.(4) On December 31, 2015 , we acquired HD Vest. See " Note 3: Business Combinations " of the Notes to Consolidated Financial Statements in Part II Item 8 ofthis report.(5) On October 14, 2015, we announced plans to divest the Search and Content and E-Commerce businesses. Accordingly, the operating results of thesebusinesses have been presented as discontinued operations for all periods presented, and the related balance sheet data have been classified in their entiretywithin current assets and current liabilities as of December 31, 2015 but classified within current and long-term assets and liabilities, as appropriate, for priorperiods. In addition, we completed the sale of Mercantila on June 22, 2011. The operating results of this business have been presented as discontinuedoperations for 2011.(6) During 2015 and 2014, the Notes were classified as a long-term liability with an outstanding balance, net of discount and issuance costs, of $185.9 millionand $181.1 million , respectively. The Notes were classified as a current liability in 2013. See " Note 8: Debt " of the Notes to Consolidated FinancialStatements in Part II Item 8 of this report.(7) We had the following debt activity. See " Note 4: Discontinued Operations " and " Note 8: Debt " of the Notes to Consolidated Financial Statements in Part IIItem 8 of this report.29Table of Contents◦In 2015, TaxAct and HD Vest entered into a credit facility agreement, which had an outstanding balance, net of any discount and issuance costs andincluding any short-term portion, of $379.1 million as of December 31, 2015 .◦In 2013, Monoprice entered into a credit facility agreement, and TaxAct entered into a new credit facility agreement (to replace the one entered into in2012). These arrangements had total outstanding balances, net of any discounts and including any short-term portions, of $25.0 million and nil ,respectively, as of December 31, 2015 , $41.8 million and $51.9 million , respectively, as of December 31, 2014 , and $49.7 million and $71.4 million ,respectively, as of December 31, 2013 . The TaxAct credit facility was closed in 2015.◦During 2012, TaxAct entered into a credit facility agreement, under which $73.9 million, net of discount and including the short-term portion, wasoutstanding as of December 31, 2012.(8) During 2013, the Monoprice acquisition resulted in a $27.7 million deferred tax liability related to intangible assets.ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsYou should read the following discussion and analysis in conjunction with the Selected Financial Data and our consolidated financial statements and notesthereto included elsewhere in this report. IntroductionBlucora operates two primary businesses: a Wealth Management business and an online Tax Preparation business. The Wealth Management business consistsof the operations of HD Vest, which we acquired on December 31, 2015 , and, accordingly, has no operating activities in Blucora's 2015 results of operations. HDVest will be included in Blucora's results of operations beginning on January 1, 2016. HD Vest provides wealth management solutions for financial advisors. TheTax Preparation business consists of the operations of TaxAct and provides digital tax preparation solutions for consumers, small business owners, and taxprofessionals.Blucora also operates an internet Search and Content business and an E-Commerce business. The Search and Content business, InfoSpace, provides searchservices to users of our owned and operated and distribution partners' web properties, as well as online content through HSW. The E-Commerce business consistsof the operations of Monoprice and sells self-branded electronics and accessories to both consumers and businesses.Strategic TransformationOn October 14, 2015, we announced our plans to focus on the technology-enabled financial solutions market, which we refer to as the “StrategicTransformation.” The Strategic Transformation consists of the acquisition of HD Vest, which closed on December 31, 2015 , and our intention to divest our Searchand Content and E-Commerce businesses in the first half of 2016. The transformation will result in fewer support requirements and, therefore, reduced corporateoperating expenses. We also expect to shift our capital allocation priority in the near-term to pay down debt, which includes using at least 50% of the netdivestiture proceeds to pay down the new TaxAct - HD Vest 2015 credit facility per the debt agreement. The elements of our Strategic Transformation aredescribed in more detail below. For a discussion of the associated risks, see the section in our Risk Factors (Part I Item 1A. of this report) under the heading "RisksAssociated With our Strategic Transformation."Acquisition: On December 31, 2015 , we acquired HD Vest for $611.9 million , including cash acquired and subject to a final working capital adjustment inthe first quarter of 2016. HD Vest provides wealth management solutions for financial advisors and is expected to be synergistic with TaxAct as a result of cross-selling opportunities and an expanded addressable market for both HD Vest and TaxAct. The acquisition was funded by a combination of cash on hand and the newTaxAct - HD Vest 2015 credit facility, under which we borrowed $400.0 million . During 2015, we incurred transaction costs of $11.0 million .See " Note 3: Business Combinations " and " Note 8: Debt " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additionalinformation on the HD Vest acquisition and the new credit facility, respectively.Business divestitures and chief executive officer departure: On October 14, 2015, we announced plans to divest the Search and Content and E-Commercebusinesses. Accordingly, our financial condition, results of operations, and cash flows reflect the Search and Content and E-Commerce businesses as discontinuedoperations for all periods presented. Unless otherwise specified, disclosures in "Management's Discussion and Analysis of Financial Condition and Results ofOperations" reflect continuing operations. We expect to incur employee-related business exit costs of approximately $3.0 million , with the majority of these costsrecorded in discontinued operations in the fourth quarter of 2015 and in the first quarter of 2016. Some of these costs are contingent or are accelerated upon the saleof the Search and Content and E-Commerce businesses and will30Table of Contentsbe recorded or adjusted, as appropriate, at the time of sale. See " Note 4: Discontinued Operations " of the Notes to Consolidated Financial Statements in Part IIItem 8 of this report for additional information on discontinued operations.We also announced the upcoming departure of our chief executive officer once a permanent successor has been identified. We incurred $1.8 million ofseparation-related costs, most of which were pursuant to the chief executive officer's employment agreement and are to be paid within 60 days of his last day ofemployment.Our Continuing BusinessesWealth ManagementThe HD Vest business provides wealth management solutions for financial advisors. Specifically, HD Vest provides an integrated platform of brokerage andinvestment advisory services to assist in making each financial advisor a financial service center for his/her clients. HD Vest generates revenue primarily throughcommissions, quarterly investment advisory fees based on assets under management, and other fees.HD Vest was founded to help tax and accounting professionals integrate financial services into their practices. The company recruits independent taxprofessionals with established tax practices and offers specialized training and support, which allows them to join the HD Vest platform as independent financialadvisors. HD Vest's specialist model provides an open-architecture investment platform and technology tools to help financial advisors identify investmentopportunities for their clients, while the long-standing tax advisory relationships provide a large client base of possible investment clients. This results in anexperienced and stable network of financial advisors, who have multiple revenue-generating options to diversify their earnings sources, thereby eliminating theneed for sales quotas.Our Wealth Management business is subject to certain additional financial industry regulations and supervision, including by the SEC, FINRA, statesecurities and insurance regulators, and other regulatory authorities. For additional information regarding the potential impact of governmental regulation on ouroperations and results, see the Risk Factor " Increased government regulation of our business may harm our operating results. " in Part I Item 1A of this report.Tax PreparationOur TaxAct business provides digital tax preparation solutions for consumers, small business owners, and tax professionals. TaxAct generates revenueprimarily through its online service at www.TaxAct.com.We had four product offerings for consumers for tax year 2014: a free federal edition that handled simple and complex returns; the free federal edition plus apaid state edition; a "deluxe" product offering that contained all of the features of the free federal edition plus taxpayer phone support, import capabilities, returnpreparation assistance tools, and enhanced reporting; and an "ultimate" product offering that contained all of the deluxe offering features plus the ability to file astate return. We also had a small business product offering for small business owners. TaxAct offers its products with a price lock guarantee, whereby the price atthe start of the tax return filing process holds until the return is filed, rather than pricing the product at the time that the tax return is filed. In addition to these coreofferings, TaxAct also offers ancillary services such as refund payment transfer, data archive services, audit defense, stored value cards, and other add-on services.TaxAct’s professional tax preparer software allows professional tax preparers to file individual and business returns for their clients. TaxAct offers flexiblepricing and packaging options that help tax professionals save money by paying only for what they need.AcquisitionsOn December 31, 2015 , we acquired HD Vest, as described further under "Strategic Transformation" above. On July 2, 2015 , TaxAct acquired SimpleTax,a provider of online tax preparation services for individuals in Canada through its website www.simpletax.ca, for C$2.4 million (with C$ indicating Canadiandollars and amounting to approximately $1.9 million based on the acquisition-date exchange rate) in cash and additional consideration of up to C$4.6 million ( $3.7million ) that is contingent upon product availability and revenue performance over a three-year period. SimpleTax is included in our financial results beginning onJuly 2, 2015 . In addition, on October 4, 2013 , TaxAct acquired Balance Financial, a provider of web and mobile-based financial management software through itswebsite www.balancefinancial.com.Seasonality31Table of ContentsOur Tax Preparation segment is highly seasonal, with a significant portion of its annual revenue earned in the first four months of our fiscal year. During thethird and fourth quarters, the Tax Preparation segment typically reports losses because revenue from the segment is minimal while core operating expensescontinue at relatively consistent levels.ComparabilityWe reclassified certain amounts related to discontinued operations for all periods presented, including quarterly periods within the years ended December 31,2015 and 2014, from the amounts previously reported in the annual reports on Form 10-K and quarterly reports on Form 10-Q for those periods. See " Note 4:Discontinued Operations " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information.RESULTS OF OPERATIONSSummary(In thousands, except percentages)Years ended December 31, 2015 PercentageChange 2014 PercentageChange 2013Revenue$117,708 13 % $103,719 14 % $91,213Operating income (loss)$(4,807) (204)% $4,603 (232)% $(3,478)Year ended December 31, 2015 compared with year ended December 31, 2014Revenue increase d approximately $14.0 million due to an increase in revenue related to our Tax Preparation business.Operating income decrease d approximately $9.4 million , consisting of the $14.0 million increase in revenue and offset by a $23.4 million increase inoperating expenses. Key changes in operating expenses were:•$6.7 million increase in the Tax Preparation segment’s operating expenses, primarily due to higher personnel expenses resulting from increased averageheadcount, higher spending on marketing campaigns for the current tax season, and, to a lesser extent, higher data center costs related to softwaresupport and maintenance fees.•$16.7 million increase in corporate-level expense activity, primarily due to higher professional services fees, mainly from transaction costs related tothe HD Vest acquisition, and higher personnel expenses, mainly due to increased average headcount to support operations and separation-related costsin connection with the upcoming departure of our chief executive officer. As part of the Strategic Transformation, we announced the upcomingdeparture of our chief executive officer once a permanent successor has been identified.Segment results are discussed in the next section.Year ended December 31, 2014 compared with year ended December 31, 2013Revenue increase d approximately $12.5 million due to an increase in revenue related to our Tax Preparation business.Operating income increase d approximately $8.1 million , consisting of the $12.5 million increase in revenue and offset by a $4.4 million increase inoperating expenses. Key changes in operating expenses were:•$3.4 million increase in the Tax Preparation segment’s operating expenses, primarily due to higher personnel expenses resulting from increased averageheadcount and, to a lesser extent, higher spending on marketing campaigns for the related tax season.•$1.0 million increase in corporate-level expense activity, primarily due to higher corporate business insurance expenses mainly related to the timing ofpolicy premiums in connection with our acquisitions, offset by lower net personnel expenses. Personnel expenses were impacted by decreased bonusamounts consistent with company performance in 2014, offset by increased average headcount to support operations and increased employee separationcosts mainly related to leadership changes.Segment results are discussed in the next section.32Table of ContentsSEGMENT REVENUE/OPERATING INCOMEThe revenue and operating income amounts in this section are presented on a basis consistent with accounting principles generally accepted in the U.S. (“GAAP ”) and include certain reconciling items attributable to the segments. Segment information appearing in " Note 12: Segment Information " of the Notes toConsolidated Financial Statements in Part II Item 8 of this report is presented on a basis consistent with our current internal management financial reporting. We donot allocate certain general and administrative costs (including personnel and overhead costs), stock-based compensation, depreciation, amortization of acquiredintangible assets, other loss, net, and income taxes to segment operating results. We analyzed these separately.Following the acquisition of HD Vest and the discontinued operations treatment of Search and Content and E-Commerce, we determined that we have tworeportable segments: Wealth Management and Tax Preparation. Since the acquisition of HD Vest closed on December 31, 2015 , it has no operating activities inBlucora's 2015 results of operations.Tax Preparation(In thousands, except percentages)Years ended December 31, 2015PercentageChange2014 Percentage Change 2013Revenue$117,708 13% $103,719 14% $91,213Operating income$56,984 15% $49,696 22% $40,599Segment margin48% 48% 45%Our ability to generate tax preparation revenue largely is driven by our ability to effectively market our tax preparation software and online services (therebyacquiring new users and retaining existing users) and our ability to sell other offerings and ancillary services to consumers and small business owners. We alsogenerate revenue through the professional tax preparer software that we sell to professional tax preparers who use it to prepare and file individual and businessreturns for their clients. Revenue from the professional tax preparation software is derived in two ways: from per-unit licensing fees for the software and fromamounts that we charge to e-file through the software.We measure our consumer tax preparation customers using the number of accepted federal tax e-files made through our software and services. We considergrowth in the number of e-files to be the most important non-financial metric in measuring the performance of the Tax Preparation business. E-file metrics were asfollows:(In thousands, except percentages)Years ended December 31, 2015 PercentageChange 2014 PercentageChange 2013Online e-files5,235 (1)% 5,262 4 % 5,037Desktop e-files273 6 % 258 (9)% 282Sub-total e-files5,508 — % 5,520 4 % 5,319Free File Alliance e-files (1)181 (18)% 222 43 % 155Total e-files5,689 (1)% 5,742 5 % 5,474(1) Free File Alliance e-files are provided as part of an IRS partnership that provides free electronic tax filing services to taxpayers meeting certain income-basedguidelines.Year ended December 31, 2015 compared with year ended December 31, 2014Tax Preparation revenue increase d approximately $14.0 million primarily due to growth in revenue earned from online consumer users, increased sales ofancillary services (mostly related to bank services), and increased sales of our professional tax preparer software. Online consumer revenue grew, despite a slightdecrease in e-files, due to growth in average revenue per user, primarily resulting from pricing actions and their related timing when compared to the prior year.Revenue derived from professional tax preparers also contributed to the increase , with an increase in the number of professional preparer units sold and growth inaverage revenue per user.Tax Preparation operating income increase d approximately $7.3 million , consisting of the $14.0 million increase in revenue and offset by an increase of$6.7 million in operating expenses. The increase in Tax Preparation segment operating expenses primarily was due to an increase in personnel expenses resultingfrom higher average headcount supporting all33Table of Contentsfunctions, increased spending on marketing campaigns for the current tax season, and, to a lesser extent, increased data center costs related to software support andmaintenance fees.Year ended December 31, 2014 compared with year ended December 31, 2013Tax Preparation revenue increase d approximately $12.5 million primarily due to a 4% increase in consumer e-files, growth in average revenue per user,increased sales of bank services in the current year, and increasing payments over the past couple years related to data archive services that are recognized asrevenue over the related contractual term. Revenue derived from professional tax preparers also contributed to the increase, with a 12% increase in preparer e-filescoupled with an increase in the number of professional preparer units sold.Tax Preparation operating income increase d approximately $9.1 million , consisting of the $12.5 million increase in revenue and offset by an increase of$3.4 million in operating expenses. The increase in Tax Preparation segment operating expenses primarily was due to an increase in personnel expenses resultingfrom higher average headcount supporting all functions and, to a lesser extent, increased spending on marketing campaigns for the related tax season.Corporate-Level Activity(In thousands)Years ended December 31, 2015 Change 2014 Change 2013Operating expenses$30,507 $16,272 $14,235 $630 $13,605Stock-based compensation8,694 0 8,694 195 8,499Depreciation2,287 315 1,972 141 1,831Amortization of acquired intangible assets20,303 111 20,192 50 20,142Total corporate-level activity$61,791 $16,698 $45,093 $1,016 $44,077Certain corporate-level activity is not allocated to our segments, including certain general and administrative costs (including personnel and overhead costs),stock-based compensation, depreciation, and amortization of acquired intangible assets. For further detail, refer to segment information appearing in " Note 12:Segment Information " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.Year ended December 31, 2015 compared with year ended December 31, 2014Operating expenses included in corporate-level activity increase d primarily due to $11.0 million of transaction costs related to the HD Vest acquisition and a$4.2 million increase in personnel expenses, mainly from higher average headcount to support operations and $1.8 million of separation-related costs in connectionwith the upcoming departure of our chief executive officer.Stock-based compensation was unchanged but consisted of the following--a net increase in stock award grants, offset by stock-based compensation on stockoptions that vested upon the completion of the HSW acquisition in the second quarter of 2014. The Company granted stock options to certain Blucora employeeswho performed acquisition-related services. The vesting of such options were predicated on completing “qualified acquisitions” under the terms of the options. Thecompletion of the HSW acquisition constituted a qualified acquisition.Depreciation increased primarily due to depreciation expense on fixed assets attributable to TaxAct.Amortization of acquired intangible assets was comparable to the prior period.Year ended December 31, 2014 compared with year ended December 31, 2013Operating expenses included in corporate-level activity increase d primarily due to a $0.5 million increase in corporate business insurance expenses mainlyrelated to the timing of policy premiums in connection with our acquisitions, offset by a $0.1 million net decrease in personnel expenses. The net decrease inpersonnel expenses consisted of lower bonus amounts consistent with company performance in 2014, offset by higher average headcount to support operations andhigher employee separation costs mainly related to leadership changes.34Table of ContentsStock-based compensation, depreciation, and amortization of acquired intangible assets were comparable to the prior period.OPERATING EXPENSES Cost of Revenue(In thousands, except percentages)Years ended December 31, 2015Change2014Change2013Services cost of revenue$6,167 $287 $5,880 $(664) $6,544Amortization of acquired technology7,546 96 7,450 — 7,450Total cost of revenue$13,713 $383 $13,330 $(664) $13,994Percentage of revenue12% 13% 15%We record the cost of revenue for sales of services when the related revenue is recognized. Services cost of revenue consists of costs related to our TaxPreparation business, which include royalties, bank product services fees, and costs associated with the operation of its data centers. Data center costs includepersonnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs), software support and maintenance, bandwidth and hostingcosts, and depreciation. Cost of revenue also includes the amortization of acquired technology.Year ended December 31, 2015 compared with year ended December 31, 2014Services cost of revenue increased primarily due to higher data center costs related to software support and maintenance fees.Amortization of acquired technology was comparable to the prior period.Year ended December 31, 2014 compared with year ended December 31, 2013Services cost of revenue decreased primarily due to lower data center operating costs and lower bank product service fees.Amortization of acquired technology was comparable to the prior period.Engineering and Technology(In thousands, except percentages)Years ended December 31, 2015Change2014Change2013Engineering and technology$5,107 $1,349 $3,758 $509 $3,249Percentage of revenue4% 4% 4%Engineering and technology expenses are associated with the research, development, support, and ongoing enhancements of our offerings, which includepersonnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs), the cost of temporary help and contractors to augment ourstaffing, software support and maintenance, and professional services fees.Year ended December 31, 2015 compared with year ended December 31, 2014Engineering and technology expenses increased primarily due to a $1.0 million increase in personnel expenses, primarily due to higher average headcount inour Tax Preparation business.Year ended December 31, 2014 compared with year ended December 31, 2013Engineering and technology expenses increased primarily due to a $0.4 million increase in personnel expenses, primarily due to higher average headcount inour Tax Preparation business.35Table of ContentsSales and Marketing(In thousands, except percentages)Years ended December 31, 2015 Change 2014 Change 2013Sales and marketing$45,854 $3,183 $42,671 $2,499 $40,172Percentage of revenue39% 41% 44%Sales and marketing expenses consist principally of marketing expenses associated with our TaxAct business (which include television, radio, online, text,email, and sponsorship channels) and personnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs) for personnel engaged inmarketing and selling activities.Year ended December 31, 2015 compared with year ended December 31, 2014Sales and marketing expenses increased primarily due to a $2.0 million increase in marketing expenses and a $0.8 million increase in personnel expenses.The increase in marketing expenses was driven by increased marketing campaign activity for the current tax season in our Tax Preparation business. Personnelexpenses increased primarily due to higher average headcount in our Tax Preparation business.Year ended December 31, 2014 compared with year ended December 31, 2013Sales and marketing expenses increased primarily due to a $1.4 million increase in personnel expenses and a $0.5 million increase in marketing expenses.Personnel expenses increased primarily due to higher average headcount in our Tax Preparation business. The increase in marketing expenses was driven byincreased marketing campaign activity for the related tax season in our Tax Preparation business.General and Administrative(In thousands, except percentages)Years ended December 31, 2015 Change 2014 Change 2013General and administrative$43,563 $18,248 $25,315 $1,969 $23,346Percentage of revenue37% 24% 26%General and administrative (“ G&A ”) expenses consist primarily of personnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs), the cost of temporary help and contractors to augment our staffing, professional services fees (which include legal, audit, and tax fees), generalbusiness development and management expenses, occupancy and general office expenses, business taxes, and insurance expenses.Year ended December 31, 2015 compared with year ended December 31, 2014G&A expenses increased primarily due to $11.0 million in transaction costs related to the HD Vest acquisition and a $6.0 million increase in personnelexpenses, resulting from higher average headcount to support operations and $1.8 million of separation-related costs in connection with the upcoming departure ofour chief executive officer.Year ended December 31, 2014 compared with year ended December 31, 2013G&A expenses increased primarily due to a $1.0 million net increase in personnel expenses, resulting from higher average headcount to support operationsand higher employee separation costs mainly related to leadership changes, offset by lower bonus amounts consistent with company performance in 2014. Theremaining increase in G&A expenses primarily related to a $0.5 million increase in corporate business insurance expenses mainly related to the timing of policypremiums in connection with our acquisitions.36Table of ContentsDepreciation and Amortization of Acquired Intangible Assets(In thousands, except percentages)Years ended December 31, 2015 Change 2014 Change 2013Depreciation$1,521 $221 $1,300 $62 $1,238Amortization of acquired intangible assets12,757 15 12,742 50 12,692Total$14,278 $236 $14,042 $112 $13,930Percentage of revenue12% 14% 15%Depreciation of property and equipment includes depreciation of computer equipment and software, office equipment and furniture, and leaseholdimprovements not recognized in cost of revenue. Amortization of acquired intangible assets primarily includes the amortization of customer relationships, whichare amortized over their estimated lives.Year ended December 31, 2015 compared with year ended December 31, 2014Depreciation and amortization of acquired intangible assets were comparable to the prior period.Year ended December 31, 2014 compared with year ended December 31, 2013Depreciation and amortization of acquired intangible assets were comparable to the prior period.Other Loss, Net(In thousands)Years ended December 31, 2015 Change 2014 Change 2013Interest income$(609) $(254) $(355) $(55) $(300)Interest expense9,044 (432) 9,476 210 9,266Amortization of debt issuance costs1,133 74 1,059 (40) 1,099Accretion of debt discounts3,866 272 3,594 768 2,826Loss on debt extinguishment and modificationexpense398 398 — (1,593) 1,593Loss on derivative instrument— — — (11,652) 11,652Impairment of equity investment in privately-heldcompany— — — (3,711) 3,711Gain on third party bankruptcy settlement(1,128) (842) (286) 253 (539)Other(162) (163) 1 (259) 260Other loss, net$12,542 $(947) $13,489 $(16,079) $29,568Year ended December 31, 2015 compared with year ended December 31, 2014The decrease in interest expense primarily related to a lower balance on the TaxAct 2013 credit facility.The increase in loss on debt extinguishment and modification expense related to the closure of the TaxAct 2013 credit facility in December 2015, at whichpoint the remaining related unamortized debt issuance costs were written off.The gain on third party bankruptcy settlement related to amounts received in connection with ongoing distributions from the Lehman Brothers estate, ofwhich we are a creditor.Year ended December 31, 2014 compared with year ended December 31, 2013The increases in interest expense and accretion of debt discounts primarily related to the Convertible Senior Notes issued in March 2013, offset by decreasesin the same categories due to the TaxAct credit facility refinancing in August 2013 and payments of the related principal balance in 2014.37Table of ContentsLoss on debt extinguishment and modification expense related to the TaxAct credit facility refinancing in August 2013. Refer to " Note 8: Debt " of theNotes to Consolidated Financial Statements in Part II Item 8 of this report.On November 21, 2013, the Warrant to purchase 1.0 million shares of Blucora common stock was exercised in full. The change in the fair value of theWarrant, driven by the change in the value of our common stock, resulted in an $11.7 million loss on derivative instrument during 2013. Refer to " Note 2:Summary of Significant Accounting Policies " and " Note 10: Stockholders' Equity " of the Notes to Consolidated Financial Statements in Part II Item 8 of thisreport.In 2013, in connection with a review of our equity method investments for other-than-temporary impairment, we determined that our equity investment in aprivately-held company had experienced an other-than-temporary decline in value, due to recurring losses from operations, significant personnel reductions, and achange in the underlying business model. Accordingly, we wrote down the $3.7 million carrying value of the investment to zero, resulting in a loss.Income TaxesDuring 2015 , we recorded an income tax benefit of $4.6 million . Income tax differed from taxes at the statutory rates primarily due to the non-deductibleacquisition-related transaction costs.During 2014 , we recorded an income tax benefit of $3.3 million . Income taxes did not differ materially from taxes at the statutory rateDuring 2013 , we recorded an income tax benefit of $7.4 million . Income tax differed from taxes at the statutory rates primarily due to the non-deductibleloss on the Warrant derivative (see " Note 10: Stockholders' Equity " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report).At December 31, 2015 , we had gross temporary differences representing future tax deductions of $687.2 million , which represented deferred tax assetsprimarily comprised of $521.1 million of federal net operating loss carryforwards. We applied a valuation allowance against the net operating loss carryforwardsand certain other deferred tax assets. If in the future, we determine that any additional portion of the deferred tax assets is more likely than not to be realized, wewill record a benefit to the income statement or additional paid-in-capital, as appropriate.Discontinued Operations, Net of Income Taxes(In thousands)Years ended December 31, 2015 Change 2014 Change 2013Discontinued operations, net of income taxes$(27,348) $2,655 $(30,003) $(80,063) $50,060On October 14, 2015, we announced our plans to focus on the technology-enabled financial solutions market, which we refer to as the “StrategicTransformation.” The Strategic Transformation includes plans to divest the Search and Content and E-Commerce businesses. Our results of operations reflect theSearch and Content and E-Commerce businesses as discontinued operations for all periods presented. Amounts in discontinued operations include previouslyunallocated depreciation, amortization, stock-based compensation, income taxes, and other corporate expenses that were attributable to the Search and Content andE-Commerce businesses. In addition, discontinued operations included impairments of goodwill and intangible assets of $15.1 million and $5.9 million related toSearch and Content goodwill and the HSW trade name, respectively, and impairments of goodwill and intangible assets of $33.8 million and $4.2 million related toE-Commerce goodwill and the Monoprice trade name, respectively, all recognized in the fourth quarter of 2015. Impairments of goodwill and intangible assets of$59.4 million and $3.2 million related to E-Commerce goodwill and the Monoprice trade name, respectively, also were recognized in the fourth quarter of 2014.See " Note 4: Discontinued Operations " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information ondiscontinued operations. For a discussion of the risks associated with these pending divestitures, see the section in our Risk Factors (Part I Item 1A. of this report)under the heading "Risks Associated With our Strategic Transformation."NON-GAAP FINANCIAL MEASURESAdjusted EBITDA: We define Adjusted EBITDA differently for this report than we have defined it in the past, due to the discontinued operations treatmentof our Search and Content and E-Commerce businesses as determined in the fourth quarter38Table of Contentsof 2015, as well as transaction costs related to the HD Vest acquisition and separation-related costs in connection with the upcoming departure of our chiefexecutive officer both of which were announced in the fourth quarter of 2015. We define Adjusted EBITDA as income (loss) from continuing operations,determined in accordance with GAAP, excluding the effects of income taxes, depreciation, amortization of acquired intangible assets (including acquiredtechnology), stock-based compensation, acquisition-related transaction costs, CEO separation-related costs, and other loss, net (which primarily includes itemssuch as interest income, interest expense, amortization of debt issuance costs, accretion of debt discounts, loss on debt extinguishment and modification expense,loss on derivative instrument, other-than-temporary impairment loss on equity investment, and gain on third party bankruptcy settlement).We believe that Adjusted EBITDA provides meaningful supplemental information regarding our performance. We use this non-GAAP financial measure forinternal management and compensation purposes, when publicly providing guidance on possible future results, and as a means to evaluate period-to-periodcomparisons. We believe that Adjusted EBITDA is a common measure used by investors and analysts to evaluate our performance, that it provides a morecomplete understanding of the results of operations and trends affecting our business when viewed together with GAAP results, and that management and investorsbenefit from referring to this non-GAAP financial measure. Items excluded from Adjusted EBITDA are significant and necessary components to the operations ofour business and, therefore, Adjusted EBITDA should be considered as a supplement to, and not as a substitute for or superior to, GAAP income (loss) fromcontinuing operations. Other companies may calculate Adjusted EBITDA differently and, therefore, our Adjusted EBITDA may not be comparable to similarlytitled measures of other companies. A reconciliation of our Adjusted EBITDA to income (loss) from continuing operations, which we believe to be the mostcomparable GAAP measure, is presented below:(In thousands)Years ended December 31, 201520142013Loss from continuing operations$(12,726) $(5,544) $(25,661)Stock-based compensation8,694 8,694 8,499Depreciation and amortization of acquired intangible assets22,590 22,164 21,973Acquisition-related transaction costs10,988 — —CEO separation-related costs1,769 — —Other loss, net12,542 13,489 29,568Income tax benefit(4,623) (3,342) (7,385)Adjusted EBITDA$39,234 $35,461 $26,994Year ended December 31, 2015 compared with year ended December 31, 2014The increase in Adjusted EBITDA was due to an increase in segment operating income of $7.3 million related to growth in our Tax Preparation segment,offset by a $3.5 million increase in corporate operating expenses not allocated to the segments primarily related to an increase in personnel expenses (mainly due tohigher average headcount to support operations).Year ended December 31, 2014 compared with year ended December 31, 2013The increase in Adjusted EBITDA was due to an increase in segment operating income of $9.1 million related to growth in our Tax Preparation segment,offset by a $0.6 million increase in corporate operating expenses not allocated to the segments primarily related to an increase in corporate business insuranceexpenses (mainly due to the timing of policy premiums in connection with our acquisitions).Non-GAAP income from continuing operations : We define non-GAAP income from continuing operations differently for this report than we have defined itin the past, due to the discontinued operations treatment of our Search and Content and E-Commerce businesses as determined in the fourth quarter of 2015, as wellas transaction costs related to the HD Vest acquisition and separation-related costs in connection with the upcoming departure of our chief executive officer both ofwhich were announced in the fourth quarter of 2015. For this report, we define non-GAAP income from continuing operations as income (loss) from continuingoperations, determined in accordance with GAAP, excluding the effects of stock-based compensation, amortization of acquired intangible assets (included acquiredtechnology), accretion of debt discount on the Convertible Senior Notes, loss on debt extinguishment and modification expense, loss on derivative instrument,other-than-temporary impairment loss on equity investment, acquisition-related transaction costs, CEO separation-related costs, the related cash tax impact of thoseadjustments, and non-cash income taxes. We exclude the non-cash portion of income taxes because of our ability to offset a substantial portion of our cash taxliabilities by using deferred tax assets, which primarily consist of U.S. federal net operating losses. The majority of these net operating losses will expire, ifunutilized, between 2020 and 2024 .39Table of ContentsWe believe that non-GAAP income from continuing operations and non-GAAP income from continuing operations per share provide meaningfulsupplemental information to management, investors, and analysts regarding our performance and the valuation of our business by excluding items in the statementof operations that we do not consider part of our ongoing operations or have not been, or are not expected to be, settled in cash. Additionally, we believe that non-GAAP income from continuing operations and non-GAAP income from continuing operations per share are common measures used by investors and analysts toevaluate our performance and the valuation of our business. Non-GAAP income from continuing operations should be evaluated in light of our financial resultsprepared in accordance with GAAP and should be considered as a supplement to, and not as a substitute for or superior to, GAAP income (loss) from continuingoperations. Other companies may calculate non-GAAP income from continuing operations differently, and, therefore, our non-GAAP income from continuingoperations may not be comparable to similarly titled measures of other companies. A reconciliation of our non-GAAP income from continuing operations toincome (loss) from continuing operations, which we believe to be the most comparable GAAP measure, is presented below:(In thousands, except per share amounts)Years ended December 31, 2015 2014 2013Loss from continuing operations$(12,726) $(5,544) $(25,661)Stock-based compensation8,694 8,694 8,499Amortization of acquired intangible assets20,303 20,192 20,142Accretion of debt discount on Convertible Senior Notes3,866 3,594 2,674Loss on debt extinguishment and modification expense398 — 1,593Loss on derivative instrument— — 11,652Impairment of equity investment in privately-held company— — 3,711Acquisition-related transaction costs10,988 — —CEO separation-related costs1,769 — —Cash tax impact of adjustments to GAAP net income(236) (151) (209)Non-cash income tax benefit(4,857) (3,459) (7,441)Non-GAAP income from continuing operations$28,199 $23,326 $14,960Per diluted share: Loss from continuing operations(0.30) (0.13) (0.59)Stock-based compensation0.21 0.20 0.19Amortization of acquired intangible assets0.49 0.47 0.46Accretion of debt discount on Convertible Senior Notes0.09 0.08 0.06Loss on debt extinguishment and modification expense0.01 — 0.04Loss on derivative instrument— — 0.27Impairment of equity investment in privately-held company— — 0.08Acquisition-related transaction costs0.26 — —CEO separation-related costs0.04 — —Cash tax impact of adjustments to GAAP net income(0.01) 0.00 0.00Non-cash income tax benefit(0.12) (0.08) (0.17)Non-GAAP income from continuing operations$0.67 $0.54 $0.34Weighted average shares outstanding used in computing per diluted share amounts, includingthe "Loss from continuing operations" amount41,861 42,946 43,480Year ended December 31, 2015 compared with year ended December 31, 2014The increase in non-GAAP income from continuing operations primarily was due an increase in segment operating income of $7.3 million related to growthin our Tax Preparation segment, offset by a $3.5 million increase in corporate operating expenses not allocated to the segments primarily related to an increase inpersonnel expenses (mainly due to higher average headcount to support operations).40Table of ContentsYear ended December 31, 2014 compared with year ended December 31, 2013The increase in non-GAAP income from continuing operations primarily was due to an increase in segment operating income of $9.1 million related togrowth in our Tax Preparation segment, offset by a $0.6 million increase in corporate operating expenses not allocated to the segments primarily related to anincrease in corporate business insurance expenses (mainly due to the timing of policy premiums in connection with our acquisitions).LIQUIDITY AND CAPITAL RESOURCESCash, Cash Equivalents, and Short-Term InvestmentsOur principal source of liquidity is our cash, cash equivalents, and short-term investments. As of December 31, 2015 , we had cash and marketableinvestments of $66.8 million , consisting of cash and cash equivalents of $55.5 million and available-for-sale investments of $11.3 million . We generally investour excess cash in high quality marketable investments. These investments generally include debt instruments issued by the U.S. federal government and itsagencies, international governments, municipalities and publicly-held corporations, as well as commercial paper, insured time deposits with commercial banks, andmoney market funds invested in securities issued by agencies of the U.S., although specific holdings can vary from period to period depending upon our cashrequirements. Our financial instrument investments held at December 31, 2015 had minimal default risk and short-term maturities.We have financed our operations primarily from cash provided by operating activities. Accordingly, we believe that the cash generated from our operationsand the cash and cash equivalents we have on hand will be sufficient to meet our operating, working capital, and capital expenditure requirements for at least thenext 12 months. However, the underlying levels of revenues and expenses that we project may not prove to be accurate. For further discussion of the risks to ourbusiness related to liquidity, see the paragraph in our Risk Factors (Part I Item 1A of this report) under the heading " Existing cash and cash equivalents, short-terminvestments, and cash generated from operations may not be sufficient to meet our anticipated cash needs for servicing debt, working capital, and capitalexpenditures. "Use of CashWe may use our cash, cash equivalents, and short-term investments balance in the future on investment in our current businesses, for repayment of debt, forstock repurchases and/or the payment of ordinary dividends, or for acquiring companies or assets that complement our Wealth Management and Tax Preparationbusinesses. We currently are focused on the following areas: product innovation and offering expansion, as well as customer support, education, and training.On October 14, 2015, we announced our plans to focus on the technology-enabled financial solutions market, which we refer to as the “StrategicTransformation.” Our Strategic Transformation consists of the acquisition of HD Vest, which closed on December 31, 2015 , plans to divest our Search andContent and E-Commerce businesses, and plans to reduce corporate operating expenses. We also expect to shift our capital allocation priority in the near-term topay down debt, which includes using at least 50% of the net divestiture proceeds to pay down the new TaxAct - HD Vest 2015 credit facility per the debtagreement. See the "Strategic Transformation" subsection above for additional detail regarding the related use of cash. Related to the acquisition of HD Vest, wepaid $610.5 million in cash, which was funded by a combination of cash on hand and the new TaxAct - HD Vest 2015 credit facility. The TaxAct - HD Vest 2015credit facility agreement includes a revolving credit loan and a term loan and amounts to $425.0 million . The final maturity dates of the revolving credit loan andterm loan are December 31, 2020 and December 31, 2022 , respectively. The interest rate is variable, based on LIBOR plus a margin that depends upon TaxAct andHD Vest's combined net leverage to EBITDA ratio. The credit facility includes financial and operating covenants, including a net leverage to EBITDA ratio, whichare defined further in the agreement. We borrowed $400.0 million on the credit facility in 2015.On July 2, 2015 , TaxACT acquired SimpleTax for C$2.4 million (with C$ indicating Canadian dollars and amounting to approximately $1.9 million basedon the acquisition-date exchange rate) in cash and additional consideration of up to C$4.6 million ( $3.7 million ) that is contingent upon product availability andrevenue performance over a three -year period.On August 30, 2013, TaxAct entered into an agreement to refinance a 2012 credit facility on more favorable terms. Under that 2012 credit facility, TaxActborrowed $100.0 million, of which $25.5 million was repaid in 2012, $10.0 million in April 2013, and the remaining $64.5 million in August 2013, the latteramount in connection with the refinancing of this credit agreement. TaxAct initially borrowed $71.4 million under the 2013 credit facility and had net repaymentactivity of approximately $51.9 million and $19.4 million in 2015 and 2014 , respectively. TaxAct had the right to permanently reduce, without premium orpenalty, the entire credit facility at any time. In accordance with this provision, TaxAct repaid the41Table of Contentsoutstanding amount under the credit facility in full in 2015, at which point the credit facility was closed and the remaining related debt issuance costs were writtenoff. For further detail, see " Note 8: Debt " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.On March 15, 2013, we issued $201.25 million principal amount of 4.25% Convertible Senior Notes (the “ Notes ”). The Notes mature April 1, 2019, unlessearlier purchased, redeemed, or converted in accordance with their terms. The Notes bear interest at a rate of 4.25% per year, payable semi-annually in arrearsbeginning on October 1, 2013. We received net proceeds from the offering of approximately $194.8 million. There are no financial or operating covenants relatingto the Notes. As of May 2013, we are permitted to settle conversions in cash, shares of our common stock, or a combination of cash and shares of our commonstock, at our election. We intend to satisfy any conversion premium by issuing shares of our common stock. For further detail, see " Note 8: Debt " of the Notes toConsolidated Financial Statements in Part II Item 8 of this report.Our Board of Directors approved a stock repurchase program whereby we may purchase our common stock in open-market transactions. In May 2014, ourBoard of Directors increased the repurchase authorization, such that we may repurchase up to $85.0 million of our common stock, and extended the repurchaseperiod through May 2016. We had the following open-market share purchase activity, exclusive of purchase and administrative costs:(In thousands, except per share data)Total Numberof Shares Purchased Average Price Paidper Share Total CostYear ended December 31, 2015551 $14.01 $7,713Year ended December 31, 20142,289 $16.85 $38,558Year ended December 31, 2013418 $23.95 $9,990As of December 31, 2015 , we may repurchase up to an additional $28.7 million of our common stock under the repurchase program. For further detail, see "Note 10: Stockholders' Equity " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.Contractual Obligations and CommitmentsOur contractual obligations and commitments are as follows for years ending December 31:(In thousands)2016 2017 2018 2019 2020 Thereafter TotalOperating lease commitments$3,871 $3,945 $4,026 $4,105 $3,795 $6,098 $25,840Purchase commitments3,082 3,002 2,530 — — — 8,614Debt commitments33,200 32,560 20,640 221,250 10,000 290,000 607,650Interest on Notes8,553 8,553 8,553 4,277 — — 29,936Acquisition-related contingentconsideration liability— 723 962 1,266 — — 2,951Total$48,706 $48,783 $36,711 $230,898 $13,795 $296,098 $674,991For further detail see " Note 9: Commitments and Contingencies " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.Off-balance Sheet ArrangementsWe have no off-balance sheet arrangements other than operating leases.Unrecognized Tax BenefitsThe above table does not reflect unrecognized tax benefits of approximately $3.4 million , the timing of which is uncertain. For additional discussion onunrecognized tax benefits see " Note 14: Income Taxes " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.42Table of ContentsCash FlowsOur cash flows were comprised of the following:(In thousands)Years ended December 31, 2015 2014 2013Net cash provided by operating activities from continuing operations$16,341 $20,128 $28,011Net cash used by investing activities from continuing operations(336,024) (54,003) (121,208)Net cash provided (used) by financing activities from continuing operations328,619 (46,465) 196,203Net cash provided (used) by continuing operations8,936 (80,340) 103,006Net cash provided (used) by discontinued operations4,586 2,359 (51,341)Effect of exchange rate changes on cash and cash equivalents(17) — —Net increase (decrease) in cash and cash equivalents$13,505 $(77,981) $51,665Net cash from the operating activities of continuing operations: Net cash from the operating activities of continuing operations consists of income (loss) fromcontinuing operations, offset by certain non-cash adjustments, and changes in our working capital.Net cash provided by operating activities was $16.3 million , $20.1 million , and $28.0 million for the years ended December 31, 2015 , 2014 , and 2013 ,respectively. The activity in 2015 included an $11.2 million working capital contribution and approximately $5.2 million of non-cash adjustments and a loss fromcontinuing operations. The working capital contribution continued to be driven by accrued expenses and the impact of excess tax benefits from stock-based activityprimarily due to utilizing equity net operating loss carryforwards from prior years, and also included separation-related costs accrued in connection with theupcoming departure of our chief executive officer.The activity in 2014 included a $2.6 million working capital contribution and approximately $17.6 million of non-cash adjustments and a loss fromcontinuing operations. The working capital contribution was driven by accrued expenses and the impact of excess tax benefits from stock-based activity, offset byincreased prepaid expense balances related to the timing of TaxAct's spending on marketing campaigns for the related tax season.The activity in 2013 included a $14.6 million working capital contribution and approximately $13.4 million of non-cash adjustments and a loss fromcontinuing operations. The working capital contribution was driven by accrued expenses and the impact of excess tax benefits from stock-based activity, as well asdecreased prepaid expense balances related to the timing of TaxAct's spending on marketing campaigns for the related tax season. The contribution from deferredrevenue was attributable to TaxAct revenue arrangements.Net cash from the investing activities of continuing operations: Net cash from the investing activities of continuing operations primarily consists of cashoutlays for business acquisitions, transactions (purchases, as well as proceeds from sales and maturities) related to our investments, and purchases of property andequipment. Our investing activities tend to fluctuate from period to period primarily based upon the level of acquisition activity.Net cash used by investing activities was $336.0 million , $54.0 million , and $121.2 million for the years ended December 31, 2015 , 2014 , and 2013 ,respectively. The activity in 2015 primarily consisted of the acquisitions of HD Vest and SimpleTax for a combined $573.4 million and $1.5 million in purchasesof property and equipment, offset by net cash inflows on our available-for-sale investments of $238.7 million . The activity in 2014 primarily consisted of net cashoutlays on our available-for-sale investments of $52.0 million and $2.0 million in purchases of property and equipment. The activity in 2013 primarily consisted ofnet cash outlays on our available-for-sale investments of $112.5 million , the acquisition of Balance Financial for $4.9 million , and $2.4 million in purchases ofproperty and equipment.Net cash from the financing activities of continuing operations: Net cash from the financing activities of continuing operations primarily consists oftransactions related to the issuance of debt and stock. Our financing activities tend to fluctuate from period to period based upon our financing needs due to thelevel of acquisition activity and market conditions that present favorable financing opportunities.Net cash provided by financing activities was $328.6 million for the year ended December 31, 2015 . The activity in 2015 primarily consisted of $378.3million in proceeds from the TaxAct - HD Vest credit facility, $8.0 million in excess tax benefits from stock-based activity primarily due to utilizing equity netoperating loss carryforwards from prior years, and $3.6 million43Table of Contentsin combined proceeds from the issuance of common stock related to stock option exercises and the employee stock purchase plan. These cash inflows were offsetby payments of $51.9 million on the TaxAct 2013 credit facility, stock repurchases of $7.7 million , and $1.5 million in tax payments from shares withheld uponvesting of restricted stock units.Net cash used by financing activities was $46.5 million for the year ended December 31, 2014 . The activity for 2014 primarily consisted of payments of$56.0 million on the TaxAct 2013 credit facility, stock repurchases of $38.7 million , and $2.9 million in tax payments from shares withheld upon vesting ofrestricted stock units. These cash outflows were offset by approximately $36.6 million in proceeds from the TaxAct 2013 credit facility, $8.1 million in combinedproceeds from the issuance of common stock related to stock option exercises and the employee stock purchase plan, and $6.4 million in excess tax benefits fromstock-based activity primarily due to utilizing equity net operating loss carryforwards from prior years.Net cash provided by financing activities was $196.2 million for the year ended December 31, 2013 . The activity for 2013 consisted of $200.8 million incombined net proceeds from the Notes and the TaxAct 2013 credit facility, $13.5 million in combined proceeds from the issuance of common stock related to stockoption exercises, the employee stock purchase plan, and the Warrant exercise, and $4.3 million in excess tax benefits from stock-based activity primarily due toutilizing equity net operating loss carryforwards from prior years. These cash inflows were offset by a $10.0 million payment on the TaxAct 2012 credit facility,stock repurchases of $10.0 million , and $2.4 million in tax payments from shares withheld upon vesting of restricted stock units.Critical Accounting Policies and EstimatesThis Management’s Discussion and Analysis of Financial Condition and Results of Operations and the disclosures included elsewhere in this Annual Reporton Form 10-K are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financialstatements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and disclosure of contingencies.In some cases, we could have reasonably used different accounting policies and estimates.The SEC has defined a company’s most critical accounting policies as the ones that are the most important to the portrayal of the company’s financialcondition and results of operations and which require the company to make its most difficult and subjective judgments, often as a result of the need to makeestimates of matters that are inherently uncertain. On an ongoing basis, we evaluate the estimates used. We base our estimates on historical experience, currentconditions, and on various other assumptions that we believe to be reasonable under the circumstances and, based on information available to us at that time, wemake judgments about the carrying values of assets and liabilities that are not readily apparent from other sources as well as identify and assess our accountingtreatment with respect to commitments and contingencies. Actual results may differ significantly from these estimates under different assumptions, judgments, orconditions. We believe the following critical accounting policies involve the more significant judgments and estimates used in the preparation of our consolidatedfinancial statements. We also have other accounting policies that involve the use of estimates, judgments, and assumptions that are significant to understanding ourresults. For additional information, see " Note 2: Summary of Significant Accounting Policies " of the Notes to Consolidated Financial Statements in Part II Item 8of this report.Tax preparation revenue recognition : We derive service revenue from the sale of tax preparation online services, ancillary service offerings, packaged taxpreparation software, and multiple element arrangements that may include a combination of these items. Ancillary service offerings include tax preparation supportservices, data archive services, e-filing services, bank or reloadable pre-paid debit card services, and other value-added services. This revenue is recorded in theTax Preparation segment.Our Tax Preparation segment revenue consists primarily of hosted tax preparation online services, tax preparation support services, data archive services, ande-filing services. We recognize revenue from these services as the services are performed and the four revenue recognition criteria as described in " Note 2:Summary of Significant Accounting Policies " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report are met.We recognize revenue from the sale of our packaged software when legal title transfers. This is generally when our customers download the software fromthe Internet or when the software ships.The bank or reloadable prepaid debit card services are offered to taxpayers as an option to receive their tax refunds in the form of a prepaid bank card or tohave the fees for the software and/or services purchased by the customers deducted from their refunds. Other value-added service revenue consists of revenue fromrevenue sharing and royalty arrangements with third party partners. Revenue for these transactions is recognized when the four revenue recognition criteriadescribed above are44Table of Contentsmet; for some arrangements that is upon filing and for other arrangements that is upon our determination of when collectibility is probable.For software and/or services that consist of multiple elements, we must: (1) determine whether and when each element has been delivered; (2) determine thefair value of each element using the selling price hierarchy of vendor-specific objective evidence (“ VSOE ”) of fair value if available, third-party evidence (“ TPE”) of fair value if VSOE is not available, and estimated selling price (“ ESP ”) if neither VSOE nor TPE is available; and (3) allocate the total price among thevarious elements based on the relative selling price method. Once we have allocated the total price among the various elements, we recognize revenue when therevenue recognition criteria described above are met for each element.VSOE generally exists when we sell the deliverable separately. When VSOE cannot be established, we attempt to establish a selling price for each elementbased on TPE. TPE is determined based on competitor prices for similar deliverables when sold separately. When we are unable to establish selling price usingVSOE or TPE, we use ESP in our allocation of arrangement consideration. ESP is the estimated price at which we would sell the software or service if it were soldon a stand-alone basis. We determine ESP for the software or service by considering multiple factors including, but not limited to, historical stand-alone sales,pricing practices, market conditions, competitive landscape, internal costs, and gross margin objectives.In some situations, we receive advance payments from our customers. We defer revenue associated with these advance payments and recognize theconsideration for each element when we ship the software or perform the services, as appropriate. Advance payments related to data archive services are deferredand recognized over the related contractual term.Cost of revenue: We record the cost of revenue for sales of services when the related revenue is recognized. "Services cost of revenue" consists of costsrelated to the Tax Preparation business, which include royalties, bank product service fees, and costs associated with the operation of its data centers. Data centercosts include personnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs), software support and maintenance, bandwidthand hosting costs, and depreciation. Cost of revenue also includes the amortization of acquired technology.Sales and marketing expenses: Sales and marketing expenses consist principally of marketing expenses associated with our TaxAct business (which includetelevision, radio, online, text, email, and sponsorship channels) and personnel expenses (salaries, stock-based compensation, benefits, and other employee-relatedcosts) for personnel engaged in marketing and selling activities.Stock-based compensation: We measure stock-based compensation at the grant date based on the fair value of the award and recognize it as expense, net ofestimated forfeitures, over the vesting or service period, as applicable, of the stock award using the straight-line method. We recognize stock-based compensationover the vesting period for each separately vesting portion of a share-based award as if they were individual share-based awards. We estimate forfeitures at the timeof grant and revise those estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates.Calculating stock-based compensation relies upon certain assumptions, including the expected term of the stock-based awards, expected stock pricevolatility, expected interest rate, number and types of stock-based awards, and the pre-vesting forfeiture rate. If we use different assumptions due to changes in ourbusiness or other factors, our stock-based compensation could vary materially in the future.Income taxes : We account for income taxes under the asset and liability method, under which deferred tax assets, including net operating loss carryforwards,and liabilities are determined based on temporary differences between the book and tax bases of assets and liabilities. We periodically evaluate the likelihood of therealization of deferred tax assets and reduce the carrying amount of the deferred tax assets by a valuation allowance to the extent we believe a portion will not berealized. We consider many factors when assessing the likelihood of future realization of the deferred tax assets, including expectations of future taxable income,recent cumulative earnings experience by taxing jurisdiction, and other relevant factors. There is a wide range of possible judgments relating to the valuation of ourdeferred tax assets.We record liabilities to address uncertain tax positions that have been taken in previously filed tax returns or that are expected to be taken in a future taxreturn. The determination for required liabilities is based upon an analysis of each individual tax position, taking into consideration whether it is more likely thannot that the tax position, based on technical merits, will be sustained upon examination. The tax benefit to be recognized in the financial statements from such aposition is measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the taxing authority.The difference between the amount recognized and the total tax position is recorded as a liability. The ultimate resolution of these tax positions may be greater orless than the liabilities recorded.45Table of ContentsFor additional information about the realization of our deferred tax assets and our valuation allowance, see " Note 14: Income Taxes " of the Notes toConsolidated Financial Statements in Part II Item 8 of this report. For additional information about our net operating loss carryforwards, see the Risk Factor " Ifthere is a change in our ownership within the meaning of Section 382 of the Internal Revenue Code, our ability to use our net operating loss carryforwards (“ NOLs”) may be severely limited or potentially eliminated. " in Part I Item 1A of this report. For additional information about expectations of future taxable income, seethe Risk Factor " Our financial results may fluctuate, which could cause our stock price to be volatile or decline. " in Part I Item 1A of this report.Business combinations and intangible assets including goodwill : We account for business combinations using the acquisition method. The acquisition-datefair value of total consideration includes cash and contingent consideration. Since we are contractually obligated to pay contingent consideration upon theachievement of specified objectives, a contingent consideration liability is recorded at the acquisition date and is classified within Level 3 of the fair valuehierarchy because we value the liability utilizing significant inputs not observable in the market. Specifically, we have determined the fair value of the contingentconsideration liability based on a probability-weighted discounted cash flow analysis, which includes assumptions related to estimating revenues, the probability ofpayment, and the discount rate. We review our assumptions related to the fair value of the contingent consideration liability each reporting period and, if there arematerial changes, revalue the contingent consideration liability based on the revised assumptions, until such contingency is satisfied through payment upon theachievement of the specific objectives. The change in the fair value of the contingent consideration liability is recognized in the consolidated statements ofcomprehensive income for the period in which the fair value changes. If we use different assumptions due to changes in our business or other factors, the fair valueof the contingent consideration liability could vary materially in the future.Goodwill is calculated as the excess of the acquisition-date fair value of total consideration over the acquisition-date fair value of net assets, including theamount assigned to identifiable intangible assets, and is assigned to reporting units that are expected to benefit from the synergies of the business combination as ofthe acquisition date. Reporting units are consistent with reportable segments and include the former Search and Content and E-Commerce segments. Identifiableintangible assets with finite lives are amortized over their useful lives on a straight-line basis. Acquisition-related costs, including advisory, legal, accounting,valuation, and other similar costs, are expensed in the periods in which the costs are incurred. The results of operations of acquired businesses are included in theconsolidated financial statements from the acquisition date.Goodwill and intangible assets impairment: We evaluate goodwill and indefinite-lived intangible assets for impairment annually, as of November 30, ormore frequently when events or circumstances indicate that impairment may have occurred. As part of the impairment evaluation, we may elect to perform anassessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit (for goodwill) or anindefinite-lived intangible asset is less than its carrying value, or if we elect to bypass the qualitative assessment, we then would proceed with the quantitativeimpairment test.The goodwill quantitative impairment test is a two-step process that first compares the carrying values of reporting units to their fair values. If the carryingvalue of a reporting unit exceeds the fair value, a second step is performed to compute the amount of impairment. This second step determines the current fairvalues of all assets and liabilities of a reporting unit and then compares the implied fair value of the reporting unit's goodwill to the carrying value of that goodwill.If the carrying value of the reporting unit's goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in an amount equal to theexcess.The indefinite-lived intangible asset quantitative impairment test compares the carrying value of the intangible asset to its fair value. If the carrying value ofthe intangible asset exceeds the fair value, an impairment loss is recognized in an amount equal to the excess.Fair value typically is estimated using the present value of future discounted cash flows, an income approach. The significant estimates in the discountedcash flow model include the weighted-average cost of capital, long-term rates of revenue growth and/or profitability of our businesses, and working capital effects.The weighted-average cost of capital considers the relevant risk associated with business-specific characteristics and the uncertainty related to each business'sability to achieve the projected cash flows. To validate the reasonableness of the reporting unit fair values, we reconcile the aggregate fair values of our reportingunits to the aggregate market value of our common stock on the date of valuation, while considering a reasonable acquisition premium. These estimates and theresulting valuations require significant judgment.Definite-lived intangible assets are reviewed for impairment when events or circumstances indicate that the carrying value of an asset or group of assets maynot be recoverable. The determination of recoverability is based on an estimate of pre-tax undiscounted future cash flows, using our best estimates of future netsales and operating expenses, expected to result from46Table of Contentsthe use and eventual disposition of the asset or group of assets over the remaining economic life of the primary asset in the asset group. We measure the amount ofthe impairment as the excess of the asset's carrying value over its fair value.In 2015 , we performed quantitative assessments for our Search and Content and E-Commerce reporting units as of October 31, due to the Octoberannouncement of our plans to divest these businesses, and performed a qualitative assessment for our Tax Preparation reporting unit as of November 30. In 2014 ,we performed quantitative assessments for each of our reporting units as of November 30. As a result of these assessments, we recorded impairments of goodwilland intangible assets of $15.1 million and $5.9 million related to the Search and Content goodwill and the HSW trade name, respectively. and impairments ofgoodwill and intangible assets of $33.8 million and $4.2 million related to E-Commerce goodwill and the Monoprice trade name, respectively, all in the fourthquarter of 2015. We also recorded impairments of goodwill and intangible assets of $59.4 million and $3.2 million in the fourth quarter of 2014 related to E-Commerce goodwill and the Monoprice trade name, respectively. Impairments for both periods were recorded in discontinued operations. We also determined thatthe impairments related to the Search and Content and E-Commerce reporting units were indicators requiring the review of Search and Content and E-Commercelong-lived assets for recoverability. The results of this review indicated that their carrying values were recoverable.A deterioration in the assumptions used in determining fair value or in other unforeseen events--such as market disruptions and deterioration of themacroeconomic environment or internal challenges related to reorganizations, employee and management turnover, and other trends--could have material negativeimpacts on our estimates and the resulting valuations, which could lead to a decision to impair goodwill and/or intangible assets in future periods.For additional information about our goodwill and intangible assets, see " Note 4: Discontinued Operations " and " Note 5: Goodwill and Other IntangibleAssets " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.Equity method investments: We currently hold equity securities and warrants to purchase equity securities in companies whose securities are not publicly-traded. The equity method is used to account for investments in these companies, if the investment provides us with the ability to exercise significant influenceover operating and financial policies of the investees. We record our proportionate share of the net earnings or losses of equity method investees and acorresponding increase or decrease to the investment balances. We evaluate our equity method investments for impairment whenever events or changes incircumstances indicate, in management’s judgment, that the carrying value of such investment may have experienced a decline in value. See " Note 13: Other Loss,Net " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.Debt issuance costs and debt discounts: Debt issuance costs and debt discounts are deferred and amortized as interest expense under the effective interestmethod over the contractual term of the related debt, adjusted for prepayments in the case of our credit facilities.Debt issuance costs related to the Convertible Senior Notes issued in 2013 were allocated to the liability and equity components of the instrument. The debtissuance costs allocated to the liability component are amortized to interest expense through the earlier of the maturity date of the Notes or the date of conversion,if any. The debt issuance costs allocated to the equity component of the Notes were recorded as an offset to "Additional paid-in capital."Derivative instruments and hedging: We recognized derivative instruments as either assets or liabilities at their fair value. We recorded changes in the fairvalue of the derivative instruments as gains or losses either in " Other loss, net " on the consolidated statements of comprehensive income, for those not designatedas a hedging instrument (the Warrant - see " Note 10: Stockholders' Equity " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report), or in" Accumulated other comprehensive loss " on the consolidated balance sheets, for those used in a hedging relationship (the interest rate swap - see " Note 8: Debt "of the Notes to Consolidated Financial Statements in Part II Item 8 of this report). The Warrant and interest rate swap were settled in the last half of 2013. We hadno derivatives outstanding as of December 31, 2015 .Recent Accounting PronouncementsSee " Note 2: Summary of Significant Accounting Policies " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.47Table of ContentsQuarterly Results of Operations (Unaudited)The following table presents a summary of our unaudited consolidated results of operations for the eight quarters ended December 31, 2015 . Theinformation for each of these quarters has been prepared on a basis consistent with our annual audited consolidated financial statements. You should read thisinformation in conjunction with our consolidated financial statements and notes thereto in Part II Item 8. The operating results for any quarter are not necessarilyindicative of results for any future period. March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 (In thousands except per share data and percentages)Services revenue$72,279 $26,452$2,469$2,519$81,068$30,900$2,875$2,865Operating expenses: Cost of revenue: Services cost of revenue2,305 1,477 922 1,176 2,137 1,373 1,170 1,487Amortization of acquiredtechnology1,863 1,862 1,863 1,862 1,862 1,863 1,911 1,910Total cost of revenue4,168 3,3392,7853,0383,9993,2363,0813,397Engineering and technology897 893 940 1,028 1,090 1,130 1,251 1,636Sales and marketing31,352 6,451 2,011 2,857 33,018 7,693 2,113 3,030General and administrative5,898 6,218 6,086 7,113 7,146 7,653 8,895 19,869Depreciation318 322 326 334 351 356 394 420Amortization of otheracquired intangible assets3,185 3,186 3,185 3,186 3,186 3,185 3,195 3,191Total operating expenses45,818 20,40915,33317,55648,79023,25318,92931,543Operating income (loss)26,461 6,043(12,864)(15,037)32,2787,647(16,054)(28,678)Other loss, net(3,524) (3,229) (3,403) (3,333) (2,995) (3,034) (3,080) (3,433)Income (loss) from continuingoperations before incometaxes22,937 2,814(16,267)(18,370)29,2834,613(19,134)(32,111)Income tax benefit (expense)(8,710) (660) 6,037 6,675 (9,868) (2,202) 6,926 9,767Income (loss) from continuingoperations14,227 2,154 (10,230) (11,695) 19,415 2,411 (12,208) (22,344)Discontinued operations, net ofincome taxes11,760 6,583 7,992 (56,338) 3,685 1,840 1,597 (34,470)Net income (loss)$25,987 $8,737$(2,238)$(68,033)$23,100$4,251$(10,611)$(56,814)Net income (loss) per share - basic: Continuing operations$0.34 $0.05 $(0.25) $(0.29) $0.47 $0.06 $(0.30) $(0.55)Discontinued operations0.28 0.16 0.20 (1.38) 0.09 0.04 0.04 (0.84)Basic net income (loss) pershare$0.62 $0.21 $(0.05) $(1.67) $0.56 $0.10 $(0.26) $(1.39)Net income (loss) per share - diluted: Continuing operations$0.32 $0.05 $(0.25) $(0.29) $0.46 $0.06 $(0.30) $(0.55)Discontinued operations0.26 0.15 0.20 (1.38) 0.09 0.04 0.04 (0.84)Diluted net income (loss) pershare$0.58 $0.20 $(0.05) $(1.67) $0.55 $0.10 $(0.26) $(1.39)Weighted average shares outstanding: Basic42,162 41,570 41,034 40,820 40,987 40,918 40,950 40,979Diluted44,521 43,084 41,034 40,820 41,899 41,936 40,950 40,97948Table of Contents March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015Services revenue100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 %Operating expenses: Cost of revenue: Services cost of revenue3.2 5.6 37.3 46.7 2.6 4.4 40.7 51.9Amortization of acquiredtechnology2.6 7.0 75.5 73.9 2.3 6.0 66.5 66.7Total cost of revenue5.8 12.6 112.8 120.6 4.9 10.4 107.2 118.6Engineering andtechnology1.2 3.4 38.1 40.8 1.3 3.7 43.5 57.1Sales and marketing43.4 24.4 81.4 113.4 40.7 24.9 73.5 105.8General and administrative8.2 23.5 246.5 282.4 8.8 24.8 309.4 693.5Depreciation0.4 1.2 13.2 13.3 0.4 1.2 13.7 14.7Amortization of otheracquired intangibleassets4.4 12.0 129.0 126.5 3.9 10.3 111.1 111.4Total operating expenses63.4 77.1 621.0 697.0 60.0 75.3 658.4 1,101.1Operating income (loss)36.6 22.9 (521.0) (597.0) 40.0 24.7 (558.4) (1,001.1)Other loss, net(4.9) (12.2) (137.8) (132.3) (3.7) (9.8) (107.1) (119.8)Income (loss) fromcontinuing operationsbefore income taxes31.7 10.7 (658.8) (729.3) 36.3 14.9 (665.5) (1,120.9)Income tax benefit (expense)(12.1) (2.5) 244.5 265.0 (12.2) (7.1) 240.9 340.9Income (loss) fromcontinuing operations19.6 8.2 (414.3) (464.3) 24.1 7.8 (424.6) (780.0)Discontinued operations, netof income taxes16.3 24.9 323.7 (2,236.5) 4.5 6.0 55.5 (1,203.1)Net income (loss)35.9 % 33.1 % (90.6)% (2,700.8)% 28.6 % 13.8 % (369.1)% (1,983.1)%49Table of ContentsITEM 7A. Quantitative and Qualitative Disclosures about Market RiskWe are exposed to financial market risks, including changes in the market values of our marketable debt securities and interest rates.Financial market risk : We do not invest in financial instruments or their derivatives for trading or speculative purposes. By policy, we limit our creditexposure to any one issuer, other than securities issued by the U.S. federal government and its agencies, and do not have any derivative instruments in ourinvestment portfolio. The three primary goals that guide our investment decisions, with the first being the most important, are: preserve capital, maintain ease ofconversion into immediate liquidity, and achieve a rate of return over a pre-determined benchmark. As of December 31, 2015 , we principally invest in marketablefixed-rate debt securities. Fixed-rate debt securities generally include debt instruments issued by the U.S. federal government and its agencies, internationalgovernments, municipalities and publicly-held corporations, as well as commercial paper, insured time deposits with commercial banks, and money market fundsinvested in securities issued by agencies of the U.S., with minimal default risk and maturity dates of less than one year from the end of any of our quarterlyaccounting periods. We consider the market value, default, and liquidity risks of our investments to be low at December 31, 2015 .Interest rate risk : As of December 31, 2015 , all of the debt securities that we held were fixed-rate earning instruments that carry a degree of interest raterisk. Fixed-rate securities may have their fair market value adversely impacted due to a rise in interest rates. We may suffer losses in principal if we are forced tosell securities that have declined in market value due to changes in interest rates. At December 31, 2015 , our cash equivalent balance of $5.4 million was held inmoney market funds , and our short-term investment balance of $11.3 million was held in U.S. government securities . We consider the interest rate risk for ourcash equivalent and fixed-rate debt securities held at December 31, 2015 to be low. For further detail on our cash equivalents and fixed-rate debt securities, see "Note 6: Fair Value Measurements " of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.In addition, as of December 31, 2015 , we have $425.0 million of debt outstanding under the TaxAct - HD Vest 2015 (new in the fourth quarter of 2015) andMonoprice 2013 credit facilities, which carries a degree of interest rate risk. This debt has a floating portion of its interest rate tied to the London Interbank OfferedRate ( “LIBOR” ). For further information on our outstanding debt, see " Note 4: Discontinued Operations " and " Note 8: Debt " of the Notes to ConsolidatedFinancial Statements in Part II Item 8 of this report. A hypothetical 100 basis point increase in LIBOR on December 31, 2015 would result in a $10.5 millionincrease in our interest expense until the scheduled maturity dates in 2022 and 2018 .The following table provides information about our cash equivalent and fixed-rate debt securities as of December 31, 2015 , including principal cash flowsfor 2016 and thereafter and the related weighted average interest rates. The change in fair values during 2015 was less than $0.1 million for our cash equivalent andfixed-rate debt securities and was recorded in other comprehensive income. Principal amounts and weighted average interest rates by expected year of maturity areas follows:(In thousands, except percentages)2016ThereafterTotalFair ValueU.S. government securities$11,301 0.40% $— —% $11,301 0.40% $11,301Money market and other funds5,410 0.28% — —% 5,410 0.28% 5,410Cash equivalents and marketablefixed-rate debt securities$16,711 $— $16,711 $16,71150Table of ContentsITEM 8. Financial Statements and Supplementary Data INDEX TO CONSOLIDATED FINANCIAL STATEMENTS PageReport of Independent Registered Public Accounting Firm52Consolidated Balance Sheets53Consolidated Statements of Comprehensive Income (Loss)54Consolidated Statements of Stockholders’ Equity55Consolidated Statements of Cash Flows56Notes to Consolidated Financial Statements5751Table of ContentsREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMThe Board of Directors and StockholdersBlucora, Inc.We have audited the accompanying consolidated balance sheets of Blucora, Inc. as of December 31, 2015 and 2014 and the related consolidated statementsof comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2015 . These financial statements arethe responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require thatwe plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includesexamining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principlesused and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide areasonable basis for our opinion.In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Blucora, Inc. atDecember 31, 2015 and 2014 , and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2015 ,in conformity with U.S. generally accepted accounting principles.We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Blucora, Inc.’s internal controlover financial reporting as of December 31, 2015 , based on criteria established in Internal Control-Integrated Framework issued by the Committee of SponsoringOrganizations of the Treadway Commission (2013 framework) and our report dated February 24, 2016 expressed an unqualified opinion thereon./s/ ERNST & YOUNG LLPSeattle, WashingtonFebruary 24, 201652Table of ContentsBLUCORA, INC.CONSOLIDATED BALANCE SHEETS(In thousands, except per share data) December 31, 2015 2014ASSETS Current assets: Cash and cash equivalents$55,473 $41,968Cash segregated under federal or other regulations3,557 —Available-for-sale investments11,301 251,620Accounts receivable, net of allowance of $20 and $17,884 292Commissions receivable16,328 —Other receivables24,407 1,890Prepaid expenses and other current assets, net10,062 6,466Current assets of discontinued operations211,663 72,253Total current assets340,675 374,489Long-term assets: Property and equipment, net11,308 6,542Goodwill, net548,959 188,541Other intangible assets, net396,295 92,119Long-term assets of discontinued operations— 202,707Other long-term assets2,311 1,377Total long-term assets958,873 491,286Total assets$1,299,548 $865,775LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable$4,689 $419Commissions and advisory fees payable16,982 —Accrued expenses and other current liabilities13,006 7,227Deferred revenue11,521 6,320Current portion of long-term debt, net31,631 —Current liabilities of discontinued operations88,275 61,092Total current liabilities166,104 75,058Long-term liabilities: Long-term debt, net353,850 51,940Convertible senior notes, net185,918 181,063Deferred tax liability, net103,520 20,282Deferred revenue1,902 1,915Long-term liabilities of discontinued operations— 53,764Other long-term liabilities10,932 2,728Total long-term liabilities656,122 311,692Total liabilities822,226 386,750 Redeemable non-controlling interests15,038 — Commitments and contingencies (Note 9) Stockholders’ equity: Common stock, par $0.0001—authorized shares, 900,000; issued and outstanding shares, 40,954 and 40,8824 4Additional paid-in capital1,490,405 1,467,658Accumulated deficit(1,027,598) (987,524)Accumulated other comprehensive loss(527) (1,113)Total stockholders’ equity462,284 479,025Total liabilities and stockholders’ equity$1,299,548 $865,775See notes to consolidated financial statements.53Table of ContentsBLUCORA, INC.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)(In thousands, except per share data) Years ended December 31, 2015 2014 2013Services revenue$117,708 $103,719 $91,213 Operating expenses: Cost of revenue: Services cost of revenue6,167 5,880 6,544Amortization of acquired technology7,546 7,450 7,450Total cost of revenue13,713 13,330 13,994Engineering and technology5,107 3,758 3,249Sales and marketing45,854 42,671 40,172General and administrative43,563 25,315 23,346Depreciation1,521 1,300 1,238Amortization of other acquired intangible assets12,757 12,742 12,692Total operating expenses122,515 99,116 94,691Operating income (loss)(4,807) 4,603 (3,478)Other loss, net(12,542) (13,489) (29,568)Loss from continuing operations before income taxes(17,349) (8,886) (33,046)Income tax benefit4,623 3,342 7,385Loss from continuing operations(12,726) (5,544) (25,661)Income (loss) from discontinued operations, net of income taxes(27,348) (30,003) 50,060Net income (loss)$(40,074) $(35,547) $24,399Net income (loss) per share - basic: Continuing operations$(0.31) $(0.13) $(0.62)Discontinued operations(0.67) (0.73) 1.21Basic net income (loss) per share$(0.98) $(0.86) $0.59Net income (loss) per share - diluted: Continuing operations$(0.31) $(0.13) $(0.62)Discontinued operations(0.67) (0.73) 1.21Diluted net income (loss) per share$(0.98) $(0.86) $0.59Weighted average shares outstanding: Basic40,959 41,396 41,201Diluted40,959 41,396 41,201Other comprehensive income (loss): Net income (loss)$(40,074) $(35,547) $24,399Unrealized gain (loss) on available-for-sale investments, net of tax(236) (1,119) 11Foreign currency translation adjustment(517) — —Unrealized gain on derivative instrument, net of tax— — 266Reclassification adjustment for realized (gain) loss on available-for-sale investments, net of tax,included in net income as Other loss, net375 6 (1)Reclassification adjustment for other-than-temporary impairment loss on available-for-saleinvestments, included in net income as discontinued operations964 — —Other comprehensive income (loss)586 (1,113) 276Comprehensive income (loss)$(39,488) $(36,660) $24,675See notes to consolidated financial statements.54Table of ContentsBLUCORA, INC.CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY(In thousands) Redeemable Non-controlling Interest Additional-paid-incapital Accumulateddeficit Accumulatedothercomprehensiveincome (loss) Common stock Shares Amount TotalBalance as of December 31, 2012$— 40,832 $4 $1,392,098 $(976,376) $(276) $415,450Common stock issued for stock options andrestricted stock units— 584 — 2,841 — — 2,841Common stock issued for employee stockpurchase plan— 85 — 1,065 — — 1,065Common stock issued upon Warrant exercise— 1,000 — 9,620 — — 9,620Stock repurchases— (418) — (10,006) — — (10,006)Convertible senior notes, net of issuancecosts of $714 and tax effect of $7,785— — — 13,842 — — 13,842Settlement of derivative instrument(Warrant)— — — 20,217 — — 20,217Other comprehensive income— — — — — 276 276Stock-based compensation— — — 11,642 — — 11,642Tax effect of equity compensation— — — 27,224 — — 27,224Taxes paid on stock issued for equity awards— — — (2,500) — — (2,500)Net income— — — — 24,399 — 24,399Balance as of December 31, 2013— 42,083 4 1,466,043 (951,977) — 514,070Common stock issued for stock options andrestricted stock units— 1,003 — 6,715 — — 6,715Common stock issued for employee stockpurchase plan— 85 — 1,376 — — 1,376Stock repurchases— (2,289) — (38,650) — — (38,650)Other comprehensive loss— — — — — (1,113) (1,113)Stock-based compensation— — — 11,990 — — 11,990Tax effect of equity compensation— — — 22,962 — — 22,962Taxes paid on stock issued for equity awards— — — (2,778) — — (2,778)Net loss— — — — (35,547) — (35,547)Balance as of December 31, 2014— 40,882 4 1,467,658 (987,524) (1,113) 479,025Common stock issued for stock options andrestricted stock units— 520 — 2,409 — — 2,409Common stock issued for employee stockpurchase plan— 103 — 1,193 — — 1,193Stock repurchases— (551) — (7,735) — — (7,735)Other comprehensive income— — — — — 586 586Stock-based compensation— — — 13,047 — — 13,047Tax effect of equity compensation— — — 15,378 — — 15,378Taxes paid on stock issued for equity awards— — — (1,545) — — (1,545)Net loss— — — — (40,074) — (40,074)Purchase of redeemable non-controllinginterests15,038 — — — — — —Balance as of December 31, 2015$15,038 40,954 $4 $1,490,405 $(1,027,598) $(527) $462,284See notes to consolidated financial statements.55Table of ContentsBLUCORA, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands) Years ended December 31, 2015 2014 2013Operating Activities: Net income (loss)$(40,074) $(35,547) $24,399Less: Discontinued operations, net of income taxes(27,348) (30,003) 50,060Net loss from continuing operations(12,726) (5,544) (25,661)Adjustments to reconcile net loss from continuing operations to cash from operating activities: Stock-based compensation8,694 8,694 8,499Depreciation and amortization of acquired intangible assets22,590 22,164 21,973Excess tax benefits from stock-based award activity(7,967) (6,398) (4,313)Deferred income taxes(12,607) (9,858) (11,601)Amortization of premium on investments, net1,589 3,772 3,007Amortization of debt issuance costs1,133 1,059 1,099Accretion of debt discounts3,866 3,594 2,826Loss on debt extinguishment and modification expense398 — 1,593Loss on derivative instrument— — 11,652Impairment loss on equity investment in privately-held company— — 3,711Other203 77 622Cash provided (used) by changes in operating assets and liabilities: Accounts receivable(1,862) 47 (47)Other receivables651 367 1,671Prepaid expenses and other current assets(493) (3,457) 2,407Other long-term assets(15) 191 247Accounts payable369 (258) 16Deferred revenue1,875 1,130 2,609Accrued expenses and other current and long-term liabilities10,643 4,548 7,701Net cash provided by operating activities from continuing operations16,341 20,128 28,011Investing Activities: Business acquisitions, net of cash acquired(573,366) — (4,892)Equity investment in privately-held company— — (4,000)Purchases of property and equipment(1,512) (2,037) (2,352)Change in restricted cash150 — 2,491Proceeds from sales of investments156,506 28,535 25,812Proceeds from maturities of investments296,455 255,994 213,616Purchases of investments(214,257) (336,495) (351,883)Net cash used by investing activities from continuing operations(336,024) (54,003) (121,208)Financing Activities: Proceeds from issuance of convertible notes, net of debt issuance costs of $6,432— — 194,818Proceeds from credit facility, net of debt issuance costs and debt discount of $9,730 and $12,000 in 2015378,270 36,556 6,000Repayment of credit facility(51,940) (56,000) (10,000)Debt issuance costs on credit facility— — (28)Stock repurchases(7,735) (38,650) (10,006)Excess tax benefits from stock-based award activity7,967 6,398 4,313Proceeds from stock option exercises2,409 6,730 2,826Proceeds from issuance of stock through employee stock purchase plan1,193 1,376 1,065Proceeds from issuance of stock upon warrant exercise— — 9,620Tax payments from shares withheld upon vesting of restricted stock units(1,545) (2,875) (2,405)Net cash provided (used) by financing activities from continuing operations328,619 (46,465) 196,203Net cash provided (used) by continuing operations8,936 (80,340) 103,006 Net cash provided by operating activities from discontinued operations14,108 41,406 56,741Net cash used by investing activities from discontinued operations(540) (47,933) (182,483)Net cash provided (used) by financing activities from discontinued operations(8,982) 8,886 74,401Net cash provided (used) by discontinued operations4,586 2,359 (51,341) Effect of exchange rate changes on cash and cash equivalents(17) — —Net increase (decrease) in cash and cash equivalents13,505 (77,981) 51,665Cash and cash equivalents, beginning of period41,968 119,949 68,284Cash and cash equivalents, end of period$55,473 $41,968 $119,949Non-cash investing and financing activities from continuing operations: Purchases of property and equipment through leasehold incentives (investing)$— $120 $1,006Cash paid for income taxes from continuing operations$614 $684 $343Cash paid for interest from continuing operations$8,994 $9,469 $6,944See notes to consolidated financial statements.56Table of ContentsBLUCORA, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTSYears Ended December 31, 2015 , 2014 , and 2013Note 1: The Company and Basis of PresentationDescription of the business: Blucora, Inc. (the “ Company ” or “ Blucora ”) operates two primary businesses: a Wealth Management business and an onlineTax Preparation business. The Wealth Management business consists of the operations of HD Vest, Inc. (“ HD Vest ”), which the Company acquired on December31, 2015 , and, accordingly, has no operating activities recorded in Blucora's 2015 results of operations. HD Vest will be included in Blucora's results of operationsbeginning on January 1, 2016. HD Vest provides wealth management solutions for financial advisors. The Tax Preparation business consists of the operations ofTaxAct, Inc. (“ TaxAct ”) and provides digital tax preparation solutions for consumers, small business owners, and tax professionals through its websitewww.TaxAct.com.The Company also operates an internet Search and Content business and an E-Commerce business. The Search and Content business operates through theInfoSpace LLC subsidiary ( “InfoSpace” ) and provides search services to users of its owned and operated and distribution partners’ web properties, as well asonline content through HowStuffWorks (“ HSW ”). The E-Commerce business consists of the operations of Monoprice, Inc. (“ Monoprice ”) and sells self-brandedelectronics and accessories to both consumers and businesses primarily through its website www.monoprice.com.On October 14, 2015, the Company announced its plans to focus on the technology-enabled financial solutions market, referred to as the “StrategicTransformation.” The Strategic Transformation consists of the acquisition of HD Vest, which closed on December 31, 2015 (see " Note 3: Business Combinations"), and the intention to divest the Search and Content and E-Commerce businesses in the first half of 2016 (see " Note 4: Discontinued Operations "). Accordingly,the financial condition, results of operations, cash flows, and the notes to financial statements reflect the Search and Content and E-Commerce businesses asdiscontinued operations for all periods presented. Except for disclosures related to equity and unless otherwise specified, disclosures in these consolidated financialstatements reflect continuing operations.Segments: The Company has two reportable segments: the Wealth Management segment, which is the HD Vest business, and the Tax Preparation segment,which is the TaxAct business. The former Search and Content and E-Commerce segments are included in discontinued operations. The former Search and Contentsegment is the InfoSpace business, which includes HSW, and the former E-Commerce segment is the Monoprice business. Unless the context indicates otherwise,the Company uses the term “ Wealth Management ” to represent services sold through the HD Vest business, the term “ Tax Preparation ” to represent servicesand software sold through the TaxAct business, the term “ Search and Content ” to represent search and content services, and the term “ E-Commerce ” torepresent products sold through the Monoprice business (see " Note 12: Segment Information ").Principles of consolidation: The consolidated financial statements include the accounts of the Company and its subsidiaries. Intercompany accounts andtransactions have been eliminated.Reclassification: The Company reclassified certain amounts related to discontinued operations and the implementation of new accounting guidance on debtissuance costs and deferred taxes. See " Note 4: Discontinued Operations " and the "Recent accounting pronouncements" section of " Note 2: Summary ofSignificant Accounting Policies ," respectively, for additional information.Use of estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America(“GAAP” ) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and disclosure ofcontingencies. Estimates include those used for impairment of goodwill and other intangible assets, useful lives of other intangible assets, acquisition accounting,valuation of investments, valuation of the Warrant and interest rate swap derivatives, revenue recognition, the estimated allowance for sales returns and doubtfulaccounts, internally developed software, accrued contingencies, stock option valuation, and valuation allowance for deferred tax assets. Actual amounts may differfrom estimates.Seasonality: Blucora’s Tax Preparation segment is highly seasonal, with a significant portion of its annual revenue earned in the first four months of theCompany’s fiscal year. During the third and fourth quarters, the Tax Preparation segment typically reports losses because revenue from the segment is minimalwhile core operating expenses continue at relatively consistent levels.57Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Note 2: Summary of Significant Accounting PoliciesCash equivalents: The Company considers all highly liquid debt instruments with an original maturity of ninety days or less at date of acquisition to be cashequivalents.Cash segregated under federal or other regulations: Cash segregated under federal and other regulations is held in a special bank account for the exclusivebenefit of the Company’s wealth management customers.Short-term investments: The Company principally invests its available cash in fixed-rate debt securities. Fixed-rate debt securities generally include debtinstruments issued by the U.S. federal government and its agencies, international governments, municipalities and publicly-held corporations, as well ascommercial paper, insured time deposits with commercial banks, and money market funds invested in securities issued by agencies of the U.S., although specificholdings can vary from period to period depending upon the Company's cash requirements. Such investments are included in "Cash and cash equivalents" and"Available-for-sale investments" on the consolidated balance sheets and reported at fair value with unrealized gains and losses included in " Accumulated othercomprehensive loss " on the consolidated balance sheets.The Company reviews its available-for-sale investments for impairment and classifies the impairment of any individual available-for-sale investment aseither temporary or other-than-temporary. The differentiating factors between temporary and other-than-temporary impairments are primarily the length of the timeand the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of theCompany to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value. An impairment classified astemporary is recognized in " Accumulated other comprehensive loss " on the consolidated balance sheets. An impairment classified as other-than-temporary isrecognized in " Other loss, net " on the consolidated statements of comprehensive income.Accounts receivable: Accounts receivable are stated at amounts due from customers net of an allowance for doubtful accounts.Commissions receivable and payable: Commissions represent amounts generated by HD Vest's financial advisors for their clients' purchases and sales ofsecurities and various investment products. The Company generates two types of commissions: transaction-based sales commissions that occur at the point of sale,as well as trailing commissions for which the Company provides ongoing account support to clients of its financial advisors. The Company records transaction-based sales commissions receivable on a trade-date basis, which is when the Company's performance obligations in generating the commissions have beensubstantially completed. Trailing commissions receivable is estimated based on a number of factors, including market levels and the amount of trailing commissionrevenues received in prior periods. A substantial portion of the commissions are ultimately paid to the financial advisors. The Company records an estimate fortransaction-based commissions payable based upon the payout rate of the financial advisor generating the accrued commission revenue. The Company records anestimate for trailing commissions payable based upon historical payout ratios.Property and equipment: Property and equipment are stated at cost. Depreciation is computed under the straight-line method over the following estimateduseful lives:Computer equipment and software3 yearsData center servers3 yearsInternally-developed software3 yearsOffice equipment7 yearsOffice furniture7 yearsLeasehold improvementsShorter of lease term or economic lifeThe Company capitalizes certain internal-use software development costs, consisting primarily of contractor costs and employee salaries and benefitsallocated on a project or product basis. The Company capitalized $0.3 million , $0.3 million , and nil of internal-use software costs in the years ended December 31,2015 , 2014 , and 2013 , respectively.58Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Business combinations and intangible assets including goodwill : The Company accounts for business combinations using the acquisition method. Theacquisition-date fair value of total consideration includes cash and contingent consideration. Since the Company is contractually obligated to pay contingentconsideration upon the achievement of specified objectives, a contingent consideration liability is recorded at the acquisition date. The Company reviews itsassumptions related to the fair value of the contingent consideration liability each reporting period and, if there are material changes, revalues the contingentconsideration liability based on the revised assumptions, until such contingency is satisfied through payment upon the achievement of the specified objectives. Thechange in the fair value of the contingent consideration liability is recognized in "General and administrative" expense on the consolidated statements ofcomprehensive income for the period in which the fair value changes.Goodwill is calculated as the excess of the acquisition-date fair value of total consideration over the acquisition-date fair value of net assets, including theamount assigned to identifiable intangible assets, and is assigned to reporting units that are expected to benefit from the synergies of the business combination as ofthe acquisition date. Reporting units are consistent with reportable segments and include the former Search and Content and E-Commerce segments. Identifiableintangible assets with finite lives are amortized over their useful lives on a straight-line basis. Acquisition-related costs, including advisory, legal, accounting,valuation, and other similar costs, are expensed in the periods in which the costs are incurred. The results of operations of acquired businesses are included in theconsolidated financial statements from the acquisition date.Goodwill and intangible assets impairment: The Company evaluates goodwill and indefinite-lived intangible assets for impairment annually, as of November30, or more frequently when events or circumstances indicate that impairment may have occurred. As part of the impairment evaluation, the Company may elect toperform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit (forgoodwill) or an indefinite-lived intangible asset is less than its carrying value, or if the Company elects to bypass the qualitative assessment, the Company thenwould proceed with the quantitative impairment test.The goodwill quantitative impairment test is a two-step process that first compares the carrying values of reporting units to their fair values. If the carryingvalue of a reporting unit exceeds the fair value, a second step is performed to compute the amount of impairment. This second step determines the current fairvalues of all assets and liabilities of the reporting unit and then compares the implied fair value of the reporting unit's goodwill to the carrying value of thatgoodwill. If the carrying value of the reporting unit's goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in an amount equalto the excess.The indefinite-lived intangible asset quantitative impairment test compares the carrying value of the intangible asset to its fair value. If the carrying value ofthe intangible asset exceeds the fair value, an impairment loss is recognized in an amount equal to the excess.Fair value typically is estimated using the present value of future discounted cash flows, an income approach. The significant estimates in the discountedcash flow model include the weighted-average cost of capital, long-term rates of revenue growth and/or profitability of our businesses, and working capital effects.The weighted-average cost of capital considers the relevant risk associated with business-specific characteristics and the uncertainty related to each business'sability to achieve the projected cash flows. To validate the reasonableness of the reporting unit fair values, the Company reconciles the aggregate fair values of itsreporting units to the aggregate market value of its common stock on the date of valuation, while considering a reasonable acquisition premium. These estimatesand the resulting valuations require significant judgment.Definite-lived intangible assets are reviewed for impairment when events or circumstances indicate that the carrying value of an asset or group of assets maynot be recoverable. The determination of recoverability is based on an estimate of pre-tax undiscounted future cash flows, using the Company's best estimates offuture net sales and operating expenses, expected to result from the use and eventual disposition of the asset or group of assets over the remaining economic life ofthe primary asset in the asset group. The Company measures the amount of the impairment as the excess of the asset's carrying value over its fair value.See " Note 4: Discontinued Operations " for discussion of impairment of goodwill and intangible assets in the fourth quarters of 2015 and 2014.59Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Equity method investments: The Company currently holds equity securities and warrants to purchase equity securities, for business and strategic purposes, incompanies whose securities are not publicly traded. The equity method is used to account for investments in these companies, if the investment provides theCompany with the ability to exercise significant influence over operating and financial policies of the investees. The Company records its proportionate share ofthe net earnings or losses of equity method investees and a corresponding increase or decrease to the investment balances. The Company evaluates its equitymethod investments for impairment whenever events or changes in circumstances indicate, in management’s judgment, that the carrying value of such investmentsmay have experienced a decline in value (see " Note 13: Other Loss, Net "). The Company’s equity investments were carried at a fair value of nil at December 31,2015 and 2014 .Debt issuance costs and debt discounts : Debt issuance costs and debt discounts are deferred and amortized as interest expense under the effective interestmethod over the contractual term of the related debt, adjusted for prepayments in the case of the Company’s credit facilities (see " Note 4: Discontinued Operations" and " Note 8: Debt "). Debt issuance costs related to line-of-credit arrangements are recorded in "Prepaid expenses and other current assets, net." All other debtissuance costs and debt discounts are recorded as a direct deduction from the carrying amount of the recognized debt.Debt issuance costs related to the Company’s Convertible Senior Notes (the “ Notes ”) issued in 2013 were allocated to the liability and equity componentsof the instrument. The debt issuance costs allocated to the liability component are amortized to interest expense through the earlier of the maturity date of the Notesor the date of conversion, if any. The debt issuance costs allocated to the equity component of the Notes were recorded as an offset to "Additional paid-in capital"(See " Note 8: Debt ").Derivative instruments and hedging: The Company recognized derivative instruments as either assets or liabilities at their fair value. The Company recordedchanges in the fair value of the derivative instruments as gains or losses either in " Other loss, net " on the consolidated statements of comprehensive income, forthose not designated as a hedging instrument (the Warrant - see " Note 10: Stockholders' Equity "), or in " Accumulated other comprehensive loss " on theconsolidated balance sheets, for those used in a hedging relationship (the interest rate swap - see " Note 8: Debt "). The Warrant and interest rate swap were settledin the last half of 2013.The change in the fair value of the Warrant resulted in a loss of $11.7 million for the year ended December 31, 2013 .The interest rate swap agreement was used for the purpose of minimizing exposure to changes in interest rates and was accounted for as a cash flow hedge.The hedge was perfectly effective through termination, and no ineffectiveness was recorded in the consolidated statements of comprehensive income. TheCompany had no other swap agreements outstanding at December 31, 2015 .Fair value of financial instruments : The Company measures its cash equivalents, available-for-sale investments, and derivative instruments at fair value. TheCompany considers the carrying values of accounts receivable, other receivables, prepaid expenses, other current assets, accounts payable, accrued expenses, andother current liabilities to approximate fair values primarily due to their short-term natures.Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at themeasurement date. Cash equivalents and debt securities are classified within Level 2 of the fair value hierarchy because the Company values its cash equivalentsand debt securities utilizing market observable inputs. The contingent consideration liability is related to the Company's acquisition of SimpleTax Software Inc. (“SimpleTax ”) and is classified within Level 3 of the fair value hierarchy because the Company values the liability utilizing significant inputs not observable in themarket. Specifically, the Company has determined the fair value of the contingent consideration liability based on a probability-weighted discounted cash flowanalysis, which includes assumptions related to estimating revenues, the probability of payment, and the discount rate. The Company accounts for contingentconsideration in accordance with applicable accounting guidance pertaining to business combinations, as disclosed in the accounting policy "Businesscombinations and intangible assets including goodwill."Redeemable non-controlling interests: Non-controlling interests that are redeemable at the option of the holder and not solely within the control of the issuerare classified outside of stockholders' equity. In connection with the acquisition of HD Vest, management of that business has retained an ownership interest. TheCompany is party to put and call arrangements with respect to these interests. These put and call arrangements allow HD Vest management to require the Companyto purchase their interests or allow the Company to acquire such interests, respectively. The put arrangements do not meet the definition of60Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013a derivative instrument as the put agreements do not provide for net settlement. To the extent that the redemption value of these interests exceeds the valuedetermined by adjusting the carrying value for the subsidiary's attribution of net income (loss), the value of such interests is adjusted to the redemption value with acorresponding adjustment to additional paid-in capital.Revenue recognition, general: The Company recognizes revenue when all four revenue recognition criteria have been met: persuasive evidence of anarrangement exists, the Company has delivered the product or performed the service, the fee is fixed or determinable, and collectibility is probable. Determiningwhether and when these criteria have been satisfied involves exercising judgment and using estimates and assumptions that can have an impact on the timing andamount of revenue that the Company recognizes.The Company evaluates whether revenue should be presented on a gross basis, which is the amount that a customer pays for the service or product, or on anet basis, which is the customer payment less amounts the Company pays to suppliers. In making that evaluation, the Company primarily considers indicators suchas whether the Company is the primary obligor in the arrangement and assumes the risks and rewards as a principal in the customer transaction. The evaluation ofthese factors, which at times can be contradictory, are subject to significant judgment and subjectivity.Tax preparation revenue recognition : The Company derives service revenue from the sale of tax preparation online services, ancillary service offerings,packaged tax preparation software, and multiple element arrangements that may include a combination of these items. Ancillary service offerings include taxpreparation support services, data archive services, e-filing services, bank or reloadable pre-paid debit card services, and other value-added services. This revenueis recorded in the Tax Preparation segment.The Company’s Tax Preparation segment revenue consists primarily of hosted tax preparation online services, tax preparation support services, data archiveservices, and e-filing services. The Company recognizes revenue from these services as the services are performed and the four revenue recognition criteriadescribed above are met.The Company recognizes revenue from the sale of its packaged software when legal title transfers. This is generally when its customers download thesoftware from the Internet or when the software ships.The bank or reloadable prepaid debit card services are offered to taxpayers as an option to receive their tax refunds in the form of a prepaid bank card or tohave the fees for the software and/or services purchased by the customers deducted from their refunds. Other value-added service revenue consists of revenue fromrevenue sharing and royalty arrangements with third party partners. Revenue for these transactions is recognized when the four revenue recognition criteriadescribed above are met; for some arrangements that is upon filing and for other arrangements that is upon the Company’s determination of when collectibility isprobable.For software and/or services that consist of multiple elements, the Company must: (1) determine whether and when each element has been delivered;(2) determine the fair value of each element using the selling price hierarchy of vendor-specific objective evidence (“ VSOE ”) of fair value if available, third-partyevidence (“ TPE ”) of fair value if VSOE is not available, and estimated selling price (“ ESP ”) if neither VSOE nor TPE is available; and (3) allocate the totalprice among the various elements based on the relative selling price method. Once the Company has allocated the total price among the various elements, itrecognizes revenue when the revenue recognition criteria described above are met for each element.VSOE generally exists when the Company sells the deliverable separately. When VSOE cannot be established, the Company attempts to establish a sellingprice for each element based on TPE. TPE is determined based on competitor prices for similar deliverables when sold separately. When the Company is unable toestablish selling price using VSOE or TPE, it uses ESP in its allocation of arrangement consideration. ESP is the estimated price at which the Company would sellthe software or service if it were sold on a stand-alone basis. The Company determines ESP for the software or service by considering multiple factors including,but not limited to, historical stand-alone sales, pricing practices, market conditions, competitive landscape, internal costs, and gross margin objectives.In some situations, the Company receives advance payments from its customers. The Company defers revenue associated with these advance payments andrecognizes the consideration for each element when the Company ships the software or performs the services, as appropriate. Advance payments related to dataarchive services are deferred and recognized over the related contractual term.61Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Cost of revenue: The Company records the cost of revenue for sales of services when the related revenue is recognized. "Services cost of revenue" consists ofcosts related to the Tax Preparation business, which include royalties, bank product services fees, and costs associated with the operation of its data centers. Datacenter costs include personnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs), software support and maintenance,bandwidth and hosting costs, and depreciation. Cost of revenue also includes the amortization of acquired technology.Engineering and technology expenses: Engineering and technology expenses are associated with the research, development, support, and ongoingenhancements of the Company’s offerings, which include personnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs), thecost of temporary help and contractors to augment staffing, software support and maintenance, and professional services fees. Research and development expenseswere $4.8 million , $2.8 million , and $2.6 million for the years ended December 31, 2015 , 2014 , and 2013 , respectively.Sales and marketing expenses: Sales and marketing expenses consist principally of marketing expenses associated with the Company’s TaxAct business(which include television, radio, online, text, email, and sponsorship channels) and personnel expenses (salaries, stock-based compensation, benefits, and otheremployee-related costs) for personnel engaged in marketing and selling activities.Costs for advertising are recorded as expense when the advertisement appears. Advertising expense totaled $35.5 million , $33.4 million , and $32.9 millionfor the years ended December 31, 2015 , 2014 , and 2013 , respectively. Prepaid advertising costs were $3.9 million and $3.6 million at December 31, 2015 and2014 , respectively.General and administrative expenses: General and administrative expenses consist primarily of personnel expenses (salaries, stock-based compensation,benefits, and other employee-related costs), the cost of temporary help and contractors to augment staffing, professional services fees (which include legal, audit,and tax fees), general business development and management expenses, occupancy and general office expenses, business taxes, and insurance expenses.Stock-based compensation: The Company measures stock-based compensation at the grant date based on the fair value of the award and recognizes it asexpense, net of estimated forfeitures, over the vesting or service period, as applicable, of the stock award using the straight-line method. The Company recognizesstock-based compensation over the vesting period for each separately vesting portion of a share-based award as if they were individual share-based awards. TheCompany estimates forfeitures at the time of grant and revises those estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates.Employee benefit plan: The Company has a 401(k) savings plan covering its employees. Eligible employees may contribute through payroll deductions. TheCompany may match the employees’ 401(k) contributions at the discretion of the Company’s Board of Directors. Pursuant to a continuing resolution, the Companyhas matched a portion of the 401(k) contributions made by its employees. The amount contributed by the Company ranges from 1% to 4% of an employee's salary,depending upon the percentage contributed by the employee. For the years ended December 31, 2015 , 2014 , and 2013 , the Company contributed $0.6 million ,$0.3 million , and $0.3 million , respectively, for employees.Leases: The Company leases office space, and these leases are classified as operating leases.Income taxes : The Company accounts for income taxes under the asset and liability method, under which deferred tax assets, including net operating losscarryforwards, and liabilities are determined based on temporary differences between the book and tax bases of assets and liabilities. The Company periodicallyevaluates the likelihood of the realization of deferred tax assets and reduces the carrying amount of the deferred tax assets by a valuation allowance to the extentthe Company believes a portion will not be realized. The Company considers many factors when assessing the likelihood of future realization of the deferred taxassets, including expectations of future taxable income, recent cumulative earnings experience by taxing jurisdiction, and other relevant factors. There is a widerange of possible judgments relating to the valuation of the Company's deferred tax assets.The Company records liabilities to address uncertain tax positions that have been taken in previously filed tax returns or that are expected to be taken in afuture tax return. The determination for required liabilities is based upon an analysis of each individual tax position, taking into consideration whether it is morelikely than not that the tax position, based on technical merits, will be sustained upon examination. The tax benefit to be recognized in the financial statements fromsuch a position is62Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the taxing authority. Thedifference between the amount recognized and the total tax position is recorded as a liability. The ultimate resolution of these tax positions may be greater or lessthan the liabilities recorded. The Company recognizes interest and penalties related to uncertain tax positions in interest expense and general and administrativeexpense, respectively.Other comprehensive income : Comprehensive income includes net income plus items that are recorded directly to stockholders’ equity, including the netchange in unrealized gains and losses on available-for-sale investments and certain derivative instruments as well as foreign currency translation adjustments.Included in the net change in unrealized gains and losses are realized gains or losses, including other-than-temporary impairment losses, included in thedetermination of net income in the period realized. Amounts reclassified out of other comprehensive income into net income were determined on the basis ofspecific identification.Foreign currency: The financial position and operating results of the Company's foreign operations are consolidated using the local currency as thefunctional currency. Assets and liabilities recorded in local currencies are translated at the exchange rate on the balance sheet date, while revenues and expenses aretranslated at the average exchange rate for the applicable period. Translation adjustments resulting from this process are recorded in " Accumulated othercomprehensive loss " on the consolidated balance sheets. The gain or loss on foreign currency transactions, calculated as the difference between the historicalexchange rate and the exchange rate at the applicable measurement date, are recorded in " Other loss, net " on the consolidated statements of comprehensiveincome.Concentration of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cashequivalents, short-term investments, and trade receivables. These instruments are generally unsecured and uninsured. The Company places a significant amount ofits cash equivalents and investments with major financial institutions. Accounts receivable are typically unsecured and are derived from revenues earned fromcustomers primarily located in the United States operating in a variety of geographic areas. The Company performs ongoing credit evaluations of its customers andmaintains allowances for potential credit losses.The Company attempts to manage exposure to counterparty credit risk by only entering into agreements with major financial institutions which are expectedto be able to fully perform under the terms of the agreement.Geographic revenue information: Almost all of the Company's revenue for 2015, 2014, and 2013 was generated from customers located in the United States.Recent accounting pronouncements: Changes to GAAP are established by the Financial Accounting Standards Board (“ FASB ”) in the form of accountingstandards updates (“ ASUs ”) to the FASB’s Accounting Standards Codification (“ ASC ”). The Company considers the applicability and impact of all recentASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s consolidatedfinancial position and results of operations.In May 2014, the FASB issued guidance codified in ASC 606, "Revenue from Contracts with Customers," which amends the guidance in former ASC 605"Revenue Recognition." The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services tocustomers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This will be achieved in afive-step process. Enhanced disclosures also will be required. This guidance is effective on a retrospective basis--either to each reporting period presented or withthe cumulative effect of initially applying this guidance recognized at the date of initial application--for annual reporting periods, including interim reportingperiods within those annual reporting periods, beginning after December 15, 2017. Earlier application is permitted only as of annual reporting periods beginningafter December 15, 2016, including interim reporting periods within those annual reporting periods. The Company currently is evaluating the impact of thisguidance on its consolidated financial statements.In April 2015, the FASB issued two separate ASUs, both of which are effective for annual reporting periods beginning after December 15, 2015, includinginterim reporting periods within those annual reporting periods. Earlier adoption is permitted for both ASUs.63Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013•One of these ASUs provides guidance about whether a cloud computing arrangement includes a software license, in which case the software licenseelement should be accounted for consistent with the acquisition of other software licenses; otherwise, the arrangement should be accounted for as aservice contract. This guidance may be applied either prospectively or retrospectively. The adoption of this ASU is not expected to have a materialimpact on the Company's consolidated financial statements.•The other ASU provides guidance related to the balance sheet presentation of debt issuance costs, in which debt issuance costs should be presented as adirect deduction from the carrying amount of the recognized debt, unless the debt issuance costs relate to line-of-credit arrangements, in which caseasset presentation of such debt issuance costs would still be permitted. This guidance must be applied retrospectively. The Company adopted this ASUas of December 31, 2015 on a retrospective basis and reclassified debt issuance costs related to arrangements (that were not line-of-credit arrangements)previously reported in "Other long-term assets" to "Long-term debt, net" in the consolidated balance sheet for the year ended December 31, 2014 (see "Note 8: Debt "). The reclassification had no effect on reported revenues, operating income, or cash flows for the periods presented.In November 2015, the FASB issued an ASU on the balance sheet classification of deferred taxes, which would require that deferred tax assets and liabilitiesbe classified as non-current in the balance sheet. Current GAAP requires the presentation of deferred tax assets and liabilities as either current or non-current in thebalance sheet. This ASU is effective for annual reporting periods beginning after December 15, 2016, including interim reporting periods within those annualreporting periods. Earlier adoption is permitted. The guidance may be applied either prospectively or retrospectively. The Company adopted this ASU as ofDecember 31, 2015 on a retrospective basis and reclassified current deferred tax assets previously reported in "Prepaid expenses and other current assets, net" tothe long-term "Deferred tax liability, net" in the consolidated balance sheet for the year ended December 31, 2014. The reclassification had no effect on reportedrevenues, operating income, or cash flows for the periods presented.Note 3: Business CombinationsHD Vest: On December 31, 2015 and pursuant to the Purchase Agreement dated October 14, 2015, the Company acquired HD Vest for $611.9 million ,which is subject to a final working capital adjustment in the first quarter of 2016. HD Vest provides wealth management solutions for financial advisors and isexpected to be synergistic with TaxAct as a result of cross-selling opportunities and an expanded addressable market for both HD Vest and TaxAct. In connectionwith the acquisition, certain members of HD Vest management rolled over a portion of the proceeds they would have otherwise received at the closing into sharesof the acquisition subsidiary through which the Company consummated the purchase of HD Vest. A portion of those shares were sold to the Company in exchangefor a promissory note. After giving effect to the rollover shares and related purchase of the rollover shares for the promissory note, the Company indirectly owns95.52% of HDV Holdings, Inc., with the remaining 4.48% non-controlling interest held collectively by the rollover management members and subject to put andcall arrangements exercisable beginning in 2019.The Company paid $610.5 million , which was funded by a combination of cash on hand and the new TaxAct - HD Vest 2015 credit facility, under which theCompany borrowed $400.0 million (see " Note 8: Debt ").64Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Valuations were as follows (in thousands): Fair valueTangible assets acquired, including cash acquired of $38,874$77,181Liabilities assumed(21,845)Identifiable net assets acquired$55,336Fair value adjustments for intangible assets: Advisor relationships$240,300Sponsor relationships16,500Curriculum800Proprietary technology13,600Trade name52,500Fair value of intangible assets acquired$323,700Purchase price allocation: Cash paid$610,500Plus: promissory note6,400Plus: non-controlling interest15,038Less: escrow receivable(20,000)Purchase price611,938Less: identifiable net assets acquired(55,336)Less: fair value of intangible assets acquired(323,700)Plus: deferred tax liability related to intangible assets123,484Excess of purchase price over net assets acquired, allocated to goodwill$356,386The Company's estimates of the economic lives of the acquired intangible assets are 14 years for the advisor relationships, 18 years for the sponsorrelationships, 4 years for the curriculum, 6 years for the proprietary technology, and the trade name is estimated to have an indefinite life. Goodwill consists largelyof the increased cross-selling opportunities and expanded addressable markets for both HD Vest and TaxAct, neither of which apply for separate recognition, and isnot expected to be deductible for income tax purposes. The primary areas of the acquisition accounting that are not yet finalized relate to final working capitalcalculation, income and non-income based taxes, certain contingent liability matters, indemnification assets, and residual goodwill.The promissory note is with the President of HD Vest and will be paid over a three -year period. The current portion was recorded in "Current portion oflong-term debt, net," and the long-term portion was recorded in "Long-term debt, net." The note bears interest at a rate of 5% per year, with a principal amount thatapproximates its fair value. See " Note 8: Debt " for additional information on the "Note payable, related party."The Purchase Agreement dictates that the Company place into escrow $20.0 million of additional consideration that is contingent upon HD Vest's 2015earnings performance. The contingent consideration was not achieved; therefore, the amount has been excluded from the purchase price and recorded as areceivable in "Other receivables" for the amount that will be returned to the Company from the escrow agent in the first half of 2016.The gross contractual amount of accounts receivable, including commissions receivable, acquired was $21.6 million , of which the Company has estimatedthat substantially all will be collectible.During 2015, the Company incurred transaction costs of $11.0 million , which were recognized in "General and administrative expense," and $21.8 million indebt discount and issuance-related costs on the new credit facility.65Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Pro Forma Financial Information of the HD Vest Acquisition (unaudited):The financial information in the table below summarizes the combined results of operations of Blucora and HD Vest on a pro forma basis, for the period inwhich the acquisition occurred and the prior reporting period as though the companies had been combined as of the beginning of each period presented. Pro formaadjustments have been made to include (a) amortization expense on the definite-lived intangible assets identified in this acquisition, debt-related expensesassociated with the credit facility that was used to finance the acquisition, and estimated stock-based compensation related to Blucora share-based award grants toHD Vest employees; and to remove (b) acquisition-related transaction costs and debt-related expenses associated with HD Vest's previous debt facility, the latter ofwhich was paid off and closed at the acquisition date. Income taxes also have been adjusted for the effect of these items. The following pro forma financialinformation is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had theacquisition occurred at the beginning of each period presented (in thousands): Years ended December 31, 2015 2014Revenue$437,447 $408,573Loss from continuing operations$(12,793) $(16,727)SimpleTax: On July 2, 2015 , TaxAct acquired all of the equity of SimpleTax, a provider of online tax preparation services for individuals in Canada, forC$2.4 million (with C$ indicating Canadian dollars and amounting to approximately $1.9 million based on the acquisition-date exchange rate) in cash andadditional consideration of up to C$4.6 million ( $3.7 million ) that is contingent upon product availability and revenue performance over a three -year period. Theestimated fair value of the contingent consideration as of the acquisition date was C$4.1 million ( $3.3 million ). See " Note 6: Fair Value Measurements " foradditional information related to the fair value measurement of the contingent consideration.The acquisition of SimpleTax is strategic to TaxAct and intended to expand its operations. SimpleTax is included in the Tax Preparation segment. Intangibleassets acquired amounted to approximately C$1.2 million ( $0.9 million ), consisting of customer relationships and proprietary technology both of which havefinite lives. Identifiable net liabilities assumed were not material. Goodwill amounted to C$5.6 million ( $4.5 million ). Pro forma results of operations have notbeen presented because the effects of this acquisition were not material to the Company’s consolidated results of operations.Balance Financial: On October 4, 2013 , TaxAct acquired all of the equity of Balance Financial Inc. (“ Balance Financial ”), a provider of web andmobile-based financial management software, for $4.9 million in cash which included a $0.7 million escrow amount that was recorded in "Accrued expenses andother current liabilities" for indemnifications related to general representations and warranties. The escrow period expired on April 4, 2015 , at which time theamount, net of any indemnifiable losses, was released. The acquisition of the Balance Financial business is strategic to TaxAct and was funded from the revolvingcredit loan under the TaxAct 2013 credit facility (see " Note 8: Debt "). Balance Financial is included in the Tax Preparation segment. The identifiable net assetsacquired amounted to $1.0 million , consisting primarily of deferred tax assets, and intangible assets acquired amounted to $0.8 million , consisting primarily ofinternally-developed software and customer relationships both of which have finite lives. Goodwill amounted to $3.1 million . Pro forma results of operations havenot been presented because the effects of this acquisition were not material to the Company’s consolidated results of operations.Note 4: Discontinued OperationsOn October 14, 2015, the Company announced its plans to focus on the technology-enabled financial solutions market, as more fully described in " Note 1:The Company and Basis of Presentation ." The Strategic Transformation includes plans to divest the Search and Content and E-Commerce businesses. Financialcondition, results of operations, cash flows, and the notes to financial statements reflect the Search and Content and E-Commerce businesses as discontinuedoperations for all periods presented. Amounts in discontinued operations include previously unallocated depreciation, amortization, stock-based compensation,income taxes, and other corporate expenses that were attributable to the Search and Content and E-Commerce businesses.66Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Summarized financial information for discontinued operations is as follows (in thousands): Years ended December 31. 2015 2014 2013Major classes of items in net income (loss): Revenues$352,077 $477,001 $482,767Operating expenses(391,702) (490,006) (404,842)Other loss, net(2,673) (1,316) (55)Income (loss) from discontinued operations, before income taxes(42,298) (14,321) 77,870Income tax benefit (expense)14,950 (15,682) (27,810)Discontinued operations, net of income taxes$(27,348) $(30,003) $50,060 December 31. 2015 2014Major classes of assets and liabilities: Cash$2,158 $4,476Accounts receivable, net of allowance26,352 30,696Inventories43,480 29,246Other current assets3,182 7,835Property and equipment, net9,824 9,400Goodwill, net67,201 116,117Other intangible assets, net59,006 76,800Other long-term assets460 390Total assets of discontinued operations$211,663 $274,960 Accounts payable$33,295 $37,336Other current liabilities15,622 15,842Debt (net of discount and including short-term and long-term portions)25,000 41,809Deferred tax liability, net13,816 19,856Other long-term liabilities542 13Total liabilities of discontinued operations$88,275 $114,856Assets and liabilities of discontinued operations are reported at the lower of carrying value or fair value less cost to sell.Goodwill, other intangible assets, and debt are discussed further below in the related subsections of this note.67Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Business exit costs: In conjunction with the Strategic Transformation, the Company expects to incur business exit costs of approximately $3.0 million , withthe majority of these costs recorded in discontinued operations in the fourth quarter of 2015 and in the first quarter of 2016. Some of these costs are contingent orare accelerated upon the sale of the Search and Content and E-Commerce businesses and will be recorded or adjusted, as appropriate, at the time of sale. Thefollowing table summarizes the activity in the business exit cost liability (in thousands): Employee-RelatedCostsBalance as of December 31, 2014$—Charges994Payments—Adjustments—Balance as of December 31, 2015$994Goodwill and other intangible assets: The Company tested the goodwill and trade names related to Search and Content and E-Commerce for impairment asof October 31, 2015, due to the Company's October 2015 announcement of its plans to divest these businesses and their resulting classification as held for sale. Aspart of the fair value assessment of these businesses, the Company recorded goodwill impairments of $15.1 million and $33.8 million related to the Search andContent and E-Commerce reporting units, respectively. This adjusted the carrying values of the Search and Content and E-Commerce goodwill to $44.8 millionand $22.4 million , respectively. The Company had a goodwill impairment related to E-Commerce in the fourth quarter of 2014 and recorded a charge of $59.4million . In addition, the Company recorded trade name impairments of $5.9 million and $4.2 million related to the HSW and Monoprice trade names, respectively.This adjusted the carrying values of the HSW and Monoprice trade names to nil and $30.6 million , respectively. The Company had a trade name impairment in thefourth quarter of 2014 related to Monoprice and recorded a charge of $3.2 million .The impairments of goodwill and intangible assets were recorded in discontinued operations. The Company classified the fair value of its reporting units,goodwill, and trade names within Level 3 because they were valued using discounted cash flows, which have significant unobservable inputs related to theweighted-average cost of capital and forecasts of future cash flows. Refer to " Note 2: Summary of Significant Accounting Policies " for a description of theCompany's reporting units and the method used to determine the fair values of those reporting units and the amount of goodwill impairment.The Company determined that the impairments related to Search and Content and E-Commerce were indicators requiring the review of the Search andContent and E-Commerce long-lived assets for recoverability. The results of this review indicated that the carrying values of the Search and Content and E-Commerce long-lived assets were recoverable.Debt: The debt in discontinued operations consisted of the following (in thousands): December 31, 2015 December 31, 2014 Principalamount Unamortizeddiscount Net carryingvalue Principalamount Unamortizeddiscount Net carryingvalueMonoprice 2013 credit facility$25,000 $— $25,000 $42,000 $(191) $41,809On November 22, 2013 , Monoprice entered into an agreement with a syndicate of lenders for the purposes of post-transaction financing of the Monopriceacquisition and providing future working capital flexibility for Monoprice. The credit facility consists of a $30.0 million revolving credit loan—which includes upto $5.0 million under a letter of credit and up to $5.0 million in swingline loans—and, until repaid in full in 2015 as discussed below, also consisted of a $40.0million term loan. The final maturity date of the credit facility is November 22, 2018 but will become immediately due and payable upon the sale of Monoprice.Monoprice’s obligations under the credit facility are guaranteed by Monoprice Holdings, Inc. and are secured by the assets of the Monoprice business.Monoprice initially borrowed $50.0 million under the credit facility, from both the revolving credit loan and the term loan, and had net repayment activity of$17.0 million and $8.0 million in 2015 and 2014 , respectively. Monoprice has the right to permanently reduce, without premium or penalty, the entire creditfacility at any time or portions of the credit facility in an68Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013aggregate principal amount not less than $1.0 million or any whole multiple of $1.0 million in excess thereof (for swingline loans, the aggregate principal amountis not less than $0.1 million and any whole multiple of $0.1 million in excess thereof). In accordance with this provision, Monoprice repaid the outstanding amountunder the term loan in full in 2015, which was included in the net repayment activity for 2015 and resulted in the write-down of the remaining unamortizeddiscount and debt issuance costs related to the term loan. Amounts remained outstanding under the revolving credit loan, which continues to be available toMonoprice through its final maturity date. The interest rate is variable, based upon, at the election of Monoprice, either LIBOR plus a margin of between 2.75%and 3.25% , payable each interest period, or a variable rate plus a margin of between 1.75% and 2.25% , payable quarterly. In each case, the applicable marginwithin the range depends upon Monoprice’s ratio of leverage to EBITDA over the previous four quarters. The credit facility includes financial and operatingcovenants with respect to certain ratios, including leverage ratio and fixed charge coverage ratio, which are defined further in the agreement. As of December 31,2015 , Monoprice was in compliance with all of the financial and operating covenants. As of December 31, 2015 , the credit facility’s principal amountapproximated its fair value as it is a variable rate instrument and the current applicable margin approximates current market conditions.Note 5: Goodwill and Other Intangible AssetsThe following table presents goodwill by reportable segment (in thousands): Wealth Management Tax Preparation TotalBalance as of December 31, 2013$— $188,541 $188,541Additions— — —Foreign currency translation adjustment— — —Balance as of December 31, 2014— 188,541 188,541Additions356,386 4,473 360,859Foreign currency translation adjustment— (441) (441)Balance as of December 31, 2015$356,386 $192,573 $548,959 The goodwill additions in 2015 related to the acquisitions of HD Vest ( Wealth Management segment) and SimpleTax (Tax Preparation segment), both asdescribed in " Note 3: Business Combinations ."Intangible assets other than goodwill consisted of the following (in thousands): December 31, 2015 December 31, 2014 Grosscarryingamount Accumulatedamortization Net Grosscarryingamount Accumulatedamortization NetDefinite-lived intangible assets: Customer relationships$101,681 $(49,664) $52,017 $101,600 $(37,052) $64,548Advisor relationships240,300 — 240,300 — — —Sponsor relationships16,500 — 16,500 — — —Curriculum800 — 800 — — —Technology43,948 (29,270) 14,678 29,800 (21,729) 8,071Total definite-lived intangible assets403,229 (78,934) 324,295 131,400 (58,781) 72,619Indefinite-lived intangible assets: Trade names72,000 — 72,000 19,500 — 19,500Total$475,229 $(78,934) $396,295 $150,900 $(58,781) $92,119There were advisor relationship, sponsor relationship, curriculum, and technology additions in 2015 related to the acquisition of HD Vest ( WealthManagement segment). There also were customer relationship and technology additions in 2015 related to the acquisition of SimpleTax (Tax Preparation segment).Both acquisitions are described in " Note 3: Business Combinations ."69Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Amortization expense was as follows (in thousands): Years ended December 31. 2015 2014 2013Statement of comprehensive income line item: Cost of revenue$7,546 $7,450 $7,450Amortization of other acquired intangible assets12,757 12,742 12,692Total$20,303 $20,192 $20,142Expected amortization of definite-lived intangible assets held as of December 31, 2015 is as follows (in thousands): 2016 2017 2018 2019 2020 Thereafter TotalStatement of comprehensive income line item: Cost of revenue$804 $183 $91 $— $— $— $1,078Amortization of other acquired intangible assets33,262 33,263 33,263 33,263 21,444 168,722 323,217Total$34,066 $33,446 $33,354 $33,263 $21,444 $168,722 $324,295The weighted average amortization periods for definite-lived intangible assets are as follows: 49 months for customer relationships, 168 months for advisorrelationships, 216 months for sponsor relationships, 48 months for curriculum, 68 months for technology, and 147 months for total definite-lived intangible assets.Note 6: Fair Value MeasurementsThe fair value hierarchy of the Company's financial assets carried at fair value and measured on a recurring basis was as follows (in thousands): December 31, 2015 Fair value measurements at the reporting date using Quoted prices in activemarkets using identicalassets(Level 1) Significant otherobservable inputs (Level2) Significant unobservableinputs(Level 3)Cash equivalents: Money market and other funds$5,410 $— $5,410 $—Available-for-sale investments: Debt securities: U.S. government securities11,301 — 11,301 —Total assets at fair value$16,711 $— $16,711 $— Contingent consideration liability$2,951 $— $— $2,951Total liabilities at fair value$2,951 $— $— $2,95170Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013 December 31, 2014 Fair value measurements at the reporting date using Quoted prices in activemarkets using identicalassets(Level 1) Significant otherobservable inputs (Level2) Significant unobservableinputs(Level 3)Cash equivalents: Money market and other funds$8,322 $— $8,322 $—Time deposits1,242 — 1,242 —Taxable municipal bonds4,754 — 4,754 —Total cash equivalents14,318 — 14,318 —Available-for-sale investments: Debt securities: U.S. government securities100,818 — 100,818 —International government securities6,560 — 6,560 —Commercial paper24,589 — 24,589 —Time deposits30,759 — 30,759 —Corporate bonds1,528 — 1,528 —Taxable municipal bonds87,366 — 87,366 —Total debt securities251,620 — 251,620 —Total assets at fair value$265,938 $— $265,938 $—The Company also had financial instruments that were not measured at fair value. See " Note 8: Debt " for details.A reconciliation of changes in Level 3 items measured at fair value on a recurring basis was as follows (in thousands):Contingent consideration liability: Balance as of December 31, 2014$—Initial estimate upon acquisition3,274Foreign currency transaction gain(323)Balance as of December 31, 2015$2,951The contingent consideration liability is related to the Company's acquisition of SimpleTax (see " Note 3: Business Combinations "), and the relatedpayments are expected to occur annually beginning in 2017 and continuing through 2019. As of December 31, 2015 , the Company could be required to pay up toan undiscounted amount of $3.3 million . The Company has determined the fair value of the contingent consideration liability based on a probability-weighteddiscounted cash flow analysis, which includes assumptions related to estimating revenues, the probability of payment ( 100% ), and the discount rate ( 9% ). Adecrease in estimated revenues would decrease the fair value of the contingent consideration liability, while a decrease in the discount rate would increase the fairvalue of the contingent consideration liability. As of December 31, 2015 , the Company recorded the entire contingent consideration liability in "Other long-termliabilities" on the consolidated balance sheets.The Company had non-recurring Level 3 fair value measurements in 2015 and 2014 related to its reporting units and various intangible assets as part ofgoodwill and intangible asset impairment reviews. See " Note 4: Discontinued Operations " for details.The contractual maturities of the debt securities classified as available-for-sale at December 31, 2015 and 2014 were less than one year.71Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013The cost and fair value of available-for-sale investments were as follows (in thousands): Amortized cost Gross unrealized gains Gross unrealized losses Fair valueBalance as of December 31, 2015$11,316 $— $(15) $11,301Balance as of December 31, 2014$251,673 $16 $(69) $251,620Note 7: Balance Sheet ComponentsPrepaid expenses and other current assets, net consisted of the following (in thousands): December 31, 2015 2014Prepaid expenses$9,893 $6,170Other current assets, net169 296Total prepaid expenses and other current assets, net$10,062 $6,466Property and equipment, net consisted of the following (in thousands): December 31,20152014Computer equipment and data center$5,383$4,293Purchased software2,1151,124Internally-developed software1,999702Office equipment587480Office furniture1,5291,375Leasehold improvements and other6,1313,82117,74411,795Accumulated depreciation(6,915)(5,550)10,8296,245Capital projects in progress479297Total property and equipment, net$11,308$6,542Total depreciation expense was $2.3 million , $2.0 million , and $1.8 million for the years ended December 31, 2015 , 2014 , and 2013 , respectively.Unamortized internally-developed software was $1.7 million and $0.7 million at December 31, 2015 and 2014 , respectively. The Company recordeddepreciation expense for internally-developed software of $0.3 million , $0.2 million , and $0.1 million for the years ended December 31, 2015 , 2014 , and 2013 ,respectively.Accrued expenses and other current liabilities consisted of the following (in thousands): December 31, 2015 2014Salaries and related expenses$7,581 $2,436Accrued interest on Notes (see Note 8)2,138 2,138Other3,287 2,653Total accrued expenses and other current liabilities$13,006 $7,227 72Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013As part of the Strategic Transformation, the Company announced the upcoming departure of its chief executive officer once a permanent successor has beenidentified. "Salaries and related expenses" included $1.5 million of employee separation costs pursuant to the chief executive officer's employment agreement, tobe paid within 60 days of his last day of employment.Note 8: DebtThe Company’s debt consisted of the following (in thousands): December 31, 2015 December 31, 2014 Unamortized Unamortized Principalamount Discount Debt issuancecosts Net carryingvalue Principalamount Discount Debt issuancecosts Net carryingvalueTaxAct - HD Vest 2015 creditfacility$400,000 $(12,000) $(8,919) $379,081 $— $— $— $—TaxAct 2013 credit facility— — — — 51,940 — — 51,940Convertible Senior Notes201,250 (12,207) (3,125) 185,918 201,250 (16,073) (4,114) 181,063Note payable, related party6,400 — — 6,400 — — — —Total debt$607,650 $(24,207) $(12,044) $571,399 $253,190 $(16,073) $(4,114) $233,003 TaxAct - HD Vest 2015 credit facility: On December 31, 2015 , TaxAct and HD Vest entered into an agreement with a syndicate of lenders for the purposesof transaction financing of the HD Vest acquisition and providing future working capital flexibility for TaxAct and HD Vest. The credit facility consists of a $25.0million revolving credit loan--which includes a letter of credit and swingline loans--and a $400.0 million term loan for an aggregate $425.0 million credit facility.The final maturity dates of the revolving credit loan and term loan are December 31, 2020 and December 31, 2022 , respectively. Obligations under the creditfacility are guaranteed by TaxAct Holdings, Inc. and HD Vest Holdings, Inc. and are secured by the equity of the TaxAct and HD Vest businesses. While Blucorais not a party to the agreement, it has guaranteed the obligations of TaxAct and HD Vest under the credit facility, secured by its equity in TaxAct Holdings, Inc.TaxAct and HD Vest borrowed $400.0 million under the term loan. Principal payments on the term loan are payable quarterly and will be between 0.625%and 1.875% of outstanding principal, depending upon TaxAct and HD Vest's combined net leverage of EBITDA ratio. The interest rate on the term loan is variableat the London Interbank Offered Rate ( “LIBOR” ), subject to a floor of 1.00% , plus a margin of 6.00% , payable at the end of each interest period.TaxAct and HD Vest may borrow under the revolving credit loan in an aggregate principal amount not less than $2.0 million or any whole multiple of $1.0million in excess thereof (for swingline loans, the aggregate principal amount is not less than $0.5 million or any whole multiple of $0.1 million in excess thereof).Principal payments on the revolving credit loan are payable at maturity . The interest rate on the revolving credit loan is variable, with initial draws at LIBOR plusa margin of 5.00% . Subsequent draws on the revolving credit loan also have variable interest rates, based upon LIBOR plus a margin of between 2.75% and 5.00%. In each case, the applicable margin within the range depends upon TaxAct and HD Vest's combined net leverage to EBITDA ratio over the previous four quarters.Interest is payable at the end of each interest period.TaxAct and HD Vest have the right to permanently reduce, without premium or penalty, the entire credit facility at any time or portions of the credit facilityin an aggregate principal amount not less than $5.0 million or any whole multiple of $1.0 million in excess thereof, except for prepayments through December 31,2016 which carry a premium of 1.00% of the total principal amount outstanding just prior to prepayment. In addition, the credit facility includes financial andoperating covenants, including a net leverage to EBITDA ratio, which are defined further in the agreement.As of December 31, 2015 , the credit facility's principal amount approximated its fair value as it is a variable rate instrument and the current applicablemargin approximates current market conditions.TaxAct 2013 credit facility: On August 30, 2013 , TaxAct entered into an agreement with a syndicate of lenders to refinance a 2012 credit facility on morefavorable terms. Under that 2012 credit facility, TaxAct borrowed $100.0 million , of which $25.5 million was repaid in 2012, $10.0 million in April 2013, and theremaining $64.5 million in August 2013, the latter73Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013amount in connection with the refinancing of this credit agreement. The interest rate was variable. The Company hedged a portion of the interest rate risk throughan interest rate swap, which was terminated at break-even on September 10, 2013 .TaxAct initially borrowed $71.4 million under the 2013 credit facility and had net repayment activity of $51.9 million and $19.4 million in 2015 and 2014 ,respectively. TaxAct had the right to permanently reduce, without premium or penalty, the entire credit facility at any time. In accordance with this provision,TaxAct repaid the outstanding amount under the credit facility in full in 2015, at which point the credit facility was closed and the remaining related debt issuancecosts of $0.4 million were written off.On August 30, 2013, the Company performed an analysis by creditor to determine whether the refinancing would be recorded as an extinguishment or amodification of debt and, as a result of this analysis, recognized a loss on partial extinguishment of debt comprised of the following (in thousands):Refinancing fees paid to creditors, including arrangement fee, classified as extinguishment$567Deferred financing costs on extinguished debt726Debt discount on extinguished debt300Total$1,593Convertible Senior Notes: On March 15, 2013 , the Company issued $201.25 million aggregate principal amount of its Convertible Senior Notes (the “Notes ”), inclusive of the underwriters’ exercise in full of their over-allotment option of $26.25 million . The Notes mature on April 1, 2019 , unless earlierpurchased, redeemed, or converted in accordance with the terms, and bear interest at a rate of 4.25% per year, payable semi-annually in arrears beginning onOctober 1, 2013 . The Company received net proceeds from the offering of approximately $194.8 million after adjusting for debt issuance costs, including theunderwriting discount.The Notes were issued under an indenture dated March 15, 2013 (the “ Indenture ”) by and between the Company and The Bank of New York Mellon TrustCompany, N.A., as Trustee. There are no financial or operating covenants relating to the Notes.Beginning July 1, 2013 and prior to the close of business on September 28, 2018, holders may convert all or a portion of the Notes at their option, inmultiples of $1,000 principal amount, under the following circumstances:•During any fiscal quarter commencing July 1, 2013, if the last reported sale price of the Company’s common stock for at least 20 trading days during aperiod of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% ofthe conversion price on each applicable trading day. As of December 31, 2015 and 2014 , the Notes were not convertible .•During the five business day period after any five consecutive trading day period (the “measurement period” ) in which the trading price per $1,000principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sales price of theCompany’s common stock and the conversion rate on each trading day.•If the Company calls any or all of the Notes for redemption.•Upon the occurrence of specified corporate events, including a merger or a sale of all or substantially all of the Company’s assets.The convertibility of the Notes is determined at the end of each reporting period. If the Notes are determined to be convertible, they remain convertible untilthe end of the subsequent quarter and are classified in "Current liabilities" on the balance sheet; otherwise, they are classified in "Long-term liabilities." Dependingupon the price of the Company’s common stock or the trading price of the Notes within the reporting period, pursuant to the first two criteria listed above, theNotes could be convertible during one reporting period but not convertible during a comparable reporting period.On or after October 1, 2018 and until the close of business on March 28, 2019 , holders may convert their Notes, in multiples of $1,000 principal amount, atthe option of the holder.74Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013The conversion ratio for the Notes is initially 0.0461723 , equivalent to an initial conversion price of approximately $21.66 per share of the Company’scommon stock. The conversion ratio is subject to customary adjustment for certain events as described in the Indenture.At the time the Company issued the Notes, the Company was only permitted to settle conversions with shares of its common stock. The Company receivedshareholder approval at its annual meeting in May 2013 to allow for “flexible settlement,” which provided the Company with the option to settle conversions incash, shares of common stock, or any combination thereof. The Company’s intention is to satisfy conversion of the Notes with cash for the principal amount of thedebt and shares of common stock for any related conversion premium.Beginning April 6, 2016 , the Company may, at its option, redeem for cash all or part of the Notes plus accrued and unpaid interest. If the Companyundergoes a fundamental change (as described in the Indenture), holders may require the Company to repurchase for cash all or part of their Notes in principalamounts of $1,000 or an integral multiple thereof. The fundamental change repurchase price will be equal to 100% of the principal amount of the Notes to berepurchased, plus accrued and unpaid interest. However, if a fundamental change occurs and a holder elects to convert the Notes, the Company will, under certaincircumstances, increase the applicable conversion rate for the Notes surrendered for conversion by a number of additional shares of common stock based on thedate on which the fundamental change occurs or becomes effective and the price paid per share of the Company’s common stock in the fundamental change asspecified in the Indenture. The Strategic Transformation does not qualify as a fundamental change under the Indenture.The Notes are unsecured and unsubordinated obligations of the Company and rank senior in right of payment to any of the Company’s indebtedness that isexpressly subordinated in right of payment to the Notes, and equal in right of payment to any of the Company’s existing and future unsecured indebtedness that isnot subordinated. The Notes are effectively junior in right of payment to any of the Company’s secured indebtedness (to the extent of the value of assets securingsuch indebtedness) and structurally junior to all existing and future indebtedness and other liabilities, including trade payables, of the Company’s subsidiaries. TheIndenture does not limit the amount of debt that the Company or its subsidiaries may incur.The Notes may be settled in combination of cash or shares of common stock given the flexible settlement option. As a result, the Notes contain liability andequity components, which were bifurcated and accounted for separately. The liability component of the Notes, as of the issuance date, was calculated by estimatingthe fair value of a similar liability issued at a 6.5% effective interest rate, which was determined by considering the rate of return investors would require in theCompany’s debt structure. The amount of the equity component was calculated by deducting the fair value of the liability component from the principal amount ofthe Notes, resulting in the initial recognition of $22.3 million as the debt discount recorded in additional paid-in capital for the Notes. The carrying amount of theNotes is being accreted to the principal amount over the remaining term to maturity, and the Company is recording corresponding interest expense. The Companyincurred debt issuance costs of $6.4 million related to the Notes and allocated $5.7 million to the liability component of the Notes. These costs are being amortizedto interest expense over the six-year term of the Notes or the date of conversion, if any.The following table sets forth total interest expense related to the Notes (in thousands): Years ended December 31, 2015 2014 2013Contractual interest expense (Cash)$8,553 $8,553 $6,795Amortization of debt issuance costs (Non-cash)989 920 684Accretion of debt discount (Non-cash)3,866 3,594 2,674Total interest expense$13,408 $13,067 $10,153Effective interest rate of the liability component7.32% 7.32% 7.32%The fair value of the principal amount of the Notes as of December 31, 2015 was $167.8 million , based on the last quoted active trading price, a Level 1 fairvalue measurement, as of that date.Note payable, related party: The note payable is with the President of HD Vest and arose in connection with the acquisition of HD Vest. Certain membersof HD Vest management rolled over a portion of the proceeds they would have otherwise received at the acquisition's closing into shares of the acquisitionsubsidiary through which the Company75Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013consummated the purchase of HD Vest. The President of HD Vest sold a portion of his shares to the Company in exchange for the note. See " Note 3: BusinessCombinations " for additional information on the acquisition of HD Vest. The note will be paid over a three -year period, with 50% paid in year one, 40% paid inyear two, and 10% paid in year three. The note bears interest at a rate of 5% per year, with a principal amount that approximates its fair value.Note 9: Commitments and ContingenciesThe Company's contractual commitments are as follows for years ending December 31 (in thousands): 2016 2017 2018 2019 2020 Thereafter TotalOperating lease commitments$3,871 $3,945 $4,026 $4,105 $3,795 $6,098 $25,840Purchase commitments3,082 3,002 2,530 — — — 8,614Debt commitments33,200 32,560 20,640 221,250 10,000 290,000 607,650Interest on Notes8,553 8,553 8,553 4,277 — — 29,936Acquisition-related contingentconsideration liability— 723 962 1,266 — — 2,951Total$48,706 $48,783 $36,711 $230,898 $13,795 $296,098 $674,991Operating lease commitments: The Company has non-cancelable operating leases for its facilities. The leases run through 2023 , and some of the leaseshave clauses for optional renewal. Rent expense under operating leases totaled $1.2 million , $1.2 million , and $0.9 million for the years ended December 31, 2015, 2014 , and 2013 , respectively.Purchase commitments: The Company's purchase commitments consist primarily of non-cancelable service agreements for its data centers and asponsorship marketing agreement.Debt commitments and interest on Notes: The Company’s debt commitments are based upon contractual payment terms and consist of the outstandingprincipal related to the TaxAct - HD Vest credit facility, the Notes, and the note payable with related party. The Company may repay the amounts outstandingunder the TaxAct - HD Vest credit facility before its maturity date, depending upon the cash generated by the businesses, and under the Notes based upon holdersexercising their conversion option. For further detail regarding the credit facility, the Notes, and the note payable with related party, see " Note 8: Debt ."Acquisition-related contingent consideration liability: The contingent consideration liability is related to the Company's acquisition of SimpleTax (see " Note3: Business Combinations " and " Note 6: Fair Value Measurements "), and the related payments are expected to occur annually beginning in 2017 and continuingthrough 2019.Collateral pledged: The Company has pledged a portion of its cash as collateral for certain of its property lease-related banking arrangements. AtDecember 31, 2015 , the total amount of collateral pledged under these standby letters of credit was $0.7 million .Off-balance sheet arrangements: The Company has no off-balance sheet arrangements other than operating leases.Litigation: From time to time, the Company is subject to various legal proceedings or claims that arise in the ordinary course of business. Following is abrief description of the more significant legal proceedings. The Company accrues a liability when management believes that it is both probable that a liability hasbeen incurred and the amount of loss can be reasonably estimated. Although the Company believes that resolving claims against it, individually or in aggregate,will not have a material adverse impact on its financial statements, these matters are subject to inherent uncertainties.On March 5, 2015, Remigius Shatas filed a shareholder derivative action against Andrew Snyder, a director of the Company, certain companies affiliatedwith Mr. Snyder, as well as nominal defendant Blucora, in the Superior Court of the State of Washington in and for King County. Although the Company is anominal defendant, the plaintiff purports to bring the action on behalf of the Company and thus does not seek monetary damages from the Company. Instead, theplaintiff alleges improper use of inside information in certain sales of the Company's common stock and seeks to recover from Andrew Snyder and thosecompanies affiliated with Mr. Snyder profits resulting from those allegedly improper sales. On May 15, 2015, the76Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013court granted the Company's motion to dismiss the Complaint based on the plaintiffs’ failure to file this matter in the proper court. Subsequently, the plaintiffmoved for reconsideration of the Superior Court's decision to grant the motion to dismiss, and on June 5, 2015, that motion for reconsideration was denied. OnJune 30, 2015, the plaintiff filed a Notice of Appeal with the Superior Court, indicating plaintiff's intention to appeal to the Washington Court of Appeals, DivisionI. On September 14, 2015, the plaintiff filed a motion with the Washington Court of Appeals to add an additional plaintiff, which the court subsequently denied onOctober 19, 2015. Plaintiff filed its appellant brief on September 25, 2015, and the Company filed its response on October 26, 2015, as well as a Motion on theMerits to Affirm on the grounds that the plaintiff lacked standing at all points relevant to the lawsuit. The plaintiff filed a reply brief in support of its Appeal onNovember 25, 2015. The plaintiff filed its opposition to the Company’s Motion on the Merits on November 5, 2015. The court denied the Company’s motion onNovember 9, 2015, on procedural, not substantive, grounds. The Company refiled the substance of the motion in a Motion to Dismiss Appeal on November 10,2015, and the plaintiff filed its opposition on December 1, 2015. The Company filed a reply brief on December 7, 2015. The Company awaits the court’s decisionwith respect to the plaintiff’s appeal as well as the Company’s motion to dismiss.The Company has entered into indemnification agreements in the ordinary course of business with its officers and directors and may be obligated to advancepayment of legal fees and costs incurred by the defendants pursuant to the Company’s obligations under these indemnification agreements and applicable Delawarelaw.Note 10: Stockholders' EquityStock incentive plan: The Company may grant non-qualified stock options, stock, RSUs, and stock appreciation rights to employees, non-employeedirectors, and consultants.The Company granted options and RSUs during 2015 , 2014 , and 2013 under its Restated 1996 Flexible Stock Incentive Plan. The Company also begangranting options and RSUs during 2015 under the Blucora, Inc. 2015 Incentive Plan. Options and RSUs generally vest over a period of three years, with one-thirdvesting one year from the date of grant and the remainder vesting ratably thereafter on a semi-annual basis , and expire seven years from the date of grant. Thereare a few exceptions to this vesting schedule, which provide for vesting at different rates or based on achievement of performance or market targets.The Company issues new shares upon the exercise of options and upon the vesting of RSUs. If an option or RSU is surrendered or otherwise unused, therelated shares will continue to be available.Warrant: On August 23, 2011, the Company issued a warrant to purchase 1.0 million shares of Blucora common stock, exercisable at a price of $9.62 pershare (the “Warrant” ). The Warrant originally was considered stock-based compensation and was scheduled to expire on August 23, 2014 , but the completion ofthe TaxAct acquisition on January 31, 2012 was an event under the Warrant’s terms that extended the expiration date to the earlier of August 23, 2017 or theeffective date of a change of control of Blucora. Subsequent to the extension, the Company treated the award as a derivative instrument (see " Note 2: Summary ofSignificant Accounting Policies "). The Warrant’s fair value was determined each reporting period with gains or losses related to the change in fair value recordedin " Other loss, net " in the amount of $11.7 million for the year ended December 31, 2013. On November 21, 2013, the Warrant was exercised and 1.0 millionshares of Blucora common stock were purchased for an aggregate exercise price of $9.6 million . The related derivative instrument liability balance of $20.2million was settled through "Additional paid-in capital."1998 Employee Stock Purchase Plan (“ ESPP ”): The ESPP permits eligible employees to contribute up to 15% of their base earnings toward the twice-yearly purchase of Company common stock, subject to an annual maximum dollar amount. The purchase price is the lesser of 85% of the fair market value ofcommon stock on the first day or on the last day of an offering period. An aggregate of 1.4 million shares of common stock are authorized for issuance under theESPP. Of this amount, 0.2 million shares were available for issuance. The Company issues new shares upon purchase through the ESPP.77Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Stock repurchase program: In February 2013, the Company’s Board of Directors approved a stock repurchase program whereby the Company maypurchase its common stock in open-market transactions. In May 2014, the Board of Directors increased the repurchase authorization, such that the Company mayrepurchase up to $85.0 million of its common stock, and extended the repurchase period through May 2016. Repurchased shares will be retired and resume thestatus of authorized but unissued shares of common stock. The Company had the following open-market share purchase activity, exclusive of purchase andadministrative costs (in thousands, except per share data): Total Numberof Shares Purchased Average Price Paidper Share Total CostYear ended December 31, 2015551 $14.01 $7,713Year ended December 31, 20142,289 $16.85 $38,558Year ended December 31, 2013418 $23.95 $9,990As of December 31, 2015 , the Company may repurchase up to an additional $28.7 million of its common stock under the repurchase program.Other comprehensive income: The following table provides information about activity in other comprehensive income (in thousands): Unrealized gain (loss)on investments Foreign currencytranslation adjustment Unrealized gain (loss)on derivativeinstrument TotalBalance as of December 31, 2012$(10) $— $(266) $(276)Other comprehensive income10 — 266 276Balance as of December 31, 2013— — — —Other comprehensive loss(1,113) — — (1,113)Balance as of December 31, 2014(1,113) — — (1,113)Other comprehensive income (loss)1,103 (517) — 586Balance as of December 31, 2015$(10) $(517) $— $(527)Note 11: Stock-Based CompensationA summary of the general terms of stock options and RSUs at December 31, 2015 was as follows: Number of shares authorized for awards12,040,839Options and RSUs outstanding6,403,859Options and RSUs expected to vest5,956,538Options and RSUs available for grant5,285,86278Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013The following activity occurred under the Company’s stock incentive plans:OptionsWeighted averageexercise priceIntrinsic value (in thousands)Weighted averageremaining contractualterm (in years)Stock options:Outstanding December 31, 20144,343,825 $14.21 Granted1,794,763 $13.34 Forfeited(378,509) $16.97 Expired(115,745) $17.49 Exercised(248,574) $9.69 Outstanding December 31, 20155,395,760 $13.87 $1,512 4.3Exercisable December 31, 20153,004,907 $13.00 $1,512 3.0Vested and expected to vest after December 31, 20155,093,188 $13.85 $1,512 4.2Stock unitsWeighted averagegrant date fair valueIntrinsic value (in thousands)Weighted averageremaining contractualterm (in years)RSUs:Outstanding December 31, 2014753,422 $17.88 Granted837,419 $13.67 Forfeited(200,676) $16.55 Vested(382,066) $17.65 Outstanding December 31, 20151,008,099 $14.73 $9,879 1.0Expected to vest after December 31, 2015863,350 $14.77 $8,461 0.9Supplemental information is presented below: Years ended December 31, 2015 2014 2013Stock options: Weighted average grant date fair value per share granted$3.65 $5.67 $5.05Total intrinsic value of options exercised (in thousands)$1,072 $3,600 $2,626Total fair value of options vested (in thousands)$4,416 $4,000 $2,410RSUs: Weighted average grant date fair value per unit granted$13.67 $18.44 $18.86Total intrinsic value of units vested (in thousands)$5,437 $8,315 $7,986Total fair value of units vested (in thousands)$6,742 $6,560 $5,16379Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013The Company included the following amounts for stock-based compensation expense, which related to stock options, RSUs, and the ESPP, in theconsolidated statements of comprehensive income (in thousands): Years ended December 31, 2015 2014 2013Cost of revenue$96 $254 $459Engineering and technology484 516 567Sales and marketing771 829 671General and administrative7,343 7,095 6,802Total in continuing operations8,694 8,694 8,499Discontinued operations4,402 3,190 3,028Total$13,096 $11,884 $11,527Total excluded and capitalized as part of internal-use software$135 $106 $115In May 2012, the Company granted stock options to certain Blucora employees who performed acquisition-related services. The vesting of such options werepredicated on completing “qualified acquisitions” under the terms of the options. The completion of the HSW acquisition on May 30, 2014 and the Monopriceacquisition on August 22, 2013 constituted qualified acquisitions under such terms, resulting in charges of $0.3 million and $0.5 million to stock-basedcompensation expense (reflected in “General and administrative” expense) in 2014 and 2013 , respectively.To estimate stock-based compensation expense, the Company used the Black-Scholes-Merton valuation method with the following assumptions for stockoptions granted: Years ended December 31, 2015 2014 2013Risk-free interest rate0.21% - 1.33% 0.11% - 1.31% 0.25% - 1.06%Expected dividend yield0% 0% 0%Expected volatility34% - 40% 35% - 43% 40% - 46%Expected life3.0 years 3.0 years 3.2 yearsThe risk-free interest rate was based on the implied yield available on U.S. Treasury issues with an equivalent remaining term. The Company last paid adividend in 2008 but does not expect to pay recurring dividends. The expected volatility was based on historical volatility of the Company’s stock for the relatedexpected life of the award. The expected life of the award was based on historical experience, including historical post-vesting termination behavior.As of December 31, 2015 , total unrecognized stock-based compensation expense related to unvested stock awards is as follows: Expense(in thousands) Weighted average periodover which to be recognized(in years)Stock options$2,566 1.2RSUs2,753 1.2Total for continuing operations$5,319 1.2 Note 12: Segment InformationThe Company has two reportable segments: the Wealth Management segment and the Tax Preparation segment. The Wealth Management segment consistsof the HD Vest business, which was acquired on December 31, 2015 , and, accordingly, has no operating activities recorded in Blucora's 2015 results of operations.HD Vest will be included in Blucora's results of operations beginning on January 1, 2016. As a result of the Strategic Transformation and planned divestitures ofthe Search and Content and E-Commerce segments, those former segments are included in discontinued operations. The Company’s chief80Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013executive officer is its chief operating decision maker and reviews financial information presented on a disaggregated basis. This information is used for purposesof allocating resources and evaluating financial performance.The Company does not allocate certain general and administrative costs (including personnel and overhead costs), stock-based compensation, depreciation,and amortization of intangible assets to the reportable segments. Such amounts are reflected in the table under the heading "Corporate-level activity." In addition,the Company does not allocate other loss, net and income taxes to the reportable segments. The Company does not account for, and does not report to management,its assets or capital expenditures by segment other than goodwill and intangible assets used for impairment analysis purposes.Information on the reportable segments currently presented to the Company’s chief operating decision maker and a reconciliation to consolidated net incomeare presented below (in thousands): Years ended December 31, 20152014 2013Revenue:Tax Preparation$117,708 $103,719 $91,213Operating income (loss): Tax Preparation56,984 49,696 40,599Corporate-level activity(61,791) (45,093) (44,077)Total operating income (loss)(4,807) 4,603 (3,478)Other loss, net(12,542) (13,489) (29,568)Loss from continuing operations before income taxes(17,349) (8,886) (33,046)Income tax benefit4,623 3,342 7,385Loss from continuing operations(12,726) (5,544) (25,661)Discontinued operations, net of income taxes(27,348) (30,003) 50,060Net income (loss)$(40,074) $(35,547) $24,399Note 13:Other Loss, Net" Other loss, net " consisted of the following (in thousands): Years ended December 31, 2015 2014 2013Interest income$(609) $(355) $(300)Interest expense (see Note 8)9,044 9,476 9,266Amortization of debt issuance costs (see Note 8)1,133 1,059 1,099Accretion of debt discounts (see Note 8)3,866 3,594 2,826Loss on debt extinguishment and modification expense (see Note 8)398 — 1,593Loss on derivative instrument (see Notes 2 and 10)— — 11,652Impairment of equity investment in privately-held company— — 3,711Gain on third party bankruptcy settlement(1,128) (286) (539)Other(162) 1 260Other loss, net$12,542 $13,489 $29,568In 2013, in connection with the Company’s review of its equity method investments for other-than-temporary impairment, the Company determined that itsequity investment in a privately-held company had experienced an other-than-temporary decline in value, due to recurring losses from operations, significantpersonnel reductions, and a change in the underlying business model. Accordingly, the Company wrote down the $3.7 million carrying value of the investment tozero , resulting in a loss.81Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013The gain on third party bankruptcy settlement related to amounts received in connection with ongoing distributions from the Lehman Brothers estate, ofwhich the Company is a creditor.Note 14: Income TaxesIncome tax benefit consisted of the following (in thousands): Years ended December 31, 201520142013Current: U.S. federal$7,470 $6,306 $4,175State514 210 41Total current expense7,984 6,516 4,216Deferred: U.S. federal(12,004) (9,800) (10,902)State(538) (58) (699)Foreign(65) — —Total deferred benefit(12,607) (9,858) (11,601)Income tax benefit$(4,623) $(3,342) $(7,385)Income tax benefit differed from the amount computed by applying the statutory federal income tax rate of 35% as follows (in thousands): Years ended December 31, 20152014 2013Income tax benefit at the statutory federal income tax rate$(6,072) $(3,110) $(11,566)State income taxes, net of federal benefit(15) 99 (363)Deductible domestic manufacturing costs(787) (594) (395)Non-deductible compensation27 569 221Non-deductible acquisition-related transaction costs (see Note 3)2,524 — —Non-deductible loss on derivative instrument (the Warrant, see Note 10)— — 4,078Change in liabilities for uncertain tax positions— (72) (201)Change in valuation allowance on unrealized capital losses(223) (117) 1,108Other(77) (117) (267)Income tax benefit$(4,623) $(3,342) $(7,385)82Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013The tax effect of temporary differences and net operating loss carryforwards that gave rise to the Company’s deferred tax assets and liabilities were asfollows (in thousands): December 31, 20152014Deferred tax assets: Net operating loss carryforwards$182,599 $199,635Accrued compensation12,519 1,151Deferred revenue3,845 2,738Tax credit carryforwards10,797 10,370Stock-based compensation8,416 6,800Basis difference in discontinued E-Commerce business33,871 —Other, net6,720 5,471Total gross deferred tax assets258,767 226,165Valuation allowance(217,452) (211,865)Deferred tax assets, net of valuation allowance41,315 14,300Deferred tax liabilities: Depreciation and amortization(140,035) (28,815)Discount on Notes(4,422) (5,767)Other, net(378) —Total gross deferred tax liabilities(144,835) (34,582)Net deferred tax liabilities$(103,520) $(20,282)At December 31, 2015 , the Company evaluated the need for a valuation allowance for certain deferred tax assets based upon its assessment of whether it ismore likely than not that the Company will generate sufficient future taxable income necessary to realize the deferred tax benefits. The Company maintains avaluation allowance against its deferred tax assets that are capital in nature to the extent that it is more likely than not that the related deferred tax benefit will notbe realized. The Company has deferred tax assets related to net operating losses that arose from excess tax benefits for stock-based compensation and minimum taxcredits that arose from the corresponding alternative minimum tax paid for those excess tax benefits. The Company must apply a valuation allowance against theseequity-based deferred tax assets until the Company utilizes the deferred tax assets to reduce taxes payable. Accordingly, the Company does not consider thesedeferred tax assets when evaluating changes in the valuation allowance.The changes in the valuation allowance for deferred tax assets are shown below (in thousands): Years ended December 31, 2015 2014Balance at beginning of year$211,865 $235,730Net changes to deferred tax assets, subject to a valuation allowance5,587 (23,865)Balance at end of year$217,452 $211,865For the years ended December 31, 2015 and 2014 , the valuation allowance change included increase s of $22.1 million and $0.3 million , respectively, forchanges in deferred tax assets that are capital in nature, and decrease s of $16.7 million and $24.1 million , respectively, for the utilization of equity-based deferredtax assets to reduce taxes payable. As of December 31, 2015 , $192.3 million of the valuation allowance pertained to equity-based deferred tax assets. Theconsolidated balance sheets reflect an increase in equity upon the release of this valuation allowance. Accordingly, income tax expense does not reflect a benefitfor the release of this valuation allowance.As of December 31, 2015 , the Company’s U.S. federal and state net operating loss carryforwards for income tax purposes were $521.1 million and $32.0million , respectively, which primarily related to excess tax benefits for stock-based83Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013compensation. When the net operating loss carryforwards related to stock-based compensation are recognized, the income tax benefit of those losses is accountedfor as a credit to stockholders’ equity on the consolidated balance sheets rather than on the consolidated statements of comprehensive income. If not utilized, theCompany’s federal net operating loss carryforwards will expire between 2020 and 2031 , with the majority of them expiring between 2020 and 2024 . Additionally,changes in ownership, as defined by Section 382 of the Internal Revenue Code, may limit the amount of net operating loss carryforwards used in any one year.A reconciliation of the unrecognized tax benefit balances is as follows (in thousands): Years ended December 31, 2015 2014 2013Balance at beginning of year$18,403 $18,537 $19,088Gross increases for tax positions of prior years2,708 126 219Gross decreases for tax positions of prior years(9) (199) (101)Gross increases for tax positions of current year751 — —Settlements(112) (61) (562)Lapse of statute of limitations— — (107)Balance at end of year$21,741 $18,403 $18,537The total amount of unrecognized tax benefits that could affect the Company’s effective tax rate if recognized was $3.4 million and $0.5 million as ofDecember 31, 2015 and 2014 , respectively. The remaining $18.4 million and $17.9 million as of December 31, 2015 and 2014 , respectively, if recognized, wouldcreate a deferred tax asset subject to a valuation allowance. The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, various statejurisdictions, and Canada. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by taxauthorities for years before 2011, although net operating loss carryforwards and tax credit carryforwards from any year are subject to examination and adjustmentfor at least three years following the year in which they are fully utilized. As of December 31, 2015 , no significant adjustments have been proposed relative to theCompany’s tax positions.During the years ended December 31, 2015 , 2014 , and 2013 , the Company recognized less than $0.1 million of interest and penalties related to uncertaintax positions. The Company had approximately $0.8 million and $0.3 million accrued for interest and penalties as of December 31, 2015 and 2014 , respectively.Note 15:Net Income (Loss) Per Share" Basic net income (loss) per share " is computed using the weighted average number of shares outstanding during the period. " Diluted net income (loss) pershare " is computed using the weighted average number of shares outstanding plus the number of dilutive potential shares outstanding during the period. Dilutivepotential shares consist of the incremental shares issuable upon the exercise of outstanding stock options, vesting of unvested RSUs, exercise of the Warrant (for2013), and conversion or maturity of the Notes. Dilutive potential shares are excluded from the computation of earnings per share if their effect is antidilutive.Weighted average shares were as follows (in thousands): Years ended December 31, 2015 2014 2013Weighted average shares outstanding, basic40,959 41,396 41,201Dilutive potential shares— — —Weighted average shares outstanding, diluted40,959 41,396 41,201Shares excluded5,975 5,468 5,91584Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2015, 2014, and 2013Shares excluded primarily related to shares excluded due to the antidilutive effect of a loss from continuing operations, stock options with an exercise pricegreater than the average price during the applicable periods, and awards with performance conditions not completed during the applicable periods (in 2014 and2013).As more fully discussed in " Note 10: Stockholders' Equity ," on November 21, 2013 , the Warrant was exercised and 1.0 million shares of the Company’scommon stock were issued accordingly. The weighted average of these shares was included in "Weighted average shares outstanding, basic" starting in November2013. Prior to that, the weighted average of the incremental shares issuable upon the exercise of the Warrant were included in the dilutive potential shares.As more fully discussed in " Note 8: Debt ," in March 2013, the Company issued the Notes, which are convertible and mature in April 2019. In May 2013,the Company received shareholder approval for “flexible settlement,” which provided the Company with the option to settle conversions in cash, shares of commonstock, or any combination thereof. The Company intends, upon conversion or maturity of the Notes, to settle the principal in cash and satisfy any conversionpremium by issuing shares of its common stock. As a result, the Company only includes the impact of the premium feature in its dilutive potential shares when theaverage stock price for the reporting period exceeds the conversion price of the Notes, which only occurred during the fourth quarter of 2013 .85Table of ContentsITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial DisclosureNone.ITEM 9A. Controls and ProceduresEvaluation of Disclosure Controls and ProceduresOur management evaluated, with the participation of our Chief Executive Officer and our Chief Financial Officer, the effectiveness of our disclosure controlsand procedures as of the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, our Chief Executive Officer and our ChiefFinancial Officer have concluded that our disclosure controls and procedures were effective as of December 31, 2015 to ensure that information we are required todisclose in reports that we file or submit under the Securities Exchange Act of 1934 is accumulated and communicated to our management, including our principalexecutive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure, and that such information is recorded, processed,summarized, and reported within the time periods specified in the Securities and Exchange Commission rules and forms.Management’s Report on Internal Control over Financial ReportingOur management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange ActRules 13a-15(f). Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internalcontrol over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to therisk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.Under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, we conducted anevaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013framework) issued by the Committee of the Sponsoring Organizations of the Treadway Commission.Based on our evaluation under the framework in Internal Control – Integrated Framework (2013 framework), our management concluded that our internalcontrol over financial reporting was effective as of December 31, 2015 .We acquired HD Vest on December 31, 2015 . Management excluded HD Vest from its assessment of the effectiveness of internal control over financialreporting as of December 31, 2015 . HD Vest's total assets and net assets amounted to $757.3 million and $611.9 million , respectively, as of December 31, 2015and zero revenues for the year then ended.Ernst & Young LLP has audited the effectiveness of our internal control over financial reporting as of December 31, 2015 and its report is included below.Changes in Internal Control over Financial ReportingThere was no change in our internal control over financial reporting that occurred during the fourth quarter of 2015 that has materially affected, or isreasonably likely to materially affect, our internal control over financial reporting.86Table of ContentsReport of Independent Registered Public Accounting FirmThe Board of Directors and StockholdersBlucora, Inc.We have audited Blucora, Inc.’s internal control over financial reporting as of December 31, 2015 , based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). Blucora, Inc.’smanagement is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control overfinancial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinionon the company’s internal control over financial reporting based on our audit.We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require thatwe plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all materialrespects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing andevaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessaryin the circumstances. We believe that our audit provides a reasonable basis for our opinion.A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control overfinancial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance withthe policies or procedures may deteriorate.As indicated in the accompanying Management's Report on Internal Control over Financial Reporting, management's assessment of and conclusion on theeffectiveness of internal control over financial reporting did not include the internal controls of HD Vest, which is included in the December 31, 2015 consolidatedfinancial statements of Blucora, Inc., and constituted $757.3 million and $611.9 million of total and net assets, respectively, as of December 31, 2015 and zerorevenues for the year then ended. Our audit of internal control over financial reporting of Blucora, Inc. also did not include an evaluation of the internal controlover financial reporting of HD Vest.In our opinion, Blucora, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2015 , based on theCOSO criteria.We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheetsof Blucora, Inc. as of December 31, 2015 and 2014 and the related consolidated statements of comprehensive income, stockholders’ equity and cash flows for eachof the three years in the period ended December 31, 2015 of Blucora, Inc. and our report dated February 24, 2016 expressed an unqualified opinion thereon./s/ ERNST & YOUNG LLPSeattle, WashingtonFebruary 24, 201687Table of ContentsITEM 9B. Other InformationOn February 23, 2016, the Compensation Committee of the Board of Directors of the Company approved the 2016 Executive Bonus Plan (the “ 2016 Plan ”).The 2016 Plan provides for annual performance-based cash bonuses to the Company’s executive officers. The target bonus amount for individual executive officersvaries, and is between 35% and 100% of each executive’s annual base salary.The available bonus for each executive is based on a combination of (a) the Company’s achievement of certain specified financial or operational performancemeasurements and (b) the individual performance of each executive and the discretion of the CEO (or, in the case of the CEO’s bonus, the discretion of theCompensation Committee). For the financial or operational performance components, the specific measures vary by executive, but may include overall CompanyRevenue and BCOR Adjusted EBITDA (as further specified in the 2016 Plan), and/or certain measurements that are specific to the business unit or segment thatthe individual executive is responsible for. Of the total available bonus payout, 80% is based on financial and operational performance components and 20% isbased on individual objectives and performance, as detailed in the 2016 Plan.The performance targets established for this bonus plan correspond to the operating plan targets approved by the Company’s Board of Directors. The range ofpossible bonus component achievement is 0% to 165% of the target bonus for the operational and financial performance components and 0% to 100% for theindividual objectives/discretionary component, with the result that the aggregate maximum available payout level for each executive is 152%.The foregoing description of the 2016 Plan is qualified in its entirety by reference to the full text of this plan, a copy of which is filed as Exhibit 10.13 heretoand incorporated herein by reference.88Table of ContentsPART IIIAs permitted by the rules of the Securities and Exchange Commission, we have omitted certain information from Part III of this Annual Report on Form 10-K. We intend to file a definitive Proxy Statement with the Securities and Exchange Commission relating to our annual meeting of stockholders not later than 120days after the end of the fiscal year covered by this Annual Report on Form 10-K, and such information is incorporated by reference herein.ITEM 10. Directors, Executive Officers and Corporate GovernanceCertain information concerning our directors required by this Item is incorporated by reference to our Proxy Statement under the heading "InformationRegarding the Board of Directors and Committees."Certain information regarding our executive officers required by this Item is incorporated by reference to our Proxy Statement under the heading"Information Regarding Executive Officers."Other information concerning our officers and directors required by this Item is incorporated by reference to our Proxy Statement under the heading"Beneficial Ownership."ITEM 11. Executive CompensationThe information required by this Item is incorporated by reference to our Proxy Statement under the headings "Compensation Committee Report,""Compensation Committee Interlocks and Insider Participation," "Compensation Discussion and Analysis," and "Compensation of Named Executive Officers."ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersThe information required by this Item is incorporated by reference to our Proxy Statement under the headings "Beneficial Ownership" and "EquityCompensation Plans."ITEM 13. Certain Relationships and Related Transactions, and Director IndependenceThe information required by this Item is incorporated by reference to our Proxy Statement under the headings "Information Regarding the Board ofDirectors" and "Audit Committee Report."ITEM 14. Principal Accounting Fees and ServicesThe information required by this Item is incorporated by reference to our Proxy Statement under the heading "Audit Committee Report."89Table of ContentsPART IVITEM 15. Exhibits, Financial Statement Schedules(a)1. Consolidated Financial StatementsSee Index to Consolidated Financial Statements at Item 8 of this report.2. Financial Statement SchedulesAll financial statement schedules required by Item 15(a)(2) have been omitted because they are not applicable or the required information is presented in theConsolidated Financial Statements or Notes thereto.3. ExhibitsThe exhibits listed in the accompanying index to exhibits are filed or incorporated by reference as part of this report.(b) ExhibitsSee Item 15(a) above.(c) Financial Statements and SchedulesSee Item 15(a) above.90Table of ContentsSIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to besigned on its behalf by the undersigned, thereunto duly authorized. BLUCORA, INC. By:/s/ William J. Ruckelshaus William J. RuckelshausChief Executive Officer and President Date:February 24, 2016POWER OF ATTORNEYKNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Eric M. Emans and Mark A.Finkelstein, jointly and severally, his or her attorneys-in-fact, each with the power of substitution, for him or her in any and all capacities to execute anyamendments to this Annual Report on Form 10-K, and to file the same, exhibits thereto and other documents in connection therewith, with the Securities andExchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may lawfully do or cause to be doneby virtue hereof.Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrantand in the capacities indicated and on the dates indicated.Signature TitleDate /s/ William J. Ruckelshaus President, Chief Executive Officer, and Director(Principal Executive Officer)February 24, 2016William J. Ruckelshaus /s/ Eric M. Emans Chief Financial Officer(Principal Financial Officer and Principal Accounting Officer)February 24, 2016Eric M. Emans /s/ John E. Cunningham, IV Chairman and DirectorFebruary 24, 2016John E. Cunningham, IV /s/ David H. S. Chung DirectorFebruary 24, 2016David H. S. Chung /s/ Lance G. Dunn DirectorFebruary 24, 2016Lance G. Dunn /s/ Steven W. Hooper DirectorFebruary 24, 2016Steven W. Hooper /s/ Elizabeth J. Huebner DirectorFebruary 24, 2016Elizabeth J. Huebner /s/ Andrew M. Snyder DirectorFebruary 24, 2016Andrew M. Snyder /s/ Christopher W. Walters DirectorFebruary 24, 2016Christopher W. Walters /s/ Mary S. Zappone DirectorFebruary 24, 2016Mary S. Zappone Table of ContentsINDEX TO EXHIBITSExhibitNumber Exhibit Description Form Date of First Filing ExhibitNumber FiledHerewith2.1 Stock Purchase Agreement between Blucora, Inc., Monoprice, Inc.,and the Shareholders, dated as of July 31, 2013 8-K August 1, 2013 2.1 3.1 Restated Certificate of Incorporation, as filed with the Secretary ofthe State of Delaware on August 10, 2012 8-K August 13, 2012 3.1 3.2 Amended and Restated Bylaws of Blucora, Inc., dated August 8,2013 8-K August 14, 2013 3.1 4.1 Indenture dated as of March 15, 2013 by and between Blucora, Inc.and The Bank of New York Mellon Trust Company, N.A., as trustee 8-K March 15, 2013 4.1 4.2 Form of 4.25% Convertible Senior Note due 2019 (included inExhibit 4.1) 8-K March 15, 2013 4.2 10.1* 1998 Employee Stock Purchase Plan S-1 (No. 333-62323), asamended August 27, 1998 10.3 10.2* Restated 1996 Flexible Stock Incentive Plan, as amended andrestated effective as of June 5, 2012 S-8 (No. 333-198645) September 8, 2014 99.1 10.3* Form of Restated 1996 Flexible Stock Incentive Plan NonqualifiedStock Option Letter Agreement for Nonemployee Directors S-8 (No. 333-169691) September 30, 2010 4.5 10.4* Form of Restated 1996 Flexible Stock Incentive Plan NonqualifiedStock Option Letter Agreement for Vice Presidents and Above S-8 (No. 333-169691) September 30, 2010 4.6 10.5* Form of Restated 1996 Flexible Stock Incentive Plan Notice of Grantof Restricted Stock Units and Restricted Stock Unit Agreement forNonemployee Directors S-8 (No. 333-169691) September 30, 2010 4.8 10.6* Form of Restated 1996 Flexible Stock Incentive Plan Notice of Grantof Restricted Stock Units and Restricted Stock Unit Agreement forVice Presidents and Above S-8 (No. 333-169691) September 30, 2010 4.9 10.7 Office Lease between Blucora, Inc. and Plaza Center Property LLCdated July 19, 2012 10-Q November 1, 2012 10.2 10.8 First Amendment to Office Lease between Blucora, Inc. and PlazaCenter Property LLC dated November 5, 2013 10-K February 27, 2014 10.8 10.9 Lease Agreement, dated January 28, 2008, by and between 2nd StorySoftware, Inc., PBI Properties, Larry Kane Investments, L.C., andSwati Dandekar for office space located at 1425 60th Street NE,Suite 300, Cedar Rapids, Iowa 10-K March 9, 2012 10.13 10.10 Amendment to Lease Agreement by and between 2nd StorySoftware, Inc., PBI Properties, Larry Kane Investments, L.C., andSwati Dandekar for office space located at 1425 60th Street NE,Suite 300, Cedar Rapids, Iowa, dated March 14, 2013 10-Q May 2, 2013 10.5 10.11* Form of Indemnification Agreement between the registrant and eachof its directors and executive officers 8-K April 13, 2011 10.1 10.12* Blucora 2015 Executive Bonus Plan 8-K February 25, 2015 10.1 10.13* Blucora 2016 Executive Bonus Plan X10.14* Amended and Restated Employment Agreement, amended andrestated effective as of January 6, 2015, between Company and EricM. Emans 8-K January 22, 2015 10.1 Table of ContentsExhibitNumber Exhibit Description Form Date of First Filing ExhibitNumber FiledHerewith10.15* Employment Agreement dated between Blucora, Inc., Monoprice,Inc., and Bernard Luthi dated July 14, 2014 10-Q November 5, 2014 10.1 10.16* Employment Agreement between Blucora, Inc. and Nathan Garnettdated September 7, 2014 10-Q November 5, 2014 10.2 10.17* Employment Agreement between Blucora, Inc. and Mark Finkelstein,dated September 30, 2014 10-Q November 5, 2014 10.3 10.18* Employment Agreement between Blucora, Inc., InfoSpace LLC, andPeter Mansour, dated October 6, 2014 10-Q November 5, 2014 10.4 10.19* Amended and Restated Employment Agreement between William J.Ruckelshaus and Company December 31, 2012 10-K March 8, 2013 10.19 10.20* Employment Agreement between JoAnn Kintzel, TaxAct, Inc., andCompany dated January 31, 2015 8-K February 4, 2015 10.10 10.21* Employment Agreement, effective as of May 3, 2012, between theCompany and George Allen 10-Q August 1, 2012 10.1 10.22† Google Services Agreement and Order Form by and between GoogleInc. and InfoSpace Sales LLC dated April 1, 2014 8-K/A August 27, 2014 10.1 10.23† Amendment Number One to Amended and Restated Google Inc.Services Agreement between Infospace LLC and Google, Inc. datedApril 1, 2014 10-Q August 7, 2014 10.1 10.24† Amendment Number Two to Amended and Restated Google Inc.Services Agreement between Infospace LLC and Google, Inc. datedOctober 1, 2014 10-K February 14, 2014 10.2 10.25† Yahoo Publisher Network Contract #1-23975446 dated January 31,2011 by and between Yahoo! Inc. and its subsidiary Yahoo! Sarl andInfoSpace Sales LLC 10-Q/A August 30, 2011 10.2 10.26 Amendment No. 1 to the Yahoo Publisher Network Contract #1-23975446 dated January 14, 2013 10-K March 8, 2013 10.1 10.27 Stockholder Agreement between Company and CambridgeInformation Group I LLC, dated August 23, 2011 8-K August 23, 2011 10.3 10.28 Credit Agreement among TaxAct, Inc., as Borrower, TaxActHoldings, Inc., as a Guarantor, and Wells Fargo Bank, N.A., asadministrative agent and a lender, BMO Harris Bank, N.A., SiliconValley Bank, Bank of America, N.A., and RBS Citizens, N.A., eachas lenders, dated August 30, 2013 8-K September 6, 2013 10.1 10.29 Credit Agreement among Monoprice, Inc., as Borrower, MonopriceHoldings, Inc., as a Guarantor, and Bank of Montreal, asadministrative agent and a lender, Bank of America, N.A., and WellsFargo Bank, N.A., each as lenders, dated November 22, 2013 8-K November 27, 2013 10.1 10.30 First Amendment to Credit Agreement among Monoprice, Inc., asBorrower, Monoprice Holdings, Inc., as a Guarantor, and Bank ofMontreal, as administrative agent and a lender, Bank of America,N.A., and Wells Fargo Bank, N.A., each as lenders, dated December9, 2014 10-K February 27, 2014 10.3 10.31 Lease Agreement between Monoprice, Inc. and Sixth and Rochester,LLC, dated June 2, 2009 10-Q November 5, 2013 10.3 10.32 First Amendment to Lease Agreement between Monoprice, Inc. andSixth and Rochester, LLC, dated August 25, 2009 10-Q November 5, 2013 10.4 Table of ContentsExhibitNumber Exhibit Description Form Date of First Filing ExhibitNumber FiledHerewith10.33 Second Amendment to Lease Agreement between Monoprice, Inc.and Sixth and Rochester, LLC, dated September 23, 2009 10-Q November 5, 2013 10.5 10.34 Third Amendment to Lease Agreement between Monoprice, Inc. andSixth and Rochester, LLC, dated October 16, 2009 10-Q November 5, 2013 10.6 10.35 Fourth Amendment to Lease Agreement between Monoprice, Inc.and Sixth and Rochester, LLC, dated November 20, 2014 10-K February 27, 2014 10.4 10.36* Nonemployee Director Compensation Policy, effective as of January1, 2014 10-K February 27, 2014 10.42 10.37* Blucora, Inc. 2015 Incentive Plan 10-Q October 29, 2015 10.1 10.38* Form of Blucora, Inc. 2015 Incentive Plan Nonqualified StockOption Grant Notice 10-Q July 30, 2015 10.2 10.39* Form of Blucora, Inc. 2015 Incentive Plan Restricted Stock UnitGrant Notice 10-Q July 30, 2015 10.3 10.40* Blucora, Inc. 2016 Equity Inducement Plan S-8 January 29, 2016 99.1 10.41* Form of Blucora, Inc. 2016 Inducement Plan Nonqualified StockOption Grant Notice X10.42* Form of Blucora, Inc. 2016 Inducement Plan Restricted Stock UnitGrant Notice X10.43† Microsoft Advertising Publisher Business Framework Agreementdated August 1, 2014 10-Q October 29, 2015 10.4 10.44 Amendment No. 1 dated July 29, 2015 to the Microsoft AdvertisingPublisher Business Framework Agreement 10-Q October 29, 2015 10.5 10.45 Paid Search Services Schedule to the Framework Agreement datedAugust 1, 2014 10-Q October 29, 2015 10.6 10.46 Amendment No. 1 to the Paid Search Services Schedule to theFramework Agreement dated August 1, 2014 10-Q October 29, 2015 10.7 10.47† Amendment No. 2 to the Yahoo Publisher Network Contract #2-23975446 dated December 28, 2015 X10.48 Stock Purchase Agreement by an among HDV Holdings, LLC,Blucora, Inc., Project Baseball Sub, Inc. and HDV Holdings, Inc.,dated October 14, 2015 8-K October 14, 2015 10.1 10.49 Credit Agreement among TaxAct Holdings, Inc., TaxAct, Inc., H.D.Vest, Inc. and Bank of Montreal as Administrative Agent, CollateralAgent and Swing Line Lender, and each lender from time to time aparty to the Credit Agreement, dated December 31, 2015 X10.50* Amendment No. 1 to Amended and Restated EmploymentAgreement by and between Blucora, Inc. and Eric M. Emans datedJanuary 22, 2016. 8-K January 22, 2016 10.1 10.51* Amendment No. 1 to Employment Agreement by and betweenBlucora, Inc. and Mark A. Finkelstein dated January 22, 2016. 8-K January 22, 2016 10.2 10.52* Amendment No. 1 to Employment Agreement by a between Blucora,Inc. and InfoSpace LLC and Peter Mansour dated January 22, 2016. 8-K January 22, 2016 10.3 10.53* Amendment No. 1 to Employment Agreement by and betweenBlucora, Inc. and Monoprice, Inc. and Bernard Luthi dated January22, 2016. 8-K January 22, 2016 10.4 10.54* Amended and Restated Employment Agreement between ProjectBaseball Sub, Inc. and Roger Ochs dated February 22, 2016. XTable of ContentsExhibitNumber Exhibit Description Form Date of First Filing ExhibitNumber FiledHerewith14.1 Code of Business Conduct and Ethics, as amended on August 14,2014 8-K August 15, 2014 14.1 21.1 Subsidiaries of the registrant X23.1 Consent of Ernst & Young LLP, Independent Registered PublicAccounting Firm X24.1 Power of Attorney (contained on the signature page hereto) X31.1 Certification of Principal Executive Officer pursuant to Section 302of the Sarbanes-Oxley Act of 2002 X31.2 Certification of Principal Financial Officer pursuant to Section 302 ofthe Sarbanes-Oxley Act of 2002 X32.1 Certification of Principal Executive Officer pursuant to Section 906of the Sarbanes-Oxley Act of 2002 X32.2 Certification of Principal Financial Officer pursuant to Section 906 ofthe Sarbanes-Oxley Act of 2002 X101 The following financial statements from the Company’s 10-K for thefiscal year ended December 31, 2015, formatted in XBRL: (i)Consolidated Balance Sheets, (ii) Consolidated Statements ofComprehensive Income, (iii) Consolidated Statements ofStockholders’ Equity, (iv) Consolidated Statements of Cash Flows,and (v) Notes to Consolidated Financial Statements X* Indicates a management contract or compensatory plan or arrangement.† Confidential treatment has been requested for portions of this exhibit. These portions have been omitted from theseexhibits to this Annual Report on Form 10-K and submitted separately to the Securities and Exchange Commission. Exhibit 10.13 2016 Executive Bonus PlanThis plan document outlines the Blucora Executive Bonus Plan (the “ Plan ”) for calendar year 2016. To the extent any provision of this Plan conflicts with anyprovision of an Executive’s employment agreement, then such employment agreement will control.PLAN OBJECTIVES•Provide variable pay opportunities and targeted total cash compensation that are (a) aligned with key financial drivers, and (b) otherwise consistent with thetotal cash compensation philosophy outlined from time to time by the Compensation Committee of the Compensation Committee of Blucora’s Board ofDirectors (“Compensation Committee”).•Increase the competitiveness of executive pay without increasing fixed costs, making bonus payments contingent upon organizational and individual success.•Create internal consistency and standard guidelines among the executive peer group.EFFECTIVE PERIODThe Plan is effective for calendar year 2016 and may be changed at any time at the sole discretion of the Compensation Committee.PARTICIPATION ELIGIBILITY, BONUS TARGETS AND PAYOUT TIMINGThe positions eligible for participation in the Plan are listed in the table below. Each participant’s annual bonus target, which is stated as a percentage of annualbase salary, is also set forth in the table below. If the executive leadership team changes, any additions to the Plan will be recommended by the CEO and approvedby the Compensation Committee. Payment of bonuses awarded under this Plan will be made annually, following the conclusion of the calendar year.Job TitleTarget Bonus %President and Chief Executive Officer100%Chief Financial Officer and Treasurer60%Chief Legal and Administrative Officer60%Executive Vice President, Human Resources35%President, TaxACT60%President and Chief Executive Officer, HD Vest100%President, InfoSpace*60%President, Monoprice*60%* Paid pro rata upon close of the sale of such business unit, subject to the sole discretion of the Compensation CommitteePLAN DESIGNThe Plan includes financial performance components and a discretionary component that is based on individual objectives and the CEO’s (or, with respect to theCEO, the Compensation Committee’s) subjective evaluation of that individual’s performance. The financial performance components and the weighting of thediscretionary component differ among plan participants as noted in the table below. Page 1 of 1Job Title /Financial ComponentsDiscretionaryBonus PaymentScaleBCORRevenueBCOR AdjEBITDASegmentRevenueSegmentIncomeTotalEfilesFee BasedInflowsTTM ProductionChurnNew AdvisorsComponentPresident and CEO /A30%50%* 20%CFO and Treasurer/ A30%50%* 20%Chief Legal &AdministrativeOfficer/A30%50%* 20%EVP, HumanResources / A30%50%* 20%Pres., TaxACT / A 20%30%*30% 20%**Pres and CEO, HDVest / A 20%30%* 15%5%10%20%**Pres., InfoSpace / B 50%50%* Pres., Monoprice /B 50%50%* * Pre-bonus** Discretionary component for Presidents of TaxAct and HD Vest tied to synergy achievementEach financial component may be achieved at a payout percentage ranging from 0 to 165% and the discretionary component may be achieved at a payoutpercentage ranging from 0% to 100%, with the result that the aggregate maximum payout level under the Plan for each executive is 152%. The relevant ExecutiveBonus Payment Scale set forth in the Bonus Scales section is applied to determine the payout percentage of the financial performance components. The financialperformance component targets at 100% match the corresponding operating plans for HDV, TaxAct and corporate opex approved by the Board of Directors. Thelevel of achievement of the discretionary component is subjectively determined on an annual basis by the CEO (or, with respect to the CEO, by the CompensationCommittee). Efile targets shall be adjusted based on actual overall market performance relative to the assumptions for overall market performance in the budgetmodel.Financial TargetsThe financial performance components used to determine the bonus achievement are defined below. All components that are subject to normalization (e.g.,removal of non-recurring expenses and/or revenue) shall only be so adjusted by the Compensation Committee, in its sole discretion.•BCOR Revenue : Consolidated, externally reported Revenue•BCOR Adjusted EBITDA : Consolidated, externally reported EBITDA, normalized for internally developed software and other non-operational itemsBlucora 2016 Executive Bonus Plan Page 2 of 2•Segment Revenue or Income (as applicable) : Externally reported Income or Revenue for the applicable segment, with Income normalized for internallydeveloped software and other non-operational items•Total Efiles : Combination of: 1) number of online and desktop accepted efiles generated through the consumer tax preparation site/software during theIRS designated filing season, AND 2) accepted efiles generated through the professional tax preparation software during the IRS designated filing season•Fee Based Inflows : Actual new fee based assets relative to plan•TTM Production Churn : Sum of the annualized production loss associated with advisor terminations in the calendar year, measured based on thecalendar month the termination occurred, using the trailing twelve month total production•New Advisors : Actual new advisors onboarded onto the HD Vest platform relative to planBonus ScalesThe applicable Executive Bonus Payment Scale below will be used to calculate the available amounts to be paid to each executive based on the financialperformance components.Executive Bonus Payment Scale A (BCOR, TaxAct, HD Vest)Bonus LevelFinancial Performance vs.TargetBonus Payout PercentageAdded Payout RatePer 1% AttainmentBelow Minimum0% - 89%0.0%----Decelerated90% - 94%50.0% - 86%9.0%1:195% - 105%95% - 105.0%----Accelerated106% - 110%117.0% - 165.0%12.0%Maximum> 110%Capped at 165.0%----Executive Bonus Payment Scale B (InfoSpace, Monoprice)Performance LevelFinancial Performance vs.TargetBonus Achievement PercentageAdded Payout RatePer 1% AttainmentBelow Minimum0% - 89%0.0%----Decelerated90% - 99%50.0% - 95.0%5.0%1:1100% - 150%100% - 150.0%----Maximum> 150%Capped at 150.0%----Blucora 2016 Executive Bonus Plan Page 3 of 3•Rounding . Performance results will be rounded up to the nearest whole percentage point. For example, if the calculated performance achievement percentageis 79.1%, it will be rounded up to 80%.•Performance Thresholds . There will be no payout for a financial performance component if the minimum specified threshold is not achieved. However, ifthe threshold for one financial performance component is not achieved, a bonus may still be earned on the other financial performance component(s), providedperformance for that measure achieves the applicable threshold. The discretionary component is independent of the financial performance components, andmay be awarded whether or not the threshold for any financial performance components has been met.•Acceleration Below and Above Target . For determining bonus achievement percentage where a range is indicated in the financial performance vs. targetcolumn, the whole percentage point of financial performance achieved is mapped to the corresponding bonus achievement percentage using a linear scalebetween the low and high points in the range.EMPLOYMENT REQUIREMENTSIn order to be eligible for a bonus payment under the Plan, and for a bonus to be considered earned under the Plan, participants must be employed at the end of thefiscal year; provided, however, that if a participant’s employment is terminated during the year “without Cause” or by the participant for “Good Reason” or due to“Constructive Termination” as such terms are defined in the applicable participant’s employment agreement, then the participant will be entitled to accrued bonusas of the date of his or her termination. Accrued bonus will be calculated as (a) pro-rata achievement of financial performance components based on the then-current annual forecast and (b) pro-rata achievement of the discretionary component at the level communicated at the conclusion of the semi-annual measurementperiod, or with respect to any measurement period that has not yet been completed and communicated, achievement of the discretionary component at the levelsubjectively determined by the CEO (or, with respect to the CEO, the Compensation Committee).APPROVALAll bonus payments made to executives will be submitted to the Compensation Committee for final approval. The Compensation Committee may adjust the finalbonus amount as it deems appropriate. The Committee has sole discretion to adjust bonus awards to reflect changes in the industry, company, the executive’s jobduties or performance, or any other circumstance the Committee determines should impact bonus awards.Blucora 2016 Executive Bonus Plan Page 4 of 4Exhibit 10.41BLUCORA, INC. 2016 EQUITY INDUCEMENT PLANNONQUALIFIED STOCK OPTION GRANT NOTICETO: __________________ (“ Optionee ”)We are pleased to inform you that you have been selected by Blucora, Inc. (the “ Company ”) to receive a stock option (the “Option ”) to purchase shares of the Company’s Common Stock (the “ Shares ”) under the Blucora, Inc. 2016 Equity InducementPlan (the “ 2016 Inducement Plan ”).The Option is subject to all the terms and conditions set forth in this Nonqualified Stock Option Grant Notice (the “ Notice ofGrant ”) and in the Stock Option Agreement attached hereto as Exhibit A (the “ Agreement ”) and the 2016 Inducement Plan,which are incorporated by reference into the Notice of Grant. Capitalized terms that are not defined in the Notice of Grant andthe Agreement have the meanings given to them in the 2016 Inducement Plan.Grant Date: Number of Shares: Exercise Price Per Share: $ Option Expiration Date: Vesting Commencement Date: Type of Option: Nonqualified Stock OptionVesting and Exercisability Schedule: The Option will vest and become exercisable as follows: 33.33% of the total Option willvest on the one-year anniversary of the Vesting Commencement Date, and approximately 16.67% will vest at the end of eachsix-month period thereafter, such that the Option will be fully vested on the three-year anniversary of the VestingCommencement Date; provided that vesting will cease upon your Termination of Employment and the unvested portion of theOption will terminate.Additional Terms/Acknowledgment: You acknowledge and agree that the Notice of Grant and the vesting and exercisabilityschedule set forth herein do not constitute an express or implied promise of your continued engagement as an employee for thevesting period, for any period, or at all, and shall not interfere with your right or the Company’s right to terminate youremployment relationship with the Company or its Related Companies at any time, with or without cause. You furtheracknowledge and agree that the Option granted hereby is the only Nonqualified Stock Option that has been granted to you inconnection with the closing of the acquisition of HD Vest by the Company.99999-2134/129082950.2Exhibit 10.41You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questionsrelating to the 2016 Inducement Plan and the Option.By your signature below, you agree that the Notice of Grant, the Agreement and the 2016 Inducement Plan constituteyour entire agreement with respect to the Option and may not be modified adversely to your interest except by meansof a writing signed by the Company and you.BLUCORA, INC.By: Its: OPTIONEE Signature Date: Attachments:1. Stock Option Agreement2. 2016 Equity Inducement Plan Address: Taxpayer ID: EXHIBIT ABLUCORA, INC. 2016 EQUITY INDUCEMENT PLANSTOCK OPTION AGREEMENT1. Grant. The Company hereby grants to the optionee listed on the Notice of Grant (the “ Optionee ”) an Option topurchase the number of Shares and at the exercise price as set forth in the Notice of Grant and subject to the terms andconditions in this Stock Option Agreement (this “ Agreement ”) and the 2016 Inducement Plan. Unless otherwise defined herein,the terms defined in the 2016 Inducement Plan shall have the same meanings in this Agreement.2. Company’s Obligation. Unless and until the Option vests and is exercised, the Optionee will have no right toreceive Shares under the Option. Prior to actual distribution of Shares pursuant to any vested and exercised Option, such Optionwill represent an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company.3. Vesting and Exercisability. Subject to the limitations contained herein, the Option will vest and become exercisableas provided in the Notice of Grant. Any portion of the Option that is vested may be exercised at any time during the period priorto the date the Option terminates. No partial exercise of the Option may be for less than five percent (5%) of the total number ofShares then available under the Option. In no event shall the Company be required to issue fractional shares.4. Termination of Option . The unvested portion of the Option will terminate automatically and without further noticeimmediately upon your Termination of Employment (voluntary or involuntary). The vested portion of the Option will terminateautomatically and without further notice on the earliest of the dates set forth below:a. three months after your Termination of Employment for any reason other than Disability or death. If you dieafter your Termination of Employment but while the Option is still exercisable, the vested portion of the Option may be exerciseduntil the earlier of (x) one year after the date of death and (y) the Option Expiration Date;b. one year after your Termination of Employment by reason of Disability or death;c. immediately upon notification to you of your Termination of Employment for Cause, unless the Committeedetermines otherwise. If your employment relationship is suspended pending an investigation of whether you will be terminatedfor Cause, all your rights under the Option likewise will be suspended during the period of investigation. If any facts that wouldconstitute termination for Cause are discovered after your Termination of Employment, any Option you then hold may beimmediately terminated by the Committee; ord. the Option Expiration Date.IT IS YOUR RESPONSIBILITY TO BE AWARE OF THE DATE ON WHICH YOUR OPTION TERMINATES.5. Leave of Absence. The effect of a Company-approved leave of absence on the terms and conditions of the Optionwill be determined by the Committee or chief human resources officer and subject to applicable laws.6. Method of Exercise. You may exercise the Option by giving written notice to the Company, in form and substancesatisfactory to the Company, which will state the election to exercise the Option and the number of Shares for which you areexercising the Option. The written notice must be accompanied by full payment of the exercise price for the number of Sharesyou are purchasing.7. Form of Payment. You may pay the Option exercise price, in whole or in part, (a) in cash, (b) by wire transfer orcheck acceptable to the Company, (c) unless the Committee determines otherwise and so long as the Common Stock isregistered under the Exchange Act and to the extent permitted by law, by delivery of a properly executed exercise noticetogether with irrevocable instructions to a broker to promptly deliver to the Company the amount of sale or loan proceedsnecessary to pay the exercise price, (d) if permitted by the Committee, by having the Company withhold shares of CommonStock that would otherwise be issued on exercise of the Option or by your tendering already owned shares of Common Stock, or(e) such other consideration as the Committee may permit.8. Withholding Taxes. As a condition to the exercise of any portion of the Option, you must make such arrangementsas the Company may require for the satisfaction of any federal, state or local withholding tax obligations that may arise inconnection with such exercise. The Company has the right to retain without notice a sufficient number of Shares to satisfy thewithholding obligation. If permitted by the Committee, you may satisfy the withholding obligation by electing to have theCompany withhold from the Shares to be issued upon exercise that number of Shares having a fair market value equal to theamount required to be withheld.9. Limited Transferability. During your lifetime only you can exercise the Option. The Option is not transferableexcept by will or by the applicable laws of descent and distribution. The 2016 Inducement Plan provides for exercise of theOption by a beneficiary designated on a Company-approved form. Notwithstanding the foregoing, the Committee, in its solediscretion, may permit you to assign or transfer the Option, subject to such terms and conditions as specified by the Committee.The 2016 Inducement Plan provides for exercise of the Option by the personal representative of your estate or the beneficiarythereof following your death.10. Regulatory Restrictions on Issuance of Shares. Notwithstanding the other provisions of this Agreement, if atany time the Company will determine, in its discretion, that the listing, registration or qualification of Shares upon any securitiesexchange or under any state or federal law, or the consent or approval of any governmental regulatory authority is necessary ordesirable as a condition to the issuance of Shares to the Optionee (or his or her estate), such issuance will not occur unless anduntil such listing, registration, qualification, consent or approval will have been effected or obtained free of any conditions notacceptable to the Company. The Company will make all reasonable efforts to meet the requirements of any such state or federallaw or securities exchange and to obtain any such consent or approval of any such governmental authority.11. Binding Effect. This Agreement will inure to the benefit of the successors and assigns of the Company and bebinding upon you and your heirs, executors, administrators, successors and assigns.12. No Stockholder Rights. Neither you nor any person entitled to exercise your rights in the event of your death shallhave any of the rights of a stockholder with respect to the Shares subject to the Option unless and until the date of issuanceunder the 2016 Inducement Plan of any such Shares upon the exercise of the Option.13. Notices. Any notice which either party hereto may be required or permitted to give to the other shall be in writingand may be delivered personally, by interoffice mail, by fax, by electronic mail or other electronic means, or via a postal service,postage prepaid, to such electronic mail or postal address and directed to such person as the Company may notify you from timeto time; and to you at your electronic mail or postal address as shown on the records of the Company from time to time, or atsuch other electronic mail or postal address as you, by notice to the Company, may designate in writing from time to time.14. Committee Decisions Conclusive and Binding. All decisions of the Committee upon any questions arising underthe 2016 Inducement Plan or under this Agreement shall be conclusive and binding.15. Option Not an Employment Contract. Nothing in the 2016 Inducement Plan or any award granted under the2016 Inducement Plan will be deemed to constitute an employment contract or confer or be deemed to confer any right for youto continue in the employ of the Company or any Related Company or limit in any way the right of the Company or any RelatedCompany to terminate your employment relationship at any time, with or without cause.16. No Right to Damages. You will have no right to bring a claim or to receive damages if you are required to exercisethe vested portion of the Option within three months (one year in the case of Disability or death) of your Termination ofEmployment or if any portion of the Option is cancelled or expires unexercised. The loss of existing or potential profit in theOption will not constitute an element of damages in the event of your Termination of Employment for any reason even if thetermination is in violation of an obligation of the Company or a Related Company to you.17. Section 409A. The Option is intended to be exempt from the requirements of Section 409A or to satisfy thoserequirements, and shall be construed accordingly.18. Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed bythe internal substantive laws of the State of Delaware, without reference to any choice-of-law rules. -2-99999-2134/129082950.2Exhibit 10.42BLUCORA, INC. 2016 EQUITY INDUCEMENT PLANRESTRICTED STOCK UNIT GRANT NOTICETO: _____________________ (“ Employee ”)We are pleased to inform you that you have been selected by Blucora, Inc. (the “ Company ”) to receive a Restricted Stock UnitAward (the “ Award ”) under the Blucora, Inc. 2016 Equity Inducement Plan (the “ 2016 Inducement Plan ”). Each restrictedstock unit (an “ RSU ”) subject to the Award is equivalent to one share of the Company’s Common Stock for purposes ofdetermining the number of shares of Common Stock (the “ Shares ”) subject to the Award.The Award is subject to all the terms and conditions set forth in this Restricted Stock Unit Grant Notice (the “ Notice of Grant ”)and in the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “ Agreement ”) and the 2016 Inducement Plan,which are incorporated by reference into the Notice of Grant. Capitalized terms that are not defined in the Notice of Grant andthe Agreement have the meanings given to them in the 2016 Inducement Plan.Grant Date: Number of RSUs Subject to the Award: Vesting Commencement Date: Vesting Schedule: 33.33% of the RSUs will vest on the one-year anniversary of the vesting start dateand approximately 16.67% will vest at the end of each six-month period thereafter, such that the RSUs willbe fully vested on the three-year anniversary of the vesting start date; provided that vesting will cease uponyour Termination of Employment and the unvested portion of the Award will terminate.Additional Terms/Acknowledgment: You acknowledge and agree that the Notice of Grant and the vesting schedule set forthherein do not constitute an express or implied promise of your continued engagement as an employee for the vesting period, forany period, or at all, and shall not interfere with your right or the Company’s right to terminate your employment relationship withthe Company or its Related Companies at any time, with or without cause.You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questionsrelating to the 2016 Inducement Plan and the Award.By your signature below, you agree that the Notice of Grant, the Agreement and the 2016 Inducement Plan constituteyour entire agreement with respect to the Award and may not99999-2134/129082929.2Exhibit 10.42be modified adversely to your interest except by means of a writing signed by the Company and you.BLUCORA, INC.By: Its: EMPLOYEE Signature Date: Attachments:1. Restricted Stock Unit Agreement2. 2016 Equity Inducement Plan Address: Taxpayer ID: EXHIBIT ABLUCORA, INC. 2016 EQUITY INDUCEMENT PLANRESTRICTED STOCK UNIT AGREEMENT1. Grant. The Company hereby grants to the employee listed on the Notice of Grant (the “ Employee ”) an Awardof RSUs, as set forth in the Notice of Grant and subject to the terms and conditions in this Restricted Stock Unit Agreement (this“ Agreement ”) and the 2016 Inducement Plan. Unless otherwise defined herein, the terms defined in the 2016 Inducement Planshall have the same meanings in this Agreement.2. Company’s Obligation. Each RSU represents the right to receive a Share on the vesting date. Unless and until theRSUs vest, the Employee will have no right to receive Shares under such RSUs. Prior to actual distribution of Shares pursuantto any vested RSUs, such RSUs will represent an unsecured obligation of the Company, payable (if at all) only from the generalassets of the Company.3. Vesting Schedule. Subject to paragraph 4, to Section 10.2 of the 2016 Inducement Plan and to any other relevant2016 Inducement Plan provisions, the RSUs awarded by this Agreement will vest in the Employee according to the vestingschedule specified in the Notice of Grant. The effect of a Company approved unpaid leave of absence on the terms andconditions of the RSUs will be determined by the Plan Administrator or chief human resources officer and subject to applicablelaws.4. Forfeiture upon Termination of Employment. Notwithstanding any contrary provision of this Agreement or theNotice of Grant, if the Employee has a Termination of Employment for any or no reason prior to vesting, the unvested RSUsawarded by this Agreement will thereupon be forfeited at no cost to the Company.5. Payment After Vesting. Any RSUs that vest in accordance with paragraph 3 will be paid to the Employee (or in theevent of the Employee’s death, to his or her estate) in Shares on, or as soon as practicable after, the applicable vesting date (butin any event, by the fifteenth day of the third month following the tax year in which the RSUs vest), provided that, to the extentdetermined appropriate by the Company, the minimum statutorily required federal, state and local withholding taxes with respectto such RSUs will be paid by reducing the number of vested RSUs actually paid to the Employee.6. Payments After Death. Any distribution or delivery to be made to the Employee under this Agreement will, if theEmployee is then deceased, be made to the administrator or executor of the Employee’s estate. Any such administrator orexecutor must furnish the Company with (a) written notice of his or her status as transferee and (b) evidence satisfactory to theCompany to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.7. Rights as Stockholder. Neither the Employee nor any person claiming under or through the Employee will haveany of the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder unless and untilthe date of issuance of any such Shares under the 2016 Inducement Plan.8. No Effect on Employment Relationship. The Employee’s employment relationship with the Company and itsRelated Companies is on an at-will basis only. Accordingly, the terms of the Employee’s employment relationship with theCompany and its Related Companies will be determined from time to time by the Company or the Related Companies employingthe Employee (as the case may be), and the Company or the Related Companies will have the right, which is hereby expresslyreserved, to terminate or change the terms of the employment relationship of the Employee at any time for any reasonwhatsoever, with or without good cause or notice.9. Address for Notices. Any notice which either party hereto may be required or permitted to give to the other shall bein writing and may be delivered personally, by interoffice mail, by fax, by electronic mail or other electronic means, or via a postalservice, postage prepaid, to such electronic mail or postal address and directed to such person as the Company may notify youfrom time to time; and to you at your electronic mail or postal address as shown on the records of the Company from time totime, or at such other electronic mail or postal address as you, by notice to the Company, may designate in writing from time totime.10. Award Is Not Transferable. Except to the limited extent provided in paragraph 6, the Award and the rights andprivileges conferred hereby will not be transferred, assigned, pledged or hypothecated in any way (whether by operation of lawor otherwise) and will not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer,assign, pledge, hypothecate or otherwise dispose of the Award, or any right or privilege conferred hereby, or upon any attemptedsale under any execution, attachment or similar process, the Award and the rights and privileges conferred hereby immediatelywill become null and void.11. Binding Agreement. Subject to the limitation on the transferability of the Award contained herein, this Agreementwill be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the partieshereto.12. Regulatory Restrictions on Issuance of Shares. Notwithstanding the other provisions of this Agreement, if atany time the Company will determine, in its discretion, that the listing, registration or qualification of Shares upon any securitiesexchange or under any state or federal law, or the consent or approval of any governmental regulatory authority is necessary ordesirable as a condition to the issuance of Shares to the Employee (or his or her estate), such issuance will not occur unless anduntil such listing, registration, qualification, consent or approval will have been effected or obtained free of any conditions notacceptable to the Company. The Company will make all reasonable efforts to meet the requirements of any such state or federallaw or securities exchange and to obtain any such consent or approval of any such governmental authority.13. 2016 Inducement Plan Governs. This Agreement and the Notice of Grant are subject to all terms and provisionsof the 2016 Inducement Plan. In the event of a conflict between one or more provisions of this Agreement or the Notice of Grantand one or more provisions of the 2016 Inducement Plan, the provisions of the 2016 Inducement Plan will govern.14. Plan Administrator Authority. The Plan Administrator will have the power to interpret this Agreement, the Noticeof Grant and the 2016 Inducement Plan, and to adopt such rules for the administration, interpretation and application of the 2016Inducement Plan as are consistent therewith and to interpret or revoke any such rules (including, but not limited to, thedetermination of whether or not any RSUs have vested). All actions taken and all interpretations and determinations made by thePlan Administrator in good faith will be conclusive and binding upon the Employee, the Company and all other interestedpersons. No member of the Plan Administrator will be personally liable for any action, determination or interpretation made ingood faith with respect to the 2016 Inducement Plan or this Agreement.15. Section 409A. The Award is intended to be exempt from the requirements of Section 409A or to satisfy thoserequirements, and shall be construed accordingly.16. Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed bythe internal substantive laws of the State of Delaware without reference to any choice-of-law rules.-2-99999-2134/129082929.2Exhibit 10.47Amendment #2to theYahoo! Publisher Network Contract #2-23975446Effective as of January 1, 2011, as amended (“ Agreement ”)This Amendment #2 to the Agreement (“ Amendment #2 ”) is effective as of the latter date of Yahoo! Inc.’s or Publisher’s signature below (“Amendment #2 Effective Date ”) by and between Yahoo! Inc. and Yahoo! EMEA Limited (as successor to Yahoo! Sarl and together with Yahoo! Inc.,“Yahoo”) on the one hand, and InfoSpace LLC (f/k/a InfoSpace Sales LLC) and Blucora, Inc. (f/k/a InfoSpace Inc., and collectively with InfoSpaceSales LLC, “ Publisher ”) on the other hand. All capitalized terms not defined herein shall have the meanings assigned to them in the Agreement.In consideration of these mutual covenants and for such other good and valuable consideration, the sufficiency of which is acknowledged bythe parties hereto, Yahoo and Publisher desire to amend the Agreement as follows:1.The Mutual Termination Agreement dated September 28, 2015 is deemed void ab initio and shall have no legal effect whatsoever.2.The End Date of the Agreement is hereby deleted and replaced with March 31, 2016. For clarity, the Agreement shall not automatically renewafter the End Date.3.The Compensation Section on the cover page of the SO is hereby amended as follows:a)The percentages of Gross Revenue set forth under Section (b) shall only apply from February 1, 2011 through December 31, 2015.b)A new Section (c) is added that is set forth as follows:“(c) From January 1, 2016 through the remainder of the Term:Monthly Gross RevenuePercentage of Gross RevenueLess than $[*][*]%$[*] or more[*]%4.As of the Amendment #2 Effective Date, Publisher’s rights and obligations in connection with Web Search Results under the Agreement shall begoverned by the following terms:a)Except as provided in 4(b), each Query submitted by Publisher to Yahoo for Results must include a request for Paid Search Results andPublisher will display Results (including but not limited to Paid Search Results) from Yahoo in response to a Query submitted to Yahoo.b)If Publisher submits a Query to Yahoo for Web Search Results only, Publisher shall pay Yahoo US $[*] per 1000 Queries. For clarity, oneQuery calling for Web Search Results, images or news results will cost US $[*] per 1000 Queries and Queries calling for Web SearchResults, images and news results separately will count as three separate Queries and will cost US $[*] per 1000 Queries.[*]Information redacted pursuant to a confidential treatment request by Blucora, Inc. under 5 U.S.C. §552(b)(4) and17 C.F.R. §§ 200.80(b)(4) and 240.24b-2, and submitted separately with the Securities and Exchange Commission. 5.In the event of any conflict between the terms and conditions of the Agreement and the terms and conditions of this Amendment #2, the termsand conditions of this Amendment #2 shall control. Except as amended by this Amendment #2, the Agreement shall remain in full force andeffect in accordance with its terms. This Amendment #2 may be executed in two or more counterparts, each of which shall be deemed to be anoriginal, but all of which together shall constitute one and the same instrument.[SIGNATURE PAGE FOLLOWS][*]Information redacted pursuant to a confidential treatment request by Blucora, Inc. under 5 U.S.C. §552(b)(4) and17 C.F.R. §§ 200.80(b)(4) and 240.24b-2, and submitted separately with the Securities and Exchange Commission.2 [SIGNATURE PAGE TO AMENDMENT #2]IN WITNESS WHEREOF, the parties hereto have caused this Amendment #2 to the Agreement to be executed by their duly authorizedrepresentatives as of the Amendment #2 Effective Date.YAHOO! INC.By: /s/ Ian WeingartenName: Ian WeingartenTitle: SVP, Corporate Development & PartnershipsDate: December 21, 2015INFOSPACE LLCBy: /s/ Peter MansourName: Peter MansourTitle: PresidentDate: December 28, 2015YAHOO! SARLBy: /s/ Michael McElliottName: Michael McElliottTitle: DirectorDate: December 22, 2015BLUCORA, INC. (as guarantor under Section 22 of Attachment B)By: /s/ Eric EmansName: Eric EmansTitle: CFODate: December 27, 2015[*]Information redacted pursuant to a confidential treatment request by Blucora, Inc. under 5 U.S.C. §552(b)(4) and17 C.F.R. §§ 200.80(b)(4) and 240.24b-2, and submitted separately with the Securities and Exchange Commission.3Exhibit 10.49$425,000,000CREDIT AGREEMENTDated as of December 31, 2015amongTAXACT HOLDINGS, INC., as Holdings,TAXACT, INC.and, following the consummation of the Acquisition,H.D. VEST, INC.as Borrowers,THE OTHER GUARANTORS PARTY HERETO FROM TIME TO TIME,BANK OF MONTREALas Administrative Agent, Collateral Agent and Swing Line LenderandTHE LENDERS PARTY HERETO FROM TIME TO TIME______________________________________BMO CAPITAL MARKETS CORP.as Sole Lead Arranger and Sole Bookrunner,TABLE OF CONTENTSARTICLE IDEFINITIONS AND ACCOUNTING TERMS 1Section 1.01. Defined Terms 1Section 1.02. Other Interpretive Provisions 54Section 1.03. Accounting Terms 55Section 1.04. Rounding 55Section 1.05. References to Agreements, Laws, Etc 55Section 1.06. Times of Day 55Section 1.07. Timing of Payment or Performance 56Section 1.08. Limited Condition Transactions 56Section 1.09. Pro Forma Calculations 57Section 1.10. Letters of Credit 58Section 1.11. Certifications 58ARTICLE II THECOMMITMENTS AND CREDIT EXTENSIONS 58Section 2.01. The Loans 58Section 2.02. Borrowings, Conversions and Continuations of Loans 59Section 2.03. Letters of Credit 61Section 2.04. Swing Line Loans 70Section 2.05. Prepayments 73Section 2.06. Termination or Reduction of Commitments 77Section 2.07. Repayment of Loans 77Section 2.08. Interest 78Section 2.09. Fees 78Section 2.10. Computation of Interest and Fees 79Section 2.11. Evidence of Indebtedness 80Section 2.12. Payments Generally 80Section 2.13. Sharing of Payments 82Section 2.14. Incremental Credit Extensions 83Section 2.15. Refinancing Amendments 88Section 2.16. Extension of Term Loans; Extension of Revolving Credit Loans 89Section 2.17. Defaulting Lenders 92ARTICLE IIITAXES, INCREASED COSTS PROTECTION AND ILLEGALITY 94Section 3.01. Taxes 94Section 3.02. Illegality 98Section 3.03. Inability to Determine Rates 98Section 3.04. Increased Cost and Reduced Return; Capital Adequacy; Eurodollar Rate Loan Reserves 98Section 3.05. Funding Losses 100Section 3.06. Matters Applicable to All Requests for Compensation 100Section 3.07. Replacement of Lenders under Certain Circumstances 101Section 3.08. Survival 102ARTICLE IVCONDITIONS PRECEDENT TO CREDIT EXTENSIONS 103Section 4.01. Conditions to Initial Credit Extension 103Section 4.02. Conditions to All Credit Extensions after the Closing Date 105ARTICLE VREPRESENTATIONS AND WARRANTIES 106Section 5.01. Existence, Qualification and Power; Compliance with Laws 106Section 5.02. Authorization; No Contravention 107Section 5.03. Governmental Authorization 107Section 5.04. Binding Effect 107Section 5.05. Financial Statements; No Material Adverse Effect; No Default 107Section 5.06. Litigation 108Section 5.07. Ownership of Property; Liens 108Section 5.08. Environmental Matters 108Section 5.09. Taxes 109Section 5.10. ERISA Compliance 109Section 5.11. Use of Proceeds 110Section 5.12. Margin Regulations; Investment Company Act 110Section 5.13. Disclosure 110Section 5.14. Labor Matters 111Section 5.15. Intellectual Property; Licenses, Etc 111Section 5.16. Solvency 111Section 5.17. USA Patriot Act; OFAC; FCPA 111Section 5.18. Security Documents 112Section 5.19. Senior Indebtedness 112Section 5.20. Regulated Entities 112ARTICLE VIAFFIRMATIVE COVENANTS 113Section 6.01. Financial Statements 113Section 6.02. Certificates; Other Information 116Section 6.03. Notices 117Section 6.04. Payment of Taxes 117Section 6.05. Preservation of Existence, Etc. 118Section 6.06. Maintenance of Properties; Intellectual Property 118Section 6.07. Maintenance of Insurance 118Section 6.08. Compliance with Laws 118Section 6.09. Books and Records 119Section 6.10. Inspection Rights 119Section 6.11. Additional Collateral; Additional Guarantors 119Section 6.12. Compliance with Environmental Laws 121Section 6.13. Further Assurances; Post-Closing Obligations 121Section 6.14. Designation of Subsidiaries 121Section 6.15. Maintenance of Ratings 122Section 6.16. Use of Proceeds 122Section 6.17. Lender Calls 122Section 6.17. Employee Benefits 122ARTICLE VIINEGATIVE COVENANTS 122Section 7.01. Liens 122Section 7.02. Investments 126Section 7.03. Indebtedness 129Section 7.04. Fundamental Changes 132Section 7.05. Dispositions 133Section 7.06. Restricted Payments 134Section 7.07. Change in Nature of Business 137Section 7.08. Transactions with Affiliates 137Section 7.09. Burdensome Agreements 138Section 7.11. Consolidated Total Net Leverage Ratio 139Section 7.12. Fiscal Year 139Section 7.13. Prepayments, Etc. of Subordinated Indebtedness 139Section 7.14. Permitted Activities 140ARTICLE VIIIEVENTS OF DEFAULT AND REMEDIES 141Section 8.01. Events of Default 141Section 8.02. Remedies Upon Event of Default 143Section 8.03. Application of Funds 144Section 8.04. Borrowers’ Right to Cure 145ARTICLE IXADMINISTRATIVE AGENT AND OTHER AGENTS 146Section 9.01. Appointment and Authority 146Section 9.02. Rights as a Lender 147Section 9.03. Exculpatory Provisions 147Section 9.04. Reliance by Administrative Agent 148Section 9.05. Delegation of Duties 148Section 9.06. Resignation of Administrative Agent 148Section 9.07. Non-Reliance on Administrative Agent and Other Lenders 149Section 9.08. No Other Duties, Etc 150Section 9.09. Administrative Agent May File Proofs of Claim 150Section 9.10. Collateral and Guaranty Matters 150Section 9.12. Secured Treasury Services Agreements and Secured Hedge Agreements 152Section 9.13. Withholding Tax Indemnity 152ARTICLE XMISCELLANEOUS 153Section 10.01. Amendments, Etc 153Section 10.02. Notices and Other Communications 156Section 10.03. No Waiver; Cumulative Remedies 158Section 10.04. Attorney Costs and Expenses 159Section 10.05. Indemnification by the Borrowers 159Section 10.06. Payments Set Aside 161Section 10.07. Successors and Assigns 161Section 10.08. Confidentiality 166Section 10.09. Setoff 167Section 10.10. Interest Rate Limitation 168Section 10.11. Counterparts 168Section 10.12. Integration 168Section 10.13. Survival of Representations and Warranties 168Section 10.14. Severability 169Section 10.15. GOVERNING LAW 169Section 10.16. WAIVER OF RIGHT TO TRIAL BY JURY 169Section 10.17. Binding Effect 170Section 10.18. USA Patriot Act 170Section 10.19. No Advisory or Fiduciary Responsibility 170Section 10.20. Intercreditor Agreements 171ARTICLE XIGUARANTEE 171Section 11.01. The Guarantee 171Section 11.02. Obligations Unconditional 171Section 11.03. Reinstatement 172Section 11.04. Subrogation; Subordination 172Section 11.05. Remedies 173Section 11.06. [Reserved] 173Section 11.07. Continuing Guarantee 173Section 11.08. General Limitation on Guarantee Obligations 173Section 11.09. Release of Guarantors 173Section 11.10. Right of Contribution 174Section 11.11. Keepwell 174Section 11.12. Joint and Several Liability 174SCHEDULESI Subsidiary Guarantors1.01 Commitments4.01(a) Closing Date Documents5.06 Litigation5.07 Real Property5.10 Plans5.21 Subsidiaries; Equity Interests6.13(b) Post-Closing Matters7.01(b) Existing Liens7.02(f) Existing Investments7.03(b) Existing Indebtedness7.08 Affiliate Transactions7.09 Burdensome Agreements10.02 Administrative Agent’s Office, Certain Addresses for NoticesEXHIBITSForm ofA-1 Committed Loan NoticeA-2 Swing Line Loan NoticeB Compliance CertificateC-1 Term NoteC-2 Revolving Credit NoteC-3 Swing Line NoteD Solvency CertificateF Security AgreementG Intercompany NoteH-1 to H-4 Tax CertificatesI Assignment and AssumptionCREDIT AGREEMENTThis CREDIT AGREEMENT is entered into as of December 31, 2015, among TAXACT HOLDINGS, INC., a Delaware corporation(“ Holdings ”), TAXACT, INC., an Iowa corporation (“ TaxACT ”), and, following the consummation of the Acquisition (as defined below),H.D. VEST, INC., a Texas corporation (“ HDVest ” and together with TaxACT, the “ Borrowers ” and each, a “ Borrower ”), the otherGuarantors party hereto from time to time, BANK OF MONTREAL, as Administrative Agent, Collateral Agent and Swing Line Lender, andeach lender from time to time party hereto (collectively, the “ Lenders ” and, individually, a “ Lender ”).PRELIMINARY STATEMENTSPursuant to that certain Stock Purchase Agreement, dated as of October 14, 2015 (such agreement, together with all schedules andexhibits thereto, as amended, supplemented or otherwise modified from time to time in a manner that would not result in a failure of thecondition precedent set forth in Section 4.01(d) , the “ Acquisition Agreement ”), by and among Project Baseball Sub, Inc., a Delawarecorporation (“ Baseball ”), Blucora, Inc., a Delaware corporation (“ Parent ”), HDV Holdings, Inc., a Delaware corporation (“ HDVHoldings ”) and HDV Holdings LLC, a Delaware limited liability company (the “ Seller ”), Baseball will acquire all of the capital stock ofHDV Holdings (the “ Acquisition ”).To refinance the Existing Credit Facilities and for other purposes described herein, the Lenders have agreed to extend certain creditfacilities in an aggregate principal amount not to exceed $425,000,000, consisting of (i) Term Loans to be made available to the Borrowers onthe Closing Date in an aggregate principal amount of $400,000,000 and (ii) Revolving Credit Commitments (which Revolving CreditCommitments shall include sub-facilities as set forth herein with respect to Letters of Credit and Swing Line Loans) to be made available tothe Borrowers in an aggregate principal amount of $25,000,000.The Lenders have indicated their willingness to lend and each L/C Issuer (as defined below) has indicated its willingness to issueLetters of Credit and the Swing Line Lender has indicated its willingness to make Swing Line Loans, in each case, on the terms and subject tothe conditions set forth herein.In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:ARTICLE I DEFINITIONS AND ACCOUNTING TERMSSection 1.01. Defined Terms . As used in this Agreement (including in the preamble and preliminary statements hereto), thefollowing terms shall have the meanings set forth below:“ ABR ” means the highest of (a) the rate of interest publicly announced by the Agent as its prime rate in effect at its principal officein New York City (the “ Prime Rate ”), (b) the federal funds effective rate from time to time plus 0.50% per annum and (c) the 1-monthEurodollar Rate (as defined below, and taking into account the floor) plus 1.00% per annum.“ ABR Loan ” means a Loan that bears interest based on the ABR.“ Acquisition ” has the meaning set forth in the preliminary statements to this Agreement.“ Acquisition Agreement ” has the meaning set forth in the preliminary statements to this Agreement.“ Acquisition Agreement Representations ” means such of the representations and warranties made by or on behalf of HDVHoldings, its Subsidiaries or their respective businesses in the Acquisition Agreement as are material to the interests of the Lenders, but onlyto the extent that Baseball or any of its applicable Affiliates has the right to terminate its obligations, or decline to consummate theAcquisition under the Acquisition Agreement, as a result of a breach of such representations and warranties.“ Additional Lender ” has the meaning set forth in Section 2.14(c) .“ Additional Refinancing Lender ” means, at any time, any Person that is not (w) a Disqualified Lender, (x) any Person that is aDefaulting Lender, (y) a natural Person or (z) Parent, the Holding Companies, the Borrowers or any of their respective Subsidiaries, in eachcase, that agrees to provide any portion of Credit Agreement Refinancing Indebtedness pursuant to a Refinancing Amendment in accordancewith Section 2.15 ; provided that each Additional Refinancing Lender shall be subject to the approval of (i) the Administrative Agent, suchapproval not to be unreasonably withheld, conditioned or delayed, to the extent that each such Additional Refinancing Lender is not anAffiliate of a then-existing Lender or an Approved Fund, (ii) Borrower Representative and (iii) in the case of a Refinancing Amendment inrespect of the Revolving Credit Loans, each L/C Issuer and the Swing Line Lender.“ Administrative Agent ” means Bank of Montreal, in its capacity as administrative agent under any of the Loan Documents, or anysuccessor administrative agent. Unless the context otherwise requires, the term “Administrative Agent” as used herein and in the other LoanDocuments shall include the Collateral Agent.“ Administrative Agent’s Office ” means the Administrative Agent’s address and account as set forth on Schedule 10.02 , or suchother address or account as the Administrative Agent may from time to time notify Borrower Representative and the Lenders.“ Administrative Questionnaire ” means an administrative questionnaire in a form supplied by the Administrative Agent withrespect to any Lender.“ Advisory Contract ” shall mean any existing investment advisory, sub-advisory, investment management, trust or similaragreement between HDV Holdings or any of its Subsidiaries and any Person where HDV Holdings or such Subsidiary acts as investmentadviser, manager, sub-advisor, sub-manager, or in another similar capacity to such Person.“ Advisory Services Subsidiary ” means H.D. Vest Advisory Services, Inc.“ Affected Class ” has the meaning set forth in Section 3.07(a) .“ Affiliate ” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries,Controls or is Controlled by or is under common Control with the Person specified. “ Control ” means the possession, directly or indirectly,of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power,by contract or otherwise. “ Controlling ” and “ Controlled ” have meanings correlative thereto. For the avoidance of doubt none of theArranger, the Agents or their respective lending Affiliates shall be deemed to be an Affiliate of any Holding Company, either Borrower orany of their Subsidiaries.“ Agent-Related Persons ” means the Agents and their respective Affiliates and the respective officers, directors, employees,partners, trustees, agents, advisors, attorneys-in-fact and other representatives of each of the foregoing.“ Agents ” means, collectively, the Administrative Agent, the Collateral Agent and the Arranger.“ Aggregate Commitments ” means the Commitments of all the Lenders.“ Agreement ” means this Credit Agreement, as the same may be amended, restated, amended and restated, supplemented orotherwise modified from time to time.“ All-In Yield ” means, as to any Indebtedness, the yield thereof, whether in the form of interest rate margins, OID, upfront fees, anABR floor greater than 2.00% or a Eurodollar Rate floor greater than 1.00% (with such increased amount being equated to interest marginsfor purposes of determining any increase to the Applicable Margin) or otherwise, in each case incurred or payable by the Borrowers generallyto the Lenders; provided that (i) OID and upfront fees shall be equated to an interest rate assuming a four-year life to maturity (or, if less, thestated life to maturity at the time of its incurrence of the applicable Indebtedness), (ii) “All-In Yield” shall not include arrangement fees,structuring fees, commitment fees and underwriting fees or other similar fees not paid generally to all Lenders of such Indebtedness and (iii)if and to the extent such Indebtedness was originally issued with OID or upfront fees and was subsequently repriced through an amendment inconnection with which no additional OID or upfront fees were incurred, the OID or upfront fees with respect to the original issuance of suchIndebtedness will be taken into account.“ Annual Financial Statements ” means (a) the audited consolidated balance sheets and related statements of income and cash flowsof each of the Parent and HDV Holdings for the fiscal years ended December 31, 2012, December 31, 2013, and December 31, 2014, and (b)unaudited standalone financial statements of income and cash flows of Holdings and its Subsidiaries, on a consolidated basis, for the fiscalyears ended December 31, 2012, December 31, 2013, and December 31, 2014.“ Anti-Corruption Laws ” means the United States Foreign Corrupt Practices Act of 1977 (Pub. L. No. 95 213, §§ 101-104), asamended, the UK Bribery Act of 2010 and any similar laws, rules or regulations issued, administered or enforced by any GovernmentalAuthority having jurisdiction over Parent or any Consolidated Party.“ Anti-Money Laundering Laws ” means all applicable financial recordkeeping and reporting requirements and the moneylaundering statutes and the rules and regulations thereunder and any related or similar rules, regulations or guidelines, which in each case areissued, administered or enforced by any Governmental Authority having jurisdiction over Parent or any Consolidated Party, or to whichParent or any Consolidated Party is subject.“ Applicable ECF Percentage ” means, for any fiscal year, (a) 50%, if the Consolidated First Lien Net Leverage Ratio (determinedon a Pro Forma Basis in accordance with Section 1.09 ) as of the last day of such fiscal year is greater than 3.00 to 1.00, (b) 25%, if theConsolidated First Lien Net Leverage Ratio (determined on a Pro Forma Basis in accordance with Section 1.09 ) as of the last day of suchfiscal year is less than or equal to 3.00 to 1.00 and greater than 2.25 to 1.00 and (c) 0%, if the Consolidated First Lien Net Leverage Ratio(determined on a Pro Forma Basis in accordance with Section 1.09 ) as of the last day of such fiscal year is less than or equal to 2.25 to 1.00.“ Applicable Margin ” means a percentage per annum equal to:(a) with respect to Initial Term Loans, (i) for Eurodollar Rate Loans, 6.00% and (B) for ABR Loans, 5.00%; and(b) with respect to Revolving Credit Loans, Swing Line Loans, unused Revolving Credit Commitments and Letter ofCredit fees, (i) until delivery of financial statements for the first full fiscal quarter ending after the Closing Date pursuant toSection 6.01 , (A) for Eurodollar Rate Loans and Letter of Credit fees, 5.00% and (B) for ABR Loans, 4.00% and (C) in the case ofthe undrawn commitment fees for the Revolving Credit Commitments, 0.50% and (ii) thereafter, the following percentages perannum , based upon the Consolidated First Lien Net Leverage Ratio as set forth in the most recent Compliance Certificate received bythe Administrative Agent pursuant to Section 6.02(a) :Applicable MarginPricing LevelConsolidated First Lien Net LeverageRatioEurodollar Rate Loans andLetter of Credit FeesABR LoansCommitment Fee1> 3.55.00%4.00%0.50%2≤ 3.50 and > 3.004.25%3.25%0.375%3≤ 3.00 and > 2.503.50%2.50%0.30%4≤ 2.52.75%1.75%0.25% Any increase or decrease in the Applicable Margin resulting from a change in the Consolidated First Lien Net Leverage Ratio shallbecome effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant toSection 6.02(a) ; provided that at the option of the Administrative Agent (at the direction of the Required Lenders) or the Required Lenders(following written notice to the Borrower Representative), the highest pricing level shall apply (x) as of the first Business Day after the dateon which a Compliance Certificate was required to have been delivered but was not delivered, and shall continue to so apply to and includingthe date on which such Compliance Certificate is so delivered (and thereafter the pricing level otherwise determined in accordance with thisdefinition shall apply) and (y) as of the first Business Day after an Event of Default under Section 8.01(a) or 8.01(f) shall have occurred andbe continuing, and shall continue to so apply to but excluding the date on which such Event of Default is cured or waived (and thereafter thepricing level otherwise determined in accordance with this definition shall apply).Notwithstanding the foregoing, (v) the Applicable Margin in respect of any Class of Extended Revolving Credit Commitments or anyExtended Term Loans or Revolving Credit Loans made pursuant to any Extended Revolving Credit Commitments shall be the applicablepercentages per annum set forth in the relevant Extension Amendment, (w) the Applicable Margin in respect of any Revolving CommitmentIncrease, any Class of Incremental Term Loans or any Class of Incremental Revolving Loans shall be the applicable percentages per annumset forth in the relevant Incremental Amendment, (x) the Applicable Margin in respect of any Class of Replacement Term Loans shall be theapplicable percentages per annum set forth in the relevant agreement, (y) the Applicable Margin in respect of any Class of RefinancingRevolving Credit Commitments, any Class of Refinancing Revolving Credit Loans or any Class of Refinancing Term Loans shall be theapplicable percentages per annum set forth in the applicable Refinancing Amendment and (z) in the case of the Initial Term Loans, theApplicable Margin shall be increased as, and to the extent, necessary to comply with the provisions of Section 2.14 .In the event that any financial statement or certificate delivered pursuant to Section 6.01 or 6.02(a) is shown to be inaccurate (at atime when this Agreement is in effect and unpaid Obligations under this Agreement are outstanding (other than contingent obligations inrespect of which no assertion of liability (whether oral or written) and no claim or demand for payment (whether oral or written) has beenmade (and, in the case of Obligations for indemnification, no notice for indemnification has been issued by the indemnitee) at such time), andsuch inaccuracy, if corrected, would have led to the application of a higher Applicable Margin for any period (an “ Applicable Period ”) thanthe Applicable Margin applied for such Applicable Period, then (x) the Borrower Representative shall immediately deliver to theAdministrative Agent a correct Compliance Certificate required by Section 6.02(a) for such Applicable Period and (y) the Borrowers shallimmediately pay to the Administrative Agent the accrued additional interest owing as a result of such increased Applicable Margin for suchApplicable Period. Nothing in this paragraph shall limit the rights of the Administrative Agent or any Lender under Section 2.08(b) or ArticleVIII .“ Applicable Requirements ” shall mean, in respect of any Indebtedness, that such Indebtedness satisfies the followingrequirements:(a) (i) if such Indebtedness is secured on a pari passu basis by the Collateral, such Indebtedness shall not mature earlierthan the Latest Maturity Date of the Term Loans outstanding at the time of incurrence of such Indebtedness, and (ii) in the case of anyother Indebtedness, such Indebtedness shall not mature earlier than 91 days after the Latest Maturity Date of the Term Loansoutstanding at the time of incurrence of such Indebtedness;(b) (i) in respect of any Indebtedness that is not revolving in nature, such Indebtedness does not have greater amortizationor mandatory prepayments than the Initial Term Loans and (ii) in respect of any Indebtedness that is revolving in nature, suchIndebtedness shall not mature earlier than the Maturity Date of the Revolving Credit Facility or have amortization or scheduledmandatory commitment reductions (other than at maturity);(c) such Indebtedness shall have a Weighted Average Life to Maturity not shorter than the remaining Weighted AverageLife to Maturity of the Term Loans outstanding at the time of incurrence of such Indebtedness;(d) if such Indebtedness is secured by the Collateral, a Senior Representative acting on behalf of the holders of suchIndebtedness has become party to a Customary Intercreditor Agreement (or any Customary Intercreditor Agreement has beenamended or replaced in a manner reasonably acceptable to the Borrower Representative and the Administrative Agent, which resultsin such Senior Representative having rights to share in the Collateral on a pari passu basis or a junior lien basis, as applicable);(e) if such Indebtedness is subordinated in right of payment to the Obligations, then such Indebtedness shall besubordinated on terms reasonably satisfactory to the Administrative Agent;(f) if such Indebtedness is secured on a pari passu basis by the Collateral, (i) if the All-In Yield in respect of suchIndebtedness exceeds the All-In Yield in respect of any then-existing Initial Term Loans by more than 0.50%, the Applicable Marginof such then existing Initial Term Loans shall be adjusted such that the All-In Yield of such then existing Initial Term Loans equalsthe All-In Yield of such Indebtedness minus 0.50%; provided that if such Indebtedness includes a Eurodollar Rate floor greater than1.00% per annum or an ABR floor greater than 2.00% per annum , such differential between the Eurodollar Rate floor or the ABRfloor, as the case may be, shall be equated to the applicable All-In Yield for purposes of determining whether an increase to theinterest rate margin under the Initial Term Loans shall be required, but only to the extent an increase in the Eurodollar Rate floor orABR floor in the Initial Term Loans, as the case may be, would cause an increase in the interest rate then in effect thereunder, and insuch case, the Eurodollar Rate floor or ABR floor (but not the interest rate margin), applicable to the Initial Term Loans shall beincreased to the extent of such differential between the Eurodollar Rate floors or ABR floors, as the case may be, and (ii) if the All-InYield in respect of such Indebtedness constituting revolving loan commitments exceeds the All-In Yield in respect of any then-existing Revolving Credit Commitments by more than 0.50%, the Applicable Margin of such then existing Revolving CreditCommitments shall be adjusted such that the All-In Yield of such then existing Revolving Credit Commitments equals the All-InYield of such Indebtedness minus 0.50%, effective upon the incurrence of such Indebtedness;(g) to the extent such Indebtedness is secured, it is not secured by any property or assets of any Consolidated Party otherthan the Collateral (it being agreed that such Indebtedness shall not be required to be secured by all of the Collateral); provided thatIndebtedness that may be incurred by Restricted Subsidiaries that are not Guarantors pursuant to Section 7.03(r) may be secured byassets of such Restricted Subsidiaries;(h) such Indebtedness shall not be guaranteed by any Person other than any Loan Party and shall not have any obligorsother than any Loan Party, other than to the extent such Indebtedness may be incurred by a Person other than a Loan Party pursuant toSection 7.03(r) ;(i) the other terms and conditions of such Indebtedness (excluding pricing, fees, rate floors, premiums, optionalprepayment or optional redemption provisions) are (i) not materially less favorable (when taken as a whole) to the ConsolidatedParties than those set forth in the Loan Documents (when taken as a whole) or (ii) on customary terms for “high yield” notes of thetype being incurred at the time of incurrence (it being agreed that such Indebtedness may be in the form of notes or a creditagreement), except in each case for covenants or other provisions contained in such Indebtedness that are applicable only after thethen Latest Maturity Date; and(j) the holders of such Indebtedness may participate on a pro rata basis or less than pro rata basis (but not on a greater thanpro rata basis) in any voluntary or mandatory prepayments of Term Loans then outstanding;provided that a certificate of a Responsible Officer of the Borrower Representative delivered to the Administrative Agent at least fiveBusiness Days prior to the incurrence of such Indebtedness, together with a reasonably detailed description of the material terms andconditions of such Indebtedness or drafts of the documentation relating thereto, stating that the Borrower Representative has determined ingood faith that such terms and conditions satisfy the requirements of this definition, shall be conclusive evidence that such terms andconditions satisfy the requirements of this definition unless the Administrative Agent notifies the Borrower Representative within such fiveBusiness Day period that it disagrees with such determination (including a reasonable description of the basis upon which it disagrees).“ Appropriate Lender ” means, at any time, (a) with respect to Loans of any Class, the Lenders of such Class and (b) with respect toLetters of Credit, (i) the relevant L/C Issuers and (ii) the Revolving Credit Lenders.“ Approved Bank ” has the meaning set forth in clause (c) of the definition of “Cash Equivalents.”“ Approved Fund ” means, with respect to any Lender, any Fund that is administered, advised or managed by (a) such Lender, (b) anAffiliate of such Lender or (c) an entity or an Affiliate of an entity that administers, advises or manages such Lender.“ Arranger ” means BMO Capital Markets Corp., in its capacity as sole lead arranger and sole bookrunner under this Agreement.“ Assignee ” has the meaning set forth in Section 10.07(b) .“ Assignment and Assumption ” means an Assignment and Assumption substantially in the form of Exhibit I hereto or any otherform approved by the Administrative Agent.“ Assignment Taxes ” has the meaning set forth in Section 3.01(b) .“ Attorney Costs ” means and includes all reasonable and documented fees, expenses and disbursements of any law firm or otherexternal legal counsel.“ Attributable Indebtedness ” means, on any date, in respect of any Capitalized Lease of any Person, the capitalized amount thereofthat would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP.“ AUM ” shall mean assets of any Person (whether held on the BD Subsidiary's brokerage platform or held by a mutual fund,insurance company or other Person or otherwise under management pursuant to an Advisory Contract) for which HDV Holdings or one of itsSubsidiaries is the investment adviser, broker-dealer or agent of record.“ Auto-Extension Letter of Credit ” has the meaning set forth in Section 2.03(b)(iii) .2 “ Available Amount ” means, at any date, an amount, not less than zero in the aggregate, determined on a cumulative basisequal to, without duplication:(a) 100% of the aggregate cumulative amount, not less than zero, of Retained Excess Cash Flow for all Excess Cash FlowPeriods completed after the Closing Date and prior to the date of determination, plus(b) 100% of the aggregate amount of contributions to the common capital of Holdings or the net proceeds of the issuanceof Qualified Equity Interests of Holdings contributed, directly or indirectly, to any Borrower as a contribution to the common capitalof such Borrower, received in cash and Cash Equivalents after the Closing Date (other than any amount designated as a Cure Amountor any amount that is received from Parent pursuant to Section 4.01 of the Parent Guaranty), minus(c) any amount of the Available Amount used to make Investments pursuant to Section 7.02(s) after the Closing Date andprior to such time, minus(d) any amount of dividends, distributions or other Restricted Payments pursuant to Section 7.06(h) after the Closing Dateand prior to such time, minus(e) any amount of the Available Amount used to make payments or distributions in respect of Junior Financings pursuantto Section 7.13 after the Closing Date and prior to such time.“ Availability Period ” means, with respect to the Revolving Credit Commitments, the period from and including the Closing Date tothe earliest of (a) the Maturity Date of the Revolving Credit Facility, (b) the date of termination of the aggregate Revolving CreditCommitments pursuant to Section 2.06, and (c) the date of termination of the commitment of each Lender to make Loans and of theobligation of the L/C Issuers to make L/C Credit Extensions pursuant to Section 8.02 .“ Bail-in Action ” means the application of any write-down or conversion powers by an EEA Resolution Authority in respect of anyliability of an EEA Financial Institution.“ Bank ” means any Person that is a Lender, Agent or an Arranger, or an Affiliate of any of the foregoing, at the time it enters into aSecured Hedge Agreement or a Treasury Services Agreement (notwithstanding that such Bank may cease to be a Lender, an Agent, anArranger or an Affiliate of any of the foregoing after entering into a Secured Hedge Agreement or a Treasury Services Agreement), asapplicable, in its capacity as a party thereto and that (other than in the case of an Agent, Arranger or Affiliate of the foregoing) has beenspecifically designated a “Bank” with respect to such Secured Hedge Agreement or Treasury Services Agreement, as applicable, in a writingfrom the Borrower Representative to the Administrative Agent, and (other than a Person already party hereto as a Lender, Agent or Arranger)that delivers to the Administrative Agent a letter agreement reasonably satisfactory to it (i) appointing the Administrative Agent as its agentunder the applicable Loan Documents and (ii) agreeing to be bound by Sections 10.05 , 10.15 and 10.16 and Article IX as if it were a Lender.“ BD Subsidiary ” shall mean H.D. Vest Investment Securities, Inc.“ Borrower ” and “ Borrowers ” have the meanings set forth in the introductory paragraph to this Agreement.“ Borrower Materials ” has the meaning set forth in Section 6.01 .“ Borrower Representative ” means TaxACT.“ Borrowing ” means a Revolving Credit Borrowing, a Swing Line Borrowing, or a Term Borrowing, as the context may require.“ Business Day ” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to closeunder the Laws of, or are in fact closed in, the State of New York, and, if such day relates to any Eurodollar Rate Loan, means any such daythat is also a London Banking Day.“ Capital Expenditures ” means, for any period, the aggregate of all expenditures (whether paid in cash or accrued as liabilities andincluding in all events all amounts expended or capitalized under Capitalized Leases) by the Borrowers and their Restricted Subsidiariesduring such period that, in conformity with GAAP, are or are required to be included as capital expenditures on the consolidated statement ofcash flows of the Borrowers and their Restricted Subsidiaries.“ Capitalized Leases ” means all leases that have been or are required to be, in accordance with GAAP, recorded as capitalizedleases; provided that for all purposes hereunder the amount of obligations under any Capitalized Lease shall be the amount thereof accountedfor as a liability in accordance with GAAP.“ Cash Collateral ” has the meaning set forth in Section 2.03(g) .“ Cash Collateral Account ” means a blocked account at a commercial bank selected by the Administrative Agent, in the name ofthe Administrative Agent and under the sole dominion and “control” (within the meaning of the UCC) of the Administrative Agent, andotherwise established in a manner reasonably satisfactory to the Administrative Agent.“ Cash Collateralize ” has the meaning set forth in Section 2.03(g) .3 “ Cash Equivalents ” means any of the following types of Investments, to the extent owned by any Consolidated Party:(a) Dollars;(b) readily marketable obligations issued or directly and fully guaranteed or insured by the government or any agency orinstrumentality of the United States having average maturities of not more than 12 months from the date of acquisition thereof;provided that the full faith and credit of the United States is pledged in support thereof;(c) time deposits or eurodollar time deposits with, insured certificates of deposit, bankers’ acceptances or overnight bankdeposits of, or letters of credit issued by, any commercial bank that (i) is a Lender or (ii)(A) is organized under the Laws of the UnitedStates, any state thereof, the District of Columbia or any member nation of the Organization for Economic Cooperation andDevelopment or is the principal banking Subsidiary of a bank holding company organized under the Laws of the United States, anystate thereof, the District of Columbia or any member nation of the Organization for Economic Cooperation and Development and isa member of the Federal Reserve System, and (B) has combined capital and surplus of at least $500,000,000 or $250,000,000 in thecase of any non-U.S. bank (any such bank in the foregoing clauses (i) or (ii) being an “ Approved Bank ”), in each case withmaturities not exceeding 12 months from the date of acquisition thereof;(d) commercial paper and variable or fixed rate notes issued by an Approved Bank (or by the parent company thereof) orany variable or fixed rate note issued by, or guaranteed by, a corporation (other than structured investment vehicles and other thancorporations used in structured financing transactions) and rated A-1 (or the equivalent thereof) or better by S&P or Prime-1 (or theequivalent thereof) or better by Moody’s, in each case with maturities of not more than 12 months from the date of acquisitionthereof;(e) marketable short-term money market and similar funds having a rating of at least P-2 or A-2 from either Moody’s orS&P, respectively (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from anothernationally recognized statistical rating agency selected by the Borrower Representative) and, in each case, maturing within 12 monthsafter the date of creation or acquisition thereof;(f) repurchase obligations for underlying securities of the types described in clauses (b) , (c) and (e) above entered into withany Approved Bank;(g) readily marketable direct obligations with average maturities of 12 months or less from the date of acquisition issued byany state, commonwealth or territory of the United States, or any political subdivision or taxing authority thereof, in each case havingan investment grade rating from either S&P or Moody’s (or the equivalent thereof);(h) Investments (other than in structured investment vehicles and structured financing transactions) with average maturitiesof 12 months or less from the date of acquisition in money market funds rated AAA- (or the equivalent thereof) or better by S&P orAaa3 (or the equivalent thereof) or better by Moody’s;(i) securities with maturities of 12 months or less from the date of acquisition backed by standby letters of credit issued byany Approved Bank;(j) in the case of any Foreign Subsidiary, such local currencies in those countries in which such Foreign Subsidiarytransacts business from time to time in the ordinary course of business;(k) Investments, classified in accordance with GAAP as Current Assets of any Consolidated Party, in money marketinvestment programs which are registered under the Investment Company Act of 1940 or which are administered by financialinstitutions having capital of at least $500,000,000, and, in either case, the portfolios of which are limited such that substantially all ofsuch Investments are of the character, quality and maturity described in clauses (a) through (i) above; and(l) investment funds investing at least 95% of their assets in securities of the types described in clauses (a) through (k)above.4 “ Cash Management Obligations ” means obligations owed by any Consolidated Party to any Bank in respect of any overdraftand related liabilities arising from treasury, depository, credit card, debit card and cash management services or any automated clearing housetransfers of funds, in each case, pursuant to a Treasury Services Agreement, in each case, to the extent designated by the BorrowerRepresentative and such Bank as “Cash Management Obligations” in writing to the Administrative Agent. The designation of any CashManagement Obligations shall not create in favor of such Bank any rights in connection with the management or release of any Collateral orof the obligations of any Guarantor under the Loan Documents.“ Casualty Event ” means any event that gives rise to the receipt by any Consolidated Party of any insurance proceeds orcondemnation awards in respect of any equipment, fixed assets or real property (including any improvements thereon) to replace or repairsuch equipment, fixed assets or real property.“ Certain Funds Provision ” has the meaning set forth in the Commitment Letter.“ CFC ” means a controlled foreign corporation within the meaning of Section 957 of the Code.5 “ Change of Control ” shall be deemed to occur if:(a) any “person” or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on theClosing Date, but excluding any employee benefit plan of such person and its Subsidiaries and any person or entity acting in itscapacity as trustee, agent or other fiduciary or administrator of any such plan) shall have, directly or indirectly, acquired beneficialownership of Equity Interests representing 35% or more of the aggregate voting power represented by the issued and outstandingEquity Interests of Parent;(b) excluding the replacement of members of the Board of Directors of HDV Holdings or HD VEST within 30 days fromthe consummation of the Acquisition, a majority of the Board of Directors of any Holding Company or either Borrower is replacedover a two-year period from the directors who constituted the respective Board of Directors at the beginning of such period, and suchreplacement shall not have been approved by a vote of at least a majority of the Board of Directors of any Holding Company or eitherBorrower, as applicable, then still in office who either were members of such Board of Directors at the beginning of such period orwhose election as a member of such Board of Directors was previously so approved;(c) a “change of control” (or similar event) shall occur in any document pertaining to any Indebtedness of any ConsolidatedParty with an aggregate outstanding principal amount in excess of the Threshold Amount;(d) Parent shall cease to own directly, beneficially and of record, 100% of the issued and outstanding Equity Interests ofHoldings;(e) Holdings shall cease to own directly, beneficially and of record, (i) 100% of the issued and outstanding Equity Interestsof TaxACT or (ii) at least 95% of the issued and outstanding Equity Interests of Baseball;(f) Baseball shall cease to own, directly, beneficially and of record, 100% of the issued and outstanding Equity Interests ofeither HDV Holdings or HD Vest;(g) HDV Holdings shall cease to own, directly, beneficially and of record, 100% of the issued and outstanding EquityInterests of HD Vest; and(h) HDVest shall cease to own, directly, beneficially and of record, 100% of the issued and outstanding Equity Interests ofthe BD Subsidiary and the Advisory Services Subsidiary.“ Class ” (a) when used with respect to any Lender, refers to whether such Lender has a Loan or Commitment with respect to aparticular Class of Loans or Commitments, (b) when used with respect to Commitments, refers to whether such Commitments are RevolvingCredit Commitments, Extended Revolving Credit Commitments of a given Extension Series, Refinancing Revolving Credit Commitments ofa given Refinancing Series, Initial Term Commitments, Incremental Term Commitments, Refinancing Term Commitments of a givenRefinancing Series or Commitments in respect of Replacement Term Loans and (c) when used with respect to Loans or a Borrowing, refers towhether such Loans, or the Loans comprising such Borrowing, are Revolving Credit Loans, Revolving Credit Loans under ExtendedRevolving Credit Commitments of a given Extension Series, Incremental Revolving Loans, Revolving Credit Loans under RefinancingRevolving Credit Commitments of a given Refinancing Series, Initial Term Loans, Extended Term Loans of a given Extension Series,Incremental Term Loans, Refinancing Term Loans of a given Refinancing Series or Replacement Term Loans. Commitments (and in eachcase, the Loans made pursuant to such Commitments) that have different terms and conditions shall be construed to be in different Classes.Commitments (and, in each case, the Loans made pursuant to such Commitments) that have the same terms and conditions shall be construedto be in the same Class.“ Closing Date ” means December 31, 2015.“ Closing Date Material Adverse Effect ” means (all defined terms used in this sentence and defined in the Acquisition Agreementto have the meanings set forth in the Acquisition Agreement): any change, effect, event, occurrence, state of facts or development that,individually or in the aggregate, is or would reasonably be expected to be materially adverse to (a) the business, assets, liabilities, financialcondition or results of operations of the Company and its Subsidiaries taken as a whole or (b) the consummation of the transactionscontemplated by the Acquisition Agreement; provided, however, that none of the following shall be deemed, either alone or in combination,to constitute, and none of the following shall be taken into account in determining whether there has been or will be, a Closing Date MaterialAdverse Effect: any change, effect, event, occurrence, state of facts or development attributable to (i) the negotiation, execution,announcement or pendency of the transactions contemplated by the Acquisition Agreement, including the impact thereof on relationships,contractual or otherwise, with, or actual or potential loss or impairment of, customers, suppliers, partners or employees, or on revenue,profitability and cash flows; (ii) conditions affecting the industry in which the Company and its Subsidiaries participate, the U.S. or worldeconomy as a whole or the U.S. or global capital or financial markets in general or the markets in which the Company and its Subsidiariesoperate; (iii) compliance with the terms of, or the taking of any action required by, the Stock Purchase Agreement; (iv) the taking of anyaction, or failing to take any action, at the request of New Sub, or the taking of any action by New Sub, in each case, with the prior writtenconsent for the underlying action by the Lead Arranger; (v) any change in applicable Laws or the interpretation thereof; (vi) actions requiredto be taken under applicable Laws; (vii) any change in GAAP or other accounting requirements or principles; (viii) any change in the cost oravailability or other terms of any financing to be obtained by New Sub; (ix) any failure (as distinguished from any change, effect, event,occurrence, state of facts or development giving rise to or contributing to such failure) by the Company and its Subsidiaries to meet financialforecasts, projections or estimates; or (x) national or international political or social conditions, including the commencement, continuation orescalation of a war, material armed hostilities or other material international or national calamity or act of terrorism; except in each of theforegoing clauses (ii), (v), (vi), (vii) or (x), excluding any such change, effect, event, occurrence, state of facts or development that has adisproportionate effect on the Company or its Subsidiaries in comparison to other participants in industries in which the Company and itsSubsidiaries operate.“ Closing Fees ” has the meaning set forth in Section 2.09(c) .“ Code ” means the U.S. Internal Revenue Code of 1986, as amended from time to time (unless as specifically provided otherwise).“ Collateral ” means the “Collateral” as defined in the Security Agreement and all the “Collateral” or “Pledged Assets” as defined inany other Collateral Document and any other assets pledged pursuant to any Collateral Document (but in any event excluding the ExcludedAssets).“ Collateral Agent ” means Bank of Montreal, in its capacity as collateral agent under any of the Collateral Documents, or anysuccessor collateral agent.6 “ Collateral and Guarantee Requirement ” means, at any time, the requirement that:(a) the Administrative Agent shall have received each Collateral Document required to be delivered (i) on the ClosingDate, pursuant to Section 4.01(a)(iv) and (ii) at such time as may be designated therein, pursuant to the Collateral Documents orSection 6.11 or 6.13 , subject, in each case, to the limitations and exceptions of this Agreement, duly executed by each Loan Partythereto;(b) all Obligations shall have been (i) unconditionally guaranteed by each Holding Company, each Borrower and eachexisting and subsequently acquired or organized Restricted Subsidiary of the Borrowers that is a direct or indirect wholly-ownedMaterial Domestic Subsidiary (other than any Excluded Subsidiary) including those that are listed on Schedule I hereto (each, a “Guarantor ”) and (ii) guaranteed by Parent pursuant to the Parent Guaranty; provided that recourse to Parent shall be limited solelyto Parent’s Equity Interests in Holdings and the proceeds thereof;(c) the Obligations and the Guaranty shall have been secured by a first-priority security interest (subject to Liens permittedby Section 7.01 ) in (i) all of the Equity Interest of each Holding Company, (ii) all of the Equity Interests of each Borrower, (iii) all ofthe Equity Interests of each wholly-owned Restricted Subsidiary that is a Material Domestic Subsidiary, and (iv) 65% of the votingstock and 100% of the non-voting stock of each first-tier CFC or CFC Holding Company (other than, in each case of foregoingclauses (i) , (ii) and (iii) , to the extent constituting an Excluded Asset);(d) except to the extent otherwise provided hereunder, including subject to Liens permitted by Section 7.01 , or under anyCollateral Document, the Obligations and the Guaranty shall have been secured by a perfected first-priority security interest (to theextent such security interest may be perfected by delivering certificated securities, filing financing statements under the UniformCommercial Code or making any necessary filings with the United States Patent and Trademark Office or United States CopyrightOffice or to the extent required in the Security Agreement) in the Collateral of Parent, the Borrowers and each Guarantor (includingaccounts, inventory, equipment, investment property, contract rights, applications and registrations of intellectual property filed in theUnited States, other general intangibles, Material Real Property, intercompany notes, cash, deposit accounts, securities accounts andproceeds of the foregoing), in each case, (i) with the priority required by the Collateral Documents and (ii) subject to exceptions andlimitations otherwise set forth in this Agreement (for the avoidance of doubt, including the limitations and exceptions set forth inSection 4.01 ) and the Collateral Documents; and(e) the Administrative Agent shall have received (i) counterparts of a Mortgage with respect to each Material Real Property(other than Excluded Assets) owned by a Borrower or a Guarantor and required to be delivered pursuant to Sections 6.11 and 6.13(the “ Mortgaged Properties ”) duly executed and delivered by the applicable Loan Party, (ii) a title insurance policy for suchproperty available in each applicable jurisdiction (the “ Mortgage Policies ”) insuring the Lien of each such Mortgage as a valid first-priority Lien on the property described therein, free of any other Liens except as permitted by Section 7.01 , together with suchendorsements, coinsurance and reinsurance and in such amounts as the Administrative Agent may reasonably request, (iii) acompleted Life-of-Loan Federal Emergency Management Agency Standard Flood Hazard Determination with respect to eachMortgaged Property (together with a notice about special flood hazard area status and flood disaster assistance duly executed by theBorrowers and each other Loan Party relating thereto) and, if any improvements on any Mortgaged Property are located within anarea designated a “flood hazard area,” evidence of such flood insurance as may be required under Section 6.07 , (iv) ALTA surveys inform and substance reasonably acceptable to the Administrative Agent or such existing surveys together with no-change affidavitssufficient for the title company to remove all standard survey exceptions from the Mortgage Policies and issue the endorsementsrequired in clause (ii) above and (v) such legal opinions and other documents as the Administrative Agent may reasonably requestwith respect to any such Mortgaged Property;provided , however , that (i) the foregoing definition shall not require, and the Loan Documents shall not contain any requirements asto, (A) the creation or perfection of pledges of, security interests in, Mortgages on, or the obtaining of title insurance, surveys, abstracts orappraisals or taking other actions with respect to any Excluded Assets, (B) the perfection of pledges of or security interests in motor vehiclesand other assets subject to certificates of title to the extent a Lien thereon cannot be perfected by the filing of a Uniform Commercial Codefinancing statement (or the equivalent) or (C) the obtaining of any landlord waivers, estoppels or collateral access letters, and (ii) the Liensrequired to be granted from time to time pursuant to the Collateral and Guarantee Requirement shall be subject to exceptions and limitationsset forth in this Agreement and the Collateral Documents.The Administrative Agent may grant extensions of time for the perfection of security interests in, or the delivery of the Mortgagesand the obtaining of title insurance and surveys with respect to, particular assets and the delivery of assets (including extensions beyond theClosing Date for the perfection of security interests in the assets of the Loan Parties on such date) or any other compliance with therequirements of this definition where it reasonably determines, in consultation with the Borrower Representative, that perfection orcompliance cannot be accomplished without undue effort or expense by the time or times at which it would otherwise be required by thisAgreement, the Collateral Documents or any other Loan Documents.No actions in any non-U.S. jurisdiction or required by the Laws of any non-U.S. jurisdiction shall be required in order to create anysecurity interests in assets located or titled outside of the U.S. or to perfect such security interests (it being understood that there shall be nosecurity agreements or pledge agreements governed under the Laws of any non-U.S. jurisdiction).“ Collateral Documents ” means, collectively, the Security Agreement, the Pledge Agreement, the Parent Guaranty, each CustomaryIntercreditor Agreement, the Intellectual Property Security Agreements, the Mortgages, collateral assignments, Security AgreementSupplements, the Control Agreements, security agreements, pledge agreements or other similar agreements delivered to the AdministrativeAgent pursuant to Section 4.01(a)(iv) , 6.11 or 6.13 and each of the other agreements, instruments or documents that creates or purports tocreate a Lien or Guarantee in favor of the Administrative Agent or the Collateral Agent for the benefit of the Secured Parties.“ Committed Loan Notice ” means a written notice of (a) a Borrowing, (b) a conversion of Loans from one Type to the other or (c) acontinuation of Eurodollar Rate Loans pursuant to Section 2.02(a) , which shall be substantially in the form of Exhibit A-1 hereto.“ Commitment ” means a Revolving Credit Commitment, Extended Revolving Credit Commitment of a given Extension Series,Revolving Commitment Increase, Refinancing Revolving Credit Commitment of a given Refinancing Series, Initial Term Commitment,Incremental Term Commitment, Refinancing Term Commitment of a given Refinancing Series or a Commitment in respect of ReplacementTerm Loans, as the context may require.“ Commitment Letter ” means the Commitment Letter, dated October 14, 2015, among Parent, the Lead Arranger, and the Affiliatesof the Lead Arranger party thereto.“ Commodity Exchange Act ” means the Commodity Exchange Act (7 U.S.C. § 1 et seq. ), as amended from time to time, and anysuccessor statute.“ Compensation Period ” has the meaning set forth in Section 2.12(c)(ii) .“ Compliance Certificate ” means a certificate substantially in the form of Exhibit B hereto.“ Connection Income Taxes ” means any Taxes that are imposed on or measured by net income (however denominated) or that arefranchise Taxes or branch profits Taxes, in each case as a result of any present or former connection between a Lender or Agent andjurisdiction imposing such Tax (other than any connections arising solely from executing, delivering, being a party to, performing itsobligations under, receiving payments under, receiving or perfecting a security interest under, engaging in any other transaction pursuant to,or enforcing, any Loan Document, or selling or assigning an interest in a Loan or Loan Document).“ Consolidated EBITDA ” means, for any period, the Consolidated Net Income for such period, plus :(a) without duplication and, to the extent deducted (and not added back or excluded) in arriving at such Consolidated NetIncome, the sum of the following amounts for such period with respect to the Consolidated Parties:(i) Consolidated Interest Expense for such period;(ii) without duplication, income and franchise tax expense during such period ;(iii) amortization (including, without limitation, amortization of OID (for avoidance of doubt, including anyTransaction Expenses attributable to OID)), depreciation and other non-cash charges for such period (except to the extent thatsuch non-cash charges represent an accrual or reserve for potential cash charges to be taken in the future ) ;(iv) (A) extraordinary charges, expenses or losses (including legal expenses in connection therewith) and (B)unusual or non-recurring charges, expenses or losses (including legal expenses in connection therewith) in an aggregateamount for all cash items added pursuant to this subclause (B) and clause (vi) not to exceed (1) 10% of ConsolidatedEBITDA for such Test Period and (2) when aggregated with the aggregate amount for all cash items added pursuant to anypro forma adjustments during such period pursuant to Section 1.09 and clauses (a)(vi), (a)(vii) and (a)(ix) of the definition of“Consolidated EBITDA,” 15% of Consolidated EBITDA for such Test Period (giving pro forma effect to the relevantSpecified Transaction (but not to any cost savings or synergies)) ;(v) non-cash charges, expenses or losses ( except to the extent that such non-cash charges represent an accrual orreserve for potential cash charges to be taken in the future);(vi) integration costs, transition costs, consolidation and restructuring costs, costs incurred during such period inconnection with any non-recurring strategic initiatives, acquisitions and non-recurring intellectual property development afterthe Closing Date, other non-recurring business optimization expenses or consulting programs (including non-recurring costsand expenses relating to business optimization programs, new systems design, technology upgrades and implementationcosts), and other restructuring charges, accruals or reserves (including restructuring costs related to acquisitions after theClosing Date and “growth projects”), in each case determined on a consolidated basis in accordance with GAAP and to theextent deducted in computing Consolidated Net Income for such period, in an aggregate amount for all cash items addedpursuant to this clause (vi) and subclause (B) of clause (iv) not to exceed (1) 10% of Consolidated EBITDA for such TestPeriod and (2) when aggregated with the aggregate amount for all cash items added pursuant to any pro forma adjustmentsduring such period pursuant to Section 1.09 and clauses (a)(iv)(B), (a)(vii) and (a)(ix) of the definition of “ConsolidatedEBITDA,” 15% of Consolidated EBITDA for such Test Period (giving pro forma effect to the relevant Specified Transaction(but not to any cost savings or synergies));(vii) other customary transaction costs, fees and expenses, or any amortization thereof, related to the Transactions(including Transaction Expenses in an amount not to exceed $23,750,000) and, to the extent permitted under the LoanDocuments, any Permitted Acquisitions, Investments pursuant to Section 7.02(o) and (s), Dispositions, issuances of EquityInterests and issuances, amendments, modifications, refinancings or repayments of Indebtedness (in each case, including anysuch transaction consummated on the Closing Date and any such transaction undertaken but not completed in an aggregateamount not to exceed $2,500,000 for all such uncompleted transactions for any such period), in each case to the extentdeducted in computing Consolidated Net Income for such period and when aggregated with the aggregate amount for all cashitems added pursuant to any pro forma adjustments during such period pursuant to Section 1.09 and clauses (a)(iv)(B), (a)(vi)and (a)(ix) of the definition of “Consolidated EBITDA,” not to exceed 15% of Consolidated EBITDA for such Test Period(giving pro forma effect to the relevant Specified Transaction (but not to any cost savings or synergies)) ;(viii) the amount of any minority interest expense consisting of Subsidiary income attributable to minority equityinterests of third parties in Baseball (not in excess of 5% of the issued and outstanding Equity Interests thereof) deducted incalculating Consolidated Net Income (and not added back in such period to Consolidated Net Income); and(ix) legal expenses and fines related to regulatory proceedings related to the business of the BD Subsidiary and theAdvisory Services Subsidiary in a cumulative aggregate amount not to exceed $10,000,000, and when aggregated with theaggregate amount for all cash items added pursuant to any pro forma adjustments during such period pursuant to Section 1.09and clauses (a)(iv)(B), (a)(vi) and (a)(vii) of the definition of “Consolidated EBITDA,” not to exceed 15% of ConsolidatedEBITDA for such Test Period (giving pro forma effect to the relevant Specified Transaction (but not to any cost savings orsynergies)) ; minus(b) without duplication and to the extent included in arriving at such Consolidated Net Income, (i) non-cash gains(excluding any non-cash gain to the extent it represents the reversal of an accrual or reserve for a potential cash item that reducedConsolidated EBITDA in any prior period) including non-cash gains as a result of last-in first -out and/or first-in first-out methods ofaccounting, (ii) any net gain from disposed, abandoned or discontinued operations or product lines, (iii) any extraordinary, unusual ornon-recurring net gains and (iv) the amount of any minority interest income attributable to minority interests or non-controllinginterests of third parties in any non-wholly-owned Restricted Subsidiary.7 For the avoidance of doubt, Consolidated EBITDA shall be calculated, including pro forma adjustments, in accordance withSection 1.09 . Notwithstanding anything to the contrary contained herein, for purposes of determining Consolidated EBITDA under thisAgreement for any period that includes any of the fiscal quarters ended December 31, 2014, March 31, 2015, June 30, 2015, and September30, 2015, Consolidated EBITDA for such fiscal quarters shall be $7,925,498, $52,333,751, $30,833,242 and $9,296.763, respectively.“ Consolidated First Lien Net Debt ” means, as of any date of determination, (a) the aggregate principal amount of anyIndebtedness described in clause (a) of the definition of “Consolidated Total Net Debt” outstanding on such date that is secured by a Lien, ona first lien or pari passu basis with the Facilities (including Indebtedness incurred pursuant to Section 7.03(e) ), on any asset or property ofany Consolidated Party minus (b)(i) Unrestricted cash and Cash Equivalents that are subject to a Control Agreement in favor of the CollateralAgent for the benefit of the Secured Parties and (ii) cash and Cash Equivalents Restricted in favor of the Collateral Agent for the benefit ofthe Secured Parties, in each case, (x) that are or should, in accordance with GAAP, be included on the consolidated balance sheet of Parentwith respect to the Consolidated Parties as of such date, and (y) for all purposes other than the calculation of Consolidated First Lien NetLeverage Ratio for purposes of determining the Applicable Margin, in an aggregate amount not to exceed $50,000,000; provided thatConsolidated First Lien Net Debt shall not include Indebtedness in respect of letters of credit, except to the extent of unreimbursed amountsthereunder. For the avoidance of doubt, it is understood that obligations (i) under Swap Contracts and Treasury Services Agreements and (ii)owed by Unrestricted Subsidiaries do not constitute Consolidated First Lien Net Debt.“ Consolidated First Lien Net Leverage Ratio ” means, with respect to any Test Period, the ratio of (a) Consolidated First Lien NetDebt as of the last day of such Test Period to (b) Consolidated EBITDA for such Test Period.8 “ Consolidated Interest Expense ” means, for any period, the sum of the following determined on a consolidated basis, withoutduplication, for the Consolidated Parties in accordance with GAAP, interest expense (including, without limitation, interest expenseattributable to Capital Leases and all net payment obligations pursuant to Hedge Agreements) for such period.9 “ Consolidated Net Income ” means, for any period, the net income (or loss) of the Consolidated Parties for such period,determined on a consolidated basis, without duplication, in accordance with GAAP; provided , that in calculating Consolidated Net Income ofthe Consolidated Parties for any period, there shall be excluded the net income (or loss) of any Person (other than a Subsidiary), in which anyConsolidated Party has a joint interest with a third party, except to the extent such net income is actually paid in cash to any ConsolidatedParty by dividend or other distribution during such period.For the avoidance of doubt, (other than for purposes of calculating Excess Cash Flow) Consolidated Net Income shall be calculated,including pro forma adjustments, in accordance with Section 1.09 .“ Consolidated Parties ” means the Holding Companies, the Borrowers and their Restricted Subsidiaries.“ Consolidated Secured Net Debt ” means, as of any date of determination, (a) the aggregate principal amount of any Indebtednessdescribed in clause (a) of the definition of “Consolidated Total Net Debt” outstanding on such date that is secured by a Lien on any asset orproperty of any Consolidated Party minus (b)(i) Unrestricted cash and Cash Equivalents that are subject to a Control Agreement in favor ofthe Collateral Agent for the benefit of the Secured Parties and (ii) cash and Cash Equivalents Restricted in favor of the Collateral Agent forthe benefit of the Secured Parties, in each case, (x) included on the consolidated balance sheet of Parent with respect to the ConsolidatedParties as of such date and (y) in an aggregate amount not to exceed $50,000,000; provided that Consolidated Secured Net Debt shall notinclude Indebtedness in respect of letters of credit, except to the extent of unreimbursed amounts thereunder. For the avoidance of doubt, it isunderstood that obligations (i) under Swap Contracts and Treasury Services Agreements and (ii) owed by Unrestricted Subsidiaries, do notconstitute Consolidated Secured Net Debt.“ Consolidated Secured Net Leverage Ratio ” means, with respect to any Test Period, the ratio of (a) Consolidated Secured NetDebt as of the last day of such Test Period to (b) Consolidated EBITDA for such Test Period.“ Consolidated Total Net Debt ” means, as of any date of determination, (a) the aggregate principal amount of Indebtedness of theConsolidated Parties outstanding on such date, in an amount that would be reflected on the consolidated balance sheet of Parent with respectto the Consolidated Parties as of such date in accordance with GAAP (but excluding the effects of any discounting of Indebtedness underGAAP) consisting of Indebtedness for borrowed money and all obligations of the Consolidated Parties evidenced by bonds, debentures,notes, loan agreements or other similar instruments and Attributable Indebtedness; provided that Consolidated Total Net Debt shall notinclude Indebtedness in respect of letters of credit, except to the extent of unreimbursed amounts thereunder, minus (b) (i) Unrestricted cashand Cash Equivalents that are subject to a Control Agreement in favor of the Collateral Agent for the benefit of the Secured Parties and (ii)cash and Cash Equivalents Restricted in favor of the Collateral Agent for the benefit of the Secured Parties, in each case, (x) included on theconsolidated balance sheet of Parent with respect to the Consolidated Parties as of such date and (y) in an aggregate amount not to exceed$50,000,000. For the avoidance of doubt, it is understood that obligations (i) under Swap Contracts and Treasury Services Agreements and(ii) owed by Unrestricted Subsidiaries, do not constitute Consolidated Total Net Debt.“ Consolidated Total Net Leverage Ratio ” means, with respect to any Test Period, the ratio of (a) Consolidated Total Net Debt asof the last day of such Test Period to (b) Consolidated EBITDA for such Test Period.“ Consolidated Working Capital ” means, with respect to the Consolidated Parties on a consolidated basis at any date ofdetermination, Current Assets at such date of determination minus Current Liabilities at such date of determination; provided that increases ordecreases in Consolidated Working Capital shall be calculated without regard to any changes in Current Assets or Current Liabilities as aresult of (a) any reclassification in accordance with GAAP of assets or liabilities, as applicable, between current and noncurrent or (b) theeffects of purchase accounting.“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement,instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.“ Control ” has the meaning set forth in the definition of “Affiliate.”“ Control Agreement ” means a control agreement, in form and substance reasonably satisfactory to Collateral Agent, executed anddelivered by a Consolidated Party, the Collateral Agent and the applicable securities intermediary (with respect to a securities account) orbank (with respect to a deposit account).“ Credit Agreement Refinancing Indebtedness ” means any (a) Permitted Equal Priority Refinancing Debt, (b) Permitted JuniorPriority Refinancing Debt, (c) Permitted Unsecured Refinancing Debt or (d) other Indebtedness incurred pursuant to a RefinancingAmendment, in each case, issued, incurred or otherwise obtained (including by means of the extension or renewal of existing Indebtedness) inexchange for, or to extend, renew, replace, repurchase, retire or refinance, in whole or part, existing Loans (or, if applicable, unusedRevolving Credit Commitments), or any then-existing Credit Agreement Refinancing Indebtedness (the “ Refinanced Debt ”); provided that(i) such Credit Agreement Refinancing Indebtedness shall have a maturity date that is no earlier than the Latest Maturity Date (or (A) in thecase of Permitted Junior Priority Refinancing Debt or Permitted Unsecured Refinancing Debt, the date that is 91 days after the LatestMaturity Date and (B) in the case of any Revolving Credit Facility, the latest maturity date of any then-existing Revolving Credit Facility) atthe time of incurrence and, in the case of Credit Agreement Refinancing Indebtedness consisting of loans that are not revolving Indebtedness,a Weighted Average Life to Maturity equal to or greater than that of the Refinanced Debt (after giving effect to any amortization thereof, butnot any prepayments thereof, prior to the time of such Refinancing) as of the date of determination, (ii) the covenants, events of default andguarantees of any such Indebtedness (excluding, for the avoidance of doubt, interest rates (including through fixed interest rates), interestmargins, rate floors, fees, funding discounts, original issue discounts and optional prepayment or redemption premiums and terms) shall beidentical to, or less favorable to the lenders thereunder than, those applicable to the Refinanced Debt (other than covenants or other provisionsapplicable only to periods after the Latest Maturity Date (or, in the case of Permitted Junior Priority Refinancing Debt or PermittedUnsecured Refinancing Debt, the date that is 91 days after the Latest Maturity Date) at the time of incurrence), (iii) such Indebtedness shallnot have a greater principal amount than the principal amount of the Refinanced Debt plus accrued interest, fees and premiums (including anytender premium and prepayment premiums) and penalties (if any) thereon and fees, expenses, original issue discount and upfront feesincurred in connection with such Refinancing, (iv) such Refinanced Debt shall be repaid, defeased or satisfied and discharged, and all accruedinterest, fees and premiums (if any) in connection therewith shall be paid, substantially concurrently with the date such Credit AgreementRefinancing Indebtedness is issued, incurred or obtained with the Net Cash Proceeds received from the incurrence or issuance of suchIndebtedness and any corresponding commitments shall immediately terminate, (v) such Credit Agreement Refinancing Indebtedness shallnot require any mandatory repayment, redemption, repurchase or defeasance (other than (x) in the case of notes or debentures, customarychange of control, asset sale event or casualty or condemnation event offers and customary acceleration any time after an event of default and(y) in the case of any Permitted Equal Priority Refinancing Debt, mandatory prepayments (including redemptions or repurchases or offers toprepay, redeem or repurchase based on excess cash flow) that are on terms not more favorable to the lenders or holders providing suchIndebtedness than those applicable to the Refinanced Debt and that share such payments ratably (but not greater than ratable) in anyequivalent voluntary or mandatory prepayments, as applicable, of the Term Facility unless the Borrowers and the lenders or investors inrespect of such Permitted Equal Priority Refinancing Debt elect lesser payments) prior to the Latest Maturity Date (or, in the case ofPermitted Junior Priority Refinancing Debt or Permitted Unsecured Refinancing Debt, the date that is 91 days after the Latest Maturity Date)at the time of such incurrence, (vi) if the Refinanced Debt is subordinated in right of payment to, or to the Liens securing, the Obligations,then any Credit Agreement Refinancing Indebtedness shall be subordinated in right of payment to, or to the Liens securing, the Obligations,as applicable, pursuant to a Customary Intercreditor Agreement and, if subordinated in right of payment, on terms reasonably satisfactory tothe Administrative Agent, and (vii) with respect to Credit Agreement Refinancing Indebtedness consisting of a revolving facility, (A) suchCredit Agreement Refinancing Indebtedness shall have no mandatory scheduled commitment reductions prior to the maturity date of anyexisting Revolving Credit Facility (or, if at such time no Revolving Credit Facility exists, the Latest Maturity Date at the time of incurrence),(B) any borrowings, repayments, prepayments and commitment reductions thereunder shall be ratable among such facility, any RevolvingCredit Facility and any other such revolving facility and (C) there shall not be more than two revolving credit facilities among the revolvingfacilities constituting Credit Agreement Refinancing Indebtedness and any Revolving Credit Facility.“ Credit Extension ” means each of the following: (a) a Borrowing and (b) an L/C Credit Extension.“ Cure Amount ” has the meaning set forth in Section 8.04(a) .“ Cure Expiration Date ” has the meaning set forth in Section 8.04(a) .“ Current Assets ” means, with respect to the Consolidated Parties on a consolidated basis at any date of determination, all assets(other than cash and Cash Equivalents) that would, in accordance with GAAP, be classified on a consolidated balance sheet of theConsolidated Parties as current assets at such date of determination, other than amounts related to current or deferred Taxes based on incomeor profits (but excluding assets held for sale, loans (permitted) to third parties, pension assets, deferred bank fees and derivative financialinstruments).“ Current Liabilities ” means, with respect to the Consolidated Parties on a consolidated basis at any date of determination, allliabilities that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Consolidated Parties as current liabilitiesat such date of determination, other than (a) the current portion of any Indebtedness, (b) accruals for Capital Expenditures, (c) accruals forcurrent or deferred Taxes based on income or profits, (d) accruals of any costs or expenses related to restructuring reserves, (e) any RevolvingCredit Exposure or Revolving Credit Loans and (g) the current portion of pension liabilities.“ Customary Intercreditor Agreement ” means (a) to the extent executed in connection with the incurrence of Indebtedness securedby Liens on the Collateral intended to rank equal in priority to the Liens on the Collateral securing the Obligations, a customary intercreditoragreement in form and substance reasonably acceptable to the Administrative Agent, Required Lenders and the Borrower Representative,which agreement shall provide that the Liens on the Collateral securing such Indebtedness shall rank equal in priority to the Liens on theCollateral securing the Obligations and (b) to the extent executed in connection with the incurrence of Indebtedness secured by Liens on theCollateral intended to rank junior to the Liens on the Collateral securing the Obligations, a customary intercreditor agreement in form andsubstance reasonably acceptable to the Administrative Agent, Required Lenders and the Borrower Representative, which agreement shallprovide that the Liens on the Collateral securing such Indebtedness shall rank junior to the Lien on the Collateral securing the Obligations.“ Debtor Relief Laws ” means the U.S. Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for thebenefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization or similar debtor relief Laws of the United States orother applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.“ Declined Proceeds ” has the meaning set forth in Section 2.05(b)(vi) .“ Default ” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage oftime, or both, without cure or waiver hereunder, would be an Event of Default.“ Default Rate ” means an interest rate equal to (a) the ABR plus (b) the Applicable Margin, if any, applicable to Term Loans that areABR Loans plus (c) 2.00% per annum ; provided that with respect to a Eurodollar Rate Loan, the Default Rate shall be an interest rate equalto the interest rate (including any Applicable Margin) otherwise applicable to such Loan plus 2.00% per annum , in each case, to the fullestextent permitted by applicable Laws.“ Defaulting Lender ” means, subject to Section 2.17(b) , any Lender that (a) has failed to perform any of its funding obligationshereunder, including in respect of its Loans or participations in respect of L/C Obligations, within one Business Day of the date required to befunded by it hereunder, unless such Lender notifies the Administrative Agent and the Borrower Representative in writing that such failure isthe result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together withany applicable Default, shall be specifically identified in such writing) has not been satisfied, (b) has notified the Administrative Agent that itdoes not intend to comply with its funding obligations or has made a public statement to that effect with respect to its funding obligationshereunder or under other agreements in which it commits to extend credit (unless such writing or public statement relates to such Lender’sobligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent tofunding (which condition precedent, together with any applicable Default, shall be specifically identified in such writing or public statement)cannot be satisfied), (c) has failed, within three Business Days after request by the Administrative Agent, to confirm in a manner satisfactoryto the Administrative Agent that it will comply with its funding obligations, (d) has failed, within two Business Days after request by theAdministrative Agent, to pay any amounts owing to the Administrative Agent or the other Lenders, or (e) has, or has a direct or indirectparent company that has, after the Closing Date, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had a receiver,conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of itsbusiness or a custodian appointed for it, (iii) become the subject of a Bail-in Action or (iv) taken any action in furtherance of, or indicated itsconsent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lendersolely by virtue of (x) the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by aGovernmental Authority or (y) in the case of a solvent Person, the precautionary appointment of an administrator, guardian, custodian orother similar official by a Governmental Authority under or based on the Law of the country where such Person is subject to homejurisdiction supervision if any applicable Law requires that such appointment not be publicly disclosed, in any such case, where such actiondoes not result in or provide such Person with immunity from the jurisdiction of courts within the United States of America or from theenforcement of judgments or writs of attachment on its assets or permit such Person (or such Governmental Authority) to reject, repudiate,disavow or disaffirm any contracts or agreements made by such Person. Any determination by the Administrative Agent that a Lender is aDefaulting Lender under clauses (a) through (e) above shall be conclusive and binding absent manifest error, and such Lender shall bedeemed to be a Defaulting Lender (subject to Section 2.17(b) ) upon delivery of written notice of such determination to the BorrowerRepresentative, each L/C Issuer and each Lender.“ Designated Person ” means a person or entity:(a) listed in the annex to, or otherwise subject to the provisions of, the Executive Order;(b) named as a “Specially Designated National and Blocked Person” (“ SDN ”) on the most current list published by OFAC at itsofficial website or any replacement website or other replacement official publication of such list (the “ SDN List ”); or(c) in which an entity on the SDN List has 50% or greater ownership interest or that is otherwise controlled by an SDN.“ Disposition ” or “ Dispose ” means the sale, transfer, license tantamount to a sale, lease or other disposition (including any sale-leaseback transaction and any sale or issuance of Equity Interests (other than directors’ qualifying shares or other shares required byapplicable Law) in a Restricted Subsidiary) of any property by any Person, including any sale, assignment, transfer or other disposal, with orwithout recourse, of any notes or accounts receivable or any rights and claims associated therewith.“ Disqualified Equity Interest ” means any Equity Interest that, by its terms (or by the terms of any security or other Equity Interestsinto which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (a) matures or is mandatorilyredeemable (other than solely for Qualified Equity Interests and cash in lieu of fractional shares), pursuant to a sinking fund obligation orotherwise (except as a result of a change of control, asset sale or similar event so long as any rights of the holders thereof upon the occurrenceof a change of control, asset sale or similar event shall be subject to the prior repayment in full of the Loans and all other Obligations that areaccrued and payable and the termination of the Commitments and the termination of all outstanding Letters of Credit (unless the OutstandingAmount of the L/C Obligations related thereto has been Cash Collateralized, back-stopped by a letter of credit reasonably satisfactory to theapplicable L/C Issuer or deemed reissued under another agreement reasonably acceptable to the applicable L/C Issuer)), (b) is redeemable atthe option of the holder thereof (other than (i) solely for Qualified Equity Interests and cash in lieu of fractional shares or (ii) as a result of achange of control, asset sale or similar event so long as any rights of the holders thereof upon the occurrence of a change of control, asset saleor similar event shall be subject to the prior repayment in full of the Loans and all other Obligations that are accrued and payable and thetermination of the Commitments and the termination of all outstanding Letters of Credit (unless the Outstanding Amount of the L/CObligations related thereto has been Cash Collateralized, back-stopped by a letter of credit reasonably satisfactory to the applicable L/C Issueror deemed reissued under another agreement reasonably acceptable to the applicable L/C Issuer)), in whole or in part, (c) provides for thescheduled payments of dividends in cash or (d) is or becomes convertible into or exchangeable for Indebtedness or any other Equity Intereststhat would constitute Disqualified Equity Interests, in each case, prior to the date that is 91 days after the Latest Maturity Date at the time ofissuance of such Equity Interests; provided that if such Equity Interests are issued (x) pursuant to a plan for the benefit of employees ofHoldings (or any direct or indirect parent thereof) or any other Consolidated Party or (y) by any such plan to any such employees, such EquityInterests shall not constitute Disqualified Equity Interests solely because they may be required to be repurchased by the Borrowers or any oftheir Restricted Subsidiaries in order to satisfy applicable statutory or regulatory obligations.“ Disqualified Lenders ” shall mean the Persons identified in writing to the Administrative Agent prior to the Closing Date. A list ofthe Disqualified Lenders will be posted by the Administrative Agent on the Platform and available for inspection by all Lenders.“ Dollar ” and “ $ ” mean lawful money of the United States.“ Domestic Subsidiary ” means any Subsidiary that is organized under the Laws of the United States, any state thereof or the Districtof Columbia.“ EEA Financial Institution ” means (a) any credit institution or investment firm established in any EEA Member Country which issubject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of aninstitution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is asubsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.“ EEA Member Country ” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.“ EEA Resolution Authority ” means any public administrative authority or any person entrusted with public administrativeauthority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.“ Eligible Assignee ” has the meaning set forth in Section 10.07(a)(i) .“ Enforcement Qualifications ” has the meaning set forth in Section 5.04 .“ Environment ” means indoor air, ambient air, surface water, groundwater, land surface, subsurface strata or sediment, and naturalresources such as wetlands, flora and fauna or as otherwise defined in any Environmental Law.“ Environmental Laws ” means any applicable Law relating to the prevention of pollution or the protection of the Environment andnatural resources, and the protection of worker health and safety as it relates to exposure to Hazardous Materials, including any applicableprovisions of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et seq. , the HazardousMaterials Transportation Act, 49 U.S.C. § 5101 et seq. , the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq. , the CleanWater Act, 33 U.S.C. § 1251 et seq. , the Clean Air Act, 42 U.S.C. § 7401 et seq. , the Toxic Substances Control Act, 15 U.S.C. § 2601 etseq. , the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq. , and the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq. , and allanalogous state or local statutes, and the regulations promulgated pursuant thereto.“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of investigationand remediation, fines, penalties or indemnities), of the Loan Parties or any Subsidiary directly or indirectly resulting from or based upon(a) noncompliance with any Environmental Law including any failure to obtain, maintain or comply with any Environmental Permit, (b) thegeneration, use, handling, transportation, storage or treatment of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) theRelease or threatened Release of any Hazardous Materials or (e) any contract or agreement to the extent pursuant to which liability isassumed or imposed with respect to any of the foregoing.“ Environmental Permit ” means any permit, approval, identification number, license or other authorization required under anyEnvironmental Law.“ Equity Contribution ” means equity contributions (including, without limitation, the contribution of Holdings’ Equity Interests inTaxACT) or, in the case of Rollover Equity, exchanges (including Equity Interests issued by Baseball to certain existing managementshareholders of HDV Holdings (collectively, “ Rollover Equity ”)) in the form of (i) common equity or preferred equity or convertiblepreferred equity that are not Disqualified Equity Interests, in each case having customary provisions reasonably satisfactory to theAdministrative Agent or (ii) other Equity Interests having terms reasonably acceptable to the Lead Arranger, in each case (other than in thecase of Rollover Equity and the contribution of Holdings’ Equity Interests in TaxACT) made in cash directly or indirectly to Holdings byParent and further contributed directly or indirectly to Borrowers, and in an aggregate amount not less than $186,000,000); provided that, onthe Closing Date, (A) Parent shall own directly, beneficially and of record, 100% of the issued and outstanding Equity Interests of Holdings,(B) Holdings shall own directly, beneficially and of record, (1) 100% of the issued and outstanding Equity Interests of TaxACT or (2) at least95% of the issued and outstanding Equity Interests of Baseball; (C) Baseball shall own, directly, beneficially and of record, 100% of theissued and outstanding Equity Interests of either HDV Holdings or HD Vest; and (D) HDV Holdings shall own, directly, beneficially and ofrecord, 100% of the issued and outstanding Equity Interests of HD Vest.“ Equity Interests ” means, with respect to any Person, all of the shares, interests, rights, participations or other equivalents (howeverdesignated) of capital stock of (or other ownership or profit interests or units in) such Person and all of the warrants, options or other rightsfor the purchase, acquisition or exchange from such Person of any of the foregoing (including through convertible securities); provided , thatany instrument evidencing Indebtedness convertible or exchangeable for Equity Interests shall not be deemed to be Equity Interests unlessand until such instrument is so converted or exchanged.“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time.“ ERISA Affiliate ” means any trade or business (whether or not incorporated) that is under common control with a Loan Party orany Restricted Subsidiary within the meaning of Section 414(b) or (c) of the Code or Section 4001 of ERISA (and Sections 414(m) and (o) ofthe Code for purposes of provisions relating to Section 412 of the Code).“ ERISA Event ” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by a Loan Party, any RestrictedSubsidiary or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a “substantialemployer” (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e)of ERISA; (c) a complete or partial withdrawal by a Loan Party, any Restricted Subsidiary or any ERISA Affiliate from a MultiemployerPlan or notification that a Multiemployer Plan is in reorganization (within the meaning of Section 4241 of ERISA) or insolvent (within themeaning of Section 4245 of ERISA) or in “endangered” or “critical” status (within the meaning of Section 432 of the Code or Section 305 ofERISA); (d) a determination that any Pension Plan is in “at risk” status (within the meaning of Section 430 of the Code or Section 303 ofERISA); (e) the filing of a notice of intent to terminate, the treatment of a Pension Plan or Multiemployer Plan amendment as a terminationunder Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or MultiemployerPlan; (f) an event or condition which constitutes grounds under Section 4042 of ERISA for, and that would reasonably be expected to resultin, the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (g) with respect to a PensionPlan, the failure to satisfy the minimum funding standard of Sections 412 or 430 of the Code or Sections 302 or 303 of ERISA, whether or notwaived, or the filing, pursuant to Section 412(c) of the Code or Section 302(c) of ERISA, of an application for the waiver of the minimumfunding standard with respect to any Pension Plan; (h) a failure by a Loan Party, any Restricted Subsidiary or any ERISA Affiliate to make arequired contribution to a Multiemployer Plan; (i) the occurrence of a nonexempt prohibited transaction (within the meaning of Section 4975of the Code or Section 406 of ERISA) which would result in liability to a Loan Party or any Restricted Subsidiary; (j) the imposition of anyliability under Title IV of ERISA, other than for PBGC premiums due under Section 4007 of ERISA, upon a Loan Party, any RestrictedSubsidiary or any ERISA Affiliate; (k) the imposition of a Lien pursuant to Section 430(k) of the Code or pursuant to ERISA with respect toany Pension Plan; or (l) any condition that constitutes grounds for the revocation by the IRS of the qualified or tax-exempt status of any Planor any trust thereunder that is intended to qualify for tax exempt status under Section 401 or 501 of the Code.10 “ Eurodollar Rate ” means:(a) for any Interest Period with respect to a Eurodollar Rate Loan, the rate per annum determined by the AdministrativeAgent at approximately 11:00 a.m. (London time) on the date that is two Business Days prior to the commencement of such InterestPeriod by reference to the interest settlement rates for deposits in Dollars appearing on Reuters Screen LIBOR01 Page (or otherwiseon the Reuters screen) (the “ Published LIBOR Rate ”) for a period equal to such Interest Period; provided that, to the extent that aninterest rate is not ascertainable pursuant to the foregoing provisions of this definition, the “Eurodollar Rate” shall be the InterpolatedRate;(b) for any interest calculation with respect to an ABR Loan on any date, the rate per annum determined by theAdministrative Agent at approximately 11:00 a.m. (London time) on such date by reference to the Published LIBOR Rate for depositsin Dollars with a term of one month; provided that, to the extent that an interest rate is not ascertainable pursuant to the foregoingprovisions of this definition, the “Eurodollar Rate” shall be the Interpolated Rate;in the case of each of clause (a) and (b) above, multiplied by Statutory Reserves; provided that if the Eurodollar Rate shall be less than 0%,such rate shall be deemed to be 0% for purposes of this Agreement; provided further that notwithstanding the foregoing, the Eurodollar Rate(before giving effect to any adjustment for Statutory Reserves) shall, in respect of Initial Term Loans only, be deemed not to be less than1.00% per annum at any time.“ Eurodollar Rate Loan ” means a Loan that bears interest at a rate based on clause (a) of the definition of “Eurodollar Rate.”Eurodollar Rate Loans shall be denominated in Dollars.“ Event of Default ” has the meaning set forth in Section 8.01 .11 “ Excess Cash Flow ” means, for any period, an amount equal to:(a) the sum, without duplication, of:(i) Consolidated Net Income for such period,(ii) an amount equal to the amount of all non-cash charges (including depreciation and amortization) to the extentdeducted in arriving at such Consolidated Net Income (except to the extent that such non-cash charges represent an accrual orreserve for potential cash charges to be taken in any future period and not included in Consolidated Working Capital ) ,(iii) decreases in Consolidated Working Capital for such period,(iv) an amount equal to the aggregate net non-cash loss on Dispositions by the Consolidated Parties during suchperiod (other than sales in the ordinary course of business) to the extent deducted in arriving at such Consolidated NetIncome,(v) expenses deducted from Consolidated Net Income during such period in respect of expenditures made duringany prior period for which a deduction from Excess Cash Flow was made in such period pursuant to clause (b)(x) or (xi)below,(vi) cash income or gain (actually received in cash) excluded from the calculation of Consolidated Net Income forsuch period pursuant to the definition thereof, and(vii) the amount of tax expense deducted from Consolidated Net Income in such period (including penalties andinterest or tax reserves) paid for such period, minus(b) the sum (in each case, to the extent not deducted in calculating Consolidated Net Income), without duplication, of:(i) an amount equal to the amount of all non-cash credits included in arriving at such Consolidated Net Income, andcash charges included in the definition of “Consolidated Net Income,”(ii) the amount of Capital Expenditures or acquisitions of intellectual property permitted hereunder to the extent(A) not expensed or accrued during such period and (B) such Capital Expenditures or acquisitions were financed withInternally Generated Cash,(iii) to the extent financed with Internally Generated Cash, the aggregate amount of all principal payments ofIndebtedness of the Consolidated Parties (including (A) the principal component of payments in respect of Capitalized Leasesand (B) the amount of any scheduled repayment of Initial Term Loans pursuant to Section 2.07 , Extended Term Loans,Refinancing Term Loans, Incremental Term Loans or Replacement Term Loans and any mandatory prepayment of TermLoans pursuant to Section 2.05(b)(ii) to the extent required due to a Disposition that resulted in an increase to ConsolidatedNet Income and not in excess of the lesser of (1) the amount of such increase and (2) the Net Proceeds of such Disposition,but in each case excluding (X) all other voluntary prepayments of Term Loans, (Y) all prepayments or repayments in respectof any revolving credit facility and (Z) the Refinancing, unless accompanied by a permanent reduction of the relatedcommitments),(iv) an amount equal to the aggregate net non-cash gain on Dispositions by the Consolidated Parties during suchperiod (other than Dispositions in the ordinary course of business) to the extent included in arriving at such Consolidated NetIncome,(v) increases in Consolidated Working Capital for such period,(vi) the amount of Permitted Acquisitions made during such period pursuant to Section 7.02(i) to the extentfinanced with Internally Generated Cash,(vii) the amount of Restricted Payments paid during such period pursuant to Section 7.06(f) and (g) , in each case,to the extent financed with Internally Generated Cash,(viii) the aggregate amount of any premium, make-whole or penalty payments actually paid in cash by theConsolidated Parties during such period that are required to be made in connection with any prepayment of Indebtedness tothe extent that such payments are not expensed during such period or any previous period, in each case to the extent financedwith Internally Generated Cash,(ix) the amount of cash taxes (including penalties and interest or tax reserves) actually paid or currently payable byParent with respect to such period and attributable to the Consolidated Net Income of the Consolidated Parties,(x) cash expenditures in respect of Swap Contracts during such period to the extent not deducted in arriving at suchConsolidated Net Income, and(xi) reimbursable or insured expenses incurred during such fiscal year to the extent that such reimbursement hasnot yet been received and to the extent not deducted in arriving at such Consolidated Net Income (in which case therespective reimbursement shall increase Excess Cash Flow in the period in which it is received).Notwithstanding anything in the definition of any term used in the definition of “Excess Cash Flow” to the contrary, all componentsof Excess Cash Flow shall be computed for the Consolidated Parties on a consolidated basis.“ Excess Cash Flow Period ” means each fiscal year of Holdings commencing with and including the fiscal year ending December31, 2016.“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.“ Excluded Assets ” means (i) any fee owned real property (other than Material Real Properties) and any leasehold rights andinterests in real property (including landlord waivers, estoppels and collateral access letters), (ii) motor vehicles, airplanes and other assetssubject to certificates of title to the extent perfection of the security interest in such assets cannot be accomplished by the filing of a UCCfinancing statement (or equivalent), (iii) any lease, license or other agreement or any property subject to a purchase money security interest,capital lease obligation or similar arrangements, in each case to the extent permitted under the Loan Documents, to the extent that a grant of asecurity interest therein would violate or invalidate such lease, license or agreement, purchase money, capital lease or a similar arrangementor create a right of termination in favor of any other party thereto (other than Holdings or any Affiliate), in each case, after giving effect to theapplicable anti-assignment provisions of the UCC or other applicable Law and any consents that have otherwise been obtained, but excludingthe proceeds and receivables thereof, the assignment of which is expressly deemed effective under applicable Law notwithstanding suchprohibition, provided that the limitations on pledges or security interests in this clause (iii) shall (a) not apply to the extent any such limitationis contained in any agreement that relates to Credit Agreement Refinancing Indebtedness and (b) only apply to the extent that such limitationis otherwise permitted under Section 7.09 , (iv) any lease, license, permit, property or agreement to the extent that a grant of a security interesttherein is prohibited by applicable Law (including restrictions in respect of margin stock and financial assistance, fraudulent conveyance,preference, thin capitalization or other similar laws or regulations), or any governmental licenses or state or local franchises, charters andauthorizations, other than to the extent such prohibition is rendered ineffective under the UCC or other applicable Law notwithstanding suchprohibition, or requires governmental or third party consents required pursuant to applicable Law that have not been obtained, (v) to theextent not permitted (after the Borrowers’ use of commercially reasonable efforts to provide such Collateral) by the terms of such Person’sorganizational or joint venture documents (except to the extent such prohibition is rendered ineffective after giving effect to applicable anti-assignment provisions of the UCC, other than the proceeds and receivables thereof the assignment of which is expressly deemed effectiveunder the UCC notwithstanding such prohibition or restriction), Equity Interests and Margin Stock in any Person other than wholly-ownedRestricted Subsidiaries of either Borrower, (vi) any property or assets to the extent that the creation or perfection of pledges of, or securityinterests in, such property or assets results in material adverse tax consequences to the Borrowers, as reasonably determined by the BorrowerRepresentative and the Administrative Agent, (vii) any property subject to a Lien permitted by Section 7.01(u) , (w) or (aa) (to the extentrelating to a Lien originally incurred pursuant to Section 7.01(u) or (w) ) to the extent that the granting of a security interest in such propertywould be prohibited under the terms of the Indebtedness secured thereby after giving effect to the applicable anti-assignment provisions of theUCC, other than the proceeds and receivables thereof the assignment of which is expressly deemed effective under the UCC notwithstandingsuch prohibition or restriction, (viii) any intent-to-use trademark application prior to the filing of a “Statement of Use” or “Amendment toAllege Use” with respect thereto, to the extent, if any, that, and solely during the period, if any, in which the grant of a security interesttherein would impair the validity or enforceability of such intent-to-use trademark application under applicable federal law, (ix) particularassets if and for so long as, if the Administrative Agent reasonably determines in consultation with the Borrower Representative that the costsof creating or perfecting such pledges or security interests in such assets or obtaining title insurance, surveys, abstracts or appraisals in respectof such assets are excessive in relation to the benefits to be obtained by the Lenders therefrom, (x) assets owned by Excluded Subsidiaries,(xi) 35% of the voting stock of any first-tier wholly-owned CFC or CFC Holding Company, (xii) Equity Interests of Excluded PledgedSubsidiaries, (xiii) any asset or right under any contract, in each case to the extent that the Collateral Agent may not validly possess a securityinterest therein under applicable Law or the creation of a security interest in such property would require consent, approval, license orauthority from a Person other than the Parent or any of its Subsidiaries or Affiliates, including any Governmental Authority, that has nototherwise been obtained, except, in each case, to the extent such requirement is rendered inapplicable under the UCC or other Law, including,to the extent applicable, any contract rights of any Restricted Subsidiary of the Borrowers acquired or created after the Closing Date that is (i)an “investment adviser,” within the meaning of the US Investment Advisers Act of 1940 that is registered or required to be registeredthereunder; and/or (ii) a "broker" or "dealer" within the meaning of the Exchange Act that is registered or required to be registered under theExchange Act and (xiv) to the extent used exclusively to hold funds in trust for the benefit of third parties, (A) payroll, payroll, healthcare andother employee wage and benefit accounts, (B) tax accounts, including, without limitation, sales tax accounts, (C) escrow, defeasance andredemption accounts and (D) fiduciary or trust accounts and, in the case of clauses (A) through (D) , the funds or other property held in ormaintained in any such account ; provided , however , that Excluded Assets shall not include any Proceeds, substitutions or replacements ofany Excluded Assets referred to in clauses (i) through (xiv) (unless such Proceeds, substitutions or replacements would independentlyconstitute Excluded Assets referred to in clauses (i) through (xiv) ). For avoidance of doubt, any asset or right under any contract, in each caseto the extent that the Collateral Agent may not validly possess a security interest therein under applicable Law or the creation of a securityinterest in such property would require consent, approval, license or authority from a Person other than Parent or any of its Subsidiaries orAffiliates, including any Governmental Authority, except, in each case, to the extent such requirement is rendered inapplicable under theUCC or other Laws, including, for the avoidance of doubt, any contract rights of the BD Subsidiary and any other Subsidiary of Holdings thatis registered as a broker-dealer under the Exchange Act. For the avoidance of doubt, no Equity Interests of either Borrower, the BDSubsidiary, the Advisory Services Company or any Holding Company shall constitute Excluded Assets.“ Excluded Pledged Subsidiary ” means (a) any Subsidiary for which the pledge of its Equity Interests is prohibited by applicableLaw or for which governmental (including regulatory) consent, approval, license or authorization would be required unless such consent,approval, license or authorization has been received and (b) any Unrestricted Subsidiary. For the avoidance of doubt, no Borrower or HoldingCompany shall be an Excluded Pledged Subsidiary.“ Excluded Subsidiary ” means (a) any Subsidiary of either Borrower that is not a wholly-owned Domestic Subsidiary, (b) anySubsidiary that is prohibited by applicable Law (including financial assistance, fraudulent conveyance, preference, capitalization or othersimilar laws and regulations) or contractual obligation existing at the time of acquisition thereof after the Closing Date (but only if thecontractual prohibition is not created in contemplation of the Closing Date or such acquisition and, in any event, only for so long as suchprohibition continues to exist), in each case, from guaranteeing the Obligations or if guaranteeing the Obligations would require governmental(including regulatory) consent, approval, license or authorization that has not otherwise been delivered, (c) any Unrestricted Subsidiaries, (d)any Foreign Subsidiary that is a CFC, (e) any direct or indirect Subsidiary substantially all the assets of which consist of the Equity Interestsof one or more Foreign Subsidiaries that are CFCs (“ CFC Holding Company ”), (f) any Domestic Subsidiary of a Foreign Subsidiary that isa CFC, (g) the BD Subsidiary and any other Subsidiary of Holdings that is registered as a broker-dealer under the Exchange Act and (h) anyother Restricted Subsidiary to the extent that the burden or cost of obtaining a guarantee of the Obligations is excessive in comparison to thebenefit to the Lenders afforded thereby, as reasonably determined by the Administrative Agent in consultations with the BorrowerRepresentative. For the avoidance of doubt, none of the Borrowers, the Advisory Services Subsidiary or any Holding Company shall be anExcluded Subsidiary.“ Excluded Swap Obligation ” means, with respect to any Guarantor, any obligation to pay or perform under any agreement,contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act (a “ Swap Obligation”), if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest tosecure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal or unlawful under the Commodity Exchange Act or any rule,regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue ofsuch Guarantor's failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and theregulations thereunder at the time the Guarantee of such Guarantor or the grant of such security interest would otherwise have becomeeffective with respect to such related Swap Obligation but for such Guarantor’s failure to constitute an “eligible contract participant” at suchtime. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion ofsuch Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal or unlawful under theCommodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or officialinterpretation of any thereof).“ Executive Order ” means Executive Order 13224 signed on September 23, 2001.“ Existing Credit Facility ” means (a) the Amended and Restated Term Loan Agreement, dated as of March 17, 2015 among HDVHoldings, HDVest, certain Subsidiaries of HDV Holdings, the other guarantors party thereto, the lenders party thereto and LBC CreditPartners III, LP, as administrative agent, (b) the Amended and Restated Revolving Credit and Term Loan Agreement, dated as of March 17,2015 among HDV Holdings, HDVest, certain Subsidiaries of HDV Holdings, the other guarantors party thereto, the lenders party thereto andMadison Capital Funding LLC, as administrative agent, and (c) the Credit Agreement, dated as of August 30, 2013, among TaxACT, theother guarantors party thereto, the lenders party thereto and Wells Fargo Bank, N.A., as administrative agent.“ Existing Revolver Tranche ” has the meaning set forth in Section 2.16(b) .“ Existing Term Loan Tranche ” has the meaning set forth in Section 2.16(a) .“ Extended Revolving Credit Commitments ” has the meaning set forth in Section 2.16(b) .“ Extending Revolving Credit Lender ” has the meaning set forth in Section 2.16(c) .“ Extended Revolving Credit Loans ” means one or more Classes of Revolving Credit Loans that result from an ExtensionAmendment.“ Extended Term Loans ” has the meaning set forth in Section 2.16(a) .“ Extending Term Lender ” has the meaning set forth in Section 2.16(c) .“ Extension ” means the establishment of an Extension Series by amending a Loan pursuant to the terms of Section 2.16 and theapplicable Extension Amendment.“ Extension Amendment ” has the meaning set forth in Section 2.16(d) .“ Extension Election ” has the meaning set forth in Section 2.16(c) .“ Extension Request ” means any Term Loan Extension Request or a Revolver Extension Request, as the case may be.“ Extension Series ” means any Term Loan Extension Series or a Revolver Extension Series, as the case may be.“ Facility ” means the Revolving Credit Facility, a given Extension Series of Extended Revolving Credit Commitments, a givenRefinancing Series of Refinancing Revolving Credit Loans, the Term Facility, a given Extension Series of Extended Term Loans, a givenClass of Incremental Term Loans or a given Refinancing Series of Refinancing Term Loans, as the context may require.“ FATCA ” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor versionthat is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretationsthereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.“ Federal Funds Rate ” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal fundstransactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the FederalReserve Bank on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate forsuch day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day,and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate(rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to the Administrative Agent on such day on such transactions asdetermined by the Administrative Agent.“ Fee Letter ” means the Fee Letter, dated October 14, 2015, among Parent, the Lead Arranger, and the Affiliates of the LeadArranger party thereto.“ FINRA ” shall mean the Financial Industry Regulatory Authority, including any successor agency thereto.“ FIRREA ” means the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended.“ Flood Insurance Laws ” means, collectively, (i) the National Flood Insurance Act of 1968 as now or hereafter in effect or anysuccessor statute thereto, (ii) the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statue thereto, (iii) theNational Flood Insurance Reform Act of 1994 as now or hereafter in effect or any successor statute thereto and (iv) the Flood InsuranceReform Act of 2004 as now or hereafter in effect or any successor statute thereto.“Foreign Pension Plan” means a registered pension plan which is subject to applicable pension legislation other than ERISA or theCode, which a Loan Party or Restricted Subsidiary sponsors or maintains, or to which it makes or is obligated to make contributions.“Foreign Plan” means each Foreign Pension Plan, deferred compensation or other retirement or superannuation plan, fund, program,agreement, commitment or arrangement (as amended, waived, supplemented, renewed or otherwise modified from time to time) whether oralor written, funded or unfunded, sponsored, established, maintained or contributed to, or required to be contributed to, or with respect to whichany liability is borne, outside the United States of America, by any Loan Party or Restricted Subsidiary, other than any such plan, fund,program, agreement or arrangement sponsored by a Governmental Authority.“ Foreign Subsidiary ” means any direct or indirect Restricted Subsidiary of a Borrower which is not a Domestic Subsidiary.“ Fraudulent Transfer Laws ” has the meaning set forth in Section 11.12 .“ Fronting Exposure ” means, at any time there is a Defaulting Lender, (a) with respect to the L/C Issuers, such Defaulting Lender’sPro Rata Share of the outstanding L/C Obligations other than L/C Obligations as to which such Defaulting Lender’s participation obligationhas been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof and (b) with respect to the Swing LineLender, such Defaulting Lender’s Pro Rata Share of Swing Line Loans other than Swing Line Loans as to which such Defaulting Lender’sparticipation obligation has been reallocated to other Lenders in accordance with the terms hereof.“ Fund ” means any Person (other than a natural person) that is engaged in making, purchasing, holding or otherwise investing incommercial loans and similar extensions of credit in the ordinary course.“ GAAP ” means generally accepted accounting principles in the United States of America, as in effect from time to time; provided ,however , that, subject to Section 1.03 , if the Borrower Representative notifies the Administrative Agent that it requests an amendment to anyprovision hereof to eliminate the effect of any change occurring after the Closing Date in GAAP or in the application thereof on the operationof such provision (or if the Administrative Agent notifies the Borrower Representative that the Required Lenders request an amendment toany provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in theapplication thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such changeshall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith.“ Governmental Authority ” means any nation or government, any state or other political subdivision thereof, any agency, authority,instrumentality, regulatory body, court, administrative tribunal, central bank or other entity exercising executive, legislative, judicial, taxing,regulatory or administrative powers or functions of or pertaining to government (including any supra-national body exercising such powers orfunctions, such as the European Union or the European Central Bank).“ Granting Lender ” has the meaning set forth in Section 10.07(h) .“ Guarantee ” means, as to any Person, without duplication, any obligation, contingent or otherwise, of such Person guaranteeing orhaving the economic effect of guaranteeing any Indebtedness by another Person (the “ primary obligor ”) in any manner, whether directly orindirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchaseor payment of) such Indebtedness, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect ofsuch Indebtedness of the payment or performance of such Indebtedness, (iii) to maintain working capital, equity capital or any other financialstatement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay suchIndebtedness or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness of the paymentor performance thereof or to protect such obligee against loss in respect thereof (in whole or in part). The amount of any Guarantee shall bedeemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of whichsuch Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by theguaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.“ Guaranteed Obligations ” has the meaning set forth in Section 11.01 .“ Guarantors ” has the meaning set forth in the definition of “Collateral and Guarantee Requirement” and shall include each HoldingCompany, each Borrower, each Subsidiary Guarantor and each other Restricted Subsidiary that shall have become a Guarantor pursuant toSection 6.11 . For the avoidance of doubt, Holdings in its sole discretion may cause any Restricted Subsidiary that is not a Guarantor toGuarantee the Obligations by causing such Restricted Subsidiary to execute a joinder to this Agreement in form and substance reasonablysatisfactory to the Administrative Agent, and any such Restricted Subsidiary shall be a Guarantor, Loan Party and Subsidiary Guarantorhereunder for all purposes.“ Guaranty ” means, collectively, the guaranty of the Obligations by the Guarantors pursuant to this Agreement.“ Hazardous Materials ” means all materials, substances or wastes, all pollutants or contaminants, in any form, including petroleumor petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas and toxic mold that are regulatedpursuant to, or which could give rise to liability under, applicable Environmental Law.“ Holding Company ” means each of Holdings, Baseball and HDV Holdings.“ Holdings ” has the meaning set forth in the introductory paragraph to this Agreement.“ Honor Date ” has the meaning set forth in Section 2.03(c)(i) .“ Immaterial Subsidiary” means any direct or indirect Subsidiary of a Borrower which is not a Material Domestic Subsidiary orMaterial Foreign Subsidiary.“ Incremental Amendment ” has the meaning set forth in Section 2.14(f) .“ Incremental Commitments ” has the meaning set forth in Section 2.14(a) .“ Incremental Facility Closing Date ” has the meaning set forth in Section 2.14(d) .“ Incremental Lenders ” has the meaning set forth in Section 2.14(c) .“ Incremental Loan ” has the meaning set forth in Section 2.14(b) .“ Incremental Request ” has the meaning set forth in Section 2.14(a) .“ Incremental Revolving Credit Lender ” has the meaning set forth in Section 2.14(c) .“ Incremental Revolving Loan ” has the meaning set forth in Section 2.14(b) .“ Incremental Term Commitments ” has the meaning set forth in Section 2.14(a) .“ Incremental Term Lender ” has the meaning set forth in Section 2.14(c) .“ Incremental Term Loan ” has the meaning set forth in Section 2.14(b) .12 “ Indebtedness ” means, as to any Person at a particular time, without duplication, all of the following:(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures,notes, loan agreements or other similar instruments;(b) the maximum amount (after giving effect to any prior drawings or reductions which may have been reimbursed) of alloutstanding letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds, performancebonds and similar instruments issued or created by or for the account of such Person;(c) net obligations of such Person under any Swap Contract to the extent required to be reflected on a balance sheet of suchPerson;(d) all obligations of such Person to pay the deferred purchase price of property or services;(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by suchPerson (including indebtedness arising under conditional sales or other title retention agreements and mortgage, industrial revenuebond, industrial development bond and similar financings), whether or not such indebtedness shall have been assumed by such Personor is limited in recourse;(f) all Attributable Indebtedness;(g) all obligations of such Person in respect of Disqualified Equity Interests if and to the extent that the foregoing wouldconstitute indebtedness or a liability in accordance with GAAP; and(h) to the extent not otherwise included above, all Guarantees of such Person in respect of Indebtedness described inclauses (a) through (g) in respect of any of the foregoing.For all purposes hereof, the Indebtedness of any Person shall (A) include the Indebtedness of any partnership or joint venture (otherthan a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner, except to the extentsuch Person’s liability for such Indebtedness is otherwise limited, (B) in the case of the Consolidated Parties, exclude all intercompanyIndebtedness having a term not exceeding 364 days (inclusive of any roll-over or extensions of terms) and made in the ordinary course ofbusiness (other than, with respect to Indebtedness of Consolidated Parties, intercompany Indebtedness owing by any Consolidated Party toany Unrestricted Subsidiary) and (C) exclude (i) trade accounts and accrued expenses payable in the ordinary course of business, (ii) anyearn-out obligation, contingent post-closing purchase price adjustments or indemnification payments in connection with any PermittedAcquisition or permitted Investment, any acquisition consummated prior to the Closing Date or any permitted Disposition, unless suchobligation is not paid after becoming due and payable, (iii) accruals for payroll and other liabilities accrued in the ordinary course of businessand (iv) purchase price holdbacks in respect of a portion of the purchase price of an asset to satisfy warranty or other unperformed obligationsof the respective seller . The amount of any net obligation under any Swap Contract on any date shall be deemed to be the Swap TerminationValue thereof as of such date. The amount of Indebtedness of any Person for purposes of clause (e) shall be equal to the lesser of (x) theaggregate unpaid amount thereof and (y) the fair market value of any assets of such Person securing such Indebtedness or to which suchIndebtedness otherwise has recourse.“ Indemnified Taxes ” means, with respect to any Agent or any Lender, (A) all Taxes imposed on or with respect to payments underthe Loan Documents other than (i) any Taxes imposed on or measured by its net income, however denominated, franchise (and similar) Taxesimposed in lieu of net income Taxes, and branch profits (or similar) Taxes, in each case imposed by a jurisdiction as a result of such recipientbeing organized in or having its principal office or applicable lending office in such jurisdiction, or as a result of any present or formerconnection between such Lender or Agent and such jurisdiction other than any connections arising solely from executing, delivering, being aparty to, performing its obligations under, receiving payments under, or enforcing, any Loan Document, (ii) any Taxes attributable to thefailure of such Agent or Lender to deliver the documentation required to be delivered pursuant to Section 3.01(d) , (iii) in the case of a Lender(other than an assignee pursuant to a request by the Borrower Representative under Section 3.07(a) ), any U.S. withholding Tax that is ineffect and would apply to amounts payable hereunder under the law applicable on the date on which the Lender becomes a party to thisAgreement or acquires an applicable interest in the Loan, or designates a new Lending Office, except to the extent such Lender (or itsassignor, if any) was entitled, immediately prior to the time of designation of a new Lending Office (or assignment), to receive additionalamounts from the Borrowers or any Guarantor with respect to such withholding Tax pursuant to Section 3.01 , and (iv) any U.S. federalTaxes imposed under FATCA, and (B) to the extent not otherwise described in clause (A), Other Taxes.“ Indemnitees ” has the meaning set forth in Section 10.05 .“ Independent Financial Advisor ” means an accounting, appraisal, investment banking firm or consultant of nationally recognizedstanding that is, in the good faith judgment of the Borrower Representative, qualified to perform the task for which it has been engaged andthat is independent of Holdings and its Affiliates.“ Information ” has the meaning set forth in Section 10.08 .“ Initial Term Commitment ” means, as to each Term Lender, its obligation to make an Initial Term Loan to the Borrowers pursuantto Section 2.01(a) in an aggregate amount not to exceed the amount set forth opposite such Lender’s name on Schedule 1.01 under the caption“Initial Term Commitment” or in the Assignment and Assumption pursuant to which such Term Lender becomes a party hereto, asapplicable, as such amount may be adjusted from time to time in accordance with this Agreement (including Section 2.14 ). The aggregateamount of the Initial Term Commitments is $400,000,000.“ Initial Term Loans ” means the term loans made by the Lenders on the Closing Date to the Borrowers pursuant to Section 2.01(a) .“ Intellectual Property Security Agreement ” has the meaning set forth in the Security Agreement.“ Intercompany Note ” means a promissory note substantially in the form of Exhibit G .“ Interest Payment Date ” means, (a) as to any Eurodollar Rate Loan, the last day of each Interest Period applicable to such Loanand the Maturity Date of the Facility under which such Loan was made; provided that if any Interest Period for a Eurodollar Rate Loanexceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be InterestPayment Dates and (b) as to any ABR Loan (including a Swing Line Loan), the last Business Day of each March, June, September andDecember and the Maturity Date of the Facility under which such Loan was made.13 “ Interest Period ” means, as to each Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan isdisbursed or converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months thereafter or, to theextent agreed by each Lender of such Eurodollar Rate Loan, 12 months, as selected by a Borrower in its Committed Loan Notice; providedthat:(a) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the nextsucceeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end onthe next preceding Business Day;(b) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is nonumerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of thecalendar month at the end of such Interest Period;(c) the initial Interest Period following the Closing Date shall be for one month; and(d) no Interest Period shall extend beyond the applicable Maturity Date.“ Internally Generated Cash ” means, with respect to any Person, funds of such Person and its Subsidiaries to the extent not (i)constituting (x) proceeds of the issuance of (or contributions in respect of) Equity Interests of such Person, (y) proceeds of the incurrence ofIndebtedness by such Person or any of its Subsidiaries (other than under any revolving credit facility or line of credit) or (z) proceeds ofDispositions and Casualty Events or (ii) used for any purpose that would require the utilization of the Available Amount.“ Interpolated Rate ” means, at any time, the rate per annum determined by the Administrative Agent (which determination shall beconclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the rate asdisplayed on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in the event such rate does not appear on aReuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such otherinformation service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; in eachcase the “Screen Rate”) for the longest period (for which that Screen Rate is available in Dollars) that is shorter than the Interest Period and(b) the Screen Rate for the shortest period (for which that Screen Rate is available for Dollars) that exceeds the Interest Period, in each case,as of approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period; provided that if theInterpolated Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.“ Investment ” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) thepurchase or other acquisition of Equity Interests or debt or other securities of another Person, (b) a loan, advance or capital contribution to,Guarantee or assumption of Indebtedness of, or purchase or other acquisition of any other debt or equity participation or interest in, anotherPerson, including any partnership or joint venture interest in such other Person or (c) the purchase or other acquisition (in one transaction or aseries of transactions) of all or substantially all of the property and assets or business of another Person or assets constituting a business unit,line of business or division of such Person. For purposes of covenant compliance, the amount of any Investment at any time shall be theamount actually invested (measured at the time made), without adjustment for subsequent increases or decreases in the value of suchInvestment.“ Investment Adviser ” means Persons who are engaged by HDVest or its Subsidiaries and who are: (a) investment advisersregistered under the Investment Advisers Act or are supervised persons of, or persons associated with, an investment adviser (in each case asdefined in the Investment Advisers Act); and/or (b) are broker-dealers registered under the Exchange Act (or associated persons thereof, asdefined in the Exchange Act).“ Investment Advisers Act ” means the United States Investment Advisers Act of 1940, as amended, and the rules and regulationspromulgated thereunder.“ IP Rights ” has the meaning set forth in Section 5.15 .“ IRS ” means the U.S. Internal Revenue Service (or any successor agency).“ ISP ” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute ofInternational Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).“ Issuer Documents ” means with respect to any Letter of Credit, the Letter of Credit Application, and any other document,agreement and instrument entered into by the applicable L/C Issuer, the applicable Borrower (or any Subsidiary) or in favor of such L/CIssuer and relating to such Letter of Credit.“ Junior Financing ” has the meaning set forth in Section 7.13(a) .“ Junior Financing Documentation ” means any documentation governing any Junior Financing.“ Latest Maturity Date ” means, at any date of determination, the latest Maturity Date applicable to any Loan or Commitmenthereunder at such time, including the latest maturity date of any Extended Revolving Credit Commitments, Refinancing Revolving CreditCommitments, Extended Term Loans, Incremental Term Loans, Refinancing Term Loans, Replacement Term Loans and Refinancing TermCommitments, in each case as extended in accordance with this Agreement from time to time.“ Laws ” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, legally binding guidelines,regulations, ordinances, codes and administrative or judicial precedents or authorities, including the legally binding interpretation oradministration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and allapplicable administrative orders, directed duties, legally binding requests, licenses, authorizations and permits of, and agreements with, anyGovernmental Authority.“ L/C Advance ” means, with respect to each Revolving Credit Lender, such Lender’s funding of its participation in any L/CBorrowing in accordance with its Pro Rata Share or other applicable share provided for under this Agreement. All L/C Advances shall bedenominated in Dollars.“ L/C Borrowing ” means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursedon the applicable Honor Date or refinanced as a Revolving Credit Borrowing. All L/C Borrowings shall be denominated in Dollars.“ L/C Credit Extension ” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, orthe renewal or increase of the amount thereof.“ L/C Fronting Fee ” has the meaning set forth in Section 2.03(i) .“ L/C Issuer ” means Bank of Montreal (directly or through its Affiliates) and any other Lender that becomes an L/C Issuer inaccordance with Section 2.03(k) or 10.07(j) , in each case, in its capacity as an issuer of Letters of Credit hereunder, or any successor issuer ofLetters of Credit hereunder. If there is more than one L/C Issuer at any given time, the term L/C Issuer shall refer to the relevant L/CIssuer(s).“ L/C Obligations ” means, as at any date of determination, the aggregate amount available to be drawn under all outstanding Lettersof Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of computing the amount available tobe drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.10 . For allpurposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawnthereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount soremaining available to be drawn.“ LCT Election ” has the meaning set forth in Section 1.08 .“ LCT Test Date ” has the meaning set forth in Section 1.08 .“ Lead Arranger ” means BMO Capital Markets Corp.“ Lender ” has the meaning set forth in the introductory paragraph to this Agreement and, as the context requires, includes the SwingLine Lender, the L/C Issuers and each Additional Lender and Additional Refinancing Lender that becomes a Lender in accordance with theterms hereof, and their respective successors and assigns as permitted hereunder, each of which is referred to herein as a “Lender.”“ Lending Office ” means, as to any Lender, such office or offices as a Lender may from time to time notify the BorrowerRepresentative and the Administrative Agent.“ Letter of Credit ” means any standby letter of credit issued hereunder.“ Letter of Credit Application ” means an application and agreement for the issuance or amendment of a Letter of Credit in the formfrom time to time in use by the relevant L/C Issuer.“ Letter of Credit Expiration Date ” means the day that is five (5) Business Days prior to the scheduled Maturity Date then in effectfor the applicable Revolving Credit Facility.“ Letter of Credit Sublimit ” means an amount equal to the lesser of (a) $5,000,000 (or such greater amount as may be agreed by theapplicable LC Issuer but in no event to exceed $10,000,000 in the aggregate) and (b) the aggregate amount of the Revolving CreditCommitments. The Letter of Credit Sublimit is part of, and not in addition to, the Revolving Credit Facility.“ Lien ” means any mortgage, pledge, hypothecation, collateral assignment, security deposit arrangement, encumbrance, lien(statutory or other), charge or other security interest of any kind or nature whatsoever (including any conditional sale or other title retentionagreement, any easement, right of way or other encumbrance on title to Real Property, and any Capitalized Lease having substantially thesame economic effect as any of the foregoing).“ Limited Condition Transaction ” has the meaning set forth in Section 2.14(d)(i) .“ Loan ” means an extension of credit under Article II by a Lender to any Borrower in the form of a Term Loan, a Revolving CreditLoan or a Swing Line Loan (including any Initial Term Loans, any Incremental Term Loans and any extensions of credit under anyRevolving Commitment Increase, any Extended Term Loans and any extensions of credit under any Extended Revolving CreditCommitment, any Refinancing Term Loans and any extensions of credit under any Refinancing Revolving Credit Commitment and anyReplacement Term Loans).“ Loan Documents ” means, collectively, (i) this Agreement (including the schedules hereto), (ii) the Notes, (iii) the CollateralDocuments, (iv) any Refinancing Amendment, Incremental Amendment or Extension Amendment, (v) each Letter of Credit Application and(vi) any amendment or joinder to this Agreement.“ Loan Parties ” means, collectively, the Borrowers and each Guarantor.“ London Banking Day ” means any day on which dealings in Dollar deposits are conducted by and between banks in the Londoninterbank eurodollar market.“ LTM EBITDA ” means, as of any date of determination, Consolidated EBITDA calculated on a trailing twelve-month basis as ofthe last day of the most recent Test Period ending prior to such date.“ Margin Stock ” shall have the meaning assigned to such term in Regulation U of the Board of Governors of the United StatesFederal Reserve System, or any successor thereto.“ Master Agreement ” shall have the meaning set forth in the definition of “Swap Contract.”“ Material Adverse Effect ” means a material adverse effect on (i) the business, condition (financial or otherwise), operations,performance, properties or prospects, in each case, of the Consolidated Parties, taken as a whole, (ii) the rights and remedies (taken as awhole) of the Administrative Agent hereunder or under the other Loan Documents or (iii) the ability of a Borrower or a Guarantor to performits payment obligations hereunder or under the other Loan Documents.“ Material Domestic Subsidiary ” means, at any date of determination, (a) each Holding Company and each Borrower and (b) eachof the Borrowers’ Domestic Subsidiaries that are Restricted Subsidiaries (i) whose total assets as of the last day of the most recently endedfiscal quarter of Parent for which financial statements have been delivered pursuant to Section 6.01(a) or (b) comprised in the aggregate morethan 5.0% of Total Assets as of such date or (ii) whose gross revenues for such fiscal quarter comprised more than 5.0% of the consolidatedgross revenues of the Consolidated Parties for such fiscal quarter. As of the Closing Date, all Domestic Subsidiaries of the Borrowers areMaterial Domestic Subsidiaries.“ Material Foreign Subsidiary ” means, at any date of determination, each of the Borrowers’ Foreign Subsidiaries that areRestricted Subsidiaries (a) whose total assets as of the last day of the most recently ended fiscal year of Parent for which financial statementshave been delivered pursuant to Section 6.01(a) comprised in the aggregate more than 5.0% of Total Assets as of such date or (b) whose grossrevenues for such fiscal year comprised more than 5.0% of the consolidated gross revenues of the Consolidated Parties for such fiscal year.As of the Closing Date, the Borrowers do not own, directly or indirectly, any Foreign Subsidiaries.“ Material Non-Public Information ” means information which is (a) not publicly available, (b) material with respect to theConsolidated Parties or their respective securities for purposes of United States federal and state securities laws and (c) of a type that wouldnot be publicly disclosed in connection with any issuance by any Consolidated Party of debt or equity securities issued pursuant to a publicoffering, a Rule 144A offering or other private placement where assisted by a placement agent.“ Material Real Property ” means any fee-owned real property located in the United States that is owned by any Loan Party and thathas a fair market value in excess of $2,500,000 (at the Closing Date or, with respect to real property acquired after the Closing Date, at thetime of acquisition, in each case, as reasonably estimated by Borrower Representative in good faith); provided that the value of all such fee-owned real property which is not Material Real Property shall not exceed $5,000,000 in the aggregate.“ Material Subsidiary ” means any Material Domestic Subsidiary or any Material Foreign Subsidiary.“ Maturity Date ” means (i) with respect to the Initial Term Loans, December 31, 2022; (ii) with respect to the Revolving CreditFacility, December 31, 2020; (iii) with respect to any tranche of Extended Term Loans or Extended Revolving Credit Commitments, the finalmaturity date as specified in the applicable Extension Amendment, (iv) with respect to any Incremental Term Loans, the final maturity date asspecified in the applicable Incremental Amendment, (v) with respect to any Refinancing Term Loans or Refinancing Revolving CreditCommitments, the final maturity date as specified in the applicable Refinancing Amendment, and (vi) with respect to any Replacement TermLoans, the final maturity date as specified in the applicable agreement; provided that, in each case, if such day is not a Business Day, theMaturity Date shall be the Business Day immediately succeeding such day.“ Maximum Rate ” has the meaning set forth in Section 10.10 .“ Moody’s ” means Moody’s Investors Service, Inc. and any successor thereto.“ Mortgage Policies ” has the meaning set forth in the definition of “Collateral and Guarantee Requirement.”“ Mortgaged Properties ” has the meaning set forth in the definition of “Collateral and Guarantee Requirement.”“ Mortgages ” means collectively, the deeds of trust, trust deeds, hypothecs and mortgages made by the Loan Parties in favor or forthe benefit of the Collateral Agent on behalf of the Secured Parties creating and evidencing a Lien on a Mortgaged Property in form andsubstance reasonably satisfactory to the Administrative Agent, and any other mortgages executed and delivered pursuant to Sections 6.11 and6.13 , in each case, as the same may from time to time be amended, restated, supplemented or otherwise modified.“ Multiemployer Plan ” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which a LoanParty, any Restricted Subsidiary or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding six plan years,has made or been obligated to make contributions.14 “ Net Proceeds ” means:(a) 100% of the cash proceeds actually received by any Consolidated Party (including any cash payments received by wayof deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise andincluding casualty insurance settlements and condemnation awards, but in each case only as and when received) from any Dispositionor Casualty Event, net of (i) attorneys’ fees, accountants’ fees, investment banking fees, survey costs, title insurance premiums, andrelated search and recording charges, transfer taxes, deed or mortgage recording taxes, other customary expenses and brokerage,consultant and other customary fees and expenses actually incurred in connection therewith, (ii) the principal amount of anyIndebtedness that is secured by a Lien (other than a Lien subordinated to the Liens securing the Obligations) on the asset subject tosuch Disposition or Casualty Event and that is required to be repaid in connection with such Disposition or Casualty Event (other thanIndebtedness under the Loan Documents), together with any applicable premium, penalty, interest and breakage costs, (iii) in the caseof any Disposition or Casualty Event by a non-wholly-owned Restricted Subsidiary, the pro rata portion of the Net Proceeds thereof(calculated without regard to this clause (iii) ) attributable to minority interests and not available for distribution to or for the accountof any wholly-owned Consolidated Party as a result thereof, (iv) Taxes actually paid or payable as a result thereof, (v) the amount ofany reasonable reserve established in accordance with GAAP against any adjustment to the sale price or any liabilities (other than anytaxes deducted pursuant to clause (i) above) (x) related to any of the applicable assets and (y) retained by any Consolidated Partyincluding, without limitation, pension and other post-employment benefit liabilities and liabilities related to environmental matters oragainst any indemnification obligations (however, the amount of any subsequent reduction of such reserve (other than in connectionwith a payment in respect of any such liability) shall be deemed to be Net Proceeds of such Disposition or Casualty Event occurringon the date of such reduction) and (vi) any funded escrow established pursuant to the documents evidencing any such sale ordisposition to secure any indemnification obligations or adjustments to the purchase price associated with any such sale or disposition( provided that to the extent that any amounts are released from such escrow to, a Consolidated Party, such amounts net of any relatedexpenses shall constitute Net Proceeds); provided that, subject to the restrictions set forth in Section 7.05(i) , if any ConsolidatedParty uses any portion of such proceeds to acquire, maintain, develop, construct, improve, upgrade or repair assets useful in thebusiness of the Consolidated Parties (other than ordinary course current assets) or to make Permitted Acquisitions (or any subsequentinvestment made in a Person, division or line of business previously acquired), in each case within 12 months of such receipt, suchportion of such proceeds shall not constitute Net Proceeds except to the extent not, within 12 months of such receipt, so used orcontractually committed to be so used (it being understood that if any portion of such proceeds are not so used within such 12-monthperiod but within such 12-month period are contractually committed to be used, then upon the termination of such contract or if suchNet Proceeds are not so used within the later of such 12-month period and 180 days from the entry into such contractual commitment,such remaining portion shall constitute Net Proceeds as of the date of such termination or expiry without giving effect to thisproviso); provided , further , that no proceeds realized in a single transaction or series of related transactions shall constitute NetProceeds unless the aggregate amount of such net proceeds shall exceed $5,000,000 in any fiscal year (and thereafter only net cashproceeds in excess of such amount shall constitute Net Proceeds under this clause (a) ), and(b) 100% of the cash proceeds from the incurrence, issuance or sale by any Consolidated Party of any Indebtedness orequity, as applicable, net of all taxes paid or reasonably estimated to be payable as a result thereof and fees (including investmentbanking fees and discounts), commissions, costs and other expenses, in each case incurred in connection with such incurrence,issuance or sale.For purposes of calculating the amount of Net Proceeds, fees, commissions and other costs and expenses payable to any ConsolidatedParty shall be disregarded.“ Non-Consenting Lender ” has the meaning set forth in Section 3.07(d) .“ Non-Defaulting Lender ” means, at any time, a Lender that is not a Defaulting Lender.“ Non-Extension Notice Date ” has the meaning set forth in Section 2.03(b)(iii) .“ Non-Guarantor Cap ” means the greater of $5,000,000 and 5% of LTM EBITDA on the date such Investment is made, reduced byInvestments made in reliance thereon under Section 7.02(c)(iii) and Indebtedness incurred in reliance thereon under Section 7.03(d) .“ Note ” means a Term Note, a Revolving Credit Note or a Swing Line Note, as the context may require.“ Notice of Intent to Cure ” has the meaning set forth in Section 8.04 .“ Obligations ” means (x) all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party and itsRestricted Subsidiaries arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect(including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and includinginterest, fees and expenses that accrue after the commencement by or against any Loan Party or Restricted Subsidiary of any proceedingunder any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest, fees and expensesare allowed claims in such proceeding and (y) for purposes of the Collateral Documents, the Guaranty and Section 8.03 only, obligations ofany Loan Party arising under any Secured Hedge Agreement or any Treasury Services Agreement. Without limiting the generality of theforegoing, the Obligations of the Loan Parties under the Loan Documents (and of their Restricted Subsidiaries to the extent they haveobligations under the Loan Documents) include (a) the obligation (including guarantee obligations) to pay principal, interest, Letter of Creditfees, reimbursement obligations, charges, expenses, fees, Attorney Costs, indemnities and other amounts payable by any Loan Party underany Loan Document and (b) the obligation of any Loan Party to reimburse any amount in respect of any of the foregoing that any Lender mayelect to pay or advance on behalf of such Loan Party in accordance with the terms of the Loan Documents. Notwithstanding the foregoing,the obligations of the Borrowers or any Restricted Subsidiary under any Secured Hedge Agreement or any Treasury Services Agreement shallbe secured and guaranteed pursuant to the Collateral Documents and the Guaranty only to the extent that, and for so long as, the otherObligations are so secured and guaranteed. Notwithstanding the foregoing, Obligations of any Guarantor shall in no event include anyExcluded Swap Obligations of such Guarantor.“ OFAC ” has the meaning set forth in Section 5.17(b) .“ OID ” means original issue discount.“ Organization Documents ” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws(or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liabilitycompany, the certificate or articles of formation or organization and operating agreement or limited liability company agreement; and (c) withrespect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement offormation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation ororganization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificateor articles of formation or organization of such entity.“ Other Applicable Indebtedness ” has the meaning set forth in Section 2.05(b)(ii) .“ Other Taxes ” has the meaning set forth in Section 3.01(b) .“ Outstanding Amount ” means (a) with respect to the Term Loans, Revolving Credit Loans and Swing Line Loans on any date, theoutstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Term Loans, Revolving CreditLoans (including any refinancing of outstanding unpaid drawings under Letters of Credit or L/C Credit Extensions as a Revolving CreditBorrowing) and Swing Line Loans, as the case may be, occurring on such date; and (b) with respect to any L/C Obligations on any date, theoutstanding amount thereof on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes theretoas of such date, including as a result of any reimbursements of outstanding unpaid drawings under any Letters of Credit (including anyrefinancing of outstanding unpaid drawings under Letters of Credit or L/C Credit Extensions as a Revolving Credit Borrowing) or anyreductions in the maximum amount available for drawing under Letters of Credit taking effect on such date.“ Overnight Rate ” means, for any day, the greater of the Federal Funds Rate and an overnight rate determined by the AdministrativeAgent in accordance with banking industry rules on interbank compensation.“ Parent ” has the meaning set forth in the recitals.“ Parent Guaranty ” means the limited recourse guaranty dated as of the date hereof by Parent in favor of the Administrative Agent.“ Participant ” has the meaning set forth in Section 10.07(e) .“ Participant Register ” has the meaning set forth in Section 10.07(e) .“ PBGC ” means the Pension Benefit Guaranty Corporation.“ Pension Plan ” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than aMultiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by any Loan Party or any ERISA Affiliate or towhich any Loan Party or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a plan described inSection 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years.“ Perfection Certificate ” means a certificate substantially in the form of Exhibit II to the Security Agreement or any other formreasonably approved by the Administrative Agent, as the same shall be supplemented from time to time.“ Permitted Acquisition ” has the meaning set forth in Section 7.02(i) .“ Permitted Equal Priority Refinancing Debt ” means any secured Indebtedness incurred by the Borrowers in the form of one ormore series of senior secured notes, bonds or debentures (and, if applicable, any Registered Equivalent Notes issued in exchange therefor);provided that (i) such Indebtedness is secured by Liens on all or a portion of the Collateral on a basis that is equal in priority to the Liens onthe Collateral securing the Obligations (but without regard to the control of remedies), is not secured by any property or assets of Parent orany of its Subsidiaries other than the Collateral, (ii) such Indebtedness satisfies the applicable requirements set forth in the provisos to thedefinition of “Credit Agreement Refinancing Indebtedness,” (iii) such Indebtedness is not at any time guaranteed by Parent or any of itsSubsidiaries other than the Loan Parties and (iv) each Borrower, the holders of such Indebtedness (or any trustee, agent or similarrepresentative on their behalf) and the Administrative Agent and/or Collateral Agent shall be party to a Customary Intercreditor Agreementproviding that the Liens on the Collateral securing such obligations shall rank equal in priority to the Liens on the Collateral securing theObligations.“ Permitted Junior Priority Refinancing Debt ” means secured Indebtedness incurred by the Borrowers in the form of one or moreseries of junior lien secured notes, bonds or debentures or junior lien secured loans (and, if applicable, any Registered Equivalent Notesissued in exchange therefor); provided that (i) such Indebtedness is secured by a Lien on all or a portion of the Collateral on a junior prioritybasis to the Liens on Collateral securing the Obligations, is not secured by any property or assets of Parent or any of its Subsidiaries otherthan the Collateral and is secured pursuant to documentation no more favorable to the secured parties thereunder than the terms of theCollateral Documents, (ii) such Indebtedness satisfies the applicable requirements set forth in the provisos in the definition of “CreditAgreement Refinancing Indebtedness”, (iii) the holders of such Indebtedness (or any trustee, agent or similar representative on their behalf)and the Administrative Agent and/or the Collateral Agent shall be party to a Customary Intercreditor Agreement providing that the Liens onCollateral securing such obligations shall rank junior to the Liens on Collateral securing the Obligations, and (iv) such Indebtedness is not atany time guaranteed by Parent or any of its Subsidiaries other than the Loan Parties.“ Permitted Liens ” has the meaning set forth in Section 7.01 .“ Permitted Refinancing ” means, with respect to any Person, any modification, refinancing, refunding, renewal, restructuring,replacement or extension of any Indebtedness of such Person; provided that (a) the principal amount (or accreted value, if applicable) thereofdoes not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so modified, refinanced, restructured, refunded,renewed, replaced or extended except by an amount equal to unpaid accrued interest and premium thereon plus other amounts owing or paidrelated to such Indebtedness, and fees and expenses incurred, in connection with such modification, refinancing, refunding, renewal,restructuring, replacement or extension and by an amount equal to any existing commitments unutilized thereunder, (b) other than withrespect to a Permitted Refinancing in respect of Indebtedness permitted pursuant to Section 7.03(e) , such modification, refinancing,refunding, renewal, replacement or extension has a final maturity date equal to or later than the final maturity date of, and has a WeightedAverage Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being modified, refinanced,refunded, renewed, replaced or extended, (c) other than with respect to a Permitted Refinancing in respect of Indebtedness permitted pursuantto Section 7.03(e) , at the time thereof, no Event of Default shall have occurred and be continuing, (d) if such Indebtedness being modified,refinanced, refunded, renewed, replaced or extended is subordinated in right of payment to the Obligations, such modification, refinancing,refunding, renewal, replacement or extension is subordinated in right of payment to the Obligations on terms at least as favorable (taken as awhole) to the Lenders as those contained in the documentation governing the Indebtedness being modified, refinanced, refunded, renewed,replaced or extended, and such modification, refinancing, refunding, renewal, replacement or extension is incurred by one or more Personswho is an obligor of the Indebtedness being modified, refinanced, refunded, renewed, replaced or extended as reasonably determined by theAdministrative Agent, (e) such Indebtedness shall be repaid, repurchased, retired, defeased or satisfied and discharged, and all accruedinterest, fees, premiums (if any) and penalties in connection therewith shall be paid, on the date such modification, refinancing, refunding,renewal, restructuring, replacement or extension is issued, incurred or obtained, (f) such modification, refinancing, refunding, renewal,restructuring, replacement or extension of Indebtedness is not at any time guaranteed by any Person other than the guarantors of suchIndebtedness and (g) any such modification, refinancing, refunding, renewal, restructuring, replacement or extension of Indebtedness shall bepari passu or junior in right of payment and, if secured, secured on no more senior a basis than such Indebtedness being refinanced.“ Permitted Repricing Amendment ” has the meaning set forth in Section 10.01 .“ Permitted Unsecured Refinancing Debt ” means unsecured Indebtedness incurred by the Borrower in the form of one or moreseries of senior unsecured notes, bonds or debentures or loans (and, if applicable, any Registered Equivalent Notes issued in exchangetherefor); provided that (i) such Indebtedness satisfies the applicable requirements set forth in the provisos in the definition of “CreditAgreement Refinancing Indebtedness” and (ii) such Indebtedness is not at any time guaranteed by Parent or any of its Subsidiaries other thanthe Loan Parties.“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership,Governmental Authority or other entity.“ Plan ” means any “employee benefit plan” (as such term is defined in Section 3(3) of ERISA) established or maintained by anyLoan Party or any Restricted Subsidiary or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, anyERISA Affiliate.“ Platform ” has the meaning set forth in Section 6.01(d) .“ Pledge Agreement ” means the pledge agreement dated as of the date hereof by Parent in favor of the Collateral Agent.“ Pledged Debt ” has the meaning set forth in the Security Agreement.“ Pledged Equity ” has the meaning set forth in the Security Agreement.“ Proceeding ” has the meaning set forth in Section 10.05 .“ Proceeds ” has the meaning set forth in the Security Agreement.“ Pro Forma Balance Sheet ” has the meaning set forth in Section 5.05(b) .“ Pro Forma Basis ” and “ Pro Forma Effect ” means, with respect to compliance with any test or covenant or calculation of anyratio hereunder, the determination or calculation of such test, covenant or ratio (including in connection with Specified Transactions) inaccordance with Section 1.09 .“ Pro Forma Financial Statements ” has the meaning set forth in Section 5.05(b) .“ Pro Rata Share ” means, with respect to each Lender, at any time a fraction (expressed as a percentage, carried out to the ninthdecimal place), the numerator of which is the amount of the Commitments and, if applicable and without duplication, Term Loans of suchLender under the applicable Facility or Facilities at such time and the denominator of which is the amount of the Aggregate Commitmentsunder the applicable Facility or Facilities and, if applicable and without duplication, Term Loans under the applicable Facility or Facilities atsuch time; provided that, in the case of the Revolving Credit Facility, if such Commitments have been terminated, then the Pro Rata Share ofeach Lender shall be determined based on the Pro Rata Share of such Lender immediately prior to such termination and after giving effect toany subsequent assignments made pursuant to the terms hereof.“ Projections ” has the meaning set forth in Section 6.01(c) .“ Public Lender ” has the meaning set forth in Section 6.01(d) .“ Qualified ECP Guarantor ” means, in respect of any Swap Obligations, each Loan Party that has total assets exceeding$10,000,000 at the time the relevant Guarantee or grant of the relevant security interest becomes effective with respect to such SwapObligation or such other person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulationspromulgated thereunder and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwellunder Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.“ Qualified Equity Interests ” means any Equity Interests that are not Disqualified Equity Interests.“ Quarterly Financial Statements ” means (a) the unaudited consolidated balance sheets and related statements of income and cashflows of each of the Parent and HDV Holdings for the fiscal quarter ended September 30, 2015, and any subsequent fiscal quarter of HDVHoldings ended at least 45 days prior to the Closing Date and (b) the unaudited standalone financial statements of income and cash flows ofHoldings and its Subsidiaries, on a consolidated basis, for the fiscal quarter ended September 30, 2015, and any subsequent fiscal quarter ofHDV Holdings ended at least 45 days prior to the Closing Date, together with a reconciliation of such financial statements with the segmentreporting of the “Tax Preparation” business as set forth in the financial statements in clause (a) of the Parent for the equivalent period.“ Real Property ” means, collectively, all right, title and interest (including any leasehold, mineral or other estate) in and to any andall parcels of or interests in real property owned or leased by any Person, whether by lease, license or other means, together with, in eachcase, all easements, hereditaments and appurtenances relating thereto, all improvements and appurtenant fixtures and equipment, all generalintangibles and contract rights and other property and rights incidental to the ownership, lease or operation thereof.“ Refinanced Debt ” has the meaning set forth in the definition of “Credit Agreement Refinancing Indebtedness.”“ Refinanced Term Loans ” has the meaning set forth in Section 10.01 .“ Refinancing ” means the prepayment in full of all amounts borrowed under the Existing Credit Facility, the termination of allcommitments thereunder and the release of all security interests and guaranties in connection therewith.“ Refinancing Amendment ” means an amendment to this Agreement executed by each of (a) the Borrowers, (b) the AdministrativeAgent, (c) each Additional Refinancing Lender and (d) each Lender that agrees to provide any portion of the Refinancing Term Loans,Refinancing Revolving Credit Commitments or Refinancing Revolving Credit Loans incurred pursuant thereto, in accordance withSection 2.15 .“ Refinancing Revolving Credit Commitments ” means one or more Classes of Revolving Credit Commitments hereunder thatresult from a Refinancing Amendment.“ Refinancing Revolving Credit Loans ” means one or more Classes of Revolving Credit Loans that result from a RefinancingAmendment.“ Refinancing Series ” means all Refinancing Term Loans or Refinancing Term Commitments that are established pursuant to thesame Refinancing Amendment (or any subsequent Refinancing Amendment to the extent such Refinancing Amendment expressly providesthat the Refinancing Term Loans or Refinancing Term Commitments, Refinancing Revolving Credit Loans or Refinancing Revolving CreditCommitments provided for therein are intended to be a part of any previously established Refinancing Series) and that provide for the sameAll-In Yield (other than, for this purpose, any original issue discount or upfront fees), if applicable and amortization schedule.“ Refinancing Term Commitments ” means one or more term loan commitments hereunder that fund Refinancing Term Loans ofthe applicable Refinancing Series hereunder pursuant to a Refinancing Amendment.“ Refinancing Term Loans ” means one or more Classes of Term Loans that result from a Refinancing Amendment.“ Register ” has the meaning set forth in Section 10.07(d) .“ Registered Equivalent Notes ” means, with respect to any notes originally issued in an offering pursuant to Rule 144A under theSecurities Act or other private placement transaction under the Securities Act, substantially identical notes (having the same guarantees)issued in a dollar-for-dollar exchange therefor pursuant to an exchange offer registered with the SEC.“ Related Parties ” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees,agents, trustees and advisors of such Person and of such Person’s Affiliates.“ Release ” means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumpingor disposing into the Environment or any facility or property.“ Replacement Term Loans ” has the meaning set forth in Section 10.01 .“ Reportable Event ” means any of the events set forth in Section 4043(c) of ERISA or the regulations issued thereunder, other thanevents for which the otherwise applicable notice period has been waived by regulation or otherwise by the PBGC.“ Repricing Event ” shall mean (i)(x) any substantially concurrent prepayment or repayment of Initial Term Loans in whole or inpart with the proceeds of, or any conversion of any Initial Term Loans into, any new or replacement tranche of indebtedness incurred bearinginterest at an All-In Yield less than the All-In Yield applicable to the Initial Term Loans the incurrence of which had the purpose of reducingthe All-In Yield or (y) any amendment to this Agreement that, directly or indirectly, reduces the “effective” interest rate applicable to theInitial Term Loans or (ii) any assignment permitted under Section 3.07 of all or any portion of the Initial Term Loans of any Lender inconnection with any amendment under clause (i) of this definition.“ Request for Credit Extension ” means (a) with respect to a Borrowing, continuation or conversion of Term Loans or RevolvingCredit Loans, a Committed Loan Notice and (b) with respect to an L/C Credit Extension, a Letter of Credit Application.“ Required Lenders ” means, as of any date of determination, Lenders having more than 50% of the sum of the (a) TotalOutstandings (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Obligations being deemed“held” by such Lender for purposes of this definition), (b) aggregate unused Term Commitments and (c) aggregate unused Revolving CreditCommitments and unused Refinancing Revolving Credit Commitments; provided that the unused Term Commitments, Revolving CreditCommitment and Refinancing Revolving Credit Commitment of, and the portion of the Total Outstandings held or deemed held by, anyDefaulting Lender shall be excluded for purposes of making a determination of Required Lenders.“ Required Revolving Lenders ” means, as of any date of determination, Revolving Credit Lenders having more than 50% of thesum of (a) the Outstanding Amount of all Revolving Credit Loans and L/C Obligations (with the aggregate amount of each Lender’s riskparticipation and funded participation in L/C Obligations being deemed “held” by such Lender for purposes of this definition) and (b)aggregate unused Revolving Credit Commitments and unused Refinancing Revolving Credit Commitments; provided that the RevolvingCredit Commitment and Refinancing Revolving Credit Commitment of, and the portion of the Total Outstandings held or deemed held by,any Defaulting Lender shall be excluded for purposes of making a determination of Required Revolving Lenders.“ Responsible Officer ” means the chief executive officer, president, vice president, chief financial officer, chief administrativeofficer, secretary or assistant secretary, treasurer or assistant treasurer, controller or other similar officer of a Loan Party, and with respect toCommitted Loan Notices, any designee thereof and directors of treasury services. Any document delivered hereunder that is signed by aResponsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/orother action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such LoanParty.“ Restricted ” means, when referring to cash or Cash Equivalents of the Consolidated Parties, means that such cash or CashEquivalents appear (or would be required to appear) as “restricted” on the consolidated balance sheet of Parent with respect to Holdings(unless such appearance is related to Liens for the benefit of the Secured Parties or Liens permitted under Section 7.01 which are notperfected under the UCC or do not benefit from a control agreement or other steps to perfect on such cash or Cash Equivalents that theCollateral Agent has not taken on behalf of the Secured Parties).“ Restricted Payment ” means any dividend or other distribution (whether in cash, securities or other property) with respect to anyEquity Interest of any Consolidated Party, or any payment (whether in cash, securities or other property), including any sinking fund orsimilar deposit, on account of the purchase, redemption, retirement, defeasance, acquisition, cancellation or termination of any such EquityInterest, or on account of any return of capital to such Consolidated Party’s equity holders, partners or members (or the equivalent Personsthereof).“ Restricted Subsidiary ” means any Subsidiary of either Borrower other than an Unrestricted Subsidiary.“ Retained Excess Cash Flow ” means, for any Excess Cash Flow Period, an amount equal to Excess Cash Flow for such ExcessCash Flow Period minus the amount required to be prepaid pursuant to Section 2.05(b)(i) (net of any Declined Proceeds with respect thereto)prior to giving effect to any deductions made pursuant to clause (B) of such subsection.“ Returns ” means, with respect to any Investment, any dividends, distributions, interest, fees, premium, return of capital, repaymentof principal, income, profits (from a Disposition or otherwise) and other amounts received or realized in respect of such Investment.“ Revolver Extension Request ” has the meaning set forth in Section 2.16(b) .“ Revolver Extension Series ” has the meaning set forth in Section 2.16(b) .“ Revolving Commitment Increase ” has the meaning set forth in Section 2.14(a) .“ Revolving Credit Borrowing ” means a borrowing consisting of simultaneous Revolving Credit Loans of the same Type and, inthe case of Eurodollar Rate Loans, having the same Interest Period, made by each of the Revolving Credit Lenders.“ Revolving Credit Commitment ” means, as to each Revolving Credit Lender, its obligation to (a) make Revolving Credit Loans tothe Borrowers, (b) purchase participations in L/C Obligations in respect of Letters of Credit and (c) purchase participations in Swing LineLoans in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender’s name onSchedule 1.01 under the caption “Revolving Credit Commitment” or in the Assignment and Assumption pursuant to which such Lenderbecomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement (includingSections 2.14 and 10.07(b) ). The aggregate Revolving Credit Commitments of all Revolving Credit Lenders shall be $25,000,000 on theClosing Date, as such amount may be adjusted from time to time in accordance with the terms of this Agreement.“ Revolving Credit Exposure ” means, as to each Revolving Credit Lender, the sum of the amount of the Outstanding Amount ofsuch Revolving Credit Lender’s Revolving Credit Loans and its Pro Rata Share or other applicable share provided for under this Agreementof the amount of the L/C Obligations and Swing Line Loans at such time.“ Revolving Credit Facility ” means the Revolving Credit Commitments, including any Revolving Commitment Increase, eachExtension Series of Extended Revolving Credit Commitments, each Refinancing Series of Refinancing Revolving Credit Commitments andthe Credit Extensions made thereunder.“ Revolving Credit Fee ” has the meaning set forth in Section 2.09(c) . “ Revolving Credit Lender ” means, at any time, any Lender that has a Revolving Credit Commitment at such time or, if theRevolving Credit Commitments have terminated, Revolving Credit Exposure.“ Revolving Credit Loans ” has the meaning set forth in Section 2.01(b) .“ Revolving Credit Note ” means a promissory note of the Borrowers payable to any Revolving Credit Lender or its registeredassigns, in substantially the form of Exhibit C-2 hereto, evidencing the aggregate Indebtedness of the Borrowers to such Revolving CreditLender resulting from the Revolving Credit Loans made by such Revolving Credit Lender to the Borrowers.“ Rollover Equity ” has the meaning set forth in the definition of “Equity Contribution.”“ S&P ” means Standard & Poor’s Ratings Services, a division of Standard & Poor's Financial Services LLC, a subsidiary ofMcGraw Hill Financial, Inc., and any successor to its credit ratings business.“ Same Day Funds ” means disbursements and payments in immediately available funds.“ Sanctions Laws and Regulations ” means (i) any sanctions or requirements imposed by, or based upon the obligations orauthorities set forth in, the Executive Order, the USA PATRIOT Act of 2001 (the “ Patriot Act ”), the U.S. International EmergencyEconomic Powers Act (50 U.S.C. §§ 1701 et seq.), the U.S. Trading with the Enemy Act (50 U.S.C. App. §§ 1 et seq.), the U.S. SyriaAccountability and Lebanese Sovereignty Act, the U.S. Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010, the IranSanctions Act, Section 1245 of the National Defense Authorization Act of 2012, or the Iran Threat Reduction and Syria Human Rights Act of2012, all as amended, or any of the foreign assets control regulations (including but not limited to 31 C.F.R., Subtitle B, Chapter V, asamended) or any other law or executive order relating thereto administered by the U.S. Department of the Treasury Office of Foreign AssetsControl (“ OFAC ”), and any similar law, regulation, or Executive Order enacted in the United States after the date of this Agreement, (ii)any sanctions or requirements imposed under similar laws or regulations enacted by the European Union, the United Kingdom or Australiaand (iii) any similar Law of any jurisdiction other than the United States, in each case, applicable to Parent or any Consolidated Party.“ Screen Rate ” has the meaning set forth in the definition of “Interpolated Rate.”“ SEC ” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principalfunctions.“ Secured Hedge Agreement ” means any Swap Contract permitted under Article VII that is entered into by and between a Borroweror any Restricted Subsidiary and any Bank, to the extent designated by such Borrower and such Bank as a “Secured Hedge Agreement” inwriting to the Administrative Agent. The designation of any Secured Hedge Agreement shall not create in favor of such Bank any rights inconnection with the management or release of Collateral or of the obligations of any Guarantor under the Loan Documents.“ Secured Obligations ” means, collectively, the Obligations, the Cash Management Obligations and all obligations owing to theSecured Parties by any Consolidated Party under any Secured Hedge Agreement (but excluding in any event Excluded Swap Obligations).“ Secured Parties ” means, collectively, the Administrative Agent, the Collateral Agent, each other Agent, each L/C Issuer, eachother Lender, each Bank and each co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to Section 9.05 .“ Securities Act ” means the Securities Act of 1933, as amended.“ Security Agreement ” means a security agreement, dated as of the Closing Date, substantially in the form of Exhibit F .“ Security Agreement Supplement ” has the meaning set forth in the Security Agreement.“ Senior Representative ” means, with respect to any series of Permitted Equal Priority Refinancing Debt or Permitted JuniorPriority Refinancing Debt, the trustee, administrative agent, collateral agent, security agent or similar agent under the indenture or agreementpursuant to which such Indebtedness is issued, incurred or otherwise obtained, as the case may be, and each of their successors in suchcapacities.“ Solvent ” means that (i) the sum of the debt (including contingent liabilities) of each Borrower and its Restricted Subsidiaries, takenas a whole, does not exceed the present fair saleable value (on a going concern basis) of the assets of such Borrower and its RestrictedSubsidiaries, taken as a whole; (ii) the capital of each Borrower and its Restricted Subsidiaries, taken as a whole, is not unreasonably small inrelation to the business of each such Borrower or its Restricted Subsidiaries, taken as a whole, contemplated as of the date hereof; and (iii)each Borrower and its Restricted Subsidiaries, taken as a whole, do not intend to incur, or believe that they will incur, debts (including currentobligations and contingent liabilities) beyond their ability to pay such debts as they mature in the ordinary course of business. For thepurposes of this definition, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the factsand circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability(irrespective of whether such contingent liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5).“ SPC ” has the meaning set forth in Section 10.07(h) .“ Specified Representations ” means the representations and warranties set forth in Sections 5.01(a) , 5.01(b) (as to authorization,execution, delivery and performance of the Loan Documents), 5.02(a) , 5.02(b) , 5.02(c)(i) , 5.02(c)(iii) , 5.04 , 5.12 , 5.16 , 5.17 , 5.18 and5.19 .“ Specified Transaction ” means any Investment that results in a Person becoming a Restricted Subsidiary, any designation of aSubsidiary as a Restricted Subsidiary or an Unrestricted Subsidiary, any Permitted Acquisition or any Disposition that results in a RestrictedSubsidiary ceasing to be a Subsidiary of the Borrowers, any Investment constituting an acquisition of assets constituting a business unit, lineof business or division of, or all or substantially all of the Equity Interests of, another Person or any Disposition of a business unit, line ofbusiness or division of the Borrowers or a Restricted Subsidiary, in each case whether by merger, consolidation, amalgamation or otherwise,or any incurrence or repayment of Indebtedness (other than Indebtedness incurred or repaid under any revolving credit facility or line ofcredit), Restricted Payment, Revolving Commitment Increase, Incremental Revolving Loan or Incremental Term Loan that by the terms ofthis Agreement requires such test to be calculated on a “Pro Forma Basis” or after giving “Pro Forma Effect.”“ Statutory Reserves ” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator ofwhich is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency orsupplemental reserves) expressed as a decimal established by the Board of Governors of the Federal Reserve System of the United States andany other banking authority, domestic or foreign, to which the Administrative Agent or any Lender (including any branch, Affiliate or otherfronting office making or holding a Loan) is subject for Eurocurrency Liabilities (as defined in Regulation D of the Board). Eurodollar RateLoans shall be deemed to constitute Eurocurrency Liabilities (as defined in Regulation D of the Board) and to be subject to such reserverequirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to the AdministrativeAgent or any Lender under such Regulation D. Statutory Reserves shall be adjusted automatically on and as of the effective date of anychange in any reserve percentage.“ Subsequent Transaction ” has the meaning set forth in Section 1.08 .“ Subsidiary ” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which(i) a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body(other than securities or interests having such power only by reason of the happening of a contingency that has not yet happened) are at thetime beneficially owned, (ii) more than half of the issued share capital is at the time beneficially owned or (iii) the management of which isotherwise controlled, directly or indirectly, through one or more intermediaries, or both, by such Person. Unless otherwise specified, allreferences herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of Holdings.“ Subsidiary Guarantor ” means any Guarantor that is not a Holding Company or a Borrower.“ Swap Contract ” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions,commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bondindex swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreignexchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swaptransactions, currency options, spot contracts or any other similar transactions or any combination of any of the foregoing (including anyoptions to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) anyand all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form ofmaster agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange MasterAgreement or any other master agreement (any such master agreement, together with any related schedules, a “ Master Agreement ”),including any such obligations or liabilities under any Master Agreement.“ Swap Obligation ” has the meaning set forth in the definition of “Excluded Swap Obligation.”“ Swap Termination Value ” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legallyenforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed outand termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced inclause (a) , the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or anyAffiliate of a Lender)“ Swing Line Borrowing ” means a borrowing consisting of Swing Line Loans made by the Swing Line Lender“ Swing Line Note ” means a promissory note of the Borrowers payable to the Swing Line Lender, or its registered assigns, insubstantially the form of Exhibit C-3 hereto, evidencing the aggregate Indebtedness of the Borrowers to the Swing Line Lender resulting fromthe Swing Line Loans made by the Swing Line Lender to the Borrowers.“ Swing Line Lender ” means Bank of Montreal in its capacity as provider of Swing Line Loans, or any successor swing line lenderhereunder.“ Swing Line Loan ” has the meaning set forth in Section 2.04(a) .“ Swing Line Loan Notice ” means a notice of a Borrowing of Swing Line Loans pursuant to Section 2.04(b), which, if in writing,shall be substantially in the form of Exhibit A-2 or such other form as is approved by the Administrative Agent (including any form on anelectronic platform or electronic transmission system as shall be approved by the Administrative Agent), appropriately completed and signedby a Responsible Officer of the applicable Borrower.“ Swing Line Sublimit ” means an amount equal to the lesser of (a) $10,000,000 and (b) the aggregate Revolving CreditCommitments; provided that at any time that Bank of Montreal is the sole Revolving Lender, the Swing Line Sublimit shall be an amountequal to the aggregate Revolving Credit Commitments. The Swing Line Sublimit is part of, and not in addition to, the Revolving CreditFacility.“ Target Person ” has the meaning set forth in Section 7.02 .“ Tax Group ” has the meaning set forth in Section 7.06(g)(iii) .“ Taxes ” means all present or future taxes, duties, levies, imposts, deductions, assessments, fees or withholdings (including backupwithholding), or other charges imposed by any Governmental Authority including interest, penalties and additions to tax applicable thereto.“ Term Borrowing ” means a borrowing consisting of Term Loans of the same Type and, in the case of Eurodollar Rate Loans,having the same Interest Period, made by each of the Term Lenders pursuant to Section 2.01(a) , or under any Incremental Amendment,Extension Amendment or Refinancing Amendment.“ Term Commitment ” means, as to each Term Lender, its obligation to make a Term Loan to the Borrowers hereunder, expressedas an amount representing the maximum principal amount of the Term Loan to be made by such Term Lender under this Agreement, as suchcommitment may be (a) reduced from time to time pursuant to Section 2.06 and (b) reduced or increased from time to time pursuant to(i) assignments by or to such Term Lender pursuant to an Assignment and Assumption, (ii) an Incremental Amendment, (iii) a RefinancingAmendment, (iv) an Extension Amendment or (v) the incurrence of Replacement Term Loans. The initial amount of each Term Lender’sCommitment is set forth on Schedule 1.01 under the caption “Initial Term Commitment” or, otherwise, in the Assignment and Assumption,Incremental Amendment, Extension Amendment or Refinancing Amendment pursuant to which such Lender shall have assumed itsCommitment, as the case may be.“ Term Facility ” means (a) prior to the Closing Date, the Initial Term Commitments and (b) thereafter, each Class of Term Loansand/or Term Commitments.“ Term Lender ” means, at any time, any Lender that has (a) an Initial Term Commitment, Incremental Term Commitment orRefinancing Term Commitment or (b) a Term Loan at such time.“ Term Loan ” means any Initial Term Loan, Extended Term Loan, Incremental Term Loan, Refinancing Term Loan orReplacement Term Loan, as the context may require.“ Term Loan Closing Fee ” has the meaning set forth in Section 2.09(c) . “ Term Loan Extension Request ” has the meaning set forth in Section 2.16(a) .“ Term Loan Extension Series ” has the meaning set forth in Section 2.16(a) .“ Term Loan Increase ” has the meaning set forth in Section 2.14(a) .“ Term Note ” means a promissory note of the Borrowers payable to any Term Lender or its registered assigns, in substantially theform of Exhibit C-1 hereto, evidencing the aggregate Indebtedness of the Borrowers to such Term Lender resulting from the Term Loansmade by such Term Lender.“ Test Period ” means, for any date of determination under this Agreement, the four consecutive fiscal quarters of Holdings mostrecently ended as of such date of determination for which financial statements are available.“ Threshold Amount ” means $20,000,000.“ Total Assets ” means the total assets of the Consolidated Parties on a consolidated basis in accordance with GAAP, as shown on themost recent balance sheet of Parent with respect to Holdings delivered pursuant to Section 6.01(a) or (b) or, for the period prior to the timeany such statements are so delivered pursuant to Section 6.01(a) or (b) , the Pro Forma Balance Sheet.“ Total Outstandings ” means the aggregate Outstanding Amount of all Loans and all L/C Obligations.“ Transaction Expenses ” means any fees or expenses incurred or paid by Parent (excluding at all times Taxes) or any ConsolidatedParty in connection with the Transactions (including (x) expenses in connection with hedging transactions and (y) transaction bonuses and theassociated employer portion of payroll taxes), this Agreement and the other Loan Documents and the transactions contemplated hereby andthereby in an amount not to exceed $36,000,000 in the aggregate.“ Transactions ” means (a) the execution and delivery of the Loan Documents to be entered into on the Closing Date and the fundingof the Loans on the Closing Date, (b) the consummation of the Refinancing, (c) the consummation of the Acquisition, (d) the consummationof the Equity Contribution and (e) the payment of fees and expenses incurred in connection therewith.“ Treasury Services Agreement ” means any agreement between any Consolidated Party and any Bank relating to treasury,depository, credit card, debit card and cash management services or automated clearinghouse transfer of funds or any similar services.“ Type ” means, with respect to a Loan, its character as an ABR Loan or a Eurodollar Rate Loan.“ Unfunded Participations ” shall mean, with respect to an L/C Issuer, the aggregate amount, if any, of participations in respect ofany outstanding L/C Disbursement that shall not have been funded by the Revolving Credit Lenders in accordance with Section 2.03(c) .“ Uniform Commercial Code ” or “ UCC ” means (i) the Uniform Commercial Code as the same may from time to time be in effectin the State of New York or (ii) the Uniform Commercial Code (or similar code or statute) of another jurisdiction, to the extent it applies toany item or items of Collateral. References in this Agreement and the other Loan Documents to specific sections of the Uniform CommercialCode are based on the Uniform Commercial Code as in effect in the State of New York on the date hereof. In the event such UniformCommercial Code is amended or another Uniform Commercial Code described in clause (ii) is applicable, such section reference shall bedeemed to be references to the comparable section in such amended or other Uniform Commercial Code.“ United States ” and “ U.S. ” mean the United States of America.“ United States Tax Compliance Certificate ” has the meaning set forth in Section 3.01(d)(ii)(C) .“ Unreimbursed Amount ” has the meaning set forth in Section 2.03(c)(i) .“ Unrestricted ” means, when referring to cash or Cash Equivalents, that such cash or Cash Equivalents are not Restricted.“ Unrestricted Subsidiary ” means any Subsidiary of the Borrowers (other than the BD Subsidiary or the Advisory ServicesSubsidiary) designated by the Borrower Representative as an Unrestricted Subsidiary pursuant to Section 6.14 subsequent to the ClosingDate.“ USA Patriot Act ” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept andObstruct Terrorism Act of 2001, Public Law 107-56, as amended, reauthorized or otherwise modified from time to time.“ Weighted Average Life to Maturity ” means, when applied to any Indebtedness at any date, the number of years obtained bydividing: (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturityor other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to thenearest one-twelfth) that will elapse between such date and the making of such payment; by (ii) the then outstanding principal amount of suchIndebtedness.“ wholly-owned ” means, with respect to a Subsidiary of a Person, a Subsidiary of such Person all of the outstanding Equity Interestsof which (other than (x) director’s qualifying shares and (y) shares issued to foreign nationals to the extent required by applicable Law) areowned by such Person and/or by one or more wholly-owned Subsidiaries of such Person.Section 1.02. Other Interpretive Provisions . With reference to this Agreement and each other Loan Document, unless otherwisespecified herein or in such other Loan Document:(a) The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms.(b) The words “herein,” “hereto,” “hereof” and “hereunder” and words of similar import when used in any Loan Documentshall refer to such Loan Document as a whole and not to any particular provision thereof.(c) Article, Section, Exhibit and Schedule references are to the Loan Document in which such reference appears.(d) The terms “include,” “includes” and “including” are by way of example and not limitation.(e) The word “or” is not exclusive.(f) The term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financialstatements and other writings, however evidenced, whether in physical or electronic form.(g) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from andincluding”; the words “to” and “until” each mean “to but excluding”; and the word “through” means “to and including.”(h) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall notaffect the interpretation of this Agreement or any other Loan Document.(i) For purposes of determining compliance with any Section of Article VII at any time, in the event that any Lien,Investment, Indebtedness (whether at the time of incurrence or upon application of all or a portion of the proceeds thereof), Disposition,Restricted Payment, Affiliate transaction, Contractual Obligation or prepayment of Indebtedness meets the criteria of one or more than one ofthe categories of transactions permitted pursuant to any clause of such Sections, such transaction (or portion thereof) at any time shall bepermitted under one or more of such clauses as determined by the Borrower Representative in its sole discretion at such time.(j) All references to “knowledge” of any Loan Party or a Restricted Subsidiary means the actual knowledge of aResponsible Officer.(k) The words “asset” and “property” shall be construed as having the same meaning and effect and to refer to any and alltangible and intangible assets and properties, including cash, securities, accounts and contract rights.(l) All references to any Person shall be constructed to include such Person’s successors and assigns (subject to anyrestriction on assignment set forth herein) and, in the case of any Governmental Authority, any other Governmental Authority that shall havesucceeded to any or all of the functions thereof.Section 1.03. Accounting Terms . All accounting terms not specifically or completely defined herein shall be construed inconformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to thisAgreement shall be prepared in conformity with, GAAP, except as otherwise specifically prescribed herein. Notwithstanding any otherprovision contained herein, (a) any lease that is treated as an operating lease for purposes of GAAP as of the date hereof shall not be treatedas Indebtedness, Attributable Indebtedness or as a Capitalized Lease and shall continue to be treated as an operating lease (and any futurelease, if it were in effect on the date hereof, that would be treated as an operating lease for purposes of GAAP as of the date hereof shall betreated as an operating lease), in each case for purposes of this Agreement, notwithstanding any actual or proposed change in GAAP after thedate hereof and (b) all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratiosreferred to herein shall be made, without giving effect to (i) Statement of Financial Accounting Standards 141R or ASC 805 (or any otherfinancial accounting standard having a similar result or effect) or (ii) any election under Financial Accounting Standards Codification No. 825—Financial Instruments, or any successor thereto (including pursuant to the Accounting Standards Codification), to value any Indebtednessof any Consolidated Party at “fair value” as defined therein.Section 1.04. Rounding . Any financial ratios required to be maintained by Borrowers pursuant to this Agreement (or required tobe satisfied in order for a specific action to be permitted under this Agreement) shall be calculated by dividing the appropriate component bythe other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and roundingthe result up or down to the nearest number (with a rounding up if there is no nearest number).Section 1.05. References to Agreements, Laws, Etc . Unless otherwise expressly provided herein, (a) references to OrganizationDocuments, agreements (including the Loan Documents) and other contractual instruments shall be deemed to include all subsequentamendments, refinancings, restatements, renewals, restructurings, extensions, supplements and other modifications thereto, but only to theextent that such amendments, refinancings, restatements, renewals, restructurings, extensions, supplements and other modifications are notprohibited by the Loan Documents; and (b) references to any Law shall include all statutory and regulatory provisions consolidating,amending, replacing, supplementing or interpreting such Law.Section 1.06. Times of Day . Unless otherwise specified, all references herein to times of day shall be references to Eastern time(daylight or standard, as applicable).Section 1.07. Timing of Payment or Performance . Except as otherwise expressly provided herein, when the payment of anyobligation or the performance of any covenant, duty or obligation is stated to be due or performance required on a day which is not a BusinessDay, the date of such payment (other than as described in the definition of “Interest Period”) or performance shall extend to the immediatelysucceeding Business Day.Section 1.08. Limited Condition Transactions . Notwithstanding anything to the contrary herein, in connection with any actionbeing taken solely in connection with a Limited Condition Transaction, for purposes of:(a) determining compliance with any provision of this Agreement (other than the covenant in Section 7.11 , the definitionof “Applicable Margin” and the definition of “Applicable ECF Percentage”) which requires the calculation of any financial ratio or test,including the Consolidated First Lien Net Leverage Ratio, Consolidated Secured Net Leverage Ratio and Consolidated Total Net LeverageRatio (and, for the avoidance of doubt, the financial ratios set forth in Sections 2.14(d) and 7.03(r) ); or(b) testing availability under baskets set forth in this Agreement;in each case, at the option of the Borrower Representative (the Borrower Representative’s election to exercise such option in connection withany Limited Condition Transaction, an “ LCT Election ”), the date of determination of whether any such action is permitted hereunder shallbe deemed to be the date the definitive agreements for such Limited Condition Transaction are entered into (the “ LCT Test Date ”), and if,after giving effect to the Limited Condition Transaction and the other transactions to be entered into in connection therewith (including anyincurrence of Indebtedness and the use of proceeds thereof) on a Pro Forma Basis as if they had occurred at the beginning of the most recentTest Period for which financial statements were (or were required to be) delivered pursuant to Section 6.01(a) or (b) ending prior to the LCTTest Date (for income statement purposes) or at the end of such most recent Test Period (for balance sheet purposes), the Borrowers wouldhave been permitted to take such action on the relevant LCT Test Date in compliance with such ratio, test or basket, such ratio, test or basketshall be deemed to have been complied with. For the avoidance of doubt, if the Borrower Representative has made an LCT Election and anyof the ratios, tests or baskets for which compliance was determined or tested as of the LCT Test Date are exceeded as a result of fluctuationsin any such ratio, test or basket, including due to fluctuations in Consolidated EBITDA or Total Assets of the Consolidated Parties or thePerson subject to such Limited Condition Transaction, at or prior to the consummation of the relevant transaction or action, such baskets, testsor ratios will not be deemed to have been exceeded as a result of such fluctuations. If the Borrower Representative has made an LCT Electionfor any Limited Condition Transaction, then in connection with any calculation of any ratio, test or basket availability with respect to theincurrence of Indebtedness or Liens, the making of Restricted Payments, the making of any Investment permitted under Section 7.02 , theprepayment, redemption, purchase, defeasance or other satisfaction of Indebtedness, or the designation of an Unrestricted Subsidiary (a “Subsequent Transaction ”) following the relevant LCT Test Date and prior to the earlier of the date on which such Limited ConditionTransaction is consummated or the date that the definitive agreement or irrevocable notice for such Limited Condition Transaction isterminated or expires without consummation of such Limited Condition Transaction, for purposes of determining whether such SubsequentTransaction is permitted under this Agreement, any such ratio, test or basket shall be required to be satisfied on a Pro Forma Basis (i)assuming such Limited Condition Transaction and other transactions in connection therewith (including any incurrence of Indebtedness andthe use of proceeds thereof) have been consummated and (ii) assuming such Limited Condition Transaction and other transactions inconnection therewith (including any incurrence of Indebtedness and the use of proceeds thereof) have not been consummated.Section 1.09. Pro Forma Calculations .(a) Notwithstanding anything to the contrary herein, financial ratios and tests, including the Consolidated Total NetLeverage Ratio, the Consolidated First Lien Net Leverage Ratio and the Consolidated Secured Net Leverage Ratio shall be calculated in themanner prescribed by this Section 1.09 . Whenever a financial ratio or test is to be calculated on a pro forma basis, (i) the reference to the“Test Period” for purposes of calculating such financial ratio or test shall be deemed to be a reference to, and shall be based on, the mostrecently ended Test Period for which financial statements have been delivered pursuant to Section 6.01(a) or (b) and (ii) prior to the initialdate upon which the financial statements and certificates required by Section 6.01(a) or 6.01(b) , as the case may be, and Section 6.02(a) arerequired to be delivered, compliance shall be calculated on a pro forma basis as of the period of four consecutive fiscal quarters endingSeptember 30, 2015.(b) For purposes of calculating any financial ratio or test, Specified Transactions that have been made (i) during theapplicable Test Period and (ii) subsequent to such Test Period and prior to or simultaneously with the event for which the calculation of anysuch ratio is made shall be calculated on a pro forma basis assuming that all such Specified Transactions (and any increase or decrease inConsolidated EBITDA and the component financial definitions used therein attributable to any Specified Transaction) had occurred on thefirst day of the applicable Test Period (or, in the case of the determination of Total Assets, the last day). If since the beginning of anyapplicable Test Period any Person that subsequently became a Restricted Subsidiary or was merged, amalgamated or consolidated with or intoa Borrower or any of its Restricted Subsidiaries since the beginning of such Test Period shall have made any Specified Transaction that wouldhave required adjustment pursuant to this Section 1.09 , then such financial ratio or test (or the calculation of Total Assets) shall be calculatedto give pro forma effect thereto in accordance with this Section 1.09 .(c) Whenever pro forma effect is to be given to a Specified Transaction, the pro forma calculations shall be made in goodfaith by a responsible financial or accounting officer of the Borrower Representative and include, for the avoidance of doubt, the amount of“run-rate” cost savings and synergies projected by the Borrower Representative in good faith to be realized as a result of specified actionstaken, committed to be taken or expected to be taken (calculated on a pro forma basis as though such cost savings and synergies had beenrealized on the first day of such period and as if such cost savings and synergies were realized during the entirety of such period) and “run-rate” means the full recurring benefit for a period that is associated with any action taken, committed to be taken or expected to be taken(including any savings expected to result from the elimination of a public target’s compliance costs with public company requirements) net ofthe amount of actual benefits realized during such period from such actions, and any such adjustments shall be included in the initial proforma calculations of such financial ratios or tests and during any subsequent Test Period in which the effects thereof are expected to berealized relating to such Specified Transaction; provided that (A) such amounts are factually supportable, reasonably identifiable,quantifiable, attributable to the transaction and based on assumptions believed by the Borrower Representative in good faith to be reasonableat the time made and supported by an officer’s certificate delivered to the Administrative Agent, and calculated on a pro forma basis asthough such cost savings and synergies had been realized on the first day of such period as if such cost savings and synergies were realizedduring the entirety of such period relating to such specified transaction, net of the amount of actual benefits realized during such period fromsuch actions, (B) such actions are taken or expected to be taken no later than 12 months after the date of such Specified Transaction, (C) noamounts shall be added pursuant to this Section 1.09(c) to the extent duplicative of any amounts that are otherwise added back in computingConsolidated EBITDA, whether through a pro forma adjustment or otherwise, with respect to such period and (D) the aggregate amount ofcost savings and synergies added pursuant to this clause (c) shall not exceed (i) 10% of Consolidated EBITDA for such Test Period (givingpro forma effect to the relevant Specified Transaction (but not to any cost savings or synergies)) and (ii) when aggregated with the aggregateamount for all cash items added pursuant to clauses (a)(iv)(B), (a)(vi), (a)(vii) and (a)(ix) of the definition of “Consolidated EBITDA,” 15%of Consolidated EBITDA for such Test Period (giving pro forma effect to the relevant Specified Transaction (but not to any cost savings orsynergies)).(d) Notwithstanding anything to the contrary herein, when calculating the Consolidated First Lien Net Leverage Ratio orthe Consolidated Secured Net Leverage Ratio, as applicable, on a Pro Forma Basis for purposes of Sections 2.14(d)(iii)(B) , 7.03(r)(i)(B) or7.03(r)(ii)(B) , any Indebtedness that is incurred substantially contemporaneously therewith under any other provision of Section 2.14 orSection 7.03 shall be disregarded.Section 1.10. Letters of Credit . Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed tobe the amount available to be drawn under such Letter of Credit in effect at such time; provided , however , that with respect to any Letter ofCredit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the statedamount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after givingeffect to all such increases, whether or not such maximum stated amount is in effect at such time.Section 1.11. Certifications . All certifications to be made hereunder by an officer or representative of a Loan Party shall be madeby such person in his or her capacity solely as an officer or a representative of such Loan Party, on such Loan Party’s behalf and not in suchPerson’s individual capacity.ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONSSection 2.01. The Loans .(m) Term Borrowings . Subject to the terms and conditions expressly set forth herein, each Term Lender severally agrees tomake to the Borrowers on the Closing Date one or more Term Borrowings denominated in Dollars in an aggregate amount not to exceed atany time outstanding the amount of such Term Lender’s Term Commitment. Amounts borrowed under this Section 2.01(a) and repaid orprepaid may not be re-borrowed. Term Loans may be ABR Loans or Eurodollar Rate Loans, as further provided herein.(n) Revolving Credit Borrowings . Subject to the terms and conditions expressly set forth herein, after the Closing Dateeach Revolving Credit Lender severally agrees to make Revolving Credit Loans denominated in Dollars, to the Borrowers pursuant toSection 2.02 (each such loan, together with any loans made pursuant to an Extended Revolving Credit Commitment, Incremental RevolvingLoans and Refinancing Revolving Credit Loans, a “ Revolving Credit Loan ”) from time to time, on any Business Day during the periodfrom the Business Day immediately following the Closing Date until the Maturity Date with respect to such Revolving Credit Lender’sapplicable Revolving Credit Commitment, in an aggregate principal amount not to exceed at any time outstanding the amount of suchLender’s Revolving Credit Commitment at such time; provided that after giving effect to any Revolving Credit Borrowing, the aggregateOutstanding Amount of the Revolving Credit Loans of any Lender, plus such Lender’s Pro Rata Share or other applicable share provided forunder this Agreement of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share or other applicable shareprovided for under this Agreement of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Revolving CreditCommitment. Within the limits of each Lender’s Revolving Credit Commitment, and subject to the other terms and conditions hereof, theBorrowers may borrow under this Section 2.01(b) , prepay under Section 2.05 , and re-borrow under this Section 2.01(b) in each case withoutpremium or penalty (subject to Section 3.05 ). Revolving Credit Loans may be ABR Loans or Eurodollar Rate Loans, as further providedherein.Section 2.02. Borrowings, Conversions and Continuations of Loans .(a) Each Term Borrowing, each Revolving Credit Borrowing, each conversion of Term Loans or Revolving Credit Loansfrom one Type to the other, and each continuation of Eurodollar Rate Loans shall be made upon the applicable Borrower’s notice to theAdministrative Agent, which may be given by telephone. Each such notice must be received by the Administrative Agent (1) not later than1:00 p.m., three Business Days prior to the requested date of any Borrowing or continuation of Eurodollar Rate Loans or any conversion ofABR Loans to Eurodollar Rate Loans, and (2) not later than 1:00 p.m., one Business Day prior to the requested date of any Borrowing ofABR Loans; provided that the notice referred to in clause (1) above may be delivered no later than one Business Day prior to the ClosingDate in the case of the initial Credit Extensions to be made on the Closing Date. Each telephonic notice by the applicable Borrower pursuantto this Section 2.02(a) must be confirmed promptly by delivery (including via email) to the Administrative Agent of a written CommittedLoan Notice (and will not be effective until so confirmed), appropriately completed and signed by a Responsible Officer of such Borrower.Except as otherwise provided in Section 2.14 , each Borrowing of, conversion to or continuation of Eurodollar Rate Loans shall be in aminimum principal amount of $2,000,000, or a whole multiple of $1,000,000, in excess thereof. Except as provided herein, each Borrowingof or conversion to ABR Loans shall be in a minimum principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof.Each Committed Loan Notice (whether telephonic or written) shall specify (i) whether such Borrower is requesting a Term Borrowing, aRevolving Credit Borrowing, a conversion of Term Loans or Revolving Credit Loans from one Type to the other or a continuation ofEurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a BusinessDay), (iii) the principal amount of Loans to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to which existingTerm Loans or Revolving Credit Loans are to be converted, (v) if applicable, the duration of the Interest Period with respect thereto and(vi) wire instructions of the account(s) to which funds are to be disbursed (it being understood, for the avoidance of doubt, that the amount tobe disbursed to any particular account may be less than the minimum or multiple limitations set forth above so long as the aggregate amountto be disbursed to all such accounts pursuant to such Borrowing meets such minimums and multiples). Notwithstanding anything herein to thecontrary, until the Administrative Agent shall have notified the Borrower that the primary syndication of the Initial Term Loans has beencompleted, the Borrower shall not be permitted to request a Term Borrowing of Eurodollar Rate Loans with an Interest Period in excess ofone month. If the applicable Borrower fails to specify a Type of Loan in a Committed Loan Notice or fail to give a timely notice requesting aconversion or continuation, then the applicable Term Loans or Revolving Credit Loans shall be made as, or converted to, ABR Loans. Anysuch automatic conversion to ABR Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicableEurodollar Rate Loans. If the applicable Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in anysuch Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.Notwithstanding anything to the contrary herein, a Swing Line Loan may not be converted to a Eurodollar Rate Loan. If not otherwisespecified, the applicable Borrower for purposes of receiving the proceeds of a Borrowing set forth in a Committed Loan Notice or othernotice hereunder shall be the Borrower Representative.(b) Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender of theamount of its Pro Rata Share or other applicable share provided for under this Agreement of the applicable Class of Loans, and if no timelynotice of a conversion or continuation is provided by the applicable Borrower, the Administrative Agent shall notify each Lender of thedetails of any automatic conversion to ABR Loans or continuation described in Section 2.02(a) . In the case of each Borrowing, eachAppropriate Lender shall make the amount of its Loan available to the Administrative Agent in Same Day Funds at the AdministrativeAgent’s Office not later than 1:00 p.m., on the Business Day specified in the applicable Committed Loan Notice. The Administrative Agentshall make all funds so received available to the applicable Borrower in like funds as received by the Administrative Agent by wire transfer ofsuch funds in accordance with instructions provided by the applicable Borrower to (and reasonably acceptable to) the Administrative Agent;provided that if, on the date the Committed Loan Notice with respect to such Borrowing is given by such Borrower, there are L/C Borrowingsoutstanding, then the proceeds of such Borrowing shall be applied, first , to the payment in full of any such L/C Borrowing and second , tosuch Borrower as provided above.(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted only on the last day of anInterest Period for such Eurodollar Rate Loan unless the applicable Borrower pays the amount due, if any, under Section 3.05 in connectiontherewith. During the occurrence and continuation of an Event of Default, the Administrative Agent or the Required Lenders may require thatno Loans may be converted to or continued as Eurodollar Rate Loans.(d) The Administrative Agent shall promptly notify the applicable Borrower and the Lenders of the interest rate applicableto any Interest Period for Eurodollar Rate Loans upon determination of such interest rate. The determination of the Eurodollar Rate by theAdministrative Agent shall be conclusive in the absence of manifest error.(e) After giving effect to all Term Borrowings, all Revolving Credit Borrowings, all conversions of Term Loans orRevolving Credit Loans from one Type to the other, and all continuations of Term Loans or Revolving Credit Loans as the same Type, thereshall not be more than eight Interest Periods in effect (or such greater amount as may be agreed by the Administrative Agent in its solediscretion).(f) The failure of any Lender to make the Loan to be made by it as part of any Borrowing shall not relieve any other Lenderof its obligation, if any, hereunder to make its Loan on the date of such Borrowing, but no Lender shall be responsible for the failure of anyother Lender to make the Loan to be made by such other Lender on the date of any Borrowing.(g) Unless the Administrative Agent shall have received notice from a Lender prior to the date of any Borrowing that suchLender will not make available to the Administrative Agent such Lender’s Pro Rata Share or other applicable share provided for under thisAgreement of such Borrowing, the Administrative Agent may assume that such Lender has made such Pro Rata Share or other applicableshare provided for under this Agreement available to the Administrative Agent on the date of such Borrowing in accordance withSection 2.02(b) above, and the Administrative Agent may, in reliance upon such assumption, make available to the applicable Borrower onsuch date a corresponding amount. If the Administrative Agent shall have so made funds available, then, to the extent that such Lender shallnot have made such portion available to the Administrative Agent, each of such Lender and such Borrower severally agree to repay to theAdministrative Agent promptly after written demand such corresponding amount together with interest thereon, for each day from the datesuch amount is made available to such Borrower until the date such amount is repaid to the Administrative Agent at (i) in the case of suchBorrower, the interest rate applicable at the time to the Loans comprising such Borrowing and (ii) in the case of such Lender, the OvernightRate plus any administrative, processing or similar fees customarily charged by the Administrative Agent in accordance with the foregoing. Acertificate of the Administrative Agent submitted to any Lender with respect to any amounts owing under this Section 2.02(g) shall beconclusive in the absence of manifest error. If the applicable Borrower and such Lender shall pay such interest to the Administrative Agentfor the same or an overlapping period, the Administrative Agent shall promptly remit to such Borrower the amount of such interest paid bysuch Borrower for such period. If such Lender pays its share of the applicable Borrowing to the Administrative Agent, then the amount sopaid shall constitute such Lender’s Loan included in such Borrowing. Any payment by such Borrower shall be without prejudice to any claimsuch Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.Section 2.03. Letters of Credit .(a) The Letter of Credit Commitment . %4. Subject to the terms and conditions expressly set forth herein, (A) each L/CIssuer agrees, in reliance upon the agreements of the other Revolving Credit Lenders set forth in this Section 2.03 , (1) from time to time onany Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit at sightdenominated in Dollars for the account of either Borrower or any Restricted Subsidiary of a Borrower and to amend or renew Letters ofCredit previously issued by it, in accordance with Section 2.03(b) , and (2) to honor drafts under the Letters of Credit and (B) the RevolvingCredit Lenders severally agree to participate in Letters of Credit issued pursuant to this Section 2.03 ; provided that no L/C Issuer shall beobligated to make any L/C Credit Extension with respect to any Letter of Credit, and no Lender shall be obligated to participate in any Letterof Credit if as of the date of such L/C Credit Extension, (x) the Revolving Credit Exposure of any Revolving Credit Lender would exceedsuch Lender’s Revolving Credit Commitment or (y) the Outstanding Amount of the L/C Obligations would exceed the Letter of CreditSublimit. Within the foregoing limits, and subject to the terms and conditions hereof, the ability of the Borrowers and the RestrictedSubsidiaries to obtain Letters of Credit shall be fully revolving, and accordingly the Borrowers and the Restricted Subsidiaries may, duringthe foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired, terminated or that have been drawn upon andreimbursed.(i) An L/C Issuer shall be under no obligation to issue any Letter of Credit if:(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport toenjoin or restrain such L/C Issuer from issuing such Letter of Credit, or any Law applicable to such L/C Issuer or anydirective (whether or not having the force of law) from any Governmental Authority with jurisdiction over such L/C Issuershall prohibit, or direct that such L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit inparticular or shall impose upon such L/C Issuer with respect to such Letter of Credit any restriction, reserve or capitalrequirement (for which such L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shallimpose upon such L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date (forwhich such L/C Issuer is not otherwise compensated hereunder);(B) subject to Section 2.03(b)(iii) , the expiry date of such requested Letter of Credit would occur morethan 12 months after the date of issuance or last renewal unless (1) each Appropriate Lender and the L/C Issuer has approvedof such expiration date or (2) the L/C Issuer thereof has approved of such expiration date and the Outstanding Amount of L/CObligations in respect of such requested Letter of Credit has been Cash Collateralized or backstopped in a manner reasonablysatisfactory to such L/C Issuer;(C) the expiry date of such requested Letter of Credit would occur after the Letter of Credit ExpirationDate, unless such Letter of Credit has been Cash Collateralized or backstopped in a manner reasonably satisfactory to suchL/C Issuer;(D) the issuance of such Letter of Credit would violate any policies of such L/C Issuer applicable to lettersof credit generally; and(E) any Revolving Credit Lender is at that time a Defaulting Lender, unless such L/C Issuer has enteredinto arrangements, including the delivery of Cash Collateral, satisfactory to such L/C Issuer (in its sole discretion) with theapplicable Borrower or such Lender to eliminate such L/C Issuer’s actual or potential Fronting Exposure (after giving effectto Section 2.17(a)(iv) ) with respect to the Defaulting Lender arising from either the Letter of Credit then proposed to beissued or that Letter of Credit and all other L/C Obligations as to which such L/C Issuer has actual or potential FrontingExposure as it may elect in its sole discretion.(ii) An L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) such L/C Issuer would have noobligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letterof Credit does not accept the proposed amendment to such Letter of Credit.(iii) Each L/C Issuer shall act on behalf of the Revolving Credit Lenders with respect to any Letters of Creditissued by it and the documents associated therewith, and each L/C Issuer shall have all of the benefits and immunities (A) provided tothe Administrative Agent in Article IX with respect to any acts taken or omissions suffered by such L/C Issuer in connection withLetters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if theterm “Administrative Agent” as used in Article IX included such L/C Issuer with respect to such acts or omissions, and (B) asadditionally provided herein with respect to such L/C Issuer.(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit . %4. Each Letter ofCredit shall be issued or amended, as the case may be, upon the request of the Borrower Representative delivered to an L/C Issuer (with acopy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officerof the Borrower Representative. Such Letter of Credit Application must be received by the relevant L/C Issuer and the Administrative Agentnot later than 1:00 p.m., at least three Business Days prior to the proposed issuance date or date of amendment, as the case may be; or, in eachcase, such later date and time as the relevant L/C Issuer may agree in a particular instance in its sole discretion. In the case of a request for aninitial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail reasonably satisfactory to the relevantL/C Issuer: (a) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (b) the amount thereof; (c) theexpiry date thereof; (d) the name and address of the beneficiary thereof; (e) the documents to be presented by such beneficiary in case of anydrawing thereunder; (f) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; and (g) suchother matters as the relevant L/C Issuer may reasonably request. In the case of a request for an amendment of any outstanding Letter ofCredit, such Letter of Credit Application shall specify in form and detail reasonably satisfactory to the relevant L/C Issuer: (1) the Letter ofCredit to be amended; (2) the proposed date of amendment thereof (which shall be a Business Day); (3) the nature of the proposedamendment; and (4) such other matters as the relevant L/C Issuer may reasonably request.(i) Promptly after receipt of any Letter of Credit Application, the relevant L/C Issuer will confirm with theAdministrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of CreditApplication from the Borrower Representative and, if not, such L/C Issuer will provide the Administrative Agent with a copy thereof.Upon receipt by the relevant L/C Issuer of confirmation from the Administrative Agent that the requested issuance or amendment ispermitted in accordance with the terms hereof, then, subject to the terms and conditions hereof, such L/C Issuer shall, on therequested date, issue a Letter of Credit for the account of the applicable Borrower (or its applicable Restricted Subsidiary) or enterinto the applicable amendment, as the case may be. Immediately upon the issuance of each Letter of Credit, each Revolving CreditLender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the relevant L/C Issuer a riskparticipation in such Letter of Credit in an amount equal to the product of such Lender’s Pro Rata Share or other applicable shareprovided for under this Agreement times the stated amount of such Letter of Credit.(ii) If the Borrower Representative so requests in any applicable Letter of Credit Application with respect to anystandby Letter of Credit, the relevant L/C Issuer shall agree to issue a Letter of Credit that has automatic extension provisions (each,an “ Auto-Extension Letter of Credit ”); provided that any such Auto-Extension Letter of Credit must permit the relevant L/C Issuerto prevent any such extension at least once in each 12-month period (commencing with the date of issuance of such Letter of Creditand in no event extending beyond the Letter of Credit Expiration Date unless the L/C Issuer thereof has approved of such expirationdate and such Letter of Credit has been Cash Collateralized or backstopped in a manner reasonably acceptable to the AdministrativeAgent and the applicable L/C Issuer) by giving prior notice to the beneficiary thereof not later than a day (the “ Non-ExtensionNotice Date ”) in each such 12-month period to be mutually agreed upon at the time such Letter of Credit is issued. Unless otherwisedirected by the relevant L/C Issuer, the Borrower Representative shall not be required to make a specific request to the relevant L/CIssuer for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to haveauthorized (but may not require) the relevant L/C Issuer to permit the extension of such Letter of Credit at any time to an expiry datenot later than the Letter of Credit Expiration Date; provided that the relevant L/C Issuer shall not permit any such extension if (A) therelevant L/C Issuer has determined that it would have no obligation at such time to issue such Letter of Credit in its extended formunder the terms hereof (by reason of the provisions of Section 2.03(a)(ii) or otherwise), or (B) it has received notice (which may be bytelephone or in writing) on or before the day that is seven Business Days before the Non-Extension Notice Date from theAdministrative Agent, any Revolving Credit Lender or the Borrower Representative that one or more of the applicable conditionsspecified in Section 4.02 is not then satisfied or waived.(iii) Promptly after issuance of any Letter of Credit or any amendment to a Letter of Credit, the relevant L/C Issuerwill also deliver to the Borrower Representative and the Administrative Agent a true and complete copy of such Letter of Credit oramendment.(c) Drawings and Reimbursements; Funding of Participations . %4. Upon receipt from the beneficiary of any Letter ofCredit of any notice of a drawing under such Letter of Credit, the relevant L/C Issuer shall notify promptly the Borrower Representative andthe Administrative Agent thereof. Not later than 1:00 p.m., on the first Business Day immediately following any payment by an L/C Issuerunder a Letter of Credit, with written notice to the Borrower Representative (each such date, an “ Honor Date ”), the Borrowers shall bejointly and severally liable to reimburse such L/C Issuer through the Administrative Agent in an amount equal to the amount of such drawingin Dollars; provided that if such reimbursement is not made on the date of drawing, the Borrowers shall pay interest to the relevant L/C Issueron such amount at the rate applicable to ABR Loans (without duplication of interest payable on L/C Borrowings). The applicable L/C Issuershall notify the Borrower Representative in writing of the amount of the drawing promptly following the determination thereof. If theBorrowers fails to so reimburse such L/C Issuer by such time, the Administrative Agent shall promptly notify each Appropriate Lender of theHonor Date, the amount of the unreimbursed drawing (the “ Unreimbursed Amount ”) and the amount of such Appropriate Lender’s ProRata Share or other applicable share provided for under this Agreement thereof. In such event, the Borrower Representative shall be deemedto have requested a Revolving Credit Borrowing of ABR Loans to be disbursed on the Honor Date in an amount equal to the UnreimbursedAmount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of ABR Loans but subject to theamount of the unutilized portion of the Revolving Credit Commitments of the Appropriate Lenders and the conditions set forth inSection 4.02 (other than the delivery of a Committed Loan Notice). Any notice given by an L/C Issuer or the Administrative Agent pursuantto this Section 2.03(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediateconfirmation shall not affect the conclusiveness or binding effect of such notice.(i) Each Appropriate Lender (including any Lender acting as an L/C Issuer) shall upon any notice pursuant toSection 2.03(c)(i) make funds available to the Administrative Agent for the account of the relevant L/C Issuer in Dollars at theAdministrative Agent’s Office for payments in an amount equal to its Pro Rata Share or other applicable share provided for under thisAgreement of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the AdministrativeAgent, whereupon, subject to the provisions of Section 2.03(c)(iii) , each Appropriate Lender that so makes funds available shall bedeemed to have made an ABR Loan to the Borrowers in such amount. The Administrative Agent shall remit the funds so received tothe relevant L/C Issuer.(ii) With respect to any Unreimbursed Amount that is not fully refinanced by a Revolving Credit Borrowing ofABR Loans because the conditions set forth in Section 4.02 cannot be satisfied or for any other reason, the Borrowers shall bedeemed to have incurred from the relevant L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not sorefinanced, which L/C Borrowing shall be due and payable on written demand (together with interest) and shall bear interest at theDefault Rate for Revolving Credit Loans (which begins to accrue upon funding by the applicable L/C Issuer). In such event, eachAppropriate Lender’s payment to the Administrative Agent for the account of the relevant L/C Issuer pursuant to Section 2.03(c)(ii)shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lenderin satisfaction of its participation obligation under this Section 2.03 .(iii) Until each Appropriate Lender funds its Revolving Credit Loan or L/C Advance pursuant to thisSection 2.03(c) to reimburse the relevant L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of suchLender’s Pro Rata Share or other applicable share provided for under this Agreement of such amount shall be solely for the accountof the relevant L/C Issuer.(iv) Each Revolving Credit Lender’s obligation to make Revolving Credit Loans or L/C Advances to reimburse anL/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.03(c) , shall be absolute and unconditionaland shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which suchLender may have against the relevant L/C Issuer, either Borrower or any other Person for any reason whatsoever; (B) the occurrenceor continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; providedthat each Revolving Credit Lender’s obligation to make Revolving Credit Loans pursuant to this Section 2.03(c) is subject to theconditions set forth in Section 4.02 (other than delivery by the Borrower Representative of a Committed Loan Notice). No suchmaking of an L/C Advance shall relieve or otherwise impair the obligation of the Borrowers to reimburse the relevant L/C Issuer forthe amount of any payment made by such L/C Issuer under any Letter of Credit, together with interest as provided herein.(v) If any Revolving Credit Lender fails to make available to the Administrative Agent for the account of therelevant L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.03(c) by thetime specified in Section 2.03(c)(ii) , such L/C Issuer shall be entitled to recover from such Lender (acting through the AdministrativeAgent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which suchpayment is immediately available to such L/C Issuer at a rate per annum equal to the applicable Overnight Rate from time to time ineffect, plus any reasonable administrative, processing or similar fees customarily charged by such L/C Issuer in connection with theforegoing. A certificate of the relevant L/C Issuer submitted to any Revolving Credit Lender (through the Administrative Agent) withrespect to any amounts owing under this Section 2.03(c)(vi) shall be conclusive absent manifest error.(d) Repayment of Participations . %4. If, at any time after an L/C Issuer has made a payment under any Letter of Creditand has received from any Revolving Credit Lender such Lender’s L/C Advance in respect of such payment in accordance withSection 2.03(c) , the Administrative Agent receives for the account of such L/C Issuer any payment in respect of the related UnreimbursedAmount or interest thereon (whether directly from the Borrowers or otherwise, including proceeds of Cash Collateral applied thereto by theAdministrative Agent), the Administrative Agent will distribute to such Lender its Pro Rata Share or other applicable share provided forunder this Agreement thereof (appropriately adjusted, in the case of interest payments, to reflect the period of time during which suchLender’s L/C Advance was outstanding) in the amount received by the Administrative Agent.(i) If any payment received by the Administrative Agent for the account of an L/C Issuer pursuant toSection 2.03(c)(i) is required to be returned under any of the circumstances described in Section 10.06 (including pursuant to anysettlement entered into by such L/C Issuer in its discretion), each Appropriate Lender shall pay to the Administrative Agent for theaccount of such L/C Issuer its Pro Rata Share or other applicable share provided for under this Agreement thereof on demand of theAdministrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at arate per annum equal to the applicable Overnight Rate from time to time in effect, plus any reasonable administrative, processing orsimilar fees customarily charged by such L/C Issuer in connection with the foregoing.(e) Obligations Absolute . The obligation of the Borrowers to reimburse the relevant L/C Issuer for each drawing undereach Letter of Credit issued by it and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictlyin accordance with the terms of this Agreement under all circumstances, including the following:(i) any lack of validity or enforceability of such Letter of Credit, this Agreement or any other agreement orinstrument relating thereto;(ii) the existence of any claim, counterclaim, setoff, defense or other right that any Loan Party may have at anytime against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any suchtransferee may be acting), the relevant L/C Issuer or any other Person, whether in connection with this Agreement, the transactionscontemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged,fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss ordelay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;(iv) any payment by the relevant L/C Issuer under such Letter of Credit against presentation of a draft or certificatethat does not strictly comply with the terms of such Letter of Credit; or any payment made by the relevant L/C Issuer under suchLetter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors,liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including anyarising in connection with any proceeding under any Debtor Relief Law;(v) any exchange, release or non-perfection of any Collateral, or any release or amendment or waiver of or consentto departure from the Guaranty or any other guarantee, for all or any of the Obligations of any Loan Party in respect of such Letter ofCredit; or(vi) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including anyother circumstance that might otherwise constitute a defense available to, or a discharge of, any Loan Party (other than payment incash or performance in full);provided that the foregoing in clauses (i) through (vi) shall not excuse any L/C Issuer from liability to either Borrower to the extent of anydirect damages (as opposed to consequential or exemplary damages, claims in respect of which are waived by the Borrowers to the extentpermitted by applicable Law) suffered by such Borrower that are caused by such L/C Issuer’s (or its Related Parties’) gross negligence orwillful misconduct as determined in a final and non-appealable judgment by a court of competent jurisdiction when determining whetherdrafts and other documents presented under a Letter of Credit comply with the terms thereof.(f) Role of L/C Issuers . Each Lender and each Borrower agrees that, in paying any drawing under a Letter of Credit, therelevant L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expresslyrequired by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Personexecuting or delivering any such document. None of the L/C Issuers, any Agent-Related Person nor any of the respective correspondents,participants or assignees of any L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at therequest or with the approval of the Lenders or the Lenders holding a majority of the Revolving Credit Commitments, as applicable; (ii) anyaction taken or omitted in the absence of gross negligence or willful misconduct as determined in a final and non-appealable judgment by acourt of competent jurisdiction; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related toany Letter of Credit or Letter of Credit Application. The Borrowers hereby assume all risks of the acts or omissions of any beneficiary ortransferee with respect to either of their use of any Letter of Credit; provided that this assumption is not intended to, and shall not, precludeeither Borrower pursuing such rights and remedies as they may have against the beneficiary or transferee at law or under any otheragreement. None of the L/C Issuers, any Agent-Related Person, nor any of the respective correspondents, participants or assignees of any L/CIssuer, shall be liable or responsible for any of the matters described in clauses (i) through (vi) of Section 2.03(e) ; provided that anything insuch clauses to the contrary notwithstanding, a Borrower may have a claim against an L/C Issuer, and such L/C Issuer may be liable to suchBorrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by such Borrowerwhich such Borrower proves were caused by such L/C Issuer’s (or its Related Parties’) willful misconduct or gross negligence or such L/CIssuer’s (or its Related Parties’) willful misconduct or grossly negligent failure to pay under any Letter of Credit after the presentation to it bythe beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit, in each case asdetermined in a final and non-appealable judgment by a court of competent jurisdiction. In furtherance and not in limitation of the foregoing,each L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless ofany notice or information to the contrary, and no L/C Issuer shall be responsible for the validity or sufficiency of any instrument transferringor assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part,which may prove to be invalid or ineffective for any reason.(g) Cash Collateral . %4. If, as of the Letter of Credit Expiration Date, any Letter of Credit may for any reason remainoutstanding and partially or wholly undrawn, (ii) if any Event of Default occurs and is continuing and the Administrative Agent or theLenders holding a majority of the Revolving Credit Commitments, as applicable, require the Borrowers to Cash Collateralize the L/CObligations pursuant to Section 8.02 or (iii) if an Event of Default set forth under Section 8.01(f) occurs and is continuing, the Borrowersshall Cash Collateralize all L/C Obligations in an amount equal to 105% of the Outstanding Amount of such L/C Obligations determined asof such date, and shall do so not later than 2:00 p.m. on (x) in the case of the immediately preceding clauses (i) and (ii) , the next BusinessDay following the Business Day that the Borrower Representative receives written notice thereof, and (y) in the case of the immediatelypreceding clause (iii) , the Business Day on which an Event of Default set forth under Section 8.01(f) occurs or, if such day is not a BusinessDay, the Business Day immediately succeeding such day. At any time that there shall exist a Defaulting Lender, promptly upon the writtenrequest of the Administrative Agent or the applicable L/C Issuer, the Borrowers shall deliver to the Administrative Agent Cash Collateral inan amount sufficient to cover all Fronting Exposure (solely after giving effect to Section 2.17(a)(iv) and any Cash Collateral provided by theDefaulting Lender). For purposes hereof, “ Cash Collateralize ” means to pledge and deposit with or deliver to the Administrative Agent, forthe benefit of the relevant L/C Issuer and the Appropriate Lenders, as collateral for the L/C Obligations, cash or deposit account balances (“Cash Collateral ”) pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the relevantL/C Issuer (which documents are hereby consented to by the Appropriate Lenders). Derivatives of such term have corresponding meanings.The Borrower hereby grant to the Administrative Agent, for the benefit of the L/C Issuers and the Revolving Credit Lenders of the applicableFacility, a security interest in all such cash, deposit accounts and all balances therein and all proceeds of the foregoing. Cash Collateral shallbe maintained in blocked accounts at the Administrative Agent and may be invested in readily available Cash Equivalents (for the benefit ofthe Borrowers). If at any time the Administrative Agent determines that any funds held as Cash Collateral are expressly subject to any right orclaim of any Person other than the Administrative Agent (on behalf of the Secured Parties) or nonconsensual liens permitted under Section7.01 or that the total amount of such funds is less than the aggregate Outstanding Amount of all L/C Obligations, the Borrowers will,promptly following written demand by the Administrative Agent, pay to the Administrative Agent, as additional funds to be deposited andheld in the deposit accounts at the Administrative Agent as aforesaid, an amount equal to the excess of (a) such aggregate OutstandingAmount over (b) the total amount of funds, if any, then held as Cash Collateral that the Administrative Agent reasonably determines to befree and clear of any such right and claim. Upon the drawing of any Letter of Credit for which funds are on deposit as Cash Collateral, suchfunds shall be applied, to the extent permitted under applicable Law, to reimburse the relevant L/C Issuer. To the extent the amount of anyCash Collateral exceeds the then Outstanding Amount of such L/C Obligations and so long as no Event of Default has occurred and iscontinuing, the excess shall be refunded to the Borrowers. To the extent any Event of Default giving rise to the requirement to CashCollateralize any Letter of Credit pursuant to this Section 2.03(g) is cured or otherwise waived by the Required Lenders, then so long as noother Event of Default has occurred and is continuing, all Cash Collateral pledged to Cash Collateralize such Letter of Credit shall bepromptly refunded to the applicable. If at any time the Administrative Agent reasonably determines that Cash Collateral is subject to any rightor claim of any Person other than the Administrative Agent as herein provided or Liens described above, or that the total amount of such CashCollateral is less than the applicable Fronting Exposure and other obligations secured thereby, the Borrowers or the relevant DefaultingLender will, promptly following written demand by the Administrative Agent, pay or provide to the Administrative Agent additional CashCollateral in an amount sufficient to eliminate such deficiency.(h) Letter of Credit Fees . The Borrowers shall pay to the Administrative Agent for the account of each Revolving CreditLender for the applicable Revolving Credit Facility in accordance with its Pro Rata Share or other applicable share provided for under thisAgreement a Letter of Credit fee for each Letter of Credit issued pursuant to this Agreement equal to the Applicable Margin times the dailymaximum amount then available to be drawn under such Letter of Credit (whether or not such maximum amount is then in effect under suchLetter of Credit if such maximum amount increases periodically pursuant to the terms of such Letter of Credit) ; provided that (x) if anyportion of a Defaulting Lender’s Pro Rata Share of any Letter of Credit is Cash Collateralized by the Borrowers or reallocated to the otherRevolving Credit Lenders pursuant to Section 2.17(a)(iv) , then the Borrowers shall not be required to pay a Letter of Credit fee to suchDefaulting Lender with respect to such portion of such Defaulting Lender’s Pro Rata Share so long as it is Cash Collateralized by theBorrowers or reallocated to the other Revolving Credit Lenders, but such Letter of Credit fee shall instead be payable to such other RevolvingCredit Lenders in accordance with their Pro Rata Share of such reallocated amount, and (y) if any portion of a Defaulting Lender’s Pro RataShare is not Cash Collateralized or reallocated pursuant to Section 2.17(a)(iv) , then the Letter of Credit fee with respect to such DefaultingLender’s Pro Rata Share shall be payable to the applicable L/C Issuer until such Pro Rata Share is Cash Collateralized or reallocated or suchLender ceases to be a Defaulting Lender. Such Letter of Credit fees shall be computed on a quarterly basis in arrears. Such Letter of Creditfees shall be due and payable in Dollars on the last Business Day of each March, June, September and December, commencing with the firstsuch date to occur after the issuance of such Letter of Credit, on the earlier to occur of the Letter of Credit Expiration Date and the MaturityDate then in effect for the applicable Revolving Credit Facility or the date on which the Revolving Credit Commitment of all Lenders shall beterminated as provided herein. If there is any change in the Applicable Margin during any quarter, the daily maximum amount of each Letterof Credit shall be computed and multiplied by the Applicable Margin separately for each period during such quarter that such ApplicableMargin was in effect.(i) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuers . The Borrowers shall be jointly andseverally liable pay directly to each L/C Issuer for its own account a fronting fee with respect to each Letter of Credit issued by it to anyConsolidated Party equal to 0.125% per annum of the maximum amount available to be drawn under such Letter of Credit (whether or notsuch maximum amount is then in effect under such Letter of Credit if such maximum amount increases periodically pursuant to the terms ofsuch Letter of Credit) or such lesser fee as may be agreed with such L/C Issuer (the “ L/C Fronting Fee ”). Such fronting fees shall becomputed on a quarterly basis in arrears. Such fronting fees shall be due and payable in Dollars on the last Business Day of each March, June,September and December, commencing with the first such date to occur after the issuance of such Letter of Credit, on the earlier to occur ofthe Letter of Credit Expiration Date and the date on which the Revolving Credit Commitment of all Lenders shall be terminated as providedherein. In addition, the Borrowers shall pay directly to each L/C Issuer for its own account with respect to each Letter of Credit issued to theLoan Parties the customary and reasonable issuance, presentation, amendment and other processing fees, and other standard costs andcharges, of such L/C Issuer relating to letters of credit as from time to time in effect. Such customary fees and standard costs and charges aredue and payable within 10 Business Days of demand and are nonrefundable.(j) Conflict with Letter of Credit Application . Notwithstanding anything else to the contrary in this Agreement or anyLetter of Credit Application, in the event of any conflict between the terms hereof and the terms of any Letter of Credit Application, the termshereof shall control.(k) Addition of an L/C Issuer . A Revolving Credit Lender reasonably acceptable to the Borrowers may become anadditional L/C Issuer hereunder pursuant to a written agreement among the Borrowers, the Administrative Agent and such Revolving CreditLender. The Administrative Agent shall notify the Revolving Credit Lenders of any such additional L/C Issuer.(l) Reporting . Each L/C Issuer will report in writing to the Administrative Agent (i) on the first Business Day of eachcalendar month, the aggregate face amount of Letters of Credit issued by it and outstanding as of the last Business Day of the precedingcalendar month (and on such other dates as the Administrative Agent may request), (ii) on or prior to each Business Day on which such L/CIssuer expects to issue, amend, renew or extend any Letter of Credit, the date of such issuance or amendment, and the aggregate face amountof Letters of Credit to be issued, amended, renewed or extended by it and outstanding after giving effect to such issuance, amendment,renewal or extension (and such L/C Issuer shall advise the Administrative Agent on such Business Day whether such issuance, amendment,renewal or extension occurred and whether the amount thereof changed), (iii) on each Business Day on which such L/C Issuer makes any L/CDisbursement, the date and amount of such L/C Disbursement and (iv) on any Business Day on which the Borrowers fail to reimburse an L/CDisbursement required to be reimbursed to such L/C Issuer on such day, the date and amount of such failure.(m) Provisions Related to Extended Revolving Credit Commitments . If the Letter of Credit Expiration Date in respect ofany tranche of Revolving Credit Commitments occurs prior to the expiry date of any Letter of Credit, then (i) if one or more other tranches ofRevolving Credit Commitments in respect of which the Letter of Credit Expiration Date shall not have so occurred are then in effect, suchLetters of Credit shall, to the extent such Letters of Credit could have been issued under such other tranches, automatically be deemed to havebeen issued (including for purposes of the obligations of the Revolving Credit Lenders to purchase participations therein and to makeRevolving Credit Loans and payments in respect thereof pursuant to Sections 2.03(c) and (d) ) under (and ratably participated in by Lenderspursuant to) the Revolving Credit Commitments in respect of such non-terminating tranches up to an aggregate amount not to exceed theaggregate principal amount of the unutilized Revolving Credit Commitments thereunder at such time (it being understood that no partial faceamount of any Letter of Credit may be so reallocated) and (ii) to the extent not reallocated pursuant to the immediately preceding clause (i) ,the Borrowers shall Cash Collateralize any such Letter of Credit in accordance with Section 2.03(g) . Commencing with the maturity date ofany tranche of Revolving Credit Commitments, the sublimit for Letters of Credit shall be agreed solely with each L/C Issuer.(n) Letters of Credit Issued for Subsidiaries . Notwithstanding that a Letter of Credit issued or outstanding hereunder is insupport of any obligations of, or is for the account of, a Restricted Subsidiary, the Borrowers shall be jointly and severally obligated toreimburse the applicable L/C Issuer hereunder for any and all drawings under such Letter of Credit. Each Borrower hereby acknowledges thatthe issuance of Letters of Credit for the account of Restricted Subsidiaries (whether or not a direct or indirect Subsidairy of such Borrower)inures to the benefit of such Borrower, and that such Borrower’s business derives substantial benefits from the businesses of such RestrictedSubsidiaries.Section 2.04. Swing Line Loans .(a) Swing Line Facility . Subject to the terms and conditions set forth herein, the Swing Line Lender, in reliance upon theagreements of the other Lenders set forth in this Section 2.04 , may, in its sole discretion, make loans (each such loan, a “ Swing Line Loan”) to any Borrower in Dollars from time to time on any Business Day during the Availability Period in an aggregate amount not to exceed atany time outstanding the amount of the Swing Line Sublimit; provided , however , that after giving effect to any Swing Line Loan, (i) theamount outstanding of all Revolving Credit Loans, Swing Line Loans and L/C Obligations shall not exceed the aggregate Revolving CreditCommitments, and (ii) the Revolving Credit Exposure of any Lender shall not exceed such Lender’s Revolving Credit Commitment. Withinthe foregoing limits, and subject to the other terms and conditions hereof, each Borrower may borrow under this Section 2.04 , prepay underSection 2.05 , and reborrow under this Section 2.04 . Each Swing Line Loan shall be an ABR Loan. Immediately upon the making of a SwingLine Loan, each Revolving Credit Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the SwingLine Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender’s Pro Rata Share of the RevolvingCredit Commitments times the amount of such Swing Line Loan.(b) Borrowing Procedures . Each Borrowing of Swing Line Loans shall be made upon the applicable Borrower’sirrevocable notice to the Swing Line Lender and the Administrative Agent, which may be given by (A) telephone or (B) a Committed LoanNotice; provided that any telephonic notice must be confirmed immediately by delivery to the Swing Line Lender and the AdministrativeAgent of a Swing Line Loan Notice. Each such notice must be received by the Swing Line Lender and the Administrative Agent not laterthan 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum principal amountof $500,000 (and any amount in excess of $500,000 shall be in integral multiples of $100,000), and (ii) the requested borrowing date, whichshall be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to the Swing Line Lender and theAdministrative Agent of a written Swing Line Loan Notice, appropriately completed and signed by a Responsible Officer of the applicableBorrower. Promptly after receipt by the Swing Line Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will confirmwith the Administrative Agent (by telephone or in writing) that the Administrative Agent has also received such Swing Line Loan Notice and,if not, the Swing Line Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof. Unless the Swing LineLender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) prior to 2:00p.m. on the date of the proposed Borrowing of Swing Line Loans (A) directing the Swing Line Lender not to make such Swing Line Loan asa result of the limitations set forth in the proviso to the first sentence of Section 2.04(a) , or (B) that one or more of the applicable conditionsspecified in Article IV is not then satisfied, then, subject to the terms and conditions hereof, the Swing Line Lender will, not later than 5:00p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to the applicableBorrower.(c) Refinancing of Swing Line Loans .(ii) The Swing Line Lender at any time in its sole discretion may request, on behalf of any Borrower (which herebyirrevocably requests and authorizes the Swing Line Lender to so request on its behalf), that each Lender make an ABR Loan in anamount equal to such Lender’s Pro Rata Share of the amount of Swing Line Loans then outstanding. Such request shall be made inwriting (which written request shall be deemed to be a Committed Loan Notice for purposes hereof) and in accordance with therequirements of Section 2.02 , without regard to the minimum and multiples specified therein for the principal amount of ABR Loans,but subject to the conditions set forth in Section 4.02 (other than the delivery of a Committed Loan Notice); provided that, aftergiving effect to such Borrowing, the amount outstanding of all Revolving Credit Loans, Swing Line Loans and L/C Obligations shallnot exceed the aggregate Revolving Credit Commitments. The Swing Line Lender shall furnish the applicable Borrower with a copyof the applicable Committed Loan Notice promptly after delivering such notice to the Administrative Agent. Each Lender shall makean amount equal to its applicable percentage of the amount specified in such Committed Loan Notice available to the AdministrativeAgent in immediately available funds for the account of the Swing Line Lender not later than 1:00 p.m. on the day specified in suchCommitted Loan Notice, whereupon, subject to Section 2.04(c)(ii) , each Lender that so makes funds available shall be deemed tohave made an ABR Loan to the applicable Borrower in such amount. The Administrative Agent shall remit the funds so received tothe Swing Line Lender.(iii) [reserved].(iv) If any Lender fails to make available to the Administrative Agent for the account of the Swing Line Lenderany amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.04(c) by the time specified inSection 2.04(c)(i) , the Swing Line Lender shall be entitled to recover from such Lender (acting through the Administrative Agent),on demand, such amount with interest thereon for the period from the date such payment is required to the date on which suchpayment is immediately available to the Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Rate and arate determined by the Swing Line Lender in accordance with banking industry rules on interbank compensation. A certificate of theSwing Line Lender submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause(iii) shall be conclusive absent manifest error.(v) Each Lender’s obligation to make Revolving Credit Loans or to purchase and fund risk participations in SwingLine Loans pursuant to this Section 2.04(c) shall be absolute and unconditional and shall not be affected by any circumstance,including (A) any setoff, counterclaim, recoupment, defense or other right that such Lender may have against the Swing Line Lender,any Borrower or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any otheroccurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation tomake Revolving Credit Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in Section 4.02 . No such purchaseor funding of risk participations shall relieve or otherwise impair the obligation of any Borrower to repay Swing Line Loans, togetherwith interest as provided herein.(d) Repayment of Participations .(vii) At any time after any Lender has purchased and funded a risk participation in a Swing Line Loan, if the SwingLine Lender receives any payment on account of such Swing Line Loan, the Swing Line Lender will distribute to such Lender its ProRata Share of such payment (appropriately adjusted, in the case of interest payments, to reflect the period of time during which suchLender’s risk participation was funded) in the same funds as those received by the Swing Line Lender.(viii) If any payment received by the Swing Line Lender in respect of principal or interest on any Swing Line Loanis required to be returned by the Swing Line Lender under any of the circumstances described in Section 10.06 (including pursuant toany settlement entered into by the Swing Line Lender in its discretion), each Lender shall pay to the Swing Line Lender its Pro RataShare thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount isreturned, at a rate per annum equal to the Federal Funds Rate. The Administrative Agent will make such demand upon the request ofthe Swing Line Lender. The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and thetermination of this Agreement.(e) Interest for Account of Swing Line Lender . The Swing Line Lender shall be responsible for invoicing the applicableBorrower for interest on the Swing Line Loans. Until each Revolving Credit Lender funds its Revolving Credit Loans that are ABR Loans orrisk participation pursuant to this Section 2.04 to refinance such Revolving Credit Lender’s Pro Rata Share of any Swing Line Loan, interestin respect of such Pro Rata Share shall be solely for the account of the Swing Line Lender.(f) Payments Directly to Swing Line Lender . The Borrowers shall make all payments of principal and interest in respect ofthe Swing Line Loans directly to the Swing Line Lender.(g) Participations. The Swing Line Lender (i) may at any time in its discretion, and (ii) no less frequently than every fiveBusiness Days or as directed by the Administrative Agent from time to time on not less than one Business Day’s written notice to the SwingLine Lender, shall by written notice given to the Administrative Agent (provided such notice requirements shall not apply if the Swing LineLender and the Administrative Agent are the same entity) not later than 11:00 a.m., New York City time, on the next succeeding BusinessDay following such notice require the Revolving Credit Lenders to acquire participations on such Business Day in all or a portion of theSwing Line Loans then outstanding. Such notice shall specify the aggregate amount of Swing Line Loans in which Revolving Credit Lenderswill participate. Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Revolving Credit Lender,specifying in such notice such Revolving Credit Lender’s Pro Rata Percentage of such Swing Line Loan or Loans. Each Revolving CreditLender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for theaccount of the Swing Line Lender, such Lender’s Pro Rata Percentage of such Swing Line Loan or Loans. Each Revolving Credit Lenderacknowledges and agrees that its obligation to acquire participations in Swing Line Loans pursuant to this Section 2.04(g) is absolute andunconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reductionor termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reductionwhatsoever (so long as such payment shall not cause such Lender’s Revolving Credit Exposure to exceed such Lender’s Revolving CreditCommitment). Each Revolving Credit Lender shall comply with its obligation under this Section 2.04(g) by wire transfer of immediatelyavailable funds, in the same manner as provided in Section 2.02(b) with respect to Loans made by such Lender (and Section 2.02 shall apply,mutatis mutandis , to the payment obligations of the Revolving Credit Lenders), and the Administrative Agent shall promptly pay to theSwing Line Lender the amounts so received by it from the Revolving Credit Lenders. The Administrative Agent shall notify the Borrowers ofany participations in any Swing Line Loan acquired by the Revolving Credit Lenders pursuant to this Section 2.04(g) , and thereafterpayments in respect of such Swing Line Loan shall be made to the Administrative Agent and not to the Swing Line Lender. Any amountsreceived by the Swing Line Lender from the Borrowers (or other party on behalf of the Borrowers) in respect of a Swing Line Loan afterreceipt by the Swing Line Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent.Any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Revolving CreditLenders that shall have made their payments pursuant to this Section 2.04(g) , as their interests may appear. The purchase of participations ina Swing Line Loan pursuant to this Section 2.04(g) shall not relieve the Borrowers of any default in the payment thereof.(h) Resignation or Removal of the Swing Line Lender. The Swing Line Lender may resign as the Swing Line Lenderhereunder at any time upon at least 30 days’ prior written notice to the Lenders, the Administrative Agent and the Borrower Representative.Following such notice of resignation, the Swing Line Lender may be replaced at any time by written agreement among the Borrowers (withBorrowers’ agreement not to be unreasonably withheld, delayed or conditioned), the Administrative Agent and the successor Swing LineLender. The Administrative Agent shall notify the Lenders of any such replacement of the Swing Line Lender. At the time any suchresignation or replacement shall become effective, the Borrowers shall pay all unpaid fees accrued for the account of the replaced Swing LineLender. From and after the effective date of any such resignation or replacement, (i) the successor Swing Line Lender shall have all the rightsand obligations of the Swing Line Lender under this Agreement with respect to Swing Line Loans to be made by it thereafter and (ii)references herein and in the other Loan Documents to the term “Swing Line Lender” shall be deemed to refer to such successor or to anyprevious Swing Line Lender, or to such successor and all previous Swing Line Lenders, as the context shall require. After the resignation orreplacement of the Swing Line Lender hereunder, the replaced Swing Line Lender shall remain a party hereto and shall continue to have allthe rights and obligations of the Swing Line Lender under this Agreement with respect to Swing Line Loans made by it prior to suchresignation or replacement, but shall not be required to make additional Swing Line Loans. Notwithstanding anything to the contrary in thisSection 2.04(h) or otherwise, the Swing Line Lender may not resign until such time as a successor Swing Line Lender has been appointed.Section 2.05. Prepayments .(a) Optional . %4. The Borrowers may, upon notice to the Administrative Agent, at any time or from time to timevoluntarily prepay any Class or Classes of Term Loans, Revolving Credit Loans and Swing Line Loans of any Class or Classes in whole or inpart without premium or penalty (except as expressly set forth in this Section 2.05 ); provided that (1) such notice must be received by theAdministrative Agent not later than 1:00 p.m. (or 2:00 p.m. with respect to Swing Line Loans) (A) three Business Days prior to any date ofprepayment of Eurodollar Rate Loans and (B) on the Business Day prior to any prepayment of ABR Loans or Swing Line Loans; (2) anyprepayment of Eurodollar Rate Loans shall be in a minimum principal amount of $2,000,000, or a whole multiple of $1,000,000 in excessthereof; and (3) any prepayment of ABR Loans shall be in a minimum principal amount of $1,000,000 or a whole multiple of $500,000 inexcess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such notice shall specify the date andamount of such prepayment and the Class(es) and Type(s) of Loans to be prepaid. The Administrative Agent will promptly notify eachAppropriate Lender of its receipt of each such notice, and of the amount of such Lender’s Pro Rata Share or other applicable share providedfor under this Agreement of such prepayment. If such notice is given by the applicable Borrower, unless rescinded pursuant to clause (iii)below, such Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the datespecified therein. Any prepayment of a Loan (other than prepayments of ABR Revolving Credit Loans that are not made in connection withthe termination or permanent reduction of the Revolving Credit Commitments) shall be accompanied by all accrued interest thereon, togetherwith any additional amounts required pursuant to clause (ii) below and Section 3.05 . In the case of each prepayment of the Loans pursuant tothis Section 2.05(a) , each Borrower may in its sole discretion select the Borrowing or Borrowings to be repaid, and such payment shall bepaid to the Appropriate Lenders in accordance with their respective Pro Rata Shares or other applicable share provided for under thisAgreement.(vi) Notwithstanding anything to the contrary contained in this Agreement, in the event that, on or prior to the datethat is twelve months after the Closing Date, any Loan Party (x) prepays, refinances, substitutes or replaces any Initial Term Loans inconnection with a Repricing Event or (y) effects any amendment of this Agreement resulting in a Repricing Event, the Borrowersshall pay to the Administrative Agent (A) in the case of clause (x) , for the ratable account of each of the applicable Lenders aprepayment premium of 1.00% of the aggregate principal amount of the Initial Term Loans so prepaid, refinanced, substituted orreplaced and (B) in the case of clause (y) , for the ratable account of each of the Lenders (including any Lender that withholds itsconsent to such amendment and that is required to assign its Initial Term Loan pursuant to Section 3.07 ), a fee equal to 1.00% of theaggregate principal amount of the applicable Initial Term Loans of such Lender outstanding immediately prior to such amendment.Such amounts shall be due and payable on the date of effectiveness of such Repricing Event or amendment and shall be a conditionprecedent to the effectiveness of any such amendment.(vii) Notwithstanding anything to the contrary contained in this Agreement, the Borrowers may rescind any noticeof prepayment under Section 2.05(a)(i) by notice to the Administrative Agent on the date of prepayment if such prepayment wouldhave resulted from a refinancing of all or any portion of the applicable Class or occurrence of another event, which refinancing orevent shall not be consummated or shall otherwise be delayed (subject to payment of amounts due under Section 3.05 ).(viii) Voluntary prepayments of any Class of Term Loans permitted hereunder shall be applied to the remainingscheduled installments of principal thereof pursuant to Section 2.07(a) in a manner determined at the discretion of the Borrowers andspecified in the notice of prepayment (and absent such direction, in direct order of maturity).(b) Mandatory . %4. Within five Business Days after financial statements have been delivered pursuant to Section 6.01(a)(commencing in respect of the fiscal year ending December 31, 2016) and the related Compliance Certificate has been delivered pursuant toSection 6.02(a) , the Borrowers shall cause to be prepaid an aggregate principal amount of Term Loans in an amount equal to (A) theApplicable ECF Percentage of Excess Cash Flow, if any, for the fiscal year covered by such financial statements minus , (B) at the option ofthe Borrowers (without duplication of any amount deducted from Consolidated Net Income in calculating Excess Cash Flow for such period)(x) the sum of (1) all voluntary prepayments of Term Loans during such fiscal year or after year-end and prior to when such Excess CashFlow prepayment is due, and (2) all voluntary prepayments of Revolving Credit Loans, Extended Revolving Credit Loans, RefinancingRevolving Credit Loans and Incremental Revolving Loans during such fiscal year or after year-end and prior to when such Excess Cash Flowprepayment is due, to the extent the Revolving Credit Commitments, Extended Revolving Credit Commitments, Refinancing RevolvingCredit Commitments and/or Revolving Commitment Increase, as the case may be, are permanently reduced by the amount of such payments,in the case of each of the immediately preceding clauses (1) and (2) , to the extent such prepayments are funded with Internally GeneratedCash and are in respect of Indebtedness that is secured on a pari passu basis with the Facilities; provided that, to the extent any deduction ismade pursuant to the foregoing clauses (1) and (2) after year-end and prior to when such Excess Cash Flow prepayment is due, suchprepayment shall not be deducted with respect to the Excess Cash Flow prepayment for the succeeding fiscal year and (y) incrementalreserves of the BD Subsidiary in an aggregate amount for any Excess Cash Flow Period equal to the lesser of (1) the amount that is necessaryto meet the capital reserve requirements of the BD Subsidiary for such period and (2) $5,000,000.(vi) If (1) any Consolidated Party Disposes of any property or assets pursuant to Sections 7.05(i) . (l) or (m) , or(2) any Casualty Event occurs, which results in the realization or receipt by a Consolidated Party of Net Proceeds, the Borrowers shallcause to be prepaid on or prior to the date which is five Business Days after the date of the realization or receipt by a Borrower or anyRestricted Subsidiary of such Net Proceeds (or such later time that Borrower is entitled to reinvest Net Proceeds as provided in thedefinition of “Net Proceeds”), an aggregate principal amount of Term Loans in an amount equal to 100% of all such Net Proceeds;provided that if at the time that any such prepayment would be required, the Borrowers are required to offer to repurchase PermittedEqual Priority Refinancing Debt (to the extent secured by Liens on the Collateral on a pari passu basis with the Obligations) and thePermitted Refinancing of any such Indebtedness, in each case pursuant to the terms of the documentation governing suchIndebtedness with the net proceeds of such Disposition or Casualty Event (such Permitted Equal Priority Refinancing Debt (or thePermitted Refinancing of any such Indebtedness) required to be offered to be so repurchased, “ Other Applicable Indebtedness ”),then the Borrowers may apply such Net Proceeds on a pro rata basis (determined on the basis of the aggregate outstanding principalamount of the Term Loans and Other Applicable Indebtedness at such time; provided that the portion of such net proceeds allocatedto the Other Applicable Indebtedness shall not exceed the amount of such net proceeds required to be allocated to the OtherApplicable Indebtedness pursuant to the terms thereof, and the remaining amount, if any, of such net proceeds shall be allocated tothe Term Loans in accordance with the terms hereof) to the prepayment of the Term Loans and to the repurchase or prepayment ofOther Applicable Indebtedness, and the amount of prepayment of the Term Loans that would have otherwise been required pursuantto this Section 2.05(b)(ii) shall be reduced accordingly; provided , further , that to the extent the holders of Other ApplicableIndebtedness decline to have such indebtedness repurchased or prepaid, the declined amount shall promptly (and in any event withinfive Business Days after the date of such rejection) be applied to prepay the Term Loans in accordance with the terms hereof.(vii) If any Consolidated Party incurs or issues any Indebtedness after the Closing Date (A) not permitted to beincurred or issued pursuant to Section 7.03 or (B) that is intended to constitute Credit Agreement Refinancing Indebtedness in respectof any Class of Term Loans, the Borrowers shall cause to be prepaid an aggregate principal amount of Term Loans (or, in the case ofIndebtedness constituting Credit Agreement Refinancing Indebtedness, the applicable Class of Term Loans) in an amount equal to100% of all Net Proceeds received therefrom on or prior to the date which is three Business Days after the receipt by suchConsolidated Party of such Net Proceeds. For the avoidance of doubt, in connection with any prepayment under Section 2.05(b)(iii)(B) which constitutes a Repricing Event that is consummated in respect of all or any portion of the Initial Term Loans prior to thedate that is twelve months after the Closing Date, the Borrowers shall pay to the Term Lenders the fees specified in Section 2.05(a)(ii).(viii) If for any reason the aggregate Outstanding Amount of Revolving Credit Loans, Swing Line Loans and L/CObligations at any time exceeds the aggregate Revolving Credit Commitments then in effect, the Borrowers shall promptly prepayRevolving Credit Loans and/or Swing Line Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to suchexcess; provided that the Borrowers shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.05(b)(iv) unless after the prepayment in full of the Revolving Credit Loans and Swing Line Loans such aggregate Outstanding Amountexceeds the aggregate Revolving Credit Commitments then in effect.(ix) Except as otherwise provided in any Refinancing Amendment, Extension Amendment or any IncrementalAmendment or as otherwise provided herein, (A) each prepayment of Term Loans pursuant to this Section 2.05(b) shall be appliedratably to each Class of Term Loans then outstanding ( provided that any prepayment of Term Loans with the Net Proceeds of CreditAgreement Refinancing Indebtedness shall be applied solely to each applicable Class of Refinanced Debt); (B) with respect to eachClass of Term Loans, (x) each prepayment pursuant to clauses (ii) , (iii) and (viii) of this Section 2.05(b) shall be applied to thescheduled installments of principal thereof following the date of such prepayment in direct order of maturity (at the Borrowers’option, pro rata with any Incremental Term Loans) and (y) each prepayment pursuant to clauses (i) and (vii) of this Section 2.05(b)shall be applied to the scheduled installments of principal to the Initial Term Loans following the date of such prepayment ratably inaccordance with the then outstanding amounts thereof until the Initial Term Loans are paid in full and then to any Incremental TermLoans ratably in accordance with the then outstanding amounts thereof; and (C) each such prepayment shall be paid to the Lenders inaccordance with their respective Pro Rata Shares of such prepayment.(x) The Borrower Representative shall notify the Administrative Agent in writing of any mandatory prepayment ofTerm Loans required to be made by the Borrowers pursuant to clauses (i) , (ii), (iii) , and (vii) of this Section 2.05(b) not later than1:00 p.m. at least three Business Days prior to the date of such prepayment. Each such notice shall specify the date of suchprepayment and provide a reasonably detailed calculation of the aggregate amount of such prepayment to be made by the Borrowers.The Administrative Agent will promptly notify each Appropriate Lender of the contents of the Borrowers’ prepayment notice and ofsuch Appropriate Lender’s Pro Rata Share of the prepayment. Each Term Lender may reject all of its Pro Rata Share of anymandatory prepayment (such declined amounts, the “ Declined Proceeds ”) of Term Loans required to be made pursuant toclauses (i) , (ii), (iii)(A) and (vii) of this Section 2.05(b) by providing written notice (each, a “ Rejection Notice ”) to theAdministrative Agent no later than 5:00 p.m. one Business Day after the date of such Lender’s receipt of notice from theAdministrative Agent regarding such prepayment; provided , however , in no event may the proceeds of any Credit AgreementRefinancing Indebtedness be rejected. If a Term Lender fails to deliver a Rejection Notice to the Administrative Agent within thetime frame specified above such failure will be deemed an acceptance of the total amount of such mandatory prepayment of TermLoans. Any Declined Proceeds shall be retained by the Borrowers.(xi) If any Consolidated Party receives any cash contribution to the common capital of any such Consolidated Partypursuant to Section 4.01 of the Parent Guaranty, the Borrowers shall cause to be prepaid on or prior to the date which is five BusinessDays after the date of the realization or receipt by such Consolidated Party of such cash contribution, an aggregate principal amountof Term Loans in an amount equal to 100% of all such cash contributions.(xii) If any Consolidated Party receives any Cure Amount pursuant to Section 8.04, the Borrowers shall cause to beprepaid on or prior to the date which is one Business Day after the date of the realization or receipt by such Consolidated Party ofsuch Cure Amount, an aggregate principal amount of Term Loans in an amount equal to 100% of such Cure Amount.(c) Interest, Funding Losses, Etc . All prepayments under this Section 2.05 shall be accompanied by all accrued interestthereon (other than prepayments of ABR Revolving Credit Loans that are not made in connection with the termination or permanentreduction of the Revolving Credit Commitments), together with, in the case of any such prepayment of a Eurodollar Rate Loan on a date priorto the last day of an Interest Period therefor, any amounts owing in respect of such Eurodollar Rate Loan pursuant to Section 3.05 .Notwithstanding any of the other provisions of this Section 2.05 , so long as no Event of Default shall have occurred and becontinuing, if any prepayment of Eurodollar Rate Loans is required to be made under this Section 2.05 , prior to the last day of the InterestPeriod therefor, in lieu of making any payment pursuant to this Section 2.05 in respect of any such Eurodollar Rate Loan prior to the last dayof the Interest Period therefor, the applicable Borrower may, in its sole discretion, deposit an amount sufficient to make any such prepaymentotherwise required to be made thereunder together with accrued interest to the last day of such Interest Period into a Cash Collateral Accountuntil the last day of such Interest Period, at which time the Administrative Agent shall be authorized (without any further action by or noticeto or from such Borrower or any other Loan Party) to apply such amount to the prepayment of such Loans in accordance with thisSection 2.05 . Upon the occurrence and during the continuance of any Event of Default, the Administrative Agent shall also be authorized(without any further action by or notice to or from the applicable Borrower or any other Loan Party) to apply such amount to the prepaymentof the outstanding Loans in accordance with the relevant provisions of this Section 2.05 . Such deposit shall be deemed to be a prepayment ofsuch Loans by such Borrower for all purposes under this Agreement.Section 2.06. Termination or Reduction of Commitments .(a) Optional . The Borrowers may, upon written notice to the Administrative Agent, terminate the unused Commitments ofany Class, or from time to time permanently reduce the unused Commitments of any Class, in each case without premium or penalty;provided that (i) any such notice shall be received by the Administrative Agent three Business Days prior to the date of termination orreduction, (ii) any such partial reduction shall be in an aggregate amount of $5,000,000, or any whole multiple of $1,000,000 in excessthereof or, if less, the entire amount thereof and (iii) if, after giving effect to any reduction of the Revolving Credit Commitments, the Letterof Credit Sublimit, or the Swing Line Sublimit exceeds the amount of the Revolving Credit Commitments, such sublimit shall beautomatically reduced by the amount of such excess. Except as provided above, the amount of any such Commitment reduction shall not beapplied to the Letter of Credit Sublimit, or the Swing Line Sublimit unless otherwise specified by the applicable Borrower. Notwithstandingthe foregoing, the applicable Borrower may rescind or postpone any notice of termination of any Commitments if such termination wouldhave resulted from a refinancing of all or any portion of the applicable Class or occurrence of other event, which refinancing or other eventshall not be consummated or otherwise shall be delayed.(b) Mandatory . The Initial Term Commitments of each Term Lender shall be automatically and permanently reduced to $0upon the funding of the Initial Term Loans to be made by such Term Lender on the Closing Date. The Revolving Credit Commitments ofeach Revolving Credit Lender and Swing Line Lender shall automatically and permanently terminate on the Maturity Date.(c) Application of Commitment Reductions; Payment of Fees . The Administrative Agent will promptly notify theAppropriate Lenders of any termination or reduction of unused portion of the Letter of Credit Sublimit, the Swing Line Sublimit, or theunused Commitments of any Class under this Section 2.06 . The amount of any such reduction of the Revolving Credit Commitments shallnot be applied to the Letter of Credit Sublimit, or the Swing Line Sublimit unless otherwise specified by the Borrower Representative. Uponany reduction of unused Commitments of any Class, the Commitment of each Lender of such Class shall be reduced by such Lender’s ProRata Share of the amount by which such Commitments are reduced. All commitment fees accrued until the effective date of any terminationof the Aggregate Commitments of any Class shall be paid to the Appropriate Lenders on the effective date of such termination.Section 2.07. Repayment of Loans .(c) Term Loans . Commencing with the first full quarter ending after the Closing Date, the Borrowers shall repay to theAdministrative Agent for the ratable account of the Appropriate Lenders on the last Business Day of each March, June, September andDecember, in an amount equal to the percentage set forth opposite the dates indicated below based on the Consolidated Total NetLeverage Ratio, which for this purpose shall be calculated without netting unrestricted cash from the numerator Consolidated Total NetDebt, multiplied by the aggregate principal amount of all Initial Term Loans outstanding on the Closing Date ( which payments shall bereduced as a result of the application of prepayments made in accordance with the order of priority set forth in Section 2.05 ) with theremaining principal amount of the Initial Term Loans then outstanding due and payable in full on the Maturity Date.Principal Amortization Payment DatesConsolidated Total Net Leverage Ratio(without netting) is greater than or equal to2.00 to 1.00Consolidated Total Net Leverage Ratio(without netting) is less than 2.00 to 1.00March 31, 2016 through December 31,20171.875%0.625%March 31, 2018 through December 31,20191.25%0.625%Thereafter0.625%0.625%(d) Revolving Credit Loans . The Borrowers shall repay to the Administrative Agent for the ratable account of theAppropriate Lenders on the Maturity Date for the applicable Revolving Credit Facility the aggregate principal amount of all Revolving CreditLoans under such Facility outstanding on such date.(e) The Borrowers shall repay each Swing Line Loan on the earlier of (i) the date that is five Business Days after suchLoan is made and (ii) the Maturity Date of the Revolving Credit Facility (although Swing Line Loans may thereafter be reborrowed, inaccordance with the terms and conditions hereof, if there are one or more Classes of Revolving Credit Commitments which remain in effect).Section 2.08. Interest .(e) Subject to the provisions of Section 2.08(b) , (i) each Eurodollar Rate Loan shall bear interest on the outstandingprincipal amount thereof for each Interest Period at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the ApplicableMargin and (ii) each ABR Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rateper annum equal to the ABR plus the Applicable Margin.(f) After the occurrence and during the continuance of an Event of Default under Sections 8.01(a) or 8.01(f) (or, withrespect to the existence of any other Event of Default, at the election of the Required Lenders), the Borrowers shall pay interest on past dueamounts owing by it hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted byapplicable Laws; provided that no interest at the Default Rate shall accrue or be payable to a Defaulting Lender so long as such Lender shallbe a Defaulting Lender. Accrued and unpaid interest on such amounts (including interest on past due interest) shall be due and payable uponwritten demand.(g) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at suchother times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof before and afterjudgment, and before and after the commencement of any proceeding under any Debtor Relief Law.Section 2.09. Fees . In addition to certain fees described in Sections 2.03(h) and (i) :(a) Commitment Fee . The Borrowers agree to pay to the Administrative Agent for the account of each Revolving CreditLender under each Revolving Credit Facility in accordance with its Pro Rata Share or other applicable share provided for under thisAgreement, a commitment fee equal to the Applicable Margin with respect to commitment fees for such Facility times the actual dailyamount by which the aggregate Revolving Credit Commitments for such Facility exceeds the sum of (A) the Outstanding Amount ofRevolving Credit Loans for such Facility plus (B) the Outstanding Amount of L/C Obligations for such Facility; provided that anycommitment fee accrued with respect to any of the Commitments of a Defaulting Lender during the period prior to the time such Lenderbecame a Defaulting Lender and unpaid at such time shall not be payable by the Borrowers so long as such Lender shall be a DefaultingLender except to the extent that such commitment fee shall otherwise have been due and payable by the Borrowers prior to such time;provided , further , that no commitment fee shall accrue on any of the Commitments of a Defaulting Lender so long as such Lender shall be aDefaulting Lender. For the avoidance of doubt, the Outstanding Amount of Swing Line Loans shall not be counted towards or consideredusage of the aggregate Revolving Credit Commitments for purposes of determining the commitment fee. The commitment fee on eachRevolving Credit Facility shall accrue at all times from the Closing Date until the Maturity Date for the Revolving Credit Facility, includingat any time during which one or more of the conditions in Article IV is not met, and shall be due and payable quarterly in arrears on the lastBusiness Day of each March, June, September and December, commencing with the first such date to occur during the first full fiscal quarterafter the Closing Date, and on the Maturity Date for the Revolving Credit Facility. The commitment fee shall be calculated quarterly inarrears, and if there is any change in the Applicable Margin during any quarter, the actual daily amount shall be computed and multiplied bythe Applicable Margin separately for each period during such quarter that such Applicable Margin was in effect.(b) Other Fees . The Borrowers shall pay to the Agents such fees as shall have been separately agreed upon in writing(including pursuant to the Fee Letter) in the amounts and at the times so specified. Such fees shall be fully earned when paid and shall not berefundable for any reason whatsoever (except as expressly agreed between the Borrowers and the applicable Agent).(c) Closing Fees . The Borrowers agree to pay on the Closing Date to each Term Lender party to this Agreement on theClosing Date, as fee compensation for the funding of such Lender’s Initial Term Loan on the Closing Date, a closing fee (the “ Term LoanClosing Fee ”) in an amount equal to 3.00% of the stated principal amount of such Lender’s Term Loans made on the Closing Date. TheBorrowers agree to pay on the Closing Date to each Revolving Credit Lender party to this Agreement on the Closing Date, as a fee for itsRevolving Credit Commitment, a closing fee (the “ Revolving Credit Fee ” and, the Revolving Credit Fee together with the Term LoanClosing Fee, the “ Closing Fees ”) in an amount equal to 1.00% of the stated principal amount of such Revolving Credit Lender’s RevolvingCredit Commitment. The Closing Fees will be in all respects fully earned, due and payable on the Closing Date and non-refundable and non-creditable thereafter and, in the case of the Term Loan Closing Fee, shall be netted against Term Loans made by such Term Lender.Section 2.10. Computation of Interest and Fees . All computations of interest for ABR Loans (including ABR Loans determined byreference to the Eurodollar Rate) shall be made on the basis of a year of 365 days, or 366 days, as applicable, and actual days elapsed. Allother computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed. Interest shall accrue on eachLoan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or suchportion is paid; provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.12(a) , bear interest forone day. Each determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes,absent manifest error.Section 2.11. Evidence of Indebtedness .(a) The Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by suchLender and evidenced by one or more entries in the Register maintained by the Administrative Agent, acting solely for purposes of TreasuryRegulation Section 5f.103-1(c), as a non-fiduciary agent for the Borrowers, in each case in the ordinary course of business. The accounts orrecords maintained by the Administrative Agent and each Lender shall be prima facie evidence absent manifest error of the amount of theCredit Extensions made by the Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doingso shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to theObligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of theAdministrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifesterror. Upon the request of any Lender made through the Administrative Agent, the Borrowers shall execute and deliver to such Lender(through the Administrative Agent) a Note payable to such Lender, which shall evidence such Lender’s Loans in addition to such accounts orrecords. Each Lender may attach schedules to its Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loansand payments with respect thereto.(b) In addition to the accounts and records referred to in Section 2.11(a) , each Lender and the Administrative Agent shallmaintain in accordance with its usual practice accounts or records and, in the case of the Administrative Agent, entries in the Register,evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans. In the event of any conflictbetween the accounts and records maintained by the Administrative Agent and the accounts and records of any Lender in respect of suchmatters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.(c) Entries made in good faith by the Administrative Agent in the Register pursuant to Sections 2.11(a) and (b) , and byeach Lender in its account or accounts pursuant to Section 2.11(a) and (b) , shall be prima facie evidence of the amount of principal andinterest due and payable or to become due and payable from the Borrowers to, in the case of the Register, each Lender and, in the case of suchaccount or accounts, such Lender, under this Agreement and the other Loan Documents, absent manifest error; provided that the failure of theAdministrative Agent or such Lender to maintain such accounts or any error therein shall not in any manner affect the obligations of theBorrowers to repay the Loans in accordance with their terms.Section 2.12. Payments Generally .(a) All payments to be made by the Borrowers shall be made without condition or deduction for any counterclaim, defense,recoupment or setoff. Except as otherwise expressly provided herein and all payments by the Borrowers hereunder shall be made to theAdministrative Agent, for the account of the respective Lenders to which such payment is owed, at the applicable Administrative Agent’sOffice in Dollars and in Same Day Funds not later than 1:00 p.m. (or 3:00 p.m. with respect to Swing Line Loans) on the date specifiedherein. The Administrative Agent will promptly distribute to each Appropriate Lender its Pro Rata Share (or other applicable share providedfor under this Agreement) of such payment in like funds as received by wire transfer to such Lender’s applicable Lending Office. Allpayments received by the Administrative Agent after the time specified above shall be deemed received on the next succeeding Business Dayand any applicable interest or fee shall continue to accrue.(b) Except as otherwise provided herein, if any payment to be made by the Borrowers shall come due on a day other than aBusiness Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interestor fees, as the case may be; provided that, if such extension would cause payment of interest on or principal of Eurodollar Rate Loans to bemade in the next succeeding calendar month, such payment shall be made on the immediately preceding Business Day.(c) Unless the Borrowers or any Lender have notified the Administrative Agent, prior to the date any payment is requiredto be made by it to the Administrative Agent hereunder, that the Borrowers or such Lender, as the case may be, will not make such payment,the Administrative Agent may assume that the Borrowers or such Lender, as the case may be, has timely made such payment and may (butshall not be so required to), in reliance thereon, make available a corresponding amount to the Person entitled thereto. If and to the extent thatsuch payment was not in fact made to the Administrative Agent in Same Day Funds, then:(i) if the Borrowers have failed to make such payment, each Lender shall forthwith on demand repay to theAdministrative Agent the portion of such assumed payment that was made available to such Lender in Same Day Funds, togetherwith interest thereon in respect of each day from and including the date such amount was made available by the Administrative Agentto such Lender to the date such amount is repaid to the Administrative Agent in Same Day Funds at the applicable Overnight Ratefrom time to time in effect; and(ii) if any Lender failed to make such payment, such Lender shall forthwith on demand pay to the AdministrativeAgent the amount thereof in Same Day Funds, together with interest thereon for the period from the date such amount was madeavailable by the Administrative Agent to the Borrowers to the date such amount is recovered by the Administrative Agent (the “Compensation Period ”) at a rate per annum equal to the applicable Overnight Rate from time to time in effect. When such Lendermakes payment to the Administrative Agent (together with all accrued interest thereon), then such payment amount (excluding theamount of any interest which may have accrued and been paid in respect of such late payment) shall constitute such Lender’s Loanincluded in the applicable Borrowing. If such Lender does not pay such amount forthwith upon the Administrative Agent’s demandtherefor, the Administrative Agent may make a demand therefor upon the Borrowers, and the Borrowers shall pay such amount to theAdministrative Agent, together with interest thereon for the Compensation Period at a rate per annum equal to the rate of interestapplicable to the applicable Borrowing. Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill itsCommitment or to prejudice any rights which the Administrative Agent or the Borrowers may have against any Lender as a result ofany default by such Lender hereunder.A written notice (including documentation reasonably supporting such request) of the Administrative Agent to any Lender or theBorrowers with respect to any amount owing under this Section 2.12(c) shall be conclusive, absent manifest error.(d) If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as providedin the foregoing provisions of this Article II , and such funds are not made available to the Borrowers by the Administrative Agent becausethe conditions to the applicable Credit Extension set forth in Article IV are not satisfied or waived in accordance with the terms hereof, theAdministrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.(e) The obligations of the Lenders hereunder to make Loans and to fund participations in Letters of Credit and Swing LineLoans are several and not joint. The failure of any Lender to make any Loan or to fund any such participation on any date required hereundershall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure ofany other Lender to so make its Loan or purchase its participation.(f) Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place ormanner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place ormanner.(g) Whenever any payment received by the Administrative Agent under this Agreement or any of the other LoanDocuments is insufficient to pay in full all amounts due and payable to the Administrative Agent and the Lenders under or in respect of thisAgreement and the other Loan Documents on any date, such payment shall be distributed by the Administrative Agent and applied by theAdministrative Agent and the Lenders in the order of priority set forth in Section 8.03 . If the Administrative Agent receives funds forapplication to the Obligations of the Loan Parties under or in respect of the Loan Documents under circumstances for which the LoanDocuments do not specify the manner in which such funds are to be applied, the Administrative Agent may (to the fullest extent permitted bymandatory provisions of applicable Law), but shall not be obligated to, elect to distribute such funds to each of the Lenders in accordancewith such Lender’s Pro Rata Share of the sum of (a) the Outstanding Amount of all Loans outstanding at such time and (b) the OutstandingAmount of all L/C Obligations outstanding at such time, in repayment or prepayment of such of the outstanding Loans or other Obligationsthen owing to such Lender.(h) Amounts to be applied to the prepayment of Loans in connection with any mandatory prepayments by the Borrowers ofthe Term Loans pursuant to Section 2.05(b) shall be applied, as applicable, on a pro rata basis to the then outstanding Term Loans beingprepaid irrespective of whether such outstanding Term Loans are ABR Loans or Eurodollar Rate Loans; provided that if no Lenders exercisethe right to waive a given mandatory prepayment of the Term Loans pursuant to Section 2.05(b)(vi) , then, with respect to such mandatoryprepayment, the amount of such mandatory prepayment shall be applied first to reduce outstanding ABR Loans. Any amounts remaining aftereach such application shall be applied to prepay Eurodollar Rate Loans in a manner that minimizes the amount of any payments required to bemade by the Borrowers pursuant to Section 3.05 .Section 2.13. Sharing of Payments . If, other than as provided elsewhere herein, any Lender shall obtain payment (whethervoluntary, involuntary, through the exercise of any right of setoff, or otherwise) in respect of any principal or interest on account of the Loansor the participations in L/C Obligations or in Swing Line Loans held by it (excluding any amounts applied by the Swing Line Lender tooutstanding Swing Line Loans), in excess of its ratable share (or other share contemplated hereunder) thereof, such Lender shall immediately(a) notify the Administrative Agent of such fact, and (b) purchase from the other Lenders such participations in the Loans made by themand/or such sub-participations in the participations in L/C Obligations and Swing Line Loans held by them, as the case may be, as shall benecessary to cause such purchasing Lender to share the excess payment in respect of any principal or interest on such Loans or suchparticipations, as the case may be, pro rata with each of them; provided that if all or any portion of such excess payment is thereafterrecovered from the purchasing Lender under any of the circumstances described in Section 10.06 (including pursuant to any settlemententered into by the purchasing Lender in its discretion), such purchase shall to that extent be rescinded and each other Lender shall repay tothe purchasing Lender the purchase price paid therefor, together with an amount equal to such paying Lender’s ratable share (according to theproportion of (i) the amount of such paying Lender’s required repayment to (ii) the total amount so recovered from the purchasing Lender) ofany interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered, without further interestthereon. For the avoidance of doubt, the provisions of this paragraph shall not be construed to apply to (A) any payment made by theBorrowers pursuant to and in accordance with the express terms of this Agreement as in effect from time to time (including the application offunds arising from the existence of a Defaulting Lender) or (B) any payment obtained by a Lender as consideration for the assignment of orsale of a participation in any of its Loans to any assignee or participant permitted hereunder. The Borrowers agree that any Lender sopurchasing a participation from another Lender may, to the fullest extent permitted by applicable Law, exercise all its rights of payment(including the right of setoff, but subject to Section 10.09 ) with respect to such participation as fully as if such Lender were the directcreditor of the Borrowers in the amount of such participation. The Administrative Agent will keep records (which shall be conclusive andbinding in the absence of manifest error) of participations purchased under this Section 2.13 and will in each case notify the Lendersfollowing any such purchases or repayments. Each Lender that purchases a participation pursuant to this Section 2.13 shall from and aftersuch purchase have the right to give all notices, requests, demands, directions and other communications under this Agreement with respect tothe portion of the Obligations purchased to the same extent as though the purchasing Lender were the original owner of the Obligationspurchased.Notwithstanding anything to the contrary contained in this Section 2.13 or elsewhere in this Agreement, the Borrowers may extendthe final maturity of Term Loans and/or Revolving Credit Commitments in connection with an Extension that is permitted under Section 2.16without being obligated to effect such extensions on a pro rata basis among the Lenders (it being understood that no such extension (i) shallconstitute a payment or prepayment of any Term Loans or Revolving Credit Loans, as applicable, for purposes of this Section 2.13 or(ii) shall reduce the amount of any scheduled amortization payment due under Section 2.07(a) , except that the amount of any scheduledamortization payment due to a Lender of Extended Term Loans may be reduced to the extent provided pursuant to the express terms of therespective Extension Amendment) without giving rise to any violation of this Section 2.13 or any other provision of this Agreement.Furthermore, the Borrowers may take all actions contemplated by Section 2.16 in connection with any Extension (including modifyingpricing, amortization and repayments or prepayments), and in each case such actions shall be permitted, and the differing paymentscontemplated therein shall be permitted without giving rise to any violation of this Section 2.13 or any other provision of this Agreement.Section 2.14. Incremental Credit Extensions .(a) Incremental Commitments . The Borrowers may at any time or from time to time after the Closing Date, by notice tothe Administrative Agent (an “ Incremental Request ”), request (i) one or more new commitments which shall be in the same Facility as anyoutstanding Term Loans (a “ Term Loan Increase ”) or a new Class of term loans (collectively with any Term Loan Increase, the “Incremental Term Commitments ”) under this Agreement and/or (ii) (A) one or more increases in the amount of the Revolving CreditCommitments (a “ Revolving Commitment Increase ”) and/or (B) the establishment of one or more new Revolving Credit Commitments(any such new commitment, a “ New Revolving Credit Commitment ” and, together with Revolving Commitment Increases, the “Incremental Revolving Loan Commitments ” and, collectively with any Incremental Term Commitments, the “ IncrementalCommitments ”), whereupon the Administrative Agent shall promptly deliver a copy to each of the Lenders.(b) Incremental Loans . Any Incremental Term Loans (other than Term Loan Increases) effected through the establishmentof one or more new Term Loans made on an Incremental Facility Closing Date shall be designated a separate Class of Incremental TermLoans for all purposes of this Agreement. On any Incremental Facility Closing Date on which any Incremental Term Commitments of anyClass are effected (including through any Term Loan Increase), subject to the satisfaction (or waiver) of the terms and conditions in thisSection 2.14 , (i) each Incremental Term Lender of such Class shall make a Loan to the applicable Borrower (an “ Incremental Term Loan”) in an amount equal to its Incremental Term Commitment of such Class and (ii) each Incremental Term Lender of such Class shall becomea Lender hereunder with respect to the Incremental Term Commitment of such Class and the Incremental Term Loans of such Class madepursuant thereto. On any Incremental Facility Closing Date on which any Incremental Revolving Loan Commitment are effected, subject tothe satisfaction of the terms and conditions in this Section 2.14 , (i) each Incremental Revolving Credit Lender shall make its Commitmentavailable to the Borrowers (when borrowed, an “ Incremental Revolving Loan ” and collectively with any Incremental Term Loan, an “Incremental Loan ”) in an amount equal to its Revolving Commitment Increase or New Revolving Credit Commitment, as applicable, and(ii) each Incremental Revolving Credit Lender shall become a Lender hereunder with respect to the Revolving Commitment Increase or theNew Revolving Credit Commitment, as applicable, and the Incremental Revolving Loans made pursuant thereto. Notwithstanding theforegoing, Incremental Term Loans may have identical terms to any of the Term Loans and be treated as the same Class as any of such TermLoans.(c) Incremental Request . Each Incremental Request from a Borrower pursuant to this Section 2.14 shall set forth therequested amount and proposed terms of the relevant Incremental Term Loans or Incremental Revolving Loan Commitments. IncrementalTerm Loans may be made, and Incremental Revolving Loan Commitments may be provided, by any existing Lender (but each existingLender will not have an obligation to make any Incremental Commitment, nor will the applicable Borrower have any obligation to approachany existing Lenders to request any Incremental Commitment) or by any other Person that is not (w) a Disqualified Lender, (x) any Personthat is a Defaulting Lender, (y) a natural Person or (z) Parent, the Holding Companies, the Borrowers or any of their respective Subsidiaries(any such Person being called an “ Additional Lender ”) (each such existing Lender or Additional Lender providing such, an “ IncrementalRevolving Credit Lender ” or “ Incremental Term Lender ,” as applicable, and, collectively, the “ Incremental Lenders ”); provided thatthe Administrative Agent, each L/C Issuer and the Swing Line Lender shall have consented (not to be unreasonably withheld, conditioned ordelayed) to such Lender’s or Additional Lender’s making such Incremental Term Loans or providing such Incremental Revolving LoanCommitments to the extent such consent, if any, would be required under Section 10.07(b) for an assignment of Loans or Revolving CreditCommitments, as applicable, to such Lender or Additional Lender.(d) Effectiveness of Incremental Amendment . The effectiveness of any Incremental Amendment, and the IncrementalCommitments thereunder, shall be subject to the satisfaction on the date of such Incremental Amendment (the “ Incremental FacilityClosing Date ”) of each of the following conditions:(i) no Default or Event of Default shall exist after giving effect to such Incremental Commitments, and therepresentations and warranties in Article V of this Agreement shall be true and correct in all material respects (or, in the case of anyrepresentation and warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language, in all respects) on andas of the date of the incurrence of such Incremental Commitments (although any representations or warranties which expressly relateto a given date or period shall be required only to be true and correct in all material respects (or in all respects, as applicable) as of therespective date or for the respective period, as the case may be); provided that in the case of Incremental Commitments incurred tofinance a Permitted Acquisition or Investments permitted under Section 7.02(o) or (s) (each, a “ Limited Condition Transaction ”),(x) such requirement shall be subject to customary “SunGard” conditionality (including waiver or non-requirement of (1) therepresentations and warranties hereunder and (2) the absence of a Default or Event of Default (other than with respect to a Default orEvent of Default under Section 8.01(a) or (f) ) and (y) the Consolidated Secured Net Leverage Ratio set forth in clause (iii)(C) belowmay, at the Borrowers’ election, be tested at the time such Limited Condition Transaction is committed and will not be tested uponconsummation thereof, in each case if otherwise agreed by the Incremental Lenders providing such Incremental Commitments;(ii) each Incremental Term Commitment shall be in an aggregate principal amount that is not less than $10,000,000and shall be in an increment of $1,000,000 and each Incremental Revolving Loan Commitment shall be in an aggregate principalamount that is not less than $5,000,000 and shall be in an increment of $1,000,000;(iii) the aggregate amount of the Incremental Term Loans and Incremental Revolving Loan Commitments shall notexceed (A) an amount equal to $50,000,000 (net of Indebtedness incurred pursuant to Section 7.03(r)(i)(A) or (ii)(A) ) plus (B) up toan additional amount of Incremental Term Loans and/or Incremental Revolving Loan Commitments so long as on and as of the dateof the incurrence of such Incremental Term Loans or Incremental Commitments, the Consolidated Secured Net Leverage Ratio(determined on a Pro Forma Basis, including the pro forma effect of any Specified Transaction to be financed (in whole or in part)with the proceeds of the Incremental Loan, and assuming all previously established and simultaneously established IncrementalRevolving Loan Commitments are fully drawn and excluding the cash proceeds of (x) any borrowing under any such IncrementalRevolving Loan Commitments, (y) any Incremental Term Loans and (z) any other Indebtedness that is incurred substantiallyconcurrently therewith) is no more than 3.75 to 1.00; and(iv) the Loan Parties shall demonstrate compliance with the financial covenant set forth in Section 7.11(determined on a Pro Forma Basis and assuming all previously established and simultaneously established Incremental RevolvingLoan Commitments are fully drawn and excluding the cash proceeds of (x) any borrowing under any such Incremental RevolvingLoan Commitments, (y) any Incremental Term Loans and (z) any other Indebtedness that is incurred substantially concurrentlytherewith) as of the most recent fiscal quarter end for which financial statements have been delivered or were required to be deliveredpursuant to Section 4.01 or 6.01 .(v) for purposes of the calculations in clauses (iii) and (iv) above, (A) with respect to any IncrementalCommitments, assuming a borrowing of the maximum amount of Loans available thereunder, (B) to the extent the proceeds thereofare used to repay Indebtedness, pro forma effect shall be given to such repayment of Indebtedness and (C) Indebtedness incurredunder clause (iii)(A) above shall be available at all times and not subject to any ratio test, whether incurred simultaneously withamounts under clause (iii)(C) or otherwise.(e) Required Terms . The terms, provisions and documentation of the Incremental Term Loans and Incremental TermCommitments or the Incremental Revolving Loans and Incremental Revolving Loan Commitments, as the case may be, of any Class, exceptas otherwise set forth herein, shall be as agreed between the applicable Borrower and the applicable Incremental Lenders; provided that in noevent will any Incremental Term Loans be permitted to be voluntarily or mandatorily prepaid prior to the repayment in full of the TermLoans, unless accompanied by at least a ratable payment of the Term Loans ( provided that any Refinancing Amendment, ExtensionAmendment or Incremental Amendment may provide that the applicable Incremental Lenders shall receive a less than ratable payment);provided , further , that to the extent the terms of such Incremental Commitments are not consistent with the Facilities (except to the extentpermitted by this Section 2.14 ), the terms of such Incremental Commitments shall be reasonably satisfactory to the Administrative Agent. Inany event:(i) the Incremental Term Loans and, as applicable, the New Revolving Credit Commitments:(A) shall rank pari passu in right of payment and of security with the Revolving Credit Loans and theTerm Loans;(B) in the case of Incremental Term Loans, shall not mature earlier than the Latest Maturity Date of theInitial Term Loans outstanding at the time of incurrence of such Incremental Term Loans;(C) in the case of New Revolving Credit Commitments, shall not mature earlier than the Latest MaturityDate of the Revolving Credit Commitments outstanding at the time of incurrence of such New Revolving CreditCommitments or have amortization or scheduled mandatory commitment reductions (other than at maturity);(D) in the case of Incremental Term Loans, shall have a Weighted Average Life to Maturity not shorterthan the remaining Weighted Average Life to Maturity of then-existing Initial Term Loans;(E) in the case of Incremental Term Loans, subject to clauses (B) and (D) above, shall have amortizationdetermined by the Borrowers and the applicable Incremental Term Lenders;(F) subject to clause (iii) below, shall have an Applicable Margin determined by the Borrowers and theapplicable Incremental Term Lenders or Incremental Revolving Credit Lenders, as applicable;(G) (x) in the case of Incremental Term Loans, shall be incurred in Dollars, and (y) in the case of NewRevolving Credit Commitments, shall be denominated in Dollars; and(H) may participate on a pro rata basis or less than pro rata basis (but not on a greater than pro rata basis)in any voluntary or mandatory prepayments of Initial Term Loans hereunder, as specified in the applicable IncrementalAmendment;(I) all other material terms of any Incremental Term Loans shall be substantially identical, or (taken as awhole) no more favorable (as reasonably determined by the Borrowers) to the Lenders providing such Incremental TermLoans than those applicable to the then-existing Term Loans (except for covenants or other provisions applicable only toperiods after the Latest Maturity Date of the then-existing Term Loans);(ii) all material terms (other than with respect to margin, pricing, maturity or fees) of any Revolving CommitmentIncrease and Incremental Revolving Loans under such Revolving Commitment Increase shall be identical to the Revolving CreditCommitments and Revolving Credit Loans or otherwise reasonably acceptable to the Administrative Agent; it being understood andagreed that covenants or other provisions applicable only to the periods after the Latest Maturity Date of any then-existing RevolvingCredit Commitments and Revolving Credit Loans shall be acceptable, subject, solely as to administrative matters to the consent of theAdministrative Agent (such consent not to be unreasonably withheld, conditioned or delayed);(iii) with respect to any Incremental Term Loan or New Revolving Credit Commitments, the All-In Yieldapplicable to such Incremental Term Loans or New Revolving Credit Commitments, as applicable, of each Class shall be determinedby the Borrower Representative and the applicable Incremental Term Lenders or Incremental Revolving Credit Lenders, and shall beset forth in each applicable Incremental Amendment; provided , however , that if the All-In Yield in respect of such Incremental TermLoans exceeds the All-In Yield in respect of any then-existing Term Loans by more than 0.50%, the Applicable Margin of such then-existing Term Loans shall be adjusted such that the All-In Yield of such then-existing Term Loans equals the All-In Yield of suchIndebtedness minus 0.50%; provided that any amendments to the Applicable Margin in respect of any then-existing Term Loans thatbecome effective subsequent to the Closing Date but prior to the time of such Indebtedness is incurred or borrowed shall also beincluded in such calculations, effective upon the making of loans under such Indebtedness; provided , further , that if suchIndebtedness includes a Eurodollar Rate floor greater than 1.00% per annum or an ABR floor greater than 2.00% per annum , suchdifferential between the Eurodollar Rate floor or the ABR floor, as the case may be, shall be equated to the applicable All-In Yield forpurposes of determining whether an increase to the interest rate margin under the Term Loans shall be required, but only to the extentan increase in the Eurodollar Rate floor or ABR floor in the Term Loans, as the case may be, would cause an increase in the interestrate then in effect thereunder, and in such case, the Eurodollar Rate floor or ABR floor (but not the interest rate margin), applicable tothe Term Loans shall be increased to the extent of such differential between the Eurodollar Rate floors or ABR floors, as the case maybe;(iv) any Incremental Term Loans that are fixed rate loans shall, at the Borrower Representative’s election, beswapped to a floating rate on a customary matched maturity basis; and(v) to the extent any Incremental Term Loans are made in the form of a Term Loan Increase or are IncrementalTerm Loans with the same terms as the Term Loans made on the Closing Date, (i) the scheduled amortization payments underSection 2.07(a) required to be made after the making of such Incremental Term Loans shall be ratably increased by the aggregateprincipal amount of such Incremental Term Loans and shall be further increased for all Lenders on a pro rata basis to the extentnecessary to avoid any reduction in the amortization payments to which the Term Lenders were entitled before such recalculation and(ii) in the event that, prior to the incurrence of any Incremental Term Loans made in the form of a Term Loan Increase or IncrementalTerm Loans with the same terms as the Term Loans made on the Closing Date, the Term Loans made on the Closing Date, pursuantto any other Term Loan Increase or any other Incremental Term Loans made on the same terms as the Term Loans made on theClosing Date have scheduled amortization payments under Section 2.07(a) that are less than 0.25% of the aggregate principal amountof such Term Loans when initially incurred, then the scheduled amortization payments on the Incremental Facility Closing Date ofsuch Incremental Term Loans shall be increased to be equal quarterly installments of principal equal to 0.25% of the aggregateprincipal amount of such Term Loans originally incurred.(f) Incremental Amendment . Commitments in respect of Incremental Term Loans and Incremental Revolving LoanCommitments shall become Commitments (or in the case of an Incremental Revolving Loan Commitment to be provided by an existingRevolving Credit Lender, an increase in such Lender’s applicable Revolving Credit Commitment), under this Agreement pursuant to anamendment (an “ Incremental Amendment ”) to this Agreement and, as appropriate, the other Loan Documents, executed by the Borrowers,each Incremental Lender providing such Commitments and the Administrative Agent. The Incremental Amendment may, without the consentof any other Loan Party, Agent or Lender, effect such amendments to this Agreement and the other Loan Documents as may be necessary orappropriate, in the reasonable opinion of the Administrative Agent and the Borrower Representative, to effect the provisions of thisSection 2.14 , including amendments to Section 2.05(a)(ii) that are not adverse to the interests of the Lenders. The Borrowers will use theproceeds of the Incremental Term Loans and Incremental Revolving Loan Commitments for working capital and other general corporatepurposes, including the financing of Permitted Acquisitions and other Investments permitted hereby and any other use not prohibited by theLoan Documents, in each case as determined by the Borrowers and the Lenders providing such Incremental Term Loans and IncrementalRevolving Loan Commitments. No Lender shall be obligated to provide any Incremental Term Loans or Incremental Revolving LoanCommitments, unless it so agrees.(g) Reallocation of Revolving Credit Exposure . Upon any Incremental Facility Closing Date on which RevolvingCommitment Increases are effected through an increase in the Revolving Credit Commitments pursuant to this Section 2.14 , (a) if theincrease relates to the Revolving Credit Facility, each of the Revolving Credit Lenders shall assign to each of the Incremental RevolvingCredit Lenders, and each of the Incremental Revolving Credit Lenders shall purchase from each of the Revolving Credit Lenders, at theprincipal amount thereof, such interests in the Incremental Revolving Loans outstanding on such Incremental Facility Closing Date as shall benecessary in order that, after giving effect to all such assignments and purchases, such Revolving Credit Loans will be held by existingRevolving Credit Lenders and Incremental Revolving Credit Lenders ratably in accordance with their Revolving Credit Commitments aftergiving effect to the addition of such Revolving Commitment Increases to the Revolving Credit Commitments, (b) each RevolvingCommitment Increase shall be deemed for all purposes a Revolving Credit Commitment and each Loan made thereunder shall be deemed, forall purposes, a Revolving Credit Loan and (c) each Incremental Revolving Credit Lender shall become a Lender with respect to the RevolvingCommitment Increases and all matters relating thereto. The Administrative Agent and the Lenders hereby agree that the minimum borrowing,pro rata borrowing and pro rata payment requirements contained elsewhere in this Agreement shall not apply to the transactions effectedpursuant to the immediately preceding sentence.(h) This Section 2.14 shall supersede any provisions in Section 2.13 or 10.01 to the contrary.Section 2.15. Refinancing Amendments .(a) On one or more occasions after the Closing Date, the Borrowers may obtain, from any Lender or any AdditionalRefinancing Lender, Credit Agreement Refinancing Indebtedness in respect of all or any portion of the Term Loans and the Revolving CreditLoans (or unused Revolving Credit Commitments) then outstanding under this Agreement (which for purposes of this Section 2.15(a) will bedeemed to include any then outstanding Refinancing Term Loans or Incremental Term Loans), in the form of Refinancing Term Loans,Refinancing Term Commitments, Refinancing Revolving Credit Commitments or Refinancing Revolving Credit Loans incurred under thisAgreement pursuant to a Refinancing Amendment; provided that notwithstanding anything to the contrary in this Section 2.15 or otherwise,(1) the borrowing and repayment (except for (A) payments of interest and fees at different rates on Refinancing Revolving CreditCommitments (and related outstandings), (B) repayments required upon the maturity date of the Refinancing Revolving Credit Commitmentsand (C) repayment made in connection with a permanent repayment and termination of commitments (subject to clause (3) below)) of Loanswith respect to Refinancing Revolving Credit Commitments after the date of obtaining any Refinancing Revolving Credit Commitments shallbe made on a pro rata basis with all other Revolving Credit Commitments, (2) subject to the provisions of Section 2.03(m) to the extentdealing with Letters of Credit which mature or expire after a maturity date when there exist Extended Revolving Credit Commitments with alonger maturity date, all Letters of Credit shall be participated on a pro rata basis by all Lenders with Commitments in accordance with theirpercentage of the Revolving Credit Commitments (and except as provided in Section 2.03(m) , without giving effect to changes thereto on anearlier maturity date with respect to Letters of Credit theretofore incurred or issued), (3) the permanent repayment of Revolving Credit Loanswith respect to, and termination of, Refinancing Revolving Credit Commitments after the date of obtaining any Refinancing Revolving CreditCommitments shall be made on a pro rata basis with all other Revolving Credit Commitments, except that the Borrowers shall be permittedto permanently repay and terminate commitments of any such Class on a better than a pro rata basis as compared to any other Class with alater maturity date than such Class and (4) assignments and participations of Refinancing Revolving Credit Commitments and RefinancingRevolving Credit Loans shall be governed by the same assignment and participation provisions applicable to Revolving Credit Commitmentsand Revolving Credit Loans.(b) Each issuance of Credit Agreement Refinancing Indebtedness under Section 2.15(a) shall be in an aggregate principalamount that is (x) not less than $5,000,000 and (y) an integral multiple of $1,000,000 in excess thereof.(c) Each of the parties hereto hereby agrees that this Agreement and the other Loan Documents may be amended pursuantto a Refinancing Amendment, without the consent of any other Lenders, to the extent (but only to the extent) necessary to (i) reflect theexistence and terms of the Credit Agreement Refinancing Indebtedness incurred pursuant thereto and (ii) make such other changes to thisAgreement and the other Loan Documents consistent with the provisions and intent of the third paragraph of Section 10.01 (without theconsent of the Required Lenders called for therein) and (iii) effect such other amendments to this Agreement and the other Loan Documentsas may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrower Representative, to effect theprovisions of this Section 2.15 , and the Required Lenders hereby expressly authorize the Administrative Agent to enter into any suchRefinancing Amendment.(d) This Section 2.15 shall supersede any provisions in Section 2.13 or 10.01 to the contrary.Section 2.16. Extension of Term Loans; Extension of Revolving Credit Loans .(a) Extension of Term Loans . The Borrowers may at any time and from time to time request that all or a portion of theTerm Loans of a given Class (each, an “ Existing Term Loan Tranche ”) be amended to extend the scheduled maturity date(s) with respectto all or a portion of any principal amount of such Term Loans (any such Term Loans which have been so amended, “ Extended TermLoans ”) and to provide for other terms consistent with this Section 2.16 . In order to establish any Extended Term Loans, the Borrowersshall provide a notice to the Administrative Agent (who shall provide a copy of such notice to each of the Lenders under the applicableExisting Term Loan Tranche) (each, a “ Term Loan Extension Request ”) setting forth the proposed terms of the Extended Term Loans tobe established, which shall (x) be identical as offered to each Lender under such Existing Term Loan Tranche (including as to the proposedinterest rates and fees payable) and offered pro rata to each Lender under such Existing Term Loan Tranche and (y) be substantially identicalto, or (taken as a whole) no more favorable to the Extending Term Lenders than those applicable to the Existing Term Loan Tranche subjectto such Term Loan Extension Request (except for covenants or other provisions applicable only to periods after the Latest Maturity Date thatis in effect on the effective date of the Extension Amendment (immediately prior to the establishment of such Extended Term Loans),including: (i) all or any of the scheduled amortization payments of principal of the Extended Term Loans may be delayed to later dates thanthe scheduled amortization payments of principal of the Term Loans of such Existing Term Loan Tranche, to the extent provided in theapplicable Extension Amendment; provided , however , that at no time shall there be Classes of Term Loans hereunder (includingRefinancing Term Loans and Extended Term Loans) which have more than five different Maturity Dates; (ii) the All-In Yield with respect tothe Extended Term Loans (whether in the form of interest rate margin, upfront fees, OID or otherwise) may be different from the All-In Yieldfor the Term Loans of such Existing Term Loan Tranche, in each case, to the extent provided in the applicable Extension Amendment;(iii) the Extension Amendment may provide for other covenants and terms that apply solely to any period after the Latest Maturity Date thatis in effect on the effective date of the Extension Amendment (immediately prior to the establishment of such Extended Term Loans); and(iv) Extended Term Loans may have call protection as may be agreed by the Borrowers and the Lenders thereof; provided that no ExtendedTerm Loans may be optionally prepaid prior to the date on which all Term Loans with an earlier final stated maturity (including Term Loansunder the Existing Term Loan Tranche from which they were amended) are repaid in full, unless such optional prepayment is accompaniedby a pro rata optional prepayment of such other Term Loans; provided , however , that (A) no Default or Event of Default shall haveoccurred and be continuing at the time a Term Loan Extension Request is delivered to Lenders, (B) in no event shall the final maturity date ofany Extended Term Loans of a given Term Loan Extension Series at the time of establishment thereof be earlier than the then Latest MaturityDate of the applicable Existing Term Loan Tranche, (C) the Weighted Average Life to Maturity of any Extended Term Loans of a givenTerm Loan Extension Series at the time of establishment thereof shall be no shorter than the remaining Weighted Average Life to Maturity ofthe applicable Existing Term Loan Tranche, (D) all documentation in respect of such Extension Amendment shall be consistent with theforegoing and (E) any Extended Term Loans may participate on a pro rata basis or less than a pro rata basis (but not greater than a pro ratabasis) in any voluntary or mandatory repayments or prepayments hereunder, in each case as specified in the respective Term Loan ExtensionRequest. Any Extended Term Loans amended pursuant to any Term Loan Extension Request shall be designated a series (each, a “ TermLoan Extension Series ”) of Extended Term Loans for all purposes of this Agreement; provided that any Extended Term Loans amendedfrom an Existing Term Loan Tranche may, to the extent provided in the applicable Extension Amendment, be designated as an increase inany previously established Term Loan Extension Series with respect to such Existing Term Loan Tranche (in which case scheduledamortization with respect thereto shall be proportionally increased). Each Term Loan Extension Series of Extended Term Loans incurredunder this Section 2.16 shall be in an aggregate principal amount that is not less than $50,000,000.(b) Extension of Revolving Credit Commitments . The Borrowers may, at any time and from time to time request that all ora portion of the Revolving Credit Commitments of a given Class (each, an “ Existing Revolver Tranche ”) be amended to extend theMaturity Date with respect to all or a portion of any principal amount of such Revolving Credit Commitments (any such Revolving CreditCommitments which have been so amended, “ Extended Revolving Credit Commitments ”) and to provide for other terms consistent withthis Section 2.16 . In order to establish any Extended Revolving Credit Commitments, the Borrowers shall provide a notice to theAdministrative Agent (who shall provide a copy of such notice to each of the Lenders under the applicable Existing Revolver Tranche) (each,a “ Revolver Extension Request ”) setting forth the proposed terms of the Extended Revolving Credit Commitments to be established, whichshall (x) be identical as offered to each Lender under such Existing Revolver Tranche (including as to the proposed interest rates and feespayable) and offered pro rata to each Lender under such Existing Revolver Tranche and (y) the Extended Revolving Credit Commitmentextended pursuant to a Revolver Extension Request, and the related outstandings, shall be a Revolving Credit Commitment (or relatedoutstandings, as the case may be) with such other terms substantially identical to, or taken as a whole, no more favorable to the ExtendingRevolving Credit Lender, as the original Revolving Credit Commitments (and related outstandings); provided : (i) the Maturity Date of theExtended Revolving Credit Commitments may be delayed to a later date than the Maturity Date of the Revolving Credit Commitments ofsuch Existing Revolver Tranche, to the extent provided in the applicable Extension Amendment; provided , however , that at no time shallthere be Classes of Revolving Credit Commitments hereunder (including Extended Revolving Credit Commitments) which have more thanfive different Maturity Dates; (ii) the All-In Yield with respect to extensions of credit under the Extended Revolving Credit Commitments(whether in the form of interest rate margin, upfront fees, OID or otherwise) may be different than the All-In Yield, pricing, optionalredemption or prepayment terms, for extensions of credit under the Revolving Credit Commitments of such Existing Revolver Tranche, ineach case, to the extent provided in the applicable Extension Amendment; (iii) the Extension Amendment may provide for other covenants(as determined by the Borrowers and Lenders extending) and terms that apply solely to any period after the Latest Maturity Date that is ineffect on the effective date of the Extension Amendment (immediately prior to the establishment of such Extended Revolving CreditCommitments); and (iv) all borrowings under the applicable Revolving Credit Commitments ( i.e. , the Existing Revolver Tranche and theExtended Revolving Credit Commitments of the applicable Revolver Extension Series) and repayments thereunder shall be made on a prorata basis (except for (I) payments of interest and fees at different rates on Extended Revolving Credit Commitments (and relatedoutstandings), (II) repayments required upon the Maturity Date of the non-extending Revolving Credit Commitments and (III) repaymentsmade in connection with a permanent repayment and termination of non-extended Revolving Credit Commitments); provided , further , that(A) no Default or Event of Default shall have occurred and be continuing at the time a Revolver Extension Request is delivered to Lenders,(B) in no event shall the final maturity date of any Extended Revolving Credit Commitments of a given Revolver Extension Series at the timeof establishment thereof be earlier than the then Latest Maturity Date of any other Revolving Credit Commitments hereunder and (C) alldocumentation in respect of such Extension Amendment shall be consistent with the foregoing. Any Extended Revolving CreditCommitments amended pursuant to any Revolver Extension Request shall be designated a series (each, a “ Revolver Extension Series ”) ofExtended Revolving Credit Commitments for all purposes of this Agreement; provided that any Extended Revolving Credit Commitmentsamended from an Existing Revolver Tranche may, to the extent provided in the applicable Extension Amendment, be designated as anincrease in any previously established Revolver Extension Series with respect to such Existing Revolver Tranche. Each Revolver ExtensionSeries of Extended Revolving Credit Commitments incurred under this Section 2.16 shall be in an aggregate principal amount that is not lessthan $10,000,000.(c) Extension Request . The Borrowers shall provide the applicable Extension Request at least five Business Days prior tothe date on which Lenders under the Existing Term Loan Tranche or Existing Revolver Tranche, as applicable, are requested to respond (orsuch shorter period as agreed by the Administrative Agent), and shall agree to such procedures, if any, as may be established by, oracceptable to, the Administrative Agent and the Borrowers, in each case acting reasonably to accomplish the purposes of this Section 2.16 .Subject to Section 3.07 , no Lender shall have any obligation to agree to have any of its Term Loans of any Existing Term Loan Trancheamended into Extended Term Loans or any of its Revolving Credit Commitments amended into Extended Revolving Credit Commitments, asapplicable, pursuant to any Extension Request. Any Lender holding a Loan under an Existing Term Loan Tranche (each, an “ ExtendingTerm Lender ”) wishing to have all or a portion of its Term Loans under the Existing Term Loan Tranche subject to such Extension Requestamended into Extended Term Loans and any Revolving Credit Lender (each, an “ Extending Revolving Credit Lender ”) wishing to haveall or a portion of its Revolving Credit Commitments under the Existing Revolver Tranche subject to such Extension Request amended intoExtended Revolving Credit Commitments, as applicable, shall notify the Administrative Agent (each, an “ Extension Election ”) on or priorto the date specified in such Extension Request of the amount of its Term Loans under the Existing Term Loan Tranche or Revolving CreditCommitments under the Existing Revolver Tranche, as applicable, which it has elected to request be amended into Extended Term Loans orExtended Revolving Credit Commitments, as applicable (subject to any minimum denomination requirements imposed by the AdministrativeAgent). In the event that the aggregate principal amount of Term Loans under the Existing Term Loan Tranche or Revolving CreditCommitments under the Existing Revolver Tranche, as applicable, in respect of which applicable Term Lenders or Revolving Credit Lenders,as the case may be, shall have accepted the relevant Extension Request exceeds the amount of Extended Term Loans or Extended RevolvingCredit Commitments, as applicable, requested to be extended pursuant to the Extension Request, Term Loans or Revolving CreditCommitments, as applicable, subject to Extension Elections shall be amended to Extended Term Loans or Revolving Credit Commitments, asapplicable, on a pro rata basis (subject to rounding by the Administrative Agent, which shall be conclusive) based on the aggregate principalamount of Term Loans or Revolving Credit Commitments, as applicable, included in each such Extension Election.(d) Extension Amendment . Extended Term Loans and Extended Revolving Credit Commitments shall be establishedpursuant to an amendment (each, an “ Extension Amendment ”) to this Agreement among the Borrowers, the Administrative Agent and eachExtending Term Lender or Extending Revolving Credit Lender, as applicable, providing an Extended Term Loan or Extended RevolvingCredit Commitment, as applicable, thereunder, which shall be consistent with the provisions set forth in Section 2.16(a) or 2.16(b) above,respectively (but which shall not require the consent of any other Lender). The effectiveness of any Extension Amendment shall be subject tothe satisfaction (or waiver) on the date thereof of each of the conditions set forth in Section 4.02 (other than delivery of a Committed LoanNotice) and, to the extent reasonably requested by the Administrative Agent, receipt by the Administrative Agent of (i) legal opinions, boardresolutions and officers’ certificates consistent with those delivered on the Closing Date other than changes to such legal opinion resultingfrom a change in law, change in fact or change to counsel’s form of opinion reasonably satisfactory to the Administrative Agent and(ii) reaffirmation agreements and/or such amendments to the Collateral Documents as may be reasonably requested by the AdministrativeAgent in order to ensure that the Extended Term Loans or Extended Revolving Credit Commitments, as applicable, are provided with thebenefit of the applicable Loan Documents. The Administrative Agent shall promptly notify each Lender as to the effectiveness of eachExtension Amendment. Each of the parties hereto hereby agrees that this Agreement and the other Loan Documents may be amendedpursuant to an Extension Amendment, without the consent of any other Lenders, to the extent (but only to the extent) necessary to (i) reflectthe existence and terms of the Extended Term Loans or Extended Revolving Credit Commitments, as applicable, incurred pursuant thereto,(ii) modify the scheduled repayments set forth in Section 2.07 with respect to any Existing Term Loan Tranche subject to an ExtensionElection to reflect a reduction in the principal amount of the Term Loans thereunder in an amount equal to the aggregate principal amount ofthe Extended Term Loans amended pursuant to the applicable Extension (with such amount to be applied ratably to reduce scheduledrepayments of such Term Loans required pursuant to Section 2.07 ), (iii) modify the prepayments set forth in Section 2.05 to reflect theexistence of the Extended Term Loans and the application of prepayments with respect thereto, (iv) make such other changes to thisAgreement and the other Loan Documents consistent with the provisions and intent of the third paragraph of Section 10.01 (without theconsent of the Required Lenders called for therein) and (v) effect such other amendments to this Agreement and the other Loan Documents asmay be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrower Representative, to effect theprovisions of this Section 2.16 , and the Required Lenders hereby expressly authorize the Administrative Agent to enter into any suchExtension Amendment.(e) No conversion of Loans pursuant to any Extension in accordance with this Section 2.16 shall constitute a voluntary ormandatory payment or prepayment for purposes of this Agreement. This Section 2.16 shall supersede any provisions in Section 2.13 or 10.01to the contrary.Section 2.17. Defaulting Lenders .(a) Adjustments . Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes aDefaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:(vi) Waivers and Amendments . That Defaulting Lender’s right to approve or disapprove any amendment, waiveror consent with respect to this Agreement shall be restricted as set forth in Section 10.01 .(vii) Reallocation of Payments . Any payment of principal, interest, fees or other amounts received by theAdministrative Agent for the account of that Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIIIor otherwise), shall be applied at such time or times as may be determined by the Administrative Agent as follows: first , to thepayment of any amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second , to the payment on a prorata basis of any amounts owing by that Defaulting Lender to the L/C Issuers or Swing Line Lender hereunder; third , if sodetermined by the Administrative Agent or requested by the L/C Issuers or Swing Line Lender, to be held as Cash Collateral forfuture funding obligations of that Defaulting Lender of any participation in any Swing Line Loan or Letter of Credit; fourth , as theBorrower Representative may request (so long as no Default or Event of Default has occurred and is continuing), to the funding ofany Loan in respect of which that Defaulting Lender has failed to fund its portion thereof as required by this Agreement, asreasonably determined by the Administrative Agent; fifth , if so determined by the Administrative Agent and the BorrowerRepresentative, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of that DefaultingLender to fund Loans under this Agreement; sixth , to the payment of any amounts owing to the Lenders, the L/C Issuers or SwingLine Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, any L/C Issuer or the SwingLine Lender against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement;seventh , so long as no Default or Event of Default has occurred and is continuing, to the payment of any amounts owing to theBorrowers as a result of any judgment of a court of competent jurisdiction obtained by the Borrowers against that Defaulting Lenderas a result of that Defaulting Lender’s breach of its obligations under this Agreement; and eighth , to that Defaulting Lender or asotherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of anyLoans or L/C Borrowings in respect of which that Defaulting Lender has not fully funded its appropriate share and (y) such Loans orL/C Borrowings were made at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall beapplied solely to pay the Loans of, and L/C Borrowings owed to, all Non-Defaulting Lenders on a pro rata basis prior to beingapplied to the payment of any Loans of, or L/C Borrowings owed to, that Defaulting Lender. Any payments, prepayments or otheramounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to postCash Collateral pursuant to this Section 2.17(a)(ii) shall be deemed paid to and redirected by that Defaulting Lender, and each Lenderirrevocably consents hereto.(viii) Certain Fees . That Defaulting Lender (x) shall not be entitled to receive any commitment fee pursuant toSection 2.09(a) for any period during which that Lender is a Defaulting Lender (and the Borrowers shall not be required to pay anysuch fee that otherwise would have been required to have been paid to that Defaulting Lender) and (y) shall be limited in its right toreceive Letter of Credit fees as provided in Section 2.03(h) .(ix) Reallocation of Pro Rata Share to Reduce Fronting Exposure . During any period in which there is aDefaulting Lender, for purposes of computing the amount of the obligation of each Non-Defaulting Lender to acquire, refinance orfund participations in Letters of Credit and Swing Line Loans pursuant to Section 2.03 , the “Pro Rata Share” of each Non-DefaultingLender’s Revolving Credit Loans and L/C Obligations shall be computed without giving effect to the Commitment of that DefaultingLender; provided that (i) each such reallocation shall be given effect only if, at the date the applicable Lender becomes a DefaultingLender, no Default or Event of Default has occurred and is continuing; and (ii) the aggregate obligation of each Non-DefaultingLender to acquire, refinance or fund participations in Letters of Credit and Swing Line Loans shall not exceed the positive difference,if any, of (1) the Commitment of that Non-Defaulting Lender minus (2) the aggregate Outstanding Amount of the Loans of thatLender.(b) Defaulting Lender Cure . If the Borrowers, the Administrative Agent and the L/C Issuers and the Swing Line Lenderagree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the AdministrativeAgent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forththerein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase that portionof outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause theRevolving Credit Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held on a pro rata basis bythe Lenders in accordance with their Pro Rata Share (without giving effect to Section 2.17(a)(iv) ), whereupon that Lender will cease to be aDefaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf ofthe Borrowers while that Lender was a Defaulting Lender; provided , further , that except to the extent otherwise expressly agreed by theaffected parties and subject to Section 11.13 , no change hereunder from Defaulting Lender to Lender will constitute a waiver or release ofany claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.ARTICLE III TAXES, INCREASED COSTS PROTECTION AND ILLEGALITYSection 3.01. Taxes .(h) Except as provided in this Section 3.01 , any and all payments made by or on account of the Borrowers (the termBorrower under Article III being deemed to include any Subsidiary for whose account a Letter of Credit is issued) or Guarantors under anyLoan Document shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes. If any Borrower, anyGuarantor or other applicable withholding agent shall be required by any Laws to deduct any Taxes from or in respect of any sum payableunder any Loan Document to any Agent or any Lender (as determined in the good-faith discretion of the applicable withholding agent), (i) ifthe Tax in question is an Indemnified Tax, the sum payable by the Borrowers or any Guarantor shall be increased as necessary so that aftermaking all required deductions of Indemnified Tax (including deductions of Indemnified Tax applicable to additional sums payable under thisSection 3.01 ), each of such Agent and such Lender receives an amount equal to the sum it would have received had no such deductions forIndemnified Tax been made, (ii) the applicable withholding agent shall make such deductions, and (iii) the applicable withholding agent shallpay the full amount deducted to the relevant Governmental Authority in accordance with applicable Laws. Within 30 days after the date ofsuch payment of Taxes pursuant to this Section 3.01 (or, if receipts or evidence are not available within 30 days, as soon as possiblethereafter), if any Borrower or any Guarantor is the applicable withholding agent, it shall furnish to the Administrative Agent the original or acopy of a receipt evidencing payment thereof, a copy of the return reporting such payment, or other evidence reasonably acceptable to theAdministrative Agent.(i) In addition, the Borrowers agree to pay any and all present or future stamp, court or documentary Taxes and any otherproperty, intangible or mortgage recording Taxes, imposed by any Governmental Authority, which arise from the execution, delivery,performance, enforcement or registration of, or otherwise with respect to, any Loan Document excluding, in each case, any such Tax imposedsolely as a result of an Agent or Lender’s Assignment and Assumption (collectively, “ Assignment Taxes ”), except for Assignment Taxesresulting from assignment or participation that is requested or required in writing by the Borrower Representative (all such non-excludedtaxes described in this Section 3.01(b) being hereinafter referred to as “ Other Taxes ”).(j) Each Borrower and each Guarantor agree to indemnify each Agent and each Lender for (i) the full amount ofIndemnified Taxes payable by such Agent or such Lender (including Indemnified Taxes imposed or asserted on or attributable to amountspayable under this Section 3.01 ) and (ii) any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes werecorrectly or legally imposed or asserted by the Governmental Authority. A certificate as to the amount of such payment or liability preparedin good faith and delivered by such Agent or Lender (or by an Agent on behalf of such Lender) accompanied by a written statement thereofsetting forth in reasonable detail the basis and calculation of such amounts shall be conclusive absent manifest error.(k) Each Lender and Agent shall, at the time or times prescribed by applicable Law and at the time or times as arereasonably requested by the Borrower Representative or the Administrative Agent, provide the Borrower Representative and theAdministrative Agent with any documentation prescribed by Law or reasonably requested by the Borrower Representative or theAdministrative Agent certifying as to any entitlement of such Lender to an exemption from, or reduction in, withholding Tax with respect toany payments to be made to such Lender or Agent under the Loan Documents. Each such Lender and Agent shall, whenever a lapse in timeor change in circumstances renders such documentation obsolete or inaccurate in any material respect, deliver promptly and on or before thedate such documentation expires, becomes obsolete or inaccurate to the Borrower Representative and the Administrative Agent updated orother appropriate documentation (including any new documentation reasonably requested by the Borrower Representative or theAdministrative Agent) or promptly notify the Borrower Representative and the Administrative Agent in writing of its inability to do so.Unless the applicable withholding agent has received forms or other documents satisfactory to it indicating that payments under any LoanDocument to or for a Lender are not subject to withholding Tax, the applicable withholding agent shall be entitled to withhold amountsrequired to be withheld by applicable Law from such payments at the applicable rate. Notwithstanding any other provision of thisSection 3.01(d) , an Agent or a Lender shall not be required to deliver any form or certification pursuant to this Section 3.01(d) (other than thedocumentation set forth in Section 3.01(d)(i) through (v) ) (x) that such Agent or Lender is not legally eligible to deliver or (y) if in suchAgent’s or Lender’s reasonable judgment the completion, execution or submission of such form or certification would subject such Agent orLender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Agent or Lender.Without limiting the foregoing:(i) Each Lender that is a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to theBorrower Representative and the Administrative Agent on or before the date on which it becomes a party to this Agreement twoproperly completed and duly signed original copies of Internal Revenue Service Form W-9 certifying that such Lender is exemptfrom federal backup withholding.(ii) Each Lender that is not a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver tothe Borrower Representative and the Administrative Agent on or before the date on which it becomes a party to this Agreement (andfrom time to time thereafter upon the request of the Borrower Representative or the Administrative Agent) whichever of the followingis applicable:(A) two properly completed and duly signed copies of IRS Form W‑8BEN or IRS Form W‑8BEN‑E, asapplicable (or any successor forms), claiming eligibility for the benefits of an income tax treaty to which the United States is aparty, and such other documentation as required under the Code,(B) two properly completed and duly signed copies of IRS Form W‑8ECI (or any successor forms),(C) in the case of a Lender claiming the benefits of the exemption for portfolio interest underSection 881(c) of the Code, (x) a certificate substantially in the form of Exhibit H-1 to the effect that such Lender is not a“bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of the Borrowers within themeaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of theCode (a “ United States Tax Compliance Certificate ”) and (y) two properly completed and duly signed original copies ofIRS Form W‑8BEN or IRS Form W‑8BEN‑E, as applicable (or any successor forms), or(D) to the extent a Lender is not the beneficial owner (for example, where the Lender is a partnership), twoproperly completed and duly signed original copies of IRS Form W‑8IMY (or any successor forms) of the Lender,accompanied by IRS Form W‑8ECI, IRS Form W‑8BEN, IRS Form W‑8BEN‑E, a United States Tax Compliance Certificatesubstantially in the form of Exhibit H‑2 or Exhibit H‑3, Form W‑9, and/or other certification documents from each beneficialowner, as applicable ( provided that if the Lender is a partnership and one or more direct or indirect partners of such Lenderare claiming the portfolio interest exemption, such Lender may provide a United States Tax Compliance Certificatesubstantially in the form of Exhibit H-4 on behalf of each such direct and indirect partner).(iii) Each Agent that is a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to theBorrower Representative and the Administrative Agent two properly completed and duly signed copies of IRS Form W‑9 withrespect to fees received on its own behalf, certifying that such Agent is exempt from federal backup withholding. Each Agent that isnot a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to the Borrower Representative and theAdministrative Agent two properly completed and duly signed original copies of IRS Form W‑8ECI with respect to fees received onits own behalf.(iv) If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding taximposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA, such Lender shalldeliver to the Borrower Representative and the Administrative Agent at the time or times prescribed by Laws and at such time ortimes reasonably requested by the Borrower Representative or the Administrative Agent such documentation prescribed by applicableLaws and such additional documentation reasonably requested by the Borrower Representative or the Administrative Agent as maybe necessary for the Borrower Representative and the Administrative Agent to comply with their obligations under FATCA and todetermine whether such Lender has or has not complied with such Lender’s obligations under FATCA and, if necessary, to determinethe amount to deduct and withhold from such payment. Solely for purposes of this Section 3.01(d) , “FATCA” shall include anyamendments made to FATCA after the date of this Agreement.(v) Each Lender and Agent agrees that if any form or certification it previously delivered expires or becomesobsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower Representative and theAdministrative Agent in writing of its legal inability to do so.(l) If any Lender requests compensation under this Section 3.01 , then such Lender will, if requested by the BorrowerRepresentative, use its commercially reasonable efforts to designate another Lending Office if such a change would reduce any suchadditional amounts (or any similar amount that may thereafter accrue) and would not, in the reasonable judgment of such Lender, result inany unreimbursed cost or expense or be otherwise disadvantageous to such Lender. The Borrowers hereby agree to pay all reasonable costsand expenses incurred by any Lender in connection with any such designation or assignment.(m) If any party determines, in its sole discretion exercised in good faith, that it has received a refund in respect of anyIndemnified Taxes as to which indemnification or additional amounts have been paid to it by a Loan Party pursuant to this Section 3.01 , itshall promptly remit such refund to such Loan Party (but only to the extent of indemnification or additional amounts paid by the Loan Partyunder this Section 3.01 with respect to the Indemnified Taxes giving rise to such refund), net of all out-of-pocket expenses (including anyTaxes) of the Lender or Agent, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authoritywith respect to such refund net of any Taxes payable by any Agent or Lender on such interest); provided that the Loan Parties, upon therequest of the Lender or Agent, as the case may be, agree promptly to return such refund ( plus any penalties, interest or other chargesimposed by the relevant Governmental Authority) to such party in the event such party is required to repay such refund to the relevant taxingauthority; provided , further , that in no event will the Lender or Agent be required to pay any amount to a Loan Party pursuant to thisparagraph (f) the payment of which would place the Lender or Agent in a less favorable net after-Tax position than the Lender or Agentwould have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposedand the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section 3.01(f) shall not beconstrued to require any Agent or any Lender to make available its tax returns (or any other information relating to Taxes that it deemsconfidential) to the Borrower Representative, the Borrowers or any other person.(n) Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) anyIndemnified Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified the AdministrativeAgent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to suchLender’s failure to comply with the provisions of Section 10.07(e) relating to the maintenance of a Participant Register and (iii) any taxesexcluded from the definition of Indemnified Taxes attributable to such Lender, in each case, that are payable or paid by the AdministrativeAgent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not suchTaxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such paymentor liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes theAdministrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwisepayable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under thisparagraph (g) .(o) Each party’s obligations under this Section 3.01 shall survive the resignation or replacement of the AdministrativeAgent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction ordischarge of all obligations under any Loan Document.(p) For purposes of this Section 3.01 , the term “Lender” includes any L/C Issuer, and the term “applicable Laws” includesFATCA.Section 3.02. Illegality . If any Lender determines in good faith that any Law or guideline has made it unlawful or impermissible,or that any Governmental Authority has asserted that it is unlawful or impermissible under any such guideline, for any Lender or itsapplicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates based upon theEurodollar Rate, in each case after the Closing Date then, on written notice thereof by such Lender to the Borrower Representative throughthe Administrative Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert ABR Loans to EurodollarRate Loans shall be suspended until such Lender notifies the Administrative Agent and the Borrower Representative that the circumstancesgiving rise to such determination no longer exist. Upon receipt of such notice, the Borrower Representative shall promptly following writtendemand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all applicable Eurodollar Rate Loans ofsuch Lender to ABR Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully and in accordance withguidelines continue to maintain such Eurodollar Rate Loans to such day, or promptly, if such Lender may not lawfully or in accordance withguidelines continue to maintain such Eurodollar Rate Loans. Upon any such prepayment or conversion, the Borrowers shall also pay accruedinterest on the amount so prepaid or converted and all amounts due, if any, in connection with such prepayment or conversion underSection 3.05 . Each Lender agrees to designate a different Lending Office if such designation will avoid the need for such notice and will not,in the good faith judgment of such Lender, otherwise be materially disadvantageous to such Lender.Section 3.03. Inability to Determine Rates . If the Administrative Agent determines, or is notified by the Required Lenders, afterthe Closing Date that for any reason adequate and reasonable means do not exist for determining the applicable Eurodollar Rate for anyrequested Interest Period with respect to a proposed Eurodollar Rate Loan, or that the Eurodollar Rate for any requested Interest Period withrespect to a proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost to such Lenders of funding such Loan, or thatDollar deposits are not being offered to banks in the London interbank eurodollar, or other applicable, market for the applicable amount andthe Interest Period of such Eurodollar Rate Loan, the Administrative Agent will promptly so notify the Borrower Representative in writingand each Lender. Thereafter, (x) the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended and (y) in theevent a determination described in the preceding sentence with respect to the Eurodollar Rate component of the ABR, the utilization of theEurodollar Rate component in determining the ABR shall be suspended, in each case until the Administrative Agent (upon the instruction ofthe Required Lenders) revokes such notice. Upon receipt of such notice, the Borrowers may revoke any pending request for a Borrowing of,conversion to or continuation of such Eurodollar Rate Loans or, failing that, will be deemed to have converted such request, if applicable, intoa request for a Borrowing of ABR Loans in the amount specified therein.Section 3.04. Increased Cost and Reduced Return; Capital Adequacy; Eurodollar Rate Loan Reserves .(d) If any Lender (which, for purposes of this Section 3.04 shall include the L/C Issuers) reasonably determines that as aresult of the introduction of or any change in or in the interpretation of any Law or guideline, in each case after the Closing Date, or suchLender’s compliance therewith, there shall be any increase in the cost to such Lender of agreeing to make or making, funding or maintainingany Eurodollar Rate Loans or (as the case may be) issuing or participating in Letters of Credit or Swing Line Loans, or a reduction in theamount received or receivable by such Lender in connection with any of the foregoing (excluding for purposes of this Section 3.04(a) anysuch increased costs or reduction in amount resulting from (i) (A) Indemnified Taxes indemnified pursuant to Section 3.01 , (B) any Taxesexcluded from the definition of ”Indemnified Taxes” in sections (ii) through (iv) of such definition or, and (C) “Connection Income Taxes,”and (ii) reserve requirements contemplated by Section 3.04(c) ) and the result of any of the foregoing shall be to increase the cost to suchLender of making or maintaining the Eurodollar Rate Loan (or of maintaining its obligations to make any Loan), or to reduce the amount ofany sum received or receivable by such Lender, then from time to time within 15 Business Days after written demand by such Lender settingforth in reasonable detail (which detail shall not be required to include any information to the extent disclosure thereof is prohibited by Law)such increased costs (with a copy of such demand to the Administrative Agent given in accordance with Section 3.06 ), the Borrowers shallpay to such Lender such additional amounts as will compensate such Lender for such increased cost or reduction. Notwithstanding anythingherein to the contrary, for all purposes under this Agreement, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and allrequests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directivespromulgated by the Bank for International settlements, the Basel Committee on Banking Supervision (or any successor or similar authority)or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a change in Law orguideline, regardless of the date enacted, adopted or issued; provided that increased costs because of a change in a Law or guideline resultingfrom the Dodd-Frank Wall Street Reform and Consumer Protection Act and Basel III may only be requested by a Lender imposing suchincreased costs on the Borrowers similarly situated to borrowers under syndicated credit facilities comparable to those provided hereunder.(e) If any Lender determines that the introduction of any Law or guideline regarding capital adequacy or liquidityrequirements or any change therein or in the interpretation thereof, in each case after the Closing Date, or compliance by such Lender (or itsLending Office) therewith, has the effect of reducing the rate of return on the capital of such Lender or any corporation controlling suchLender as a consequence of such Lender’s obligations hereunder (taking into consideration its policies with respect to capital adequacy andliquidity and such Lender’s desired return on capital), then from time to time promptly following written demand of such Lender setting forthin reasonable detail (which detail shall not be required to include any information to the extent disclosure thereof is prohibited by Law) thecharge and the calculation of such reduced rate of return (with a copy of such demand to the Administrative Agent given in accordance withSection 3.06 ), the Borrowers shall pay to such Lender such additional amounts as will compensate such Lender for such reduction within 10Business Days after receipt of such demand.(f) The Borrower shall pay to each Lender, (i) as long as such Lender shall be required to maintain reserves, capital orliquidity with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits, additional interest on the unpaidprincipal amount of each applicable Eurocurrency Rate Loan of the Borrowers equal to the actual costs of such reserves, capital or liquidityallocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive in the absenceof manifest error), and (ii) as long as such Lender shall be required to comply with any reserve ratio, capital or liquidity requirement oranalogous requirement of any other central banking or financial regulatory authority imposed in respect of the maintenance of theCommitments or the funding of any Eurocurrency Rate Loans of the Borrowers, such additional costs (expressed as a percentage per annumand rounded upwards, if necessary, to the nearest five decimal places) equal to the actual costs allocated to such Commitment or Loan bysuch Lender (as determined by such Lender in good faith, which determination shall be conclusive absent manifest error) which in each caseshall be due and payable on each date on which interest is payable on such Loan; provided the Borrower Representative shall have received atleast 10 Business Days’ prior notice (with a copy to the Administrative Agent) of such additional interest or cost from such Lender. If aLender fails to give notice 10 Business Days prior to the relevant Interest Payment Date, such additional interest or cost shall be due andpayable 10 Business Days from receipt of such notice.(g) Failure or delay on the part of any Lender to demand compensation pursuant to this Section 3.04 shall not constitute awaiver of such Lender’s right to demand such compensation; provided that the applicable Borrower shall not be required to compensate aLender pursuant to this Section 3.04 , to the extent that such Lender or Agent fails to make a demand for such compensation more than ninemonths after becoming aware of its right to such compensation.(h) If any Lender requests compensation under this Section 3.04 , then such Lender will, if requested by the BorrowerRepresentative, use commercially reasonable efforts to designate another Lending Office for any Loan or Letter of Credit affected by suchevent; provided that such efforts are made on terms that, in the reasonable judgment of such Lender, cause such Lender and its LendingOffice(s) to suffer no material economic, legal or regulatory disadvantage; provided , further , that nothing in this Section 3.04(d) shall affector postpone any of the Obligations of the Borrowers or the rights of such Lender pursuant to Section 3.04(a) , (b) , (c) or (d) .Section 3.05. Funding Losses . Promptly following written demand of any Lender (with a copy to the Administrative Agent) fromtime to time, the Borrowers shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expenseactually incurred by it as a result of:(a) any continuation, conversion, payment or prepayment of any Eurodollar Rate Loan of the Borrowers on a day otherthan the last day of the Interest Period for such Loan; or(b) any failure by the Borrowers (for a reason other than the failure of such Lender to make a Loan) to pay, prepay, borrow,continue or convert any Eurodollar Rate Loan of the Borrowers on the date or in the amount notified by the Borrower Representative;including any loss or expense (excluding loss of anticipated profits) arising from the liquidation or reemployment of funds obtained by it tomaintain such Loan or from fees payable to terminate the deposits from which such funds were obtained.For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05 , each Lender shall be deemed tohave funded each Eurocurrency Rate Loan made by it at the Eurocurrency Rate for such Loan by a matching deposit or other borrowing in theoffshore interbank market for the applicable currency for a comparable amount and for a comparable period, whether or not suchEurocurrency Rate Loan was in fact so funded.Section 3.06. Matters Applicable to All Requests for Compensation .(f) Any Agent or any Lender claiming compensation under this Article III shall deliver a certificate to the BorrowerRepresentative setting forth the additional amount or amounts to be paid to it hereunder which shall be conclusive in the absence of manifesterror. In determining such amount, such Agent or such Lender may use any reasonable averaging and attribution methods.(g) With respect to any Lender’s claim for compensation for any amounts under Section 3.02 , 3.03 or 3.04 , theBorrowers shall not be required to compensate such Lender for the interest and penalties with respect to such amounts if such Lender notifiesthe Borrower Representative of the event that gives rise to such claim more than 180 days after such event; provided that if the circumstancegiving rise to such claim is retroactive, then such 180-day period referred to above shall be extended to include the period of retroactive effectthereof. If any Lender requests compensation by the Borrowers under Section 3.04 , the Borrower Representative may, by notice to suchLender (with a copy to the Administrative Agent), suspend the obligation of such Lender to make or continue from one Interest Period toanother applicable Eurodollar Rate Loan, or, if applicable, to convert ABR Loans into Eurodollar Rate Loans, until the event or conditiongiving rise to such request ceases to be in effect (in which case the provisions of Section 3.06(c) shall be applicable); provided that suchsuspension shall not affect the right of such Lender to receive the compensation so requested.(h) If the obligation of any Lender to make or continue any Eurodollar Rate Loan, or to convert ABR Loans intoEurodollar Rate Loans shall be suspended pursuant to Section 3.06(b) hereof, such Lender’s applicable Eurodollar Rate Loans shall beautomatically converted into ABR Loans (or, if such conversion is not possible, repaid) on the last day(s) of the then current Interest Period(s)for such Eurodollar Rate Loans (or, in the case of an immediate conversion required by Section 3.02 , on such earlier date as required by Lawor guidelines) and, unless and until such Lender gives notice as provided below that the circumstances specified in Section 3.02 , 3.03 or 3.04hereof that gave rise to such conversion no longer exist:(iii) to the extent that such Lender’s Eurodollar Rate Loans have been so converted, all payments and prepaymentsof principal that would otherwise be applied to such Lender’s applicable Eurodollar Rate Loans shall be applied instead to its ABRLoans; and(iv) all Loans that would otherwise be made or continued from one Interest Period to another by such Lender asEurodollar Rate Loans shall be made or continued instead as ABR Loans (if possible), and all ABR Loans of such Lender that wouldotherwise be converted into Eurodollar Rate Loans shall remain as ABR Loans.(i) If any Lender gives notice to the Borrower Representative (with a copy to the Administrative Agent) that thecircumstances specified in Section 3.02 , 3.03 or 3.04 hereof that gave rise to the conversion of any of such Lender’s Eurodollar Rate Loanspursuant to this Section 3.06 no longer exist (which such Lender agrees to do promptly upon such circumstances ceasing to exist) at a timewhen Eurodollar Rate Loans made by other Lenders under the applicable Facility are outstanding, if applicable, such Lender’s ABR Loansshall be automatically converted, on the first day(s) of the next succeeding Interest Period(s) for such outstanding Eurodollar Rate Loans, tothe extent necessary so that, after giving effect thereto, all Loans held by the Lenders holding Eurodollar Rate Loans under such Facility andby such Lender are held pro rata (as to principal amounts, interest rate basis, and Interest Periods) in accordance with their respectiveCommitments for the applicable Facility.Section 3.07. Replacement of Lenders under Certain Circumstances .(h) If at any time (i) the Borrowers become obligated to pay additional amounts or indemnity payments described inSection 3.01 or 3.04 as a result of any condition described in such Sections or any Lender ceases to make any Eurodollar Rate Loans as aresult of any condition described in Section 3.02 or 3.04 or requires the Borrowers to pay additional amounts as a result thereof, (ii) anyLender becomes a Defaulting Lender, or (iii) any Lender becomes a Non-Consenting Lender, then the Borrower Representative may, on fiveBusiness Days’ prior written notice to the Administrative Agent and such Lender, replace such Lender by causing such Lender to (and suchLender shall be obligated to) assign pursuant to Section 10.07(b) (so long as the assignment fee is paid in such instance) all of its rights andobligations under this Agreement (which shall only apply in respect of any applicable Facility (and not all Facilities hereunder) only in thecase of clause (i) or, in the case of a Non-Consenting Lender with respect to a vote of directly and adversely affected Lenders (“ AffectedClass ”), clause (iii) ); provided that neither the Administrative Agent nor any Lender shall have any obligation to the Borrowers to find areplacement Lender or other such Person; provided , further , that (A) in the case of any such assignment resulting from a claim forcompensation under Section 3.04 or payments required to be made pursuant to Section 3.01 , such assignment will result in a reduction insuch compensation or payments and (B) in the case of any such assignment resulting from a Lender becoming a Non-Consenting Lender, theapplicable Eligible Assignees shall have agreed to, and shall be sufficient (together with all other consenting Lenders) to cause the adoptionof, the applicable departure, waiver or amendment of the Loan Documents.(i) Any Lender being replaced pursuant to Section 3.07(a) above shall (i) execute and deliver an Assignment andAssumption with respect to such Lender’s applicable Commitment and outstanding Loans and participations in L/C Obligations and SwingLine Loans in respect thereof, and (ii) deliver any Notes evidencing such Loans to the Borrower Representative or the Administrative Agent.Pursuant to such Assignment and Assumption, (A) the assignee Lender shall acquire all or a portion, as the case may be, of the assigningLender’s Commitment and outstanding Loans and participations in L/C Obligations and Swing Line Loans, (B) all obligations of theBorrowers owing to the assigning Lender relating to the Loans, Commitments and participations so assigned shall be paid in full by theassignee Lender to such assigning Lender concurrently with such Assignment and Assumption and (C) upon such payment and, if sorequested by the assignee Lender, delivery to the assignee Lender of the appropriate Note or Notes executed by the applicable Borrower, theassignee Lender shall become a Lender hereunder and the assigning Lender shall cease to constitute a Lender hereunder with respect to suchassigned Loans, Commitments and participations, except with respect to indemnification provisions under this Agreement, which shallsurvive as to such assigning Lender. In connection with any such replacement, if any such Lender does not execute and deliver to theAdministrative Agent a duly executed Assignment and Assumption reflecting such replacement within five Business Days of the date onwhich the assignee Lender executes and delivers such Assignment and Assumption to such Lender, then such Lender shall be deemed to haveexecuted and delivered such Assignment and Assumption without any action on the part of the Lender.(j) Notwithstanding anything to the contrary contained above, any Lender that acts as an L/C Issuer may not be replacedhereunder at any time that it has any Letter of Credit outstanding hereunder unless arrangements reasonably satisfactory to such L/C Issuer(including the furnishing of a back-up standby letter of credit in form and substance, and issued by an issuer, reasonably satisfactory to suchL/C Issuer or Cash Collateral) have been made in respect of such outstanding Letters of Credit and the Lender that acts as the AdministrativeAgent may not be replaced hereunder except in accordance with the terms of Section 9.06 .(k) In the event that (i) the Borrower Representative or the Administrative Agent have requested that the Lenders consentto a departure or waiver of any provisions of the Loan Documents or agree to any amendment thereto, (ii) the consent, waiver or amendmentin question requires the agreement of each affected Lender or each Lender of a Class in accordance with the terms of Section 10.01 or anAffected Class or all Lenders holding Term Loans subject to a Permitted Repricing Amendment and (iii) the Required Lenders (and, in thecase of a consent, waiver or amendment (1) involving all of an Affected Class, at least 50.1% of such Affected Class or (2) involving aPermitted Repricing Amendment, all other Lenders holding a tranche of Term Loans subject to such repricing that will continue as repriced ormodified Term Loans) have agreed to such consent, waiver or amendment, then any Lender who does not agree to such consent, waiver oramendment shall be deemed a “ Non-Consenting Lender .”Section 3.08. Survival . All of the Borrowers’ obligations under this Article III shall survive termination of the AggregateCommitments and repayment of all other Obligations hereunder.ARTICLE IV CONDITIONS PRECEDENT TO CREDIT EXTENSIONSSection 4.01. Conditions to Initial Credit Extension . The obligation of each Lender to make a Credit Extension hereunder on theClosing Date is subject solely to the satisfaction or waiver by the Lead Arranger of the following conditions (in each case, subject to theCertain Funds Provisions):(o) The Administrative Agent’s receipt of the following, each of which shall be original, .pdf or facsimile copies ordelivered by other electronic method (followed promptly by originals) unless otherwise specified, each properly executed by a ResponsibleOfficer of the signing Loan Party each in form and substance reasonably satisfactory to the Administrative Agent:(x) a Committed Loan Notice, executed by the Administrative Agent and a Responsible Officer of each Borrowerand in accordance with the requirements hereof;(xi) counterparts of this Agreement executed by each Loan Party;(xii) a Note executed by the Borrowers in favor of each Lender that has requested a Note at least two BusinessDays in advance of the Closing Date;(xiii) each Collateral Document and each other document set forth on Schedule 4.01(a) required to be executed onthe Closing Date as indicated on such schedule, duly executed by each Loan Party thereto, together with:(A) certificates, if any, representing the Pledged Equity referred to therein accompanied by undated stockor membership interest powers executed in blank and instruments, if any, evidencing the Pledged Debt indorsed in blank; and(B) proper financing statements (Form UCC-1 or the equivalent) for filing under the UCC or otherappropriate filing offices of each jurisdiction as may be necessary to perfect the security interests purported to be created bythe foregoing Security Agreement;(xiv) (A) a completed Perfection Certificate dated the Closing Date and signed by a Responsible Officer of theBorrower Representative, together with all attachments contemplated thereby and (B) the results of a search of the UniformCommercial Code filings (or equivalent filings), judgments and taxes made with respect to the Loan Parties in the states (or otherjurisdictions) of formation of such Persons, in which the chief executive office of each such Person is located and in such otherjurisdictions as may be reasonably required by the Administrative Agent, together with copies of the financing statements (or similardocuments) disclosed by such search, and accompanied by evidence satisfactory to the Administrative Agent that the Liens indicatedin any such financing statement (or similar document) would be permitted under Section 7.01 or have been or will becontemporaneously released or terminated;(xv) such certificates of good standing from the applicable secretary of state of the state of organization of eachLoan Party, copies of resolutions or other corporate or limited liability company action, incumbency certificates and/or othercertificates of Responsible Officers of each Loan Party (including a certificate attaching the Organization Documents of each LoanParty) as the Administrative Agent may reasonably require evidencing the identity, authority and capacity of each ResponsibleOfficer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to whichsuch Loan Party is a party or is to be a party on the Closing Date, and the use of commercially reasonable efforts to provide evidenceof insurance;(xvi) opinions from (A) Perkins Coie LLP, as counsel to the Loan Parties and (B) Shuttleworth & Ingersol, as Iowacounsel to the Loan Parties, in each case, in form and substance reasonably satisfactory to the Administrative Agent;(xvii) a certificate dated the Closing Date and signed by a Responsible Officer of the Borrower, confirmingsatisfaction of the conditions set forth in clause (f) below; and(xviii) a solvency certificate from the chief financial officer of Holdings substantially in the form attached hereto asExhibit D ;provided , however , that, each of the requirements set forth in clause (iv) above, including the delivery of documents and instrumentsnecessary to satisfy the Collateral and Guarantee Requirement (except to the extent that a Lien on or security interest in suchCollateral may be perfected solely (x) by the filing of a financing statement under the Uniform Commercial Code or (y) by thedelivery of stock certificates of the Borrowers and the Guarantors to the extent possession of such stock certificates or othercertificates perfects a security interest therein, together with undated stock powers executed in blank or (z) by a filing with the UnitedStates Patent and Trademark Office or the United States Copyright Office) shall not constitute conditions precedent to any CreditExtension on the Closing Date after the Borrowers’ use of commercially reasonable efforts to provide such items on or prior to theClosing Date if the Borrowers agree to deliver, or cause to be delivered, such search results, documents and instruments, or take orcause to be taken such other actions as may be required to perfect such security interests within 90 days after the Closing Date(subject to extensions approved by the Administrative Agent in its reasonable discretion).(p) All fees required to be paid on the Closing Date pursuant to the Fee Letter and (b) all fees and expenses required to bepaid on the Closing Date pursuant to the Commitment Letter to the extent invoiced at least one business day prior to the Closing Date (the “Invoice Date ”), shall have been paid (which amounts may be offset against the proceeds of the Facilities on the Closing Date).(q) The Refinancing shall have been or, substantially concurrently with the initial Borrowing hereunder shall be,consummated pursuant to customary pay-off documentation and all commitments relating thereto shall have been terminated, and all liens orsecurity interests related thereto shall have been terminated or released. On the Closing Date, after giving effect to the Refinancing, noConsolidated Party shall have (i) any third party indebtedness for borrowed money other than the Facilities and Indebtedness permittedpursuant to Section 7.03(b) or (ii) any Disqualified Equity Interests.(r) The Acquisition shall have been or, substantially concurrently with the initial Borrowing hereunder shall be,consummated in accordance with the terms of the Acquisition Agreement, without giving effect to any modifications, amendments, waiversor consents thereto that are materially adverse to the Lenders without the prior written consent of the Administrative Agent (such consent notto be unreasonably withheld, conditioned or delayed) (it being understood and agreed that (a) any decrease in the purchase price not in excessof 15% of the total purchase price shall not be materially adverse to the interests of the Lenders so long as such decrease is allocated to reducethe Term Loans on a dollar-for-dollar basis, (b) any increase in the purchase price shall be deemed to be materially adverse to the Lendersunless such increase is funded with net cash proceeds of the issuance of Equity Interests of Holdings and (c) any modifications to Section7.10 of (or any other provision that would have the effect of modifying Section 7.10 and the provisions thereof), or the definition of ClosingDate Material Adverse Effect in, the Acquisition Agreement shall be deemed to be materially adverse to the interests of the Lenders).(s) (i) Since December 31, 2014, there shall not have been a material adverse change or any development involving aprospective material adverse change in, or affecting, the business, condition (financial or otherwise), operations, performance, properties orprospects of Parent, Baseball, Holdings and their subsidiaries, taken as a whole, and (ii) since October 14, 2015, no Closing Date MaterialAdverse Effect shall have occurred.(t) The Acquisition Agreement Representations shall be true and correct to the extent required by the Certain FundsProvision and the Specified Representations shall be true and correct in all material respects, in each case as of the Closing Date (except inthe case of any Acquisition Agreement Representation or Specified Representation which expressly relates to a given date or period, forwhich such representation and warranty shall be true and correct in all material respects as of the respective date or for the respective period,as the case may be).(u) The Arranger shall have received the Annual Financial Statements, the Quarterly Financial Statements and the ProForma Financial Statements.(v) The Equity Contribution shall have been or, substantially concurrently with the initial borrowing under the Facilitiesshall be, consummated.(w) The Administrative Agent shall have received at least three Business Days prior to the Closing Date all documentationand other information about Parent and its Subsidiaries required under applicable “know your customer” and anti-money laundering rules andregulations, including the USA Patriot Act that has been requested by the Administrative Agent in writing at least ten Business Days prior tothe Closing Date.(x) The Lead Arranger shall have been afforded a period of time to syndicate the Facilities of at least fifteen (15)consecutive Business Days from the date of the delivery by the Borrowers, or on their behalf, of the Annual Financial Statements, theQuarterly Financial Statements and the Pro Forma Financial Statements and the confidential information memoranda referred to in theCommitment Letter and ending on the business day immediately prior to the Closing Date (such period, the “ Marketing Period ”); providedthat any day from and including November 26, 2015, through and including November 29, 2015, and any day from and including December24, 2015, through and including January 3, 2016, will not be considered a Business Day.(y) HDV Holdings shall have received from FINRA a decision as specified in NASD Rule 1017 granting approval withrespect to the transactions contemplated by the Acquisition Agreement and the change of indirect owners of the BD Subsidiary with onlysuch material restrictions or conditions to which Baseball and the Lead Arranger shall have agreed are acceptable, which approval shall nothave been revoked.Without limiting the generality of the provisions of Section 9.03(b) , for purposes of determining compliance with the conditionsspecified in this Section 4.01 , each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or tobe satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to aLender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying itsobjection thereto.Section 4.02. Conditions to All Credit Extensions after the Closing Date . The obligation of each Lender to honor any Request forCredit Extension after the Closing Date (other than a Committed Loan Notice requesting only a conversion of Loans to the other Type, or acontinuation of Eurodollar Rate Loans) is subject to satisfaction or waiver of the following conditions precedent:(i) The representations and warranties of each Loan Party set forth in Article V and in each other Loan Document shall betrue and correct in all material respects on and as of the date of such Credit Extension with the same effect as though made on and asof such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case they shall betrue and correct in all material respects as of such earlier date; provided that any representation and warranty that is qualified as to“materiality,” “Material Adverse Effect” or similar language shall be true and correct in all respects on the date of such CreditExtension or on such earlier date, as the case may be.(ii) No Default or Event of Default shall exist or would result from such proposed Credit Extension or from the applicationof the proceeds therefrom.(iii) The Administrative Agent and, if applicable, the relevant L/C Issuer or the Swing Line Lender, shall have received aRequest for Credit Extension in accordance with the requirements hereof.Each Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Loans to the other Type, ora continuation of Eurodollar Rate Loans) submitted by the applicable Borrower shall be deemed to be a representation and warranty that theconditions specified in Sections 4.02(i) and (ii) have been satisfied on and as of the date of the applicable Credit Extension.Notwithstanding anything in this Section 4.02 to the contrary, to the extent that the proceeds of Incremental Term Loans are to beused to finance a Limited Condition Transaction permitted hereunder, the only conditions precedent to the funding of such Incremental TermLoans shall be the conditions precedent set forth in the related Incremental Amendment.ARTICLE V REPRESENTATIONS AND WARRANTIESEach Holding Company, each Borrower and each of the Subsidiary Guarantors party hereto represents and warrants to the Agents andthe Lenders at the time of each Credit Extension (to the extent required to be true and correct for such Credit Extension pursuant to Article IV, and limited on the Closing Date to the Specified Representations) that:Section 5.01. Existence, Qualification and Power; Compliance with Laws . Each Loan Party and each Restricted Subsidiary (a) is aPerson duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organizationto the extent such concept exists in such jurisdiction, (b) has all requisite organizational power and authority to (i) own or lease its assets andcarry on its business as currently conducted and (ii) in the case of the Loan Parties, execute, deliver and perform its obligations under theLoan Documents to which it is a party, (c) is duly qualified and in good standing (where relevant) under the Laws of each jurisdiction whereits ownership, lease or operation of properties or the conduct of its business requires such qualification, (d) is in compliance with all Laws,orders, writs and injunctions and (e) has all requisite governmental licenses, authorizations, consents and approvals to operate its business ascurrently conducted; except in each case, referred to in clauses (a) (other than with respect to the Holding Companies and the Borrowers), (b)(i) (other than with respect to the Borrowers), (c) , (d) or (e) , to the extent that failure to do so would not reasonably be expected to have aMaterial Adverse Effect. The BD Subsidiary and each other Subsidiary of the Borrowers that is an investment adviser or broker-dealer is dulyregistered and in good standing with (i) the Securities and Exchange Commission (unless otherwise exempt or excluded from a registrationrequirement), (ii) the states in which it does business, and (iii) any other government or industry self-regulatory organization, except in thecase of (ii) and (iii) where a failure to be so registered or qualified could not reasonably be expected to result in a Material Adverse Effect.Section 5.02. Authorization; No Contravention . The execution, delivery and performance by each Loan Party of each LoanDocument to which such Person is a party, and the consummation of the Transactions, (a) are within such Loan Party’s corporate or otherpowers, (b) have been duly authorized by all necessary corporate or other organizational action, and (c) do not (i) contravene the terms of anyof such Person’s Organization Documents, (ii) conflict with or result in any breach or contravention of, or the creation of any Lien under(other than as permitted by Section 7.01 ), or require any payment to be made under (x) any Contractual Obligation to which such Person is aparty or affecting such Person or the properties of such Person or any of its Subsidiaries or (y) any order, injunction, writ or decree of anyGovernmental Authority or any arbitral award to which such Person or its property is subject; or (iii) violate any Law; except with respect toany conflict, breach or contravention or payment (but not creation of Liens) referred to in clauses (ii) and (iii) , to the extent that suchviolation, conflict, breach, contravention or payment would not reasonably be expected to have a Material Adverse Effect.Section 5.03. Governmental Authorization . No approval, consent, exemption, authorization, or other action by or notice to, orfiling with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery orperformance by, or enforcement against, any Loan Party of this Agreement or any other Loan Document or for the consummation of theTransactions, the grant by any Loan Party of the Liens granted by it pursuant to the Collateral Documents, the perfection or maintenance ofthe Liens created under the Collateral Documents (including the priority thereof) or the exercise by the Administrative Agent or any Lenderof its rights under the Loan Documents or the remedies in respect of the Collateral pursuant to the Collateral Documents, except for(i) approval, consent, exemption, authorization, or other action by, or notice to, or filing necessary to perfect the Liens on the Collateralgranted by the Loan Parties in favor of the Secured Parties (or release existing Liens) under applicable U.S. law, (ii) the approvals, consents,exemptions, authorizations, actions, notices and filings which have been duly obtained, taken, given or made and are in full force and effect(except to the extent not required to obtained, taken, given or made or in full force and effect pursuant to the Collateral and GuaranteeRequirement) and (iii) those approvals, consents, exemptions, authorizations or other actions, notices or filings, the failure of which to obtainor make would not reasonably be expected to have a Material Adverse Effect.Section 5.04. Binding Effect. This Agreement and each other Loan Document has been duly executed and delivered by each LoanParty that is a party thereto. This Agreement and each other Loan Document constitutes, a legal, valid and binding obligation of such LoanParty, enforceable against each Loan Party that is a party thereto in accordance with its terms, except as such enforceability may be limited by(i) Debtor Relief Laws and by general principles of equity, (ii) the need for filings and registrations necessary to create or perfect the Liens onthe Collateral granted by the Loan Parties in favor of the Secured Parties and (iii) the effect of foreign Laws, rules and regulations as theyrelate to pledges of Equity Interests in or Indebtedness owed by Foreign Subsidiaries ( clauses (i) , (ii) and (iii) , the “ EnforcementQualifications ”).Section 5.05. Financial Statements; No Material Adverse Effect; No Default .(l) The Annual Financial Statements and the Quarterly Financial Statements and any financial statements deliveredpursuant to Section 6.01(a) and (b) fairly present in all material respects the financial condition of the Consolidated Parties as of the datesthereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the periodscovered thereby, (A) except as otherwise expressly noted therein and (B) subject, in the case of the Quarterly Financial Statements, tochanges resulting from normal year-end adjustments and the absence of footnotes.(m) The unaudited pro forma consolidated balance sheet (the “ Pro Forma Balance Sheet ”) and related pro formaconsolidated statements of income of the Consolidated Parties as of and for the twelve-month period ended September 30, 2015 (and anysubsequent fiscal quarter of HDV Holdings ended at least 45 days prior to the Closing Date), prepared after giving effect to the Transactionsas if the Transactions had occurred as of such date (in the case of such balance sheet) or at the beginning of such period (in the case of suchother statement of income), without giving effect to purchase accounting (the “ Pro Forma Financial Statements ”), a copy of which hasheretofore been furnished to the Arranger.(n) Since December 31, 2014, there has been no event or circumstance, either individually or in the aggregate, that has hador could reasonably be expected to have a Material Adverse Effect.(o) As of the Closing Date, none of Holdings and its Subsidiaries has any Indebtedness or other obligations or liabilities,direct or contingent (other than (i) obligations arising under the Loan Documents and (ii) liabilities incurred in the ordinary course of businessthat, either individually or in the aggregate, have not had nor could reasonably be expected to have a Material Adverse Effect).(p) No Default or Event of Default has occurred or is continuing. None of Borrower or any Restricted Subsidiary is indefault under any provision of any agreement or instrument to which it is a party, and no condition exists which, with the giving of notice orthe lapse of time or both, would constitute such a default, other than in each case as would not, individually or in the aggregate, reasonably beexpected to have a Material Adverse Effect.Section 5.06. Litigation . Except as set forth on Schedule 5.06 , there are no actions, suits, proceedings, claims or disputes pendingor, to the knowledge of any Borrower, threatened in writing, at law, in equity, in arbitration or before any Governmental Authority, by oragainst any Consolidated Party or against its properties or revenues that either individually or in the aggregate, would reasonably be expectedto have a Material Adverse Effect.Section 5.07. Ownership of Property; Liens . Each Consolidated Party has good record title to, or valid leasehold interests in, oreasements or other limited property interests in, all Real Property necessary in the ordinary conduct of its business, free and clear of all Liensexcept (a) as set forth on Schedule 5.07 , (b) minor defects in title that do not materially interfere with its ability to conduct its business or toutilize such assets for their intended purposes, (c) Liens permitted by Section 7.01 and (d) where the failure to have such title would notreasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.Section 5.08. Environmental Matters . Except as would not reasonably be expected to have, individually or in the aggregate, aMaterial Adverse Effect:(a) each Loan Party and its respective properties and operations are and for the past five years, have been in compliancewith all Environmental Laws, which includes obtaining and maintaining all applicable Environmental Permits required under suchEnvironmental Laws to carry on the business of the Loan Parties;(b) the Loan Parties have not received any written notice (i) that alleges any of them is in violation of or potentially liableunder any Environmental Laws, (ii) that the Loan Parties or any of the Loan Parties’ Real Property is the subject of any claim,investigation, lien, demand, or judicial, administrative or arbitral proceeding or (iii) to revoke or modify any Environmental Permitheld by any of the Loan Parties, in each case with respect to clauses (i) , (ii) and (iii) above, that is pending or, to the knowledge ofany Borrower, threatened in writing under any Environmental Law;(c) there has been no Release of Hazardous Materials on, at, under or from (i) any Real Property or facilities owned,operated or leased by any of the Loan Parties, or (ii) to the knowledge of any Borrower, Real Property formerly owned, operated orleased by any Loan Party at any other location arising out of the conduct or current or prior operations of the Loan Parties that could,in any such case with respect to clauses (i) or (ii) above, reasonably be expected to require investigation, remedial activity orcorrective action or cleanup or would reasonably be expected to result in the Loan Parties incurring Environmental Liability; and(d) to the knowledge of any Borrower, there are no facts, circumstances or conditions arising out of or relating to theoperations of the Loan Parties or Real Property or facilities owned, operated or leased by any of the Loan Parties or Real Property orfacilities formerly owned, operated or leased by the Loan Parties, that would reasonably be expected to result in the Loan Partiesincurring Environmental Liability.Section 5.09. Taxes . Each of the Loan Parties and their Subsidiaries have filed when due (taking into account timely and validextensions) all federal tax returns and all other material tax returns required under applicable Law to be filed with any GovernmentalAuthority, and have paid all Taxes shown as due and payable on such tax returns or otherwise due and payable, except those which are beingcontested in good faith and for which adequate reserves have been established in accordance with the GAAP. No Tax deficiency orassessment has been threatened in writing or, to the knowledge of the Loan Parties, made by any Governmental Authority against the LoanParties.Section 5.10. ERISA Compliance .(a) As of the Closing Date, no Loan Party nor any ERISA Affiliate maintains of contributes to, or has any obligation under,any Plan other than those identified on Schedule 5.10 .(b) Except as would not, either individually or in the aggregate, reasonably be expected to result in a Material AdverseEffect, each Plan is in compliance with the applicable provisions of ERISA, the Code and other Federal or state Laws.(c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) neither any Loan Party, Restricted Subsidiarynor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan(other than premiums due under Section 4007 of ERISA); (iii) neither any Loan Party, Restricted Subsidiary nor any ERISA Affiliate hasincurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 ofERISA, would result in such liability) under Section 4201 of ERISA with respect to a Multiemployer Plan; (iv) neither any Loan Party,Restricted Subsidiary nor any ERISA Affiliate has engaged in a transaction that would-be subject to Sections 4069 or 4212(c) of ERISA and(v) the present value of all accumulated benefit obligations under all Pension Plans (based on assumptions used for purposes of statement ofFinancial Accounting Standards No. 87) did not, as of the most recent valuation date, exceed the fair market value of the assets of suchPension Plans, in the aggregate; except, with respect to each of the foregoing clauses of this Section 5.10(c) , as would not reasonably beexpected, individually or in the aggregate, to result in a Material Adverse Effect.(d) With respect to each Foreign Plan, none of the following events or conditions exists and is continuing that, eitherindividually or in the aggregate, would reasonably be expected to have a Material Adverse Effect: (i) substantial non-compliance with itsterms and with the requirements of any and all applicable laws, statutes, rules, regulations and orders; (ii) failure to be maintained, whererequired, in good standing with applicable regulatory authorities; (iii) any obligation of a Loan Party or its Restricted Subsidiaries inconnection with the termination or partial termination of, or withdrawal from, any Foreign Plan; (iv) any Lien on the property of a Loan Partyor its Restricted Subsidiaries in favor of a Governmental Authority as a result of any action or inaction regarding a Foreign Plan; (v) for eachForeign Plan that is a funded or insured plan, failure to be funded or insured on an ongoing basis to the extent required by applicable non-U.S.law (using actuarial methods and assumptions which are consistent with the valuations last filed with the applicable GovernmentalAuthorities); (vi) any facts that, to the best knowledge of the Loan Party or any of its Restricted Subsidiaries, exist that would reasonably beexpected to give rise to a dispute and any pending or threatened disputes that, to the best knowledge of the Loan Party or any of its RestrictedSubsidiaries, would reasonably be expected to result in a material liability to the Loan Party or any of its Restricted Subsidiaries concerningthe assets of any Foreign Plan (other than individual claims for the payment of benefits); and (vii) failure to make all contributions in a timelymanner to the extent required by applicable non-U.S. law (each of the events described in clauses (i) through (vii) hereof are hereinafterreferred to as a “ Foreign Plan Event ”).Section 5.11. Use of Proceeds .(i) The proceeds of the Initial Term Loans will be used on the Closing Date first , to effect the Refinancing, second , to paycosts and expenses relating to the Transactions, and third , after the use of the proceeds of the Equity Contribution, to pay the considerationfor the Acquisition.(j) The proceeds of Revolving Credit Loans will be used for working capital, capital expenditures and for other generalcorporate purposes of the Borrowers and their restricted Subsidiaries (including for capital expenditures, acquisitions, working capital and/orpurchase price adjustments, the payment of transaction fees and expenses (inlcuding in connection with the Acquisition), other investmentsand other purposes not prohibited by the Loan Documents); provided that no Restricted Payments shall be permitted with the proceeds ofRevolving Credit Loans other than pursuant to Section 7.06(g) .Section 5.12. Margin Regulations; Investment Company Act .(e) The Borrowers are not engaged and will not engage, principally or as one of their important activities, in the business ofpurchasing or carrying Margin Stock except as permitted by Regulation T with respect to proprietary accounts of the BD Subsidiary for thebenefit of bona fide third parties, or extending credit for the purpose of purchasing or carrying Margin Stock, and no proceeds of anyBorrowings or drawings under any Letter of Credit will be used for any purpose that violates Regulation T, U or X of the Board of Governorsof the United States Federal Reserve System.(f) No Consolidated Party is or is required to be registered as an “investment company” under the Investment CompanyAct of 1940.Section 5.13. Disclosure . No report, financial statement, certificate or other written information furnished by or on behalf of anyLoan Party (other than projected financial information, pro forma financial information, budgets, estimates and information of a generaleconomic or industry nature) to any Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of thisAgreement or delivered hereunder or any other Loan Document (as modified or supplemented by other information so furnished) when takenas a whole contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein (when takenas a whole), in the light of the circumstances under which they were made, not materially misleading. With respect to projected financialinformation and pro forma financial information, the Borrowers represent that such information was prepared in good faith based uponassumptions believed to be reasonable at the time such information was furnished, it being understood that such projected financialinformation and pro forma financial information are not to be viewed as facts or as a guarantee of performance or achievement of anyparticular results and that actual results may vary from such forecasts and that such variations may be material and that no assurance can begiven that the projected results will be realized.Section 5.14. Labor Matters . As of the Closing Date, except as, in the aggregate, could not reasonably be expected to have aMaterial Adverse Effect: (a) there are no strikes or other labor disputes against any Consolidated Party pending or, to the knowledge of anyBorrower, threatened; (b) hours worked by and payment made to employees of any Consolidated Party have not been in violation of the FairLabor Standards Act or any other applicable Laws dealing with such matters; and (c) all payments due from any Consolidated Party onaccount of employee health and welfare insurance have been paid or accrued as a liability on the books of the relevant party.Section 5.15. Intellectual Property; Licenses, Etc . The Consolidated Parties own, without restriction, free and clear of all Liensother than Liens permitted by Section 7.01 , license or possess the right to use all of the trademarks, service marks, trade names, domainnames, copyrights, patents, patent rights, licenses, technology, software, know-how database rights, design rights and other intellectualproperty rights (collectively, “ IP Rights ”) that are reasonably necessary for the operation of their respective businesses as currentlyconducted, except to the extent the absence of such IP Rights or the existence of such Liens permitted by Section 7.01 , in each case, eitherindividually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect. To the knowledge of any Borrower, noIP Rights, advertising, product, process, method, substance, part or other material used by any Loan Party or any of the RestrictedSubsidiaries in the operation of their respective businesses as currently conducted infringes upon any rights held by any Person except forsuch infringements, individually or in the aggregate, which would not reasonably be expected to have a Material Adverse Effect. No claim orlitigation regarding any IP Rights, is pending or, to the knowledge of any Borrower, threatened against any Loan Party or any of theRestricted Subsidiaries, which, either individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.Section 5.16. Solvency . On the Closing Date, after giving effect to the Transactions and the incurrence of the Indebtedness andobligations being incurred in connection with this Agreement and the Transactions, each Borrower and its Restricted Subsidiaries, taken as awhole, is Solvent.Section 5.17. USA Patriot Act; OFAC; FCPA .(a) To the extent applicable, each of Parent, Holdings and its Subsidiaries is in compliance, in all material respects, with(i) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department(31 CFR Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto and (ii) the USA PatriotAct.(b) None of Parent, Holdings or any of its Subsidiaries or, to the knowledge of Holdings or the Borrowers, any director orofficer of Parent, Holdings or any of its Subsidiaries is the subject or target of any U.S. sanctions administered by the Office of ForeignAssets Control of the U.S. Treasury Department (“ OFAC ”) or any other relevant U.S. or foreign Governmental Authority which administersapplicable economic or financial sanctions; and the Borrowers will not use the proceeds of the Loans or otherwise make available suchproceeds to any Person, for the purpose of financing the activities of any Person who is the subject or target of any U.S. sanctionsadministered by OFAC or such other relevant Governmental Authority, to the extent prohibited by U.S. sanctions administered by OFAC orsuch other relevant Governmental Authority.(c) No part of the proceeds of the Loans will be used, directly or, to the knowledge of the Borrowers, indirectly, for anypayments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone elseacting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United StatesForeign Corrupt Practices Act of 1977, as amended.Section 5.18. Security Documents . Except as otherwise contemplated hereby or under any other Loan Documents, the provisionsof the Collateral Documents, together with such filings and other actions required to be taken hereby or by the applicable CollateralDocuments (including the delivery to Administrative Agent of any Pledged Debt and any Pledged Equity required to be delivered pursuant tothe applicable Collateral Documents), are effective to create in favor of the Collateral Agent for the benefit of the Secured Parties, a legal,valid, enforceable and first-priority perfected Lien on all right, title and interest of the respective Loan Parties in the Collateral describedtherein subject to the Enforcement Qualifications and Liens permitted by Section 7.01 .Notwithstanding anything herein (including this Section 5.18 ) or in any other Loan Document to the contrary, neither Holdings norany other Loan Party makes any representation or warranty as to (A) the pledge or creation of any security interest, or the effects ofperfection or non-perfection, the priority or the enforceability of any pledge of or security interest to the extent such pledge, security interest,perfection or priority is not required pursuant to the Collateral and Guarantee Requirement or (B) on the Closing Date and until requiredpursuant to Section 6.13 or 4.01(a)(iv) , the pledge or creation of any security interest, or the effects of perfection or non-perfection, thepriority or enforceability of any pledge or security interest to the extent not required on the Closing Date pursuant to Section 4.01(a)(iv) .Section 5.19. Senior Indebtedness . The Obligations constitute “Senior Indebtedness” (or any comparable term) under and asdefined in the documentation governing any Indebtedness that is subordinated in right of payment to the Obligations.Section 5.20. Regulated Entities .(a) None of any Loan Party, any Person controlling any Loan Party, or any Subsidiary of any Loan Party, is (i) an“investment company” or a person “controlled” by an “investment company,” each within the meaning of the Investment CompanyAct of 1940 or (ii) subject to regulation under the Federal Power Act, the Interstate Commerce Act, any state public utilities code, orany other federal or state statute, rule or regulation limiting its ability to incur Indebtedness, pledge its assets or perform itsobligations under the Loan Documents.(b) The BD Subsidiary and any other Domestic Subsidiary that is engaged in providing broker-dealer services and is nototherwise exempt or excluded from a registration requirement is a member in good standing of FINRA and is duly registered (i) as abroker-dealer with the SEC, (ii) in each state where the conduct of its broker-dealer business requires such registration and (iii) witheach other applicable governing body where the conduct of its broker-dealer business requires such registration. No Loan Party issubject to regulation under any Law (other than Regulation X of the Federal Reserve Board) that prohibits its borrowing of the Loansunder the provisions hereof.(c) The BD Subsidiary and any other Domestic Subsidiary that is engaged in providing broker-dealer services is a brokerand dealer subject to the provisions of Regulation T of the Federal Reserve Board and does not extend or maintain credit to or for itscustomers within the meaning Regulation T of the Federal Reserve Board.(d) The Advisory Services Subsidiary and any other Domestic Subsidiary that is engaged in providing investment advisoryservices and is not otherwise exempt or excluded from a registration requirement is duly registered (i) under the Investment AdvisersAct as an investment adviser and is thus not required to be registered as an investment adviser in the various states and (ii) with eachother applicable governing body where the conduct of its investment advisory business request such registration.Section 5.21. Subsidiaries; Equity Interests . As of the Closing Date (after giving effect to the Transactions), no Loan Party has anySubsidiaries other than those specifically disclosed in Schedule 5.21 , and all of the outstanding Equity Interests owned by the Loan Parties(or a Subsidiary of any Loan Party) in such Subsidiaries have been validly issued and are fully paid and all Equity Interests owned by a LoanParty in such Subsidiaries (other than Immaterial Subsidiaries) are owned free and clear of all Liens except (i) those created under theCollateral Documents and (ii) any Lien that is permitted under Section 7.01 . As of the Closing Date, Sections IA and IIA of the PerfectionCertificate (a) set forth the name and jurisdiction of each Domestic Subsidiary that is a Loan Party and (b) set forth the ownership interest ofeach Holding Company, each Borrower and any other Guarantor in each wholly owned Subsidiary (other than Immaterial Subsidiaries),including the percentage of such ownership.Section 5.22. Interim Matters . From October 14, 2015, through and including the Closing Date, no Loan Party has entered into orpermitted any of its Subsidiaries to enter into any agreement in connection with or consummated any merger, acquisition, disposition,business combination, joint venture or other strategic transaction (other than the Acquisition and the other Transactions), in each case withoutthe consent of the Lead Arranger.ARTICLE VI AFFIRMATIVE COVENANTSSo long as any Lender shall have any Commitment hereunder, any Loan or other Obligation (other than contingent obligations not yetdue and owing and obligations under Treasury Services Agreements or Secured Hedge Agreements) hereunder which is accrued and payableshall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding (unless the Outstanding Amount of the L/C Obligationsrelated thereto has been Cash Collateralized or a backstop letter of credit reasonably satisfactory to the applicable L/C Issuer is in place), thenafter the Closing Date, the Borrowers and (solely in the case of Sections 6.04 , 6.05 , 6.08 , 6.09 , 6.10 , 6.11 and 6.13 ) each HoldingCompany shall and shall cause each of their respective Restricted Subsidiaries to:Section 6.01. Financial Statements .(i) Deliver to the Administrative Agent for prompt further distribution to each Lender, within 90 days after the end of eachfiscal year, (i) unaudited financial statements including balance sheets, statements of income and cash flows of (A) Holdings and itsSubsidiaries (including HDV Holdings and its Subsidiaries), on a consolidated and consolidating basis (reflecting the adjustments necessaryto eliminate the accounts of Unrestricted Subsidiaries (if any) (which may be in footnote form only) from such financial statements), (B)TaxACT and its Material Subsidiaries, on a consolidated and consolidating basis, and (C) HDVest and its Material Subsidiaries, on aconsolidated and consolidating basis; provided that consolidating statements of cash flows for HDVest and its Material Subsidiaries shall notbe required, in each case, for such fiscal year and, if applicable, containing disclosure of the effect on the financial position or results ofoperations of any change in the application of accounting principles and practices during such year, together with a reconciliation of suchfinancial statements with the segment reporting of the “Tax Preparation” business (however defined), the “HDVest” business (howeverdefined) and any other segment applicable to the businesses of Holdings and its Subsidiaries, in each case as set forth in Parent’s Form 10-Kfiled with the SEC for the corresponding period, and setting forth in comparative form the corresponding figures as of the end of and for thepreceding fiscal year and prepared in accordance with GAAP, (ii) at the request of the Administrative Agent during any fiscal year in which(A) Holdings or any Borrower is not classified as a material Subsidiary of Parent in accordance with GAAP, and as a result of suchclassification, Holdings’ operations are not reported on a segment basis in the audited financial statements of Parent delivered in accordancewith clause (i) above or (B) either (1) Parent has not filed a Form 10-K with the SEC for such fiscal year, (2) such Form 10-K of the Parent isnot accompanied by an opinion of an independent registered public accounting firm of nationally recognized standing in accordance withgenerally accepted auditing standards or (3) such Form 10-K of the Parent is accompanied by such an opinion, but such opinion is subject to“going concern” explanatory language (other than solely as a result of the debt maturity of any Obligations within the next 90 days) or anyqualification or exception as to the scope of such audit, in each case of clauses (A) or (B) within 30 days of such request, an auditedconsolidating financial statement of Holdings and its Subsidiaries, to include balance sheet, statements of income, retained earnings and cashflows including the notes thereto, all in reasonable detail (together with, in all cases, customary management discussion and analysis) andprepared in accordance with GAAP, audited and accompanied by a report and opinion of an independent registered public accounting firm ofnationally recognized standing, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shallnot be subject to any “going concern” explanatory language (other than solely as a result of the debt maturity of any Obligations within thenext 90 days) or any qualification or exception as to the scope of such audit, (iii) the number of Investment Advisers engaged by the Parent orits Subsidiaries as of the end of such fiscal year and (iv) the AUM as of the end of such fiscal year;(j) Deliver to the Administrative Agent for prompt further distribution to each Lender, within 45 days after the end of eachof the first three fiscal quarters of each fiscal year of Parent, (i) unaudited financial statements (to include balance sheets, statements ofincome, and cash flows) (A) Holdings and its Subsidiaries (including HDV Holdings and its Subsidiaries), on a consolidated andconsolidating basis (reflecting the adjustments necessary to eliminate the accounts of Unrestricted Subsidiaries (if any) (which may be infootnote form only) from such financial statements), (B) TaxACT and its Material Subsidiaries, on a consolidated and consolidating basis,and (C) HDVest and its Material Subsidiaries, on a consolidated and consolidating basis; provided that consolidating statements of cash flowsfor HDVest and its Material Subsidiaries shall not be required, in each case, for such fiscal quarter and for the portion of the fiscal year thenended and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the applicationof accounting principles and practices during such quarter, together with a reconciliation of such financial statements with the segmentreporting of the “Tax Preparation” business (however defined) and any other segment applicable to the businesses of Holdings and itsSubsidiaries, in each case as set forth in Parent’s Form 10-Q filed with the SEC for the corresponding period, and setting forth, starting withthe fiscal quarter ending December 31, 2016, in comparative form the figures for the corresponding fiscal quarter of the previous fiscal yearand the corresponding portion of the previous fiscal year and prepared in accordance with GAAP, subject only to normal year-end auditadjustments and the absence of footnotes, (ii) at the request of the Administrative Agent during any fiscal quarter in which (A) Holdings orany Borrower is not classified as a material Subsidiary of Parent in accordance with GAAP, and as a result of such classification, Holdings’operations are not reported on a segment basis in the unaudited financial statements of Parent delivered in accordance with clause (i) above or(B) Parent has not filed a Form 10-Q with the SEC for such fiscal quarter, in each case of clauses (A) and (B), an unaudited consolidated andconsolidating financial statement of Holdings and its Subsidiaries, to include balance sheet, statements of income, retained earnings and cashflows including the notes thereto, all in reasonable detail and prepared in accordance with GAAP, (iii) the number of Investment Advisersengaged by the Parent or its Subsidiaries as of the end of such fiscal quarter and (iv) the AUM as of the end of such fiscal quarter, all inreasonable detail and certified by a Responsible Officer of Holdings as fairly presenting in all material respects the financial condition, resultsof operations and cash flows of the Consolidated Parties in accordance with GAAP, subject only to normal year-end audit adjustments and theabsence of footnotes; and(k) Deliver to the Administrative Agent for prompt further distribution to each Lender, no later than 60 days after the endof each fiscal year, a detailed consolidated budget of the Consolidated Parties for the following fiscal year on a quarterly basis (including aprojected consolidated balance sheet of the Consolidated Parties as of the end of the following fiscal year, the related consolidated statementsof projected cash flow and projected income and a summary of the material underlying assumptions applicable thereto) (collectively, the “Projections ”), which Projections shall in each case be accompanied by a certificate of a Responsible Officer stating that such Projectionshave been prepared in good faith on the basis of the assumptions stated therein, which assumptions were believed by such ResponsibleOfficer to be reasonable at the time such Projections were furnished, it being understood that such Projections are not to be viewed as facts oras a guarantee of performance or achievement of any particular results and that actual results may vary from such Projections and that suchvariations may be material and that no assurance can be given that the projected results will be realized.Documents required to be delivered pursuant to Sections 6.01 and 6.02(a) through (d) may be delivered electronically and if sodelivered, shall be deemed to have been delivered on the date (i) on which Holdings (or any direct or indirect parent of Holdings) posts suchdocuments, or provides a link thereto on the website on the Internet at the website address listed on Schedule 10.02 ; or (ii) on which suchdocuments are posted on the Borrowers’ behalf on IntraLinks or another relevant website, if any, to which each Lender and theAdministrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); providedthat the Borrower Representative shall notify (which may be by facsimile or electronic mail) the Administrative Agent of the posting of anysuch documents and provide to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents.Notwithstanding anything contained herein, in every instance the Borrower Representative shall be required to provide paper copies of theCompliance Certificates required by Section 6.02(a) to the Administrative Agent (which may be electronic copies delivered via electronicmail). Each Lender shall be solely responsible for timely accessing posted documents or requesting delivery of paper copies of suchdocuments from the Administrative Agent and maintaining its copies of such documents.The Borrowers hereby acknowledge that (a) the Administrative Agent and/or the Arranger will make available to the Lenders and theL/C Issuers materials and/or information provided by or on behalf of the Borrowers hereunder (collectively, “ Borrower Materials ”) byposting the Borrower Materials on IntraLinks or another similar electronic system (the “ Platform ”) and (b) certain of the Lenders (each, a “Public Lender ”) may have personnel who do not wish to receive Material Non-Public Information and who may be engaged in investmentand other market-related activities with respect to such Persons’ securities. The Borrowers hereby agree that so long as Holdings (or anydirect or indirect parent thereof that is the registrant with respect to a Qualified IPO), the Borrowers or their Subsidiaries is the issuer of anyoutstanding debt or equity securities that are registered or issued pursuant to a private offering it will (and at any time it may) identify thatportion of the Borrower Materials that may be distributed to the Public Lenders and that (w) all such Borrower Materials shall be clearly andconspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first pagethereof; (x) by marking Borrower Materials “PUBLIC,” the Borrowers shall be deemed to have authorized the Administrative Agent, theArranger, the L/C Issuers and the Lenders to treat such Borrower Materials as not containing any Material Non-Public Information (althoughit may be sensitive and proprietary) ( provided , however , that to the extent such Borrower Materials constitute Information, they shall betreated as set forth in Section 10.08 ); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion ofthe Platform designated “Public Side Information”; and (z) the Administrative Agent and the Arranger shall treat any Borrower Materials thatare not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information.”Notwithstanding the foregoing, the Borrowers shall be under no obligation to mark any Borrower Materials “PUBLIC”; provided , however ,that the following Borrower Materials shall be deemed to be marked “PUBLIC” unless the Borrower Representative notifies theAdministrative Agent promptly that any such document contains Material Non-Public Information: (1) the Loan Documents, (2) anynotification of changes in the terms of the Facilities and (3) all information delivered pursuant to Sections 6.01(a) , 6.01(b) , 6.02(a) and6.02(d)(i) . Notwithstanding anything herein to the contrary, unless the Borrowers otherwise notify the Administrative Agent, the list ofDisqualified Lenders does not constitute Material Non-Public Information and shall be posted promptly to all Lenders.Section 6.02. Certificates; Other Information . Deliver to the Administrative Agent for prompt further distribution to each Lender:(d) no later than five days after the delivery of the financial statements referred to in Sections 6.01(a) and (b) , a dulycompleted Compliance Certificate signed by a Responsible Officer of the Borrower Representative;(e) promptly after the same are publicly available, copies of all annual, regular, periodic and special reports and registrationstatements which Parent files with the SEC or with any Governmental Authority that may be substituted therefor (other than amendments toany registration statement (Governmental Authority to the extent such registration statement, in the form it became effective, is delivered),exhibits to any registration statement and, if applicable, any registration statement on Form S-8) and in any case not otherwise required to bedelivered to the Administrative Agent pursuant to any other clause of this Section 6.02 ;(f) upon written request of the Administrative Agent, copies of (i) each Schedule B (Actuarial Information) to the annualreport (form 5500 Series) filed by any Loan Party, Restricted Subsidiaries or ERISA Affiliate with respect to any Pension Plan, (ii) all noticesreceived by any Loan Party, Restricted Subsidiary or ERISA Affiliate from a Multiemployer Plan sponsor or ERISA Affiliate concerning anERISA Event, and (iii) copies of such other documents or government reports or filings relating to any Pension Plan as the AdministrativeAgent may reasonably request;(g) together with the delivery of each Compliance Certificate pursuant to Section 6.02(a) , (i) a description of each event,condition or circumstance during the last fiscal quarter or fiscal year covered by such Compliance Certificate requiring a mandatoryprepayment under Section 2.05(b)(ii) or (b)(iii) and (ii) a list of each Subsidiary of Holdings that identifies each Subsidiary as a RestrictedSubsidiary or an Unrestricted Subsidiary as of the date of delivery of such Compliance Certificate (to the extent that there have been anychanges in the identity or status as a Restricted Subsidiary or Unrestricted Subsidiary of any such Subsidiaries since the Closing Date or themost recent list provided);(h) promptly after the furnishing thereof, copies of any material written notices received by any Loan Party (other than inthe ordinary course of business) or material statements or material reports furnished to any holder of debt securities (other than in connectionwith any board observer rights) of any Loan Party or of any of its Restricted Subsidiaries pursuant to the terms of any documentation forIndebtedness of the type permitted to be incurred under Section 7.03(r) , in each case, in a principal amount in excess of the ThresholdAmount and not otherwise required to be furnished to the Lenders pursuant to any other clause of Section 6.01 , 6.02 or 6.03 ;(i) promptly after the furnishing thereof, copies of all “Focus- Part II” materials provided to, or any other material filingwith, the SEC, in each case, pursuant to Rule 17a-5 under Section 17 of the Exchange Act; and(j) promptly, such additional information regarding the business, legal, financial or corporate affairs of the Loan Parties orany of their respective Restricted Subsidiaries, or compliance with the terms of the Loan Documents, as the Administrative Agent or anyLender through the Administrative Agent may from time to time reasonably request.In no event shall the requirements set forth in Section 6.02(e) require any Consolidated Party to provide any such information which(i) constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which disclosure to the AdministrativeAgent or any Lender (or their respective representatives or contractors) is prohibited by Law or (iii) is subject to attorney-client or similarprivilege or constitutes attorney work-product.Section 6.03. Notices . Promptly after a Responsible Officer of any Borrower has obtained knowledge thereof, notify theAdministrative Agent:(j) of the occurrence of any Default or Event of Default;(k) of the occurrence of a Foreign Plan Event which would reasonably be expected to result in a Material Adverse Effect oran ERISA Event which would reasonably be expected to result in a Material Adverse Effect;(l) of the filing or commencement of, or any threat or notice of intention of any person to file or commence, any action,suit, litigation or proceeding, whether at law or in equity by or before any Governmental Authority against any Consolidated Party that wouldreasonably be expected to result in a Material Adverse Effect;(m) the making of any notification to the SEC required pursuant to Rules 17a-11 under Section 17 of the Exchange Act;and(n) of the occurrence of any other matter or development that has had or would reasonably be expected to have a MaterialAdverse Effect.Each notice pursuant to this Section 6.03 shall be accompanied by a written statement of a Responsible Officer of the BorrowerRepresentative delivered to the Administrative Agent for prompt further distribution to each Lender (x) that such notice is being deliveredpursuant to Section 6.03(a) , (b) , (c) , or (d) (as applicable) and (y) setting forth details of the occurrence referred to therein and stating whataction the Borrower Representative has taken and proposes to take with respect thereto.Section 6.04. Payment of Taxes . Pay, discharge or otherwise satisfy as the same shall become due and payable in the normalconduct of its business, all of its obligations and liabilities in respect of Taxes and similar claims imposed upon it or upon its income orprofits or in respect of its property, except, in each case, to the extent any such Tax is being contested in good faith and by appropriateproceedings and with respect to which appropriate reserves have been established in accordance with GAAP.Section 6.05. Preservation of Existence, Etc .(d) Preserve, renew and maintain in full force and effect its legal existence under the Laws of the jurisdiction of itsorganization; and(e) take all reasonable action to maintain all rights, privileges (including its good standing where applicable in the relevantjurisdiction), permits, licenses and franchises necessary or desirable in the normal conduct of its business and maintain and operate suchbusiness in substantially the manner in which it is presently conducted and operated, except, in the case of Section 6.05(a) (other than withrespect to the Borrowers) or this Section 6.05(b) , to the extent (i) that failure to do so would not reasonably be expected to have, individuallyor in the aggregate, a Material Adverse Effect or (ii) pursuant to any merger, consolidation, liquidation, dissolution or Disposition permittedby Article VII .Section 6.06. Maintenance of Properties; Intellectual Property . Except if the failure to do so would not reasonably be expected tohave, individually or in the aggregate, a Material Adverse Effect, maintain, preserve and protect (a) all of its material properties andequipment necessary in the operation of its business in good working order, repair and condition, ordinary wear and tear excepted and fire,casualty or condemnation excepted and (b) all of its IP Rights that are reasonably necessary for the operation of its business as currentlyconducted.Section 6.07. Maintenance of Insurance . Maintain with insurance companies that each Borrower believes (in the good faithjudgment of its management) are financially sound and reputable at the time the relevant coverage is placed or renewed, insurance withrespect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same orsimilar business, of such types and in such amounts (after giving effect to any self-insurance customary for similarly situated Persons engagedin the same or similar businesses as the Borrowers and their Restricted Subsidiaries) as are customarily carried under similar circumstancesby such other Persons. Not later than 90 days after the Closing Date (or the date any such insurance is obtained, in the case of insuranceobtained after the Closing Date), each such policy of insurance (other than business interruption insurance, director and officer insurance andworker’s compensation insurance) shall as appropriate (i) name the Administrative Agent as additional insured thereunder or (ii) in the caseof each casualty insurance policy, contain a loss payable clause or endorsement that names the Administrative Agent, on behalf of theLenders, as loss payee thereunder. If the improvements on any Mortgaged Property are at any time located in an area identified by the FederalEmergency Management Agency (or any successor agency) as a special flood hazard area with respect to which flood insurance has beenmade available under the National Flood Insurance Act of 1968 (as now or hereafter in effect or successor act thereto), then, to the extentrequired by applicable Flood Insurance Laws, the Borrowers shall, or shall cause each Loan Party to, (i) maintain, or cause to be maintained,with a financially sound and reputable insurer, flood insurance in an amount reasonably satisfactory to the Administrative Agent andotherwise sufficient to comply with all applicable rules and regulations promulgated pursuant to the Flood Insurance Laws and (ii) upon thereasonable request of the Administrative Agent, deliver to the Administrative Agent evidence of such compliance in form and substancereasonably acceptable to the Administrative Agent.Section 6.08. Compliance with Laws . Comply with the requirements of all Laws (including Anti-Money Laundering Laws, Anti-Corruption Laws and Sanctions Laws and Regulations) and all orders, writs, injunctions and decrees applicable to it or to its business orproperty, except if the failure to comply therewith would not reasonably be expected to have, individually or in the aggregate, a MaterialAdverse Effect. None of Parent or Holdings or any of its Subsidiaries nor, to the knowledge of the Borrowers, any director, officer, agent oremployee of any of the foregoing, (i) is a Designated Person or (ii) is currently subject to any U.S. sanctions administered by OFAC.Section 6.09. Books and Records . Maintain proper books of record and account, in which entries that are full, true and correct inall material respects and are in conformity with GAAP and which reflect all material financial transactions and matters involving the assetsand business of each Consolidated Party (it being understood and agreed that certain Foreign Subsidiaries maintain individual books andrecords in conformity with general accepted accounting principles in their respective countries of organization and that such maintenanceshall not constitute a breach of the representations, warranties or covenants hereunder).Section 6.10. Inspection Rights . Permit representatives and independent contractors of the Administrative Agent and each Lenderto visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstractstherefrom, and to discuss its affairs, finances and accounts with its directors, officers and independent public accountants (subject to suchaccountants’ customary policies and procedures), all at the reasonable expense of the Borrowers and at such reasonable times during normalbusiness hours and as often as may be reasonably desired, upon reasonable advance notice to the Borrower Representative; provided that onlythe Administrative Agent on behalf of the Lenders may exercise rights of the Administrative Agent and the Lenders under this Section 6.10and the Administrative Agent shall not exercise such rights more often than one time during any calendar year and such time shall be at theBorrowers’ expense; provided , further , that during the continuation of an Event of Default, the Administrative Agent (or any of itsrespective representatives or independent contractors), on behalf of the Lenders, may do any of the foregoing at the expense of the Borrowersat any time during normal business hours and upon reasonable advance notice. The Administrative Agent shall give the BorrowerRepresentative the opportunity to participate in any discussions with the Borrowers’ independent public accountants. Notwithstandinganything to the contrary in this Section 6.10 , no Consolidated Party will be required to disclose, permit the inspection, examination ormaking copies or abstracts of, or discussion of, any document, information or other matter that (a) constitutes non-financial trade secrets ornon-financial proprietary information, (b) in respect of which access or inspection by, or disclosure to, the Administrative Agent or anyLender (or their respective representatives or contractors) is prohibited by Law or any binding agreement or (c) is subject to attorney-client orsimilar privilege or constitutes attorney work product.Section 6.11. Additional Collateral; Additional Guarantors . At the Borrowers’ expense, subject to the terms, conditions andprovisions of the Collateral and Guarantee Requirement and any applicable limitation in any Collateral Document, take all action necessary orreasonably requested by the Administrative Agent to ensure that the Collateral and Guarantee Requirement continues to be satisfied,including:(g) Upon the formation or acquisition of any new direct or indirect wholly-owned Material Domestic Subsidiary (in eachcase, other than an Excluded Subsidiary) by any Loan Party or the designation in accordance with Section 6.14 of any existing direct orindirect wholly-owned Material Domestic Subsidiary as a Restricted Subsidiary (in each case, other than an Excluded Subsidiary) or anySubsidiary becoming a wholly-owned Material Domestic Subsidiary (in each case, other than an Excluded Subsidiary):(i) within 60 days after such formation, acquisition or designation, or such longer period as the AdministrativeAgent may agree in writing in its discretion:(A) cause each such Material Domestic Subsidiary that is required to become a Guarantor pursuant to theCollateral and Guarantee Requirement to duly execute and deliver to the Administrative Agent, other than with respect to anyExcluded Assets, joinders to this Agreement as Guarantors, Security Agreement Supplements, Intellectual Property SecurityAgreements and other security agreements and documents as reasonably requested by and in form and substance reasonablysatisfactory to the Administrative Agent (consistent with the Mortgages, Security Agreement, Intellectual Property SecurityAgreements and other security agreements in effect on the Closing Date), in each case granting Liens required by theCollateral and Guarantee Requirement;(B) cause each such Material Domestic Subsidiary that is required to become a Guarantor pursuant to theCollateral and Guarantee Requirement (and the parent of each such Domestic Subsidiary that is a Borrower or a Guarantor) todeliver any and all certificates representing Equity Interests (to the extent certificated) that are required to be pledged pursuantto the Collateral and Guarantee Requirement, accompanied by undated stock powers or other appropriate instruments oftransfer executed in blank;(C) take and cause such Material Domestic Subsidiary that is required to become a Guarantor pursuant tothe Collateral and Guarantee Requirement and each direct or indirect parent of such Material Domestic Subsidiary to takewhatever action (including the recording of Mortgages, the filing of UCC financing statements and delivery of stock andmembership interest certificates) as may be necessary in the reasonable opinion of the Administrative Agent to vest in theAdministrative Agent (or in any representative of the Administrative Agent designated by it) valid and perfected Liens to theextent required by the Collateral and Guarantee Requirement, and to otherwise comply with the requirements of the Collateraland Guarantee Requirement;(ii) if reasonably requested by the Administrative Agent, within 60 days after such request (or such longer periodas the Administrative Agent may agree in writing in its discretion), deliver to the Administrative Agent a signed copy of an opinion,addressed to the Administrative Agent and the Lenders, of counsel for the Loan Parties reasonably acceptable to the AdministrativeAgent as to such matters set forth in this Section 6.11(a) as the Administrative Agent may reasonably request;(iii) within 60 days after the request therefor by the Administrative Agent (or such longer period as theAdministrative Agent may agree in writing in its discretion), deliver to the Administrative Agent with respect to each Material RealProperty, copies of title reports, abstracts or environmental assessment reports, each in form and substance reasonably satisfactory tothe Administrative Agent; provided , however , that there shall be no obligation to deliver to the Administrative Agent anyenvironmental assessment report whose disclosure to the Administrative Agent would require the consent of a Person other thanParent or one of its Subsidiaries if such consent cannot be reasonably obtained through commercially reasonable and diligent effort;and(iv) if reasonably requested by the Administrative Agent, within 75 days after such request (or such longer periodas the Administrative Agent may agree in writing in its discretion), deliver to the Administrative Agent other items necessary fromtime to time to satisfy the Collateral and Guarantee Requirement with respect to perfection and existence of security interests withrespect to property of any Guarantor acquired after the Closing Date and subject to the Collateral and Guarantee Requirement, but notspecifically covered by the preceding clauses (i) , (ii) or (iii) or Section 6.11(b) below.(h) Not later than 90 days after the acquisition by any Loan Party of Material Real Property (or such longer period as theAdministrative Agent may agree in writing in its discretion) that is required to be provided as Collateral pursuant to the Collateral andGuarantee Requirement, which property would not be automatically subject to another Lien pursuant to pre-existing Collateral Documents,cause such property to be subject to a Lien and Mortgage in favor of the Collateral Agent for the benefit of the Secured Parties and take, orcause the relevant Loan Party to take, such actions as shall be necessary or reasonably requested by the Administrative Agent to grant andperfect or record such Lien, in each case to the extent required by, and subject to the limitations and exceptions of, the Collateral andGuarantee Requirement and to otherwise comply with the requirements of the Collateral and Guarantee Requirement.Section 6.12. Compliance with Environmental Laws . Except, in each case, to the extent that the failure to do so would notreasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect, (i) comply, and take all reasonable actions tocause all lessees and other Persons operating or occupying its Real Property to comply with all applicable Environmental Laws andEnvironmental Permits; (ii) obtain and renew all Environmental Permits necessary for its operations and Real Property; and (iii) in each caseto the extent the Consolidated Parties are required by Environmental Laws or a Governmental Authority, conduct any assessment,investigation, remedial or other corrective action necessary to address Hazardous Materials at any Real Property in accordance withapplicable Environmental Laws.Section 6.13. Further Assurances; Post-Closing Obligations .(c) Promptly upon reasonable written request by the Administrative Agent (i) correct any material defect or error that maybe discovered in the execution, acknowledgment, filing or recordation of any Collateral Document or other document or instrument relatingto any Collateral, and (ii) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such furtheracts, deeds, certificates, assurances and other instruments as the Administrative Agent may reasonably request from time to time in order tocarry out more effectively the purposes of the Collateral Documents, to the extent required pursuant to the Collateral and GuaranteeRequirement and subject in all respects to the limitations therein. If the Administrative Agent reasonably determines that it is required byapplicable Law to have appraisals prepared in respect of the Real Property of any Loan Party subject to a mortgage constituting Collateral, theBorrower Representative shall promptly provide to the Administrative Agent appraisals that satisfy the applicable requirements of the RealEstate Appraisal Reform Amendments of FIRREA.(d) Execute and deliver the documents and complete the tasks set forth on Schedule 6.13(b) , in each case within the timelimits specified therein (or such longer period of time reasonably acceptable to the Administrative Agent).Section 6.14. Designation of Subsidiaries . The Borrower Representative may at any time after the Closing Date designate anyRestricted Subsidiary of either Borrower (other than the BD Subsidiary or the Advisory Services Subsidiary) as an Unrestricted Subsidiary orany Unrestricted Subsidiary as a Restricted Subsidiary; provided that (i) immediately before and after such designation (A) so long as theConsolidated Total Net Leverage Ratio (determined on a Pro Forma Basis) is no more than 4.00 to 1.00 and (B) no Default or Event ofDefault shall have occurred and be continuing, both immediately prior to and immediately following such designation, (ii) no Subsidiary maybe designated as an Unrestricted Subsidiary if, after such designation, it would be a “Restricted Subsidiary” for the purpose of anyIndebtedness for borrowed money with an outstanding principal amount in excess of the Threshold Amount or any Junior Financing, (iii) noRestricted Subsidiary may be designated as an Unrestricted Subsidiary if it was previously designated as an Unrestricted Subsidiary and (iv)no Unrestricted Subsidiary may be designated as a Restricted Subsidiary if, after such designation, it would not be in compliance with thecovenants set forth in Sections 7.01 , 7.02 and 7.03 . The designation of any Subsidiary as an Unrestricted Subsidiary after the Closing Dateshall constitute an Investment by the applicable Borrower therein at the date of designation in an amount equal to the fair market value of theapplicable Borrower’s Investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute (i) theincurrence at the time of designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time and (ii) a Return onany Investment by any Borrower in Unrestricted Subsidiaries pursuant to the preceding sentence in an amount equal to the fair market valueat the date of such designation of the applicable Borrower’s Investment in such Subsidiary.Section 6.15. Maintenance of Ratings . Use commercially reasonable efforts to maintain (i) a public corporate credit rating (but notany specific rating) from S&P and a public corporate family rating (but not any specific rating) from Moody’s, in each case in respect ofHoldings, and (ii) a public rating (but not any specific rating) in respect of the Initial Term Loans and the Revolving Credit Facility from eachof S&P and Moody’s.Section 6.16. Use of Proceeds . Use the proceeds of the Initial Term Loans to finance a portion of the Transactions and use theproceeds of the Term Loans (other than Initial Term Loans), Revolving Credit Loans and the Letters of Credit issued hereunder only forgeneral corporate purposes and working capital of the Borrowers and their Subsidiaries and any other purpose not prohibited by thisAgreement, including Permitted Acquisitions and other Investments; provided that no Revolving Credit Loans shall be made under theRevolving Credit Facility on the Closing Date.Section 6.17. Lender Calls . With respect to each fiscal year for which financial statements have been delivered pursuant to Section6.01(a) (or if requested by the Administrative Agent, with respect to any fiscal quarter for which financial statements have been deliveredpursuant to Section 6.01(b) ), upon reasonable prior notice given to the Administrative Agent, Parent shall hold a telephonic meeting with allLenders who choose to participate in such meeting, during which the financial results of the Consolidated Parties shall be reviewed for, and asof the last day of, such fiscal period.Section 6.18. Employee Benefits . Do, and cause each ERISA Affiliate to do each of the following: (a) maintain each Plan incompliance with the applicable provisions of ERISA, the Code and other United States federal or state law; (b) cause each Plan that isqualified under Section 401(a) of the Code to maintain such qualification; and (c) make all required contributions to any Plan subject toSection 412 of the Code.ARTICLE VII NEGATIVE COVENANTSSo long as any Lender shall have any Commitment hereunder, any Loan or other Obligations hereunder (other than contingentobligations as to which no claim has been asserted and obligations under Treasury Services Agreements or Secured Hedge Agreements) orany Letter of Credit remaining outstanding (unless the Outstanding Amount of the L/C Obligations related thereto has been CashCollateralized, back-stopped by a letter of credit reasonably satisfactory to the applicable L/C Issuer or deemed reissued under anotheragreement reasonably acceptable to the applicable L/C Issuer), then from and after the Closing Date, the Borrowers (and, with respect toSections 7.06 , 7.12 and 7.14 only, each Holding Company) shall not and shall not permit any of their Restricted Subsidiaries to, directly orindirectly:Section 7.01. Liens . Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether nowowned or hereafter acquired, other than the following (collectively, “ Permitted Liens ”):(k) Liens (i) created pursuant to any Loan Document and (ii) on the Collateral securing Cash Management Obligationsincurred pursuant to Section 7.03(l) and other Secured Obligations;(l) Liens existing on the Closing Date and listed on Schedule 7.01(b) and any modifications, replacements, renewals,restructurings, refinancings or extensions thereof; provided that (i) the Lien does not extend to any additional property other than (A) after-acquired property that is affixed or incorporated into the property covered by such Lien and (B) proceeds and products thereof and (ii) thereplacement, renewal, extension or refinancing of the obligations secured or benefited by such Liens, to the extent constituting Indebtedness,is permitted by Section 7.03 ;(m) Liens for taxes, assessments or governmental charges that are not yet overdue or that are being contested in good faithand by appropriate actions, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance withGAAP;(n) statutory or common law Liens of landlords, sub-landlords, carriers, warehousemen, mechanics, materialmen,repairmen, construction contractors or other like Liens, so long as, in each case, such Liens secure amounts not overdue for a period of morethan 30 days or if more than 30 days overdue, are unfiled and no other action has been taken to enforce such Liens or that are being contestedin good faith and by appropriate actions, if adequate reserves with respect thereto are maintained on the books of the applicable Person inaccordance with GAAP;(o) (i) pledges or deposits in the ordinary course of business in connection with workers’ compensation, unemploymentinsurance and other social security legislation and (ii) pledges and deposits in the ordinary course of business securing liability forreimbursement or indemnification obligations of (including obligations in respect of letters of credit or bank guarantees for the benefit of)insurance carriers providing property, casualty or liability insurance to any Consolidated Party;(p) pledges or deposits to secure the performance of bids, trade contracts, utilities, governmental contracts and leases (otherthan Indebtedness for borrowed money), statutory obligations, surety, stay, customs and appeal bonds, performance bonds and otherobligations of a like nature (including those to secure health, safety and environmental obligations) incurred in the ordinary course ofbusiness;(q) easements, rights-of-way, building codes, restrictions (including zoning restrictions), encroachments, licenses,protrusions and other similar encumbrances and minor title defects, in each case affecting Real Property and that do not in the aggregatematerially interfere with the ordinary conduct of the business of the Consolidated Parties, taken as a whole, and any exceptions on theMortgage Policies issued in connection with the Mortgaged Properties;(r) Liens (i) securing judgments for the payment of money not constituting an Event of Default under Section 8.01(g) , (ii)arising out of judgments or awards against any Consolidated Party with respect to which an appeal or other proceeding for review is thenbeing pursued and for which adequate reserves have been made with respect thereto on the books of the applicable Person in accordance withGAAP and (iii) notices of lis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings forwhich adequate reserves have been made with respect thereto on the books of the applicable Person in accordance with GAAP;(s) leases, licenses, subleases or sublicenses (including the provision of software or the licensing of other intellectualproperty rights) and terminations thereof, in each case granted to others in the ordinary course of business which (i) do not interfere in anymaterial respect with the business of the Consolidated Parties, taken as a whole, (ii) do not secure any Indebtedness and (iii) are permitted bySection 7.05(g) ;(t) Liens (i) in favor of customs and revenue authorities arising as a matter of Law to secure payment of customs duties inconnection with the importation of goods in the ordinary course of business or (ii) Liens on specific items of inventory or other goods andproceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances or letters of credit issued or created for theaccount of such person to facilitate the purchase, shipment or storage of such inventory or other goods in the ordinary course of business;(u) Liens (i) of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items in the course ofcollection, (ii) encumbering initial deposits and margin deposits and similar Liens attaching to commodity trading accounts or other brokerageaccounts incurred in the ordinary course of business, (iii) in favor of a banking or other financial institution arising as a matter of Law orunder customary general terms and conditions encumbering deposits or other funds maintained with a financial institution (including the rightof set-off) and that are within the general parameters customary in the banking industry or arising pursuant to such banking institutionsgeneral terms and conditions, and (iv) that are contractual rights of setoff or rights of pledge relating to (A) purchase orders and otheragreements entered into with customers of Borrowers or any of its Restricted Subsidiaries in the ordinary course of business or (B) pooleddeposit or sweep accounts of Borrowers or any of its Restricted Subsidiaries to permit satisfaction of overdraft or similar obligations incurredin the ordinary course of business of any Borrower or any of its Restricted Subsidiaries;(v) Liens (i) on cash advances in favor of the seller of any property to be acquired in an Investment permitted pursuant toSection 7.02(i) or to the extent related to any of the foregoing, Section 7.02(p) , to be applied against the purchase price for such Investment,and (ii) consisting of an agreement to Dispose of any property in a Disposition permitted under Section 7.05 , in each case, solely to the extentsuch Investment or Disposition, as the case may be, would have been permitted on the date of the creation of such Lien;(w) Liens in favor of any Borrowers or any Subsidiary Guarantor;(x) any interest or title of a lessor, sub-lessor, licensor or sub-licensor under leases, subleases, licenses or sublicensesentered into by any Borrower or any Restricted Subsidiary in the ordinary course of business;(y) Liens arising out of conditional sale, title retention, consignment or similar arrangements for sale of goods entered intoby any Borrower or any Restricted Subsidiary in the ordinary course of business permitted by this Agreement;(z) Liens deemed to exist in connection with Investments in repurchase agreements under Section 7.02(a) ;(aa) [reserved];(bb) Liens that are contractual rights of set off or rights of pledge relating to purchase orders and other agreements enteredinto with customers of the Borrowers or any of their Restricted Subsidiaries in the ordinary course of business;(cc) Liens solely on any cash earnest money deposits made by the Borrowers or any of their Restricted Subsidiaries inconnection with any letter of intent or purchase agreement permitted hereunder;(dd) ground leases in respect of Real Property on which facilities owned or leased by the Borrowers or any of theirRestricted Subsidiaries are located;(ee) Liens to secure Indebtedness permitted under Section 7.03(e) ; provided that (i) such Liens are incurred within 270days of the acquisition, construction, repair, lease or improvement of the property subject to such Liens, (ii) such Liens do not at any timeencumber property (except for replacements, additions, accessions and proceeds to such property) other than the property financed by suchIndebtedness and the proceeds and products thereof and customary security deposits and ( iii ) with respect to Capitalized Leases, such Liensdo not at any time extend to or cover any assets (except for replacements, additions and accessions to such assets) other than the assets subjectto such Capitalized Leases and the proceeds and products thereof and customary security deposits; provided that individual financings ofequipment provided by one lender may be cross collateralized to other financings of equipment provided by such lender.(ff) Liens on property of any Restricted Subsidiary that is not a Loan Party, which Liens secure (i) Indebtedness of any ofConsolidated Party permitted under Section 7.03(r) or (ii) Indebtedness permitted under Section 7.03 of Restricted Subsidiaries that are notLoan Parties;(gg) Liens existing on property at the time of its acquisition or existing on the property of any Person at the time suchPerson becomes a Restricted Subsidiary (other than by designation as a Restricted Subsidiary pursuant to Section 6.14 ), in each case after theClosing Date (other than Liens on the Equity Interests of any Person that becomes a Restricted Subsidiary to the extent such Equity Interestsare owned by the Borrowers or any Subsidiary Guarantor); provided that (i) such Lien was not created in contemplation of such acquisition orsuch Person becoming a Restricted Subsidiary, (ii) such Lien does not extend to or cover any other assets or property (other than theproceeds, products and accessions thereof and other than after-acquired property subjected to a Lien securing Indebtedness and otherobligations incurred prior to such time and which Indebtedness and other obligations are permitted hereunder that require, pursuant to theirterms at such time, a pledge of after-acquired property, it being understood that such requirement shall not be permitted to apply to anyproperty to which such requirement would not have applied but for such acquisition), and (iii) the Indebtedness secured thereby is permittedunder Section 7.03(g) ;(hh) (i) zoning, building, entitlement and other land use regulations by Governmental Authorities with which the normaloperation of the business complies, and (ii) any zoning or similar law or right reserved to or vested in any Governmental Authority to controlor regulate the use of any real property that does not materially interfere with the ordinary conduct of the business of the Borrowers and theirRestricted Subsidiaries, taken as a whole;(ii) Liens arising from precautionary Uniform Commercial Code financing statement or similar filings securing obligationspermitted to be incurred on a secured basis under Section 7.03 and elsewhere under this Section 7.01 ;(jj) Liens on insurance policies and the proceeds thereof securing the financing of the premiums with respect thereto;(kk) the modification, replacement, renewal or extension of any Lien permitted by Sections 7.01(b) , (u) and (w) ; providedthat (i) the Lien does not extend to any additional property, other than (A) after-acquired property that is affixed or incorporated into theproperty covered by such Lien and (B) proceeds and products thereof, and (ii) the renewal, extension, restructuring or refinancing of theobligations secured or benefited by such Liens is permitted by Section 7.03 (to the extent constituting Indebtedness);(ll) Liens with respect to property or assets of the Borrowers or any of their Restricted Subsidiaries securing obligations inan aggregate principal amount outstanding at any time not to exceed the greater of $10,000,000 and 10% of LTM EBITDA, in each casedetermined as of the date of incurrence;(mm) Liens on the Collateral securing obligations in respect of Permitted Equal Priority Refinancing Debt or PermittedJunior Priority Refinancing Debt and Indebtedness permitted pursuant to Section 7.03(r) and (w) and any Permitted Refinancing of any of theforegoing;(nn) deposits of cash with the owner or lessor of premises leased and operated by the Borrowers or any of theirSubsidiaries to secure the performance of such Borrower’s or such Subsidiary’s obligations under the terms of the lease for such premises;and(oo) Liens arising by operation of law in the United States under Article 2 of the UCC in favor of a reclaiming seller ofgoods or buyer of goods.Section 7.02. Investments . Make or hold any Investments, except:(o) Investments by the Borrowers or any of their Restricted Subsidiaries in assets that were cash or Cash Equivalents whensuch Investment was made;(p) loans or advances to current or former officers, directors, Investment Advisers and employees of any Loan Party or anyof its Subsidiaries (i) for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary businesspurposes and (ii) for any other purposes not described in the foregoing clause (i) not to exceed (i) 5,000,000 in the aggregate in anyconsecutive twelve month period and (ii) $20,000,000 in the aggregate during the term of this Agreement.(q) Investments (i) by the Borrowers or any Restricted Subsidiary in any Loan Party (other than a Holding Company),(ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is not a Loan Party and (iii) by any LoanParty in any Restricted Subsidiary that is not a Loan Party; provided that (A) no such Investments made pursuant to this clause (iii) in theform of intercompany loans shall be evidenced by a promissory note unless (x) such promissory note is pledged to the Administrative Agentin accordance with the terms of the Security Agreement and (y) all such Indebtedness of any Loan Party owed to any Subsidiary that is not aLoan Party shall be unsecured and subordinated to the Obligations pursuant to the terms of the Intercompany Note and (B) the aggregateamount of Investments made pursuant to this clause (iii) shall not exceed at any time outstanding the Non-Guarantor Cap (plus the amount ofany return in respect thereof, including dividends, interest, distributions, returns of principal, profits on sale, repayments, income and similaramounts), in each case determined at the time such Investment is made;(r) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from thegrant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financiallytroubled account debtors and other credits to suppliers in the ordinary course of business;(s) Investments (excluding loans and advances made in lieu of Restricted Payments pursuant to and limited bySection 7.02(m) below) consisting of transactions permitted under Sections 7.01 , 7.03 (other than 7.03(c) and (d) ), 7.04 (other than 7.04(c)(ii) or (e) ), 7.05 (other than 7.05(e) ), 7.06 (other than 7.06(d) or (g)(iv) ) and 7.13 , respectively;(t) Investments (i) existing or contemplated on the Closing Date and set forth on Schedule 7.02(f) and any modification,replacement, renewal, reinvestment or extension thereof that does not increase the value thereof and (ii) existing on the Closing Date by theBorrowers or any Restricted Subsidiary in the Borrowers or any other Restricted Subsidiary and any modification, renewal or extensionthereof that does not increase the value thereof;(u) Investments in Swap Contracts permitted under Section 7.03(f) ;(v) promissory notes, securities and other non-cash consideration received in connection with Dispositions permitted bySection 7.05 ;(w) any acquisition by either Borrower or any Restricted Subsidiary (any such acquisition under this Section 7.02(i) , a “Permitted Acquisition ”) of all or substantially all the assets of a Person or any Equity Interests in a Person which is in a line of businesssimilar, ancillary, complementary or related to, or a reasonable extension, development or expansion of, the business conducted by theBorrowers and their Restricted Subsidiaries and that becomes a Restricted Subsidiary or division or line of business of a Person (or anysubsequent Investment made in a Person, division or line of business previously acquired in a Permitted Acquisition), in a single transactionor series of related transactions, if immediately after giving effect thereto: (i) on the date on which the definitive agreement governing therelevant transaction is executed, (1) immediately before and immediately after giving Pro Forma Effect to any such purchase or otheracquisition (including any Indebtedness to be incurred in connection therewith), no Event of Default shall have occurred and be continuingand (2) immediately after giving effect to such purchase or other acquisition, (A) the Consolidated Secured Net Leverage Ratio as of the lastday of the most recent Test Period is less than or equal to 4.00 to 1.00 and (B) the Borrower and the Restricted Subsidiaries shall be incompliance on a Pro Forma Basis with the covenant set forth in Section 7.11; (ii) no Event of Default exists at the time of the consummationof such acquisition (limited in connection with Indebtedness incurred to finance a Limited Condition Transaction to Defaults or Events ofDefault pursuant to Sections 8.01(a) and (f) and any other Default or Event of Default that is a condition to the effectiveness of the LimitedCondition Transaction); (iii) any acquired or newly formed Restricted Subsidiary shall not be liable for any Indebtedness except forIndebtedness otherwise permitted by Section 7.03 ; (iv) to the extent required by the Collateral and Guarantee Requirement, (A) the property,assets and businesses acquired in such purchase or other acquisition shall constitute Collateral and (B) any such newly created or acquiredRestricted Subsidiary (other than an Excluded Subsidiary) shall become a Guarantor, in each case in accordance with Section 6.11 ; and(v) the aggregate amount of Investments by Loan Parties pursuant to this Section 7.02(i) in assets (other than Equity Interests) that are not (ordo not become at the time of such acquisition) directly owned by a Loan Party or in Equity Interests of Persons that do not become LoanParties shall not exceed the greater of $5,000,000 and 5% of LTM EBITDA, in each case determined as of the date such Investments aremade (plus the amount of any return in respect thereof, including dividends, interest, distributions, returns of principal, profits on sale,repayments, income and similar amounts);(x) Investments constituting a part of the Transactions on the Closing Date;(y) Investments in the ordinary course of business consisting of UCC Article 3 endorsements for collection or deposit andUCC Article 4 customary trade arrangements with customers consistent with past practices;(z) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy orreorganization of suppliers and customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers arisingin the ordinary course of business or upon the foreclosure with respect to any secured Investment or other transfer of title with respect to anysecured Investment;(aa) loans and advances to any direct or indirect parent of Holdings not in excess of the amount of (after giving effect toany other loans, advances or Restricted Payments in respect thereof) Restricted Payments to the extent permitted to be made to such parent inaccordance with Section 7.06 , such Investment being treated for purposes of the applicable clause of Section 7.06 , including any limitations,as if a Restricted Payment had been made pursuant to such clause in an amount equal to such Investment;(bb) advances of payroll payments to employees in the ordinary course of business;(cc) Investments to the extent that payment for such Investments is made solely with Qualified Equity Interests of Holdingsor any direct or indirect parent of Holdings;(dd) Investments of a Restricted Subsidiary acquired after the Closing Date or of a Person merged or amalgamated orconsolidated into the Borrowers or merged, amalgamated or consolidated with a Restricted Subsidiary in accordance with Section 7.04 afterthe Closing Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, merger,amalgamation or consolidation and were in existence on the date of such acquisition, merger or consolidation;(ee) Investments in a Person that is or will become a Restricted Subsidiary made by a Restricted Subsidiary that is not aLoan Party to the extent such Investments are financed with the proceeds received by such Restricted Subsidiary from an Investment in suchRestricted Subsidiary by a Loan Party permitted under this Section 7.02 ;(ff) Investments in deposit accounts, securities accounts and commodities accounts maintained by the Borrowers or any oftheir Restricted Subsidiaries; and(gg) Investments using the Available Amount at such time, so long as (i) no Default or Event of Default exists or wouldresult from the making of such Investment and (ii) Borrowers are in compliance (on a pro forma basis) with the Consolidated First Lien NetLeverage Ratio set forth in Section 7.11 (regardless of whether such covenant is required to be tested at such time) as of the last day of themost recently ended fiscal quarter of Parent for which financial statements have been delivered or were required to be delivered pursuant toSection 6.01 ;To the extent an Investment is permitted to be made by a Loan Party directly in any Restricted Subsidiary or any other Person that isnot a Loan Party (each such person, a “ Target Person ”) under any provision of this Section 7.02 , such Investment may be made byadvance, contribution or distribution by a Loan Party to a Restricted Subsidiary that is not a Loan Party, and further advanced or contributedto a Restricted Subsidiary for purposes of making the relevant Investment in the Target Person without constituting an Investment forpurposes of Section 7.02 (it being understood that such Investment must satisfy the requirements of, and shall count towards any thresholdsin, a provision of this Section 7.02 as if made by the applicable Loan Party directly to the Target Person).Section 7.03. Indebtedness . Create, incur, assume or suffer to exist any Indebtedness, except:(q) Indebtedness of any Loan Party under the Loan Documents;(r) Indebtedness outstanding on the Closing Date and listed on Schedule 7.03(b) ; provided that all such Indebtedness ofany Loan Party owed to any Restricted Subsidiary that is not a Loan Party shall be unsecured and subordinated to the Obligations pursuant tothe Intercompany Note;(s) Guarantees by the Borrowers and any Restricted Subsidiary in respect of Indebtedness of the Borrowers or anyRestricted Subsidiary otherwise permitted hereunder; provided that (A) no Guarantee by any Restricted Subsidiary of any Indebtednessconstituting a junior lien financing shall be permitted unless such guaranteeing party shall have also provided a Guarantee of the Obligationson the terms set forth herein, (B) if the Indebtedness being Guaranteed is subordinated to the Obligations, such Guarantee shall besubordinated to the Guarantee of the Obligations on terms at least as favorable to the Lenders as those contained in the subordination of suchIndebtedness and (C) any Guarantee by a Loan Party of Indebtedness of a Restricted Subsidiary that is not a Loan Party shall only bepermitted to the extent constituting an Investment permitted by Section 7.02(c)(iii) ;(t) Indebtedness of the Borrowers or any Restricted Subsidiary owing to any Loan Party or any other Restricted Subsidiary(or issued or transferred to any direct or indirect parent of a Loan Party which is substantially contemporaneously transferred to a Loan Partyor any Restricted Subsidiary of a Loan Party) but only, in the case of Indebtedness of a non-Loan Party owing to a Loan Party, to the extentconstituting an Investment permitted by Section 7.02(c)(iii) ; provided that (x) no such Indebtedness owed to a Loan Party shall be evidencedby a promissory note unless such promissory note is pledged to the Administrative Agent in accordance with the terms of the SecurityAgreement, (y) all such Indebtedness of any non-Loan Party owed to a Loan Party shall not exceed the Non-Guarantor Cap;(u) Attributable Indebtedness and other Indebtedness (including Capitalized Leases) financing an acquisition, construction,repair, replacement, lease or improvement of a fixed or capital asset incurred by the Borrowers or any Restricted Subsidiary prior to or within270 days after the acquisition, construction, repair, replacement, lease or improvements of the applicable asset in an aggregate amount not toexceed the greater of $10,000,000 and 10% of LTM EBITDA, in each case determined as of the date of incurrence at any time outstanding;(v) Indebtedness in respect of Swap Contracts designed to hedge against the Borrowers’ or any Restricted Subsidiary’sexposure to interest rates, foreign exchange rates or commodities pricing risks incurred in the ordinary course of business and not forspeculative purposes and Guarantees thereof, provided that any such Guarantees by Loan Parties of such Indebtedness of RestrictedSubsidiaries that are not Loan Parties shall only be permitted to the extent constituting an Investment permitted by Section 7.02(c)(iii) ;(w) Indebtedness of the Borrowers or any Restricted Subsidiary (i) assumed in connection with any Permitted Acquisition (provided that such Indebtedness is not incurred in contemplation of such Permitted Acquisition or any Permitted Refinancing thereof) in anaggregate amount not to exceed the greater of $10,000,000 and 10% of LTM EBITDA, in each case determined as of the date of incurrenceor (ii) incurred to finance any Permitted Acquisition and that complies with the Applicable Requirements; so long as after giving Pro FormaEffect to such Permitted Acquisition and the assumption or incurrence of such Indebtedness, as applicable, (A) the Consolidated Total NetLeverage Ratio is no more than 3.75 to 1.00; provided that in the case of clause (ii) , (A) such Indebtedness does not mature prior to the datethat is the Latest Maturity Date, or have a Weighted Average Life to Maturity less than the Weighted Average Life to Maturity of any TermLoan outstanding at the time such Indebtedness is incurred or issued and does not require any scheduled amortization or other scheduledpayments of principal prior to the Latest Maturity Date and (B) no Event of Default shall exist or result therefrom (limited in connection withIndebtedness incurred to finance a Limited Condition Transaction to Defaults or Events of Default under Sections 8.01(a) and (f) and anyother Default or Event of Default that is a condition to the effectiveness of the Limited Condition Transaction); provided , further , that (x) theonly obligors with respect to any Indebtedness incurred pursuant to clause (i) of this paragraph or any Permitted Refinancing of Indebtednessin respect thereof shall be of those Persons who were obligors of such Indebtedness immediately prior to such Permitted Acquisition and (y)all such Indebtedness under this Section 7.03(g) of any Restricted Subsidiary that is not a Loan Party shall not exceed the greater of$10,000,000 and 10% of LTM EBITDA, in each case determined as of the date of incurrence.(x) Indebtedness representing deferred compensation to current or former officers, managers, consultants, directors,Investment Advisers and employees (including their respective estates, spouses or former spouses) of any Consolidated Party incurred in theordinary course of business;(y) Indebtedness consisting of promissory notes issued by the Borrowers or any of their Restricted Subsidiaries to currentor former officers, managers, consultants, directors, Investment Advisers and employees, their respective estates, spouses or former spousesto finance the purchase or redemption of Equity Interests of Baseball permitted by Section 7.06 ;(z) Indebtedness incurred by the Borrowers or any of their Restricted Subsidiaries in a Permitted Acquisition, any otherInvestment permitted hereunder, merger or any Disposition permitted hereunder, in each case, constituting indemnification obligations orobligations in respect of purchase price (including earnouts) or other similar adjustments;(aa) Indebtedness consisting of obligations of the Borrowers or any of their Restricted Subsidiaries under deferredcompensation or other similar arrangements incurred by such Person in connection with Permitted Acquisitions or any other Investmentpermitted hereunder;(bb) Cash Management Obligations and other Indebtedness in respect of netting services, automatic clearinghousearrangements, overdraft protections, employee credit card programs and other cash management and similar arrangements in the ordinarycourse of business and any Guarantees thereof or the honoring by a bank or other financial institution of a check, draft or similar instrumentdrawn against insufficient funds in the ordinary course of business, so long as such Indebtedness is extinguished within 15 Business Days ofits incurrence;(cc) Indebtedness consisting of (i) the financing of insurance premiums or (ii) take-or-pay obligations contained in supplyarrangements, in each case, in the ordinary course of business;(dd) Indebtedness incurred by the Borrowers or any of their Restricted Subsidiaries in respect of letters of credit, bankguarantees, bankers’ acceptances, warehouse receipts or similar instruments issued or created in the ordinary course of business, including inrespect of workers compensation claims, health, disability or other employee benefits or property, casualty or liability insurance or self-insurance or other Indebtedness with respect to reimbursement-type obligations regarding workers compensation claims;(ee) obligations in respect of performance, bid, appeal and surety bonds and performance and completion guarantees andsimilar obligations provided by the Borrowers or any Restricted Subsidiaries or obligations in respect of letters of credit, bank guarantees orsimilar instruments related thereto, in each case in the ordinary course of business or consistent with past practice;(ff) Credit Agreement Refinancing Indebtedness;(gg) Indebtedness incurred by a Foreign Subsidiary or other Restricted Subsidiary that is not a Loan Party, which, whenaggregated with the principal amount of all other Indebtedness incurred pursuant to this Section 7.03(q) and Section 7.03(r) and thenoutstanding for all such Persons taken together, does not exceed the greater of $10,000,000 and 10% of LTM EBITDA, in each casedetermined as of the date of incurrence;(hh) Indebtedness of the Borrowers or any of their Restricted Subsidiaries that complies with the Applicable Requirements,so long as no Default or Event of Default (limited in connection with Indebtedness incurred to finance a Limited Condition Transaction toDefaults or Events of Default under Sections 8.01(a) and (f) and any other Default or Event of Default that is a condition to the effectivenessof the Limited Condition Transaction) is continuing or would result from the incurrence of such Indebtedness; provided that any Indebtednessthat may be incurred by Restricted Subsidiaries that are not Loan Parties pursuant to this Section 7.03(r) and Section 7.03(q) shall not exceedthe greater of $10,000,000 and 10% of LTM EBITDA, in each case determined as of the date of incurrence; provided , further , that:(i) if such Indebtedness is secured on a pari passu basis in right of security with the Obligations, the aggregateprincipal amount of such Indebtedness shall not exceed the sum of (A) an amount equal to $50,000,000 (net of Indebtedness incurredpursuant to Section 2.14(d)(iii)(A) and Section 7.03(r)(ii)(A) ) plus (B) up to an additional amount so long as on and as of the date ofsuch incurrence the Consolidated First Lien Net Leverage Ratio (determined on a Pro Forma Basis and assuming all previouslyestablished and simultaneously established revolving credit facilities under this Section 7.03(r)(i) are fully drawn and excluding thecash proceeds of any borrowing under any such Indebtedness (assuming any revolving credit facility is fully drawn) is no more than3.75 to 1.00 at the time of incurrence; and(ii) if such Indebtedness is secured on a junior basis in right of security with the Obligations or is unsecured, theaggregate principal amount of such Indebtedness shall not exceed the sum of (A) an amount equal to $50,000,000 (net ofIndebtedness incurred pursuant to Section 2.14(d)(iii)(A) and Section 7.03(r)(i)(A) ) plus (B) up to an additional amount so long as onand as of the date of such incurrence the Consolidated Secured Net Leverage Ratio (determined on a Pro Forma Basis) is no morethan 3.75 to 1.00 at the time of incurrence (and if being utilized to incur unsecured Indebtedness, assuming for the calculation of theConsolidated Secured Net Leverage Ratio that all such unsecured Indebtedness is secured).For purposes of the calculations in this Section 7.03(r) , (A) with respect to any Revolving Credit Commitments, a borrowing of themaximum amount of Loans available thereunder shall be assumed, (B) to the extent the proceeds of any Indebtedness incurred under thisSection 7.03(r) are used to repay Indebtedness, Pro Forma Effect shall be given to such repayment of Indebtedness and (C) and Indebtednessincurred under clauses (i)(A) and (ii)(A) above shall be available at all times and not subject to any ratio test, whether incurredsimultaneously with amounts under clauses (i)(B) or (ii)(B) or otherwise.(ii) any Permitted Refinancings of Indebtedness incurred pursuant to Section 7.03 (b) , (e) , (g) , (s) , (u) , (r) , (s) , and (t) ;(jj) all premiums (if any), interest (including post-petition interest), fees, expenses, charges and additional or contingentinterest on obligations described in Sections 7.03(a) through 7.03(s) ; and(kk) additional unsecured Indebtedness incurred by the Borrowers or any of their Restricted Subsidiaries in an amount notto exceed the greater of $10,000,000 and 10% of LTM EBITDA, in each case determined as of the date of incurrence at any time outstanding.Section 7.04. Fundamental Changes . Merge, dissolve, liquidate, consolidate with or into another Person, or Dispose of (whether inone transaction or in a series of related transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or infavor of any Person, except that:(f) any Restricted Subsidiary of either Borrower may merge, amalgamate or consolidate with (A) such Borrower(including a merger, the purpose of which is to reorganize a Borrower into a new jurisdiction); provided that such Borrower shall be thecontinuing or surviving Person or (B) one or more other Restricted Subsidiaries of such Borrower; provided that when any Person that is aLoan Party is merging with a Restricted Subsidiary, a Loan Party shall be the continuing or surviving Person or(g) (i) any Restricted Subsidiary of either Borrower that is not a Loan Party may merge, amalgamate or consolidate with orinto any other Restricted Subsidiary of such Borrower that is not a Loan Party, (ii) any Restricted Subsidiary of either Borrower may liquidateor dissolve and (iii) any Restricted Subsidiary of either Borrower may change its legal form if, with respect to clauses (ii) and (iii) , theBorrower Representative determines in good faith that such action is in the best interest of the Consolidated Parties and if not materiallydisadvantageous to the Lenders (it being understood that in the case of any change in legal form, a Restricted Subsidiary that is a Guarantorwill remain a Guarantor unless such Guarantor is otherwise permitted to cease being a Guarantor hereunder);(h) any Restricted Subsidiary of either Borrower may Dispose of all or substantially all of its assets (upon voluntaryliquidation or otherwise) to the Borrowers or to another such Restricted Subsidiary; provided that if the transferor in such a transaction is aGuarantor, then (i) the transferee must be a Guarantor or a Borrower or (ii) to the extent constituting an Investment, such Investment must bea permitted Investment in or Indebtedness of a Restricted Subsidiary which is not a Loan Party in accordance with Sections 7.02 (other than7.02(e) or 7.02(h) ) and 7.03 , respectively;(i) so long as no Default has occurred and is continuing or would result therefrom, any Borrower may merge, amalgamateor consolidate with any other Person (other than any Holding Company or any other Borrower); provided that (x) such Borrower shall be thecontinuing or surviving corporation and (y) such Borrower shall be a Domestic Subsidiary;(j) so long as (in the case of a merger involving a Loan Party) no Default has occurred and is continuing or would resulttherefrom (limited in connection with a merger involving a Limited Condition Transaction to Defaults or Events of Default pursuant toSections 8.01(a) and (f) and any other Default or Event of Default that is a condition to the effectiveness of the Limited ConditionTransaction), any Restricted Subsidiary of either Borrower may merge or consolidate with any other Person in order to effect an Investmentpermitted pursuant to Section 7.02 ; provided that the continuing or surviving Person shall be (x) a Restricted Subsidiary of such Borrowerand (y) a Domestic Subsidiary, which together with each of their Restricted Subsidiaries, shall have complied with the requirements ofSection 6.11 and Section 6.13 to the extent required pursuant to the Collateral and Guarantee Requirement; and(k) so long as no Default has occurred and is continuing or would result therefrom, a merger, dissolution, liquidation,consolidation or Disposition, the purpose of which is to effect a Disposition permitted pursuant to Section 7.05 (other than Section 7.05(e) ).Section 7.05. Dispositions . Make any Disposition, except:(a) Dispositions of obsolete, worn out, used or surplus property, whether now owned or hereafter acquired, in the ordinarycourse of business and Dispositions of property no longer used or useful in the conduct of the business of the Borrowers or any of theirRestricted Subsidiaries;(b) Dispositions of inventory, goods held for sale in the ordinary course of business and immaterial assets (other than thelapse or abandonment of IP Rights, which is governed by clause (o) of this Section 7.05 ) and termination of leases and licenses in theordinary course of business;(c) Dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similarreplacement property or (ii) the proceeds of such Disposition are promptly applied to the purchase price of similar replacement property;(d) Dispositions of property to the Borrowers or any Restricted Subsidiary; provided that if the transferor of such propertyis a Loan Party, (i) the transferee thereof must be a Loan Party or (ii) if such transaction constitutes an Investment, such transaction ispermitted under Section 7.02 (other than 7.02(e) or (h) );(e) to the extent constituting Dispositions, transactions permitted by (i) Section 7.01 (other than ( 7.01(i) ), (ii) Section7.02 (other than 7.02(e) or (h) ), (iii) Section 7.04 (other than 7.04(f) ) and (iv) Section 7.06 (other than 7.06(d) );(f) Dispositions of cash and Cash Equivalents;(g) (i) leases, subleases, licenses or sublicenses (including the provision of software under an open source license or thelicensing of other intellectual property rights) and terminations thereof, in each case in the ordinary course of business and which do notmaterially interfere with the business of the Consolidated Parties (taken as a whole) and (ii) Dispositions of IP Rights, and inbound andoutbound licenses to IP Rights, in each case in the ordinary course of business and that do not interfere in any material respect with thebusiness of the Consolidated Parties (taken as a whole);(h) transfers of property subject to Casualty Events;(i) Dispositions of property in an aggregate amount not to exceed $10,000,000; provided that (i) at the time of suchDisposition, no Default shall have occurred and been continuing or would result from such Disposition, (ii) with respect to any Dispositionpursuant to this Section 7.05(i) for a purchase price in excess of $2,500,000 individually (and $5,000,000 in the aggregate when takentogether with any other Dispositions that were excluded during the term of this Agreement), the Borrowers or any of their RestrictedSubsidiaries shall receive not less than 75% of such consideration in the form of cash or Cash Equivalents (in each case, free and clear of allLiens at the time received, other than Permitted Liens); provided , however , that for the purposes of this clause (ii) , the following shall bedeemed to be cash: (A) any securities received by the Borrowers or the applicable Restricted Subsidiary from such transferee that areconverted by the Borrowers or such Restricted Subsidiary into cash or Cash Equivalents (to the extent of the cash or Cash Equivalentsreceived) within 180 days following the closing of the applicable Disposition, and (B) aggregate non-cash consideration received by theBorrowers or the applicable Restricted Subsidiary having an aggregate fair market value (determined as of the closing of the applicableDisposition for which such non-cash consideration is received) not to exceed the greater of $2,500,000 and 2.5% of LTM EBITDA at anytime; and (iii) such Disposition is for fair market value as reasonably determined by the Borrower Representative in good faith;(j) Dispositions or discounts without recourse of accounts receivable in connection with the compromise or collectionthereof in the ordinary course of business;(k) any swap of assets in exchange for services or other assets in the ordinary course of business of comparable or greatervalue or usefulness to the business of the Consolidated Parties as a whole, as determined in good faith by the management of the BorrowerRepresentative;(l) any sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;(m) Dispositions of Investments in joint ventures to the extent required by, or made pursuant to customary buy/sellarrangements between, the joint venture parties set forth in joint venture arrangements and similar binding arrangements; (n) the unwinding or settling of any Swap Contract in the ordinary course of business; and(o) the lapse or abandonment in the ordinary course of business of any registrations or applications for registration of anyimmaterial IP Rights.provided that any Disposition of any property pursuant to this Section 7.05 (except pursuant to Sections 7.05(a) , (d) , (e) , (g) , (h) , (j) , (m) ,(n) and (o) and except for Dispositions from a Loan Party to any other Loan Party) shall be for no less than the fair market value of suchproperty at the time of such Disposition. To the extent any Collateral is Disposed of as permitted by this Section 7.05 to any Person other thana Loan Party, such Collateral shall be sold free and clear of the Liens created by the Loan Documents, and the Administrative Agent shall beauthorized to take any actions deemed appropriate in order to effect the foregoing.Section 7.06. Restricted Payments . Declare or make, directly or indirectly, any Restricted Payment, except:(d) each Restricted Subsidiary may make Restricted Payments to Borrowers and other Restricted Subsidiaries of theBorrowers (and, in the case of a Restricted Payment by a non-wholly-owned Restricted Subsidiary, to either Borrower and any otherRestricted Subsidiary and to each other owner of Equity Interests of such Restricted Subsidiary based on their relative ownership interests ofthe relevant class of Equity Interests);(e) each Borrower and each Restricted Subsidiary may declare and make dividend payments or other Restricted Paymentspayable solely in the Equity Interests (other than Disqualified Equity Interests not otherwise permitted by Section 7.03 ) of such Person (and,in the case of such a Restricted Payment by a non-wholly owned Restricted Subsidiary, the Borrowers and any Restricted Subsidiary and toeach other owner of Equity Interests of such Restricted Subsidiary based on their relative ownership interests of the relevant class of EquityInterests);(f) [Reserved](g) to the extent constituting Restricted Payments, the Borrowers (or any direct or indirect parent thereof (other thanParent)) and their Restricted Subsidiaries may enter into and consummate transactions permitted by any provision of Section 7.02(other than 7.02(e) and 7.02(m) ), 7.04 , 7.05 (other than 7.05(e)(iv) and 7.05(g)) or 7.08 (other than 7.08(e) and 7.08(k ) and otherthan the redemption, repurchase or other acquisition of any Rollover Equity);(h) so long as no Default or Event of Default shall have occurred and be continuing or would otherwise result therefrom,each Borrower and each of its Restricted Subsidiaries may (i) pay (or make Restricted Payments to allow any Holding Company or any otherdirect or indirect parent thereof to pay) for the repurchase, retirement or other acquisition or retirement for value of Equity Interests of Parentor Baseball held by any future, present or former employee, officer, director, manager or consultant (or any spouses, former spouses,successors, executors, administrators, heirs, legatees or distributees of any of the foregoing) of such Consolidated Party or (ii) makeRestricted Payments in the form of distributions to allow any Holding Company or any direct or indirect parent of any Holding Company topay principal or interest on promissory notes that were issued to any future, present or former employee, officer, director, manager orconsultant (or any spouses, former spouses, successors, executors, administrators, heirs, legatees or distributees of any of the foregoing) ofsuch Consolidated Party in lieu of cash payments for the repurchase, retirement or other acquisition or retirement for value of such EquityInterests held by such Persons; provided that the aggregate amount of Restricted Payments made pursuant to this Section 7.06(e) togetherwith the aggregate amount of loans and advances to any direct or indirect parent of Holdings made pursuant to Section 7.02(m) in lieu ofRestricted Payments permitted by this Section 7.06(e) shall not exceed (i) $5,000,000 in the aggregate in any consecutive twelve monthperiod and (ii) $20,000,000 in the aggregate during the term of this Agreement;(i) so long as (i) no Default or Event of Default shall have occurred and be continuing or would otherwise result therefromand (ii) Borrowers are in compliance with Section 7.11 on a Pro Forma Basis (after giving Pro Forma Effect to such Restricted Payment),other Restricted Payments made by the Borrowers to the applicable Holding Companies, which shall be permitted to make such payment toParent (or, in the case of Baseball, to Holdings and to each other owner of Equity Interests of Baseball based on their relative ownershipinterests of the relevant class of Equity Interests) in a cumulative aggregate amount not to exceed $15,000,000;(j) the Borrowers may make Restricted Payments to any Holding Company or, solely in the case of clause (iii) below, anydirect or indirect parent of Holdings:(i) to pay its operating costs and expenses incurred in the ordinary course of business and other corporate overheadcosts and expenses (including administrative, legal, accounting and similar expenses provided by third parties), incurred in theordinary course of business and attributable to the ownership or operations of the Borrowers and their Restricted Subsidiaries,Transaction Expenses and any indemnification claims made by directors or officers of such parent in each case attributable to theownership or operations of the Borrowers and their Restricted Subsidiaries (but shall in no event include payment of any managementfees);(ii) the proceeds of which shall be used to pay franchise taxes and other fees, taxes and expenses, in each case,required to maintain any Holding Company’s corporate existence;(iii) for any taxable period in which Holdings and, if applicable, any of its Subsidiaries is a member of aconsolidated, combined or similar income tax group of which Parent is the common parent (a “ Tax Group ”), to pay federal, foreign,state and local income taxes of such Tax Group that are attributable to the taxable income of Holdings and/or its Subsidiaries;provided that, for each taxable period, the amount of such payments made in respect of such taxable period in the aggregate shall notexceed the amount that Holdings and its Subsidiaries would have been required to pay as a stand-alone consolidated, combined orsimilar income tax group and, in any event, shall be limited to the amount actually paid in cash with respect to such period; provided ,further , that the permitted payment pursuant to this clause (iii) with respect to any Taxes of any Unrestricted Subsidiary for anytaxable period shall be limited to the amount actually paid with respect to such period by such Unrestricted Subsidiary to theBorrowers or their Restricted Subsidiaries for the purposes of paying such consolidated, combined or similar income Taxes;(iv) to finance any Investment that would be permitted to be made pursuant to Sections 7.02 and 7.08 if such parentwere subject to such Sections as a Loan Party; provided that (A) such Restricted Payment shall be made substantially concurrentlywith the closing of such Investment, (B) such parent shall, immediately following the closing thereof, cause (1) all property acquired(whether assets or Equity Interests) to be contributed to any Borrower or their respective Restricted Subsidiaries that are Loan Partiesor (2) the merger (to the extent permitted in Section 7.04 ) of the Person formed or acquired into the Borrowers or the RestrictedSubsidiaries (with the Borrowers or the applicable Restricted Subsidiary that is a Loan Party being the surviving or continuing entity)in order to consummate such Permitted Acquisition or Investment, in each case, in accordance with the requirements of Section 6.11and (C) such contribution shall constitute an Investment by the applicable Borrower or Restricted Subsidiary, as the case may be, atthe date of such contribution or merger, as applicable, in an amount equal to the amount of such Restricted Payment; and(v) the proceeds of which (A) shall be used to pay customary salary, bonus and other benefits payable to officersand employees of Holdings to the extent such salaries, bonuses and other benefits are attributable to the ownership or operation of theBorrowers and their Restricted Subsidiaries or (B) shall be used to make payments permitted under Sections 7.08(c) and (h) (but onlyto the extent such payments have not been and are not expected to be made by the Borrowers or a Restricted Subsidiary);(k) so long as (i) no Default or Event of Default shall have occurred and be continuing or would otherwise result therefromand (ii) Borrowers are in compliance with Section 7.11 on a Pro Forma Basis (after giving Pro Forma Effect to such Restricted Payment),Restricted Payments made by the Borrowers to the applicable Holding Companies, which shall be permitted to make such payment to Parent(or, in the case of Baseball, to Holdings and to each other owner of Equity Interests of Baseball based on their relative ownership interests ofthe relevant class of Equity Interests), using the lesser of (i) Available Amount at such time and (ii) $25,000,000 in any fiscal year of Parent;(l) so long as no Default or Event of Default shall have occurred and be continuing or would otherwise result therefrom,other Restricted Payments made by the Borrowers to the applicable Holding Companies, which shall be permitted to make such payment toParent (or, in the case of Baseball, to Holdings and to each other owner of Equity Interests of Baseball based on their relative ownershipinterests of the relevant class of Equity Interests) such that the Consolidated First Lien Net Leverage Ratio after giving pro forma effect tosuch payments and any related transactions would not exceed 2.00 to 1.00; provided that for the purpose of determining the ConsolidatedFirst Lien Net Leverage Ratio for purposes of this clause (i) only, Consolidated First Lien Net Debt shall be (x) deemed to include any CreditAgreement Refinancing Indebtedness and any Indebtedness incurred pursuant to Section 2.14 , 2.15 , 2.16 or Section 7.03(g) or (r) (and anyPermitted Refinancing of the foregoing), regardless of whether secured on a first lien basis or at all) and (y) shall be calculated without givingeffect to clause (b) of the definition thereof;(m) on or prior to the date that is two Business Days following the Closing Date, Borrowers may make a one-timeRestricted Payment to the applicable Holding Companies, which shall be permitted to make such payment to Parent, in an amount not toexceed the lesser of (i) the amount by which the Equity Contribution made by Parent in Holdings (and contributed in turn to Baseball)exceeds $186,000,000 and (ii) $30,000,000, so long as no Default or Event of Default exists or would result from the making of suchRestricted Payment.Notwithstanding anything herein to the contrary, no Restricted Payments may be made with any Cure Amount.Section 7.07. Change in Nature of Business . Engage in any material line of business substantially different from those lines ofbusiness conducted by the Borrowers and the Restricted Subsidiaries on the Closing Date or any business reasonably related, complementary,corollary, synergistic or ancillary thereto (including related, complementary, synergistic or ancillary technologies) or reasonable extensionsthereof.Section 7.08. Transactions with Affiliates . Enter into any transaction of any kind with any Affiliate of Holdings, whether or not inthe ordinary course of business, other than:(e) transactions among the Borrowers and the Restricted Subsidiaries or any entity that becomes a Restricted Subsidiary asa result of such transaction;(f) on terms substantially as favorable to a Borrower or their Restricted Subsidiary as would be obtainable by suchBorrower or Restricted Subsidiary at the time in a comparable arm’s-length transaction with a Person other than an Affiliate;(g) the Transactions and the payment of Transaction Expenses as part of or in connection with the Transactions;(h) [reserved];(i) Restricted Payments permitted under Section 7.06 (but shall in no event include payment of any management fees);(j) [reserved];(k) [reserved];(l) employment and severance arrangements between the Borrowers and their Restricted Subsidiaries and their respectiveofficers and employees in the ordinary course of business and transactions pursuant to stock option plans and employee benefit plans andarrangements in the ordinary course of business;(m) the payment of customary fees and reasonable out-of-pocket costs to, and indemnities provided on behalf of, directors,officers, employees and consultants of the Consolidated Parties (or any direct or indirect parent of Holdings in the ordinary course of businessto the extent attributable to the ownership or operation of the Borrowers and their Restricted Subsidiaries;(n) transactions pursuant to agreements, instruments or arrangements in existence on the Closing Date and set forth onSchedule 7.08 or any amendment thereto to the extent such an amendment is not adverse to the Lenders in any material respect;(o) payments by the Borrowers or any of their Subsidiaries pursuant to any tax sharing agreements with any direct orindirect parent of Holdings to the extent attributable to the ownership or operation of the Borrowers and the Subsidiaries, but only to theextent permitted by Section 7.06(g)(iii) ; and(p) the issuance or transfer of Qualified Equity Interests of Holdings to Parent.Section 7.09. Burdensome Agreements . Enter into or permit to exist any Contractual Obligation (other than this Agreement or anyother Loan Document) that limits the ability of:(k) any Restricted Subsidiary of the Borrowers that is not a Guarantor to make Restricted Payments to the Borrowers orany Subsidiary Guarantor; or(l) any Loan Party to create, incur, assume or suffer to exist Liens on property of such Person for the benefit of the Lenderswith respect to the Facilities and the Obligations; provided that the foregoing Sections 7.09(a) and (b) shall not apply to ContractualObligations which:(i) (x) exist on the Closing Date and (to the extent not otherwise permitted by this Section 7.09 ) are listed onSchedule 7.09 and (y) to the extent Contractual Obligations permitted by clause (x) are set forth in an agreement evidencingIndebtedness, are set forth in any agreement evidencing any permitted modification, replacement, renewal, extension or refinancingof such Indebtedness so long as such modification, replacement, renewal, extension or refinancing does not expand the scope of suchContractual Obligation;(ii) are binding on a Restricted Subsidiary at the time such Restricted Subsidiary first becomes a RestrictedSubsidiary of the Borrowers, so long as such Contractual Obligations were not entered into in contemplation of such Personbecoming a Restricted Subsidiary of the Borrowers and do not extend past such Restricted Subsidiary and its subsidiaries; provided ,further , that this clause (ii) shall not apply to Contractual Obligations that are binding on a Person that becomes a RestrictedSubsidiary pursuant to Section 6.14 ;(iii) are customary provisions in joint venture agreements and other similar agreements applicable to joint venturespermitted under Section 7.02 and applicable solely to such joint venture and its equity entered into in the ordinary course of business;(iv) are negative pledges and restrictions on Liens in favor of any holder of Indebtedness permitted underSection 7.03 but solely to the extent any negative pledge relates to the property financed by such Indebtedness and the proceeds,accessions and products thereof;(v) are customary restrictions on leases, subleases, licenses or asset sale agreements otherwise permitted hereby solong as such restrictions relate to the property interest, rights or the assets subject thereto;(vi) [reserved];(vii) are customary provisions restricting subletting, transfer or assignment of any lease governing a leaseholdinterest of the Borrowers or any Restricted Subsidiary;(viii) are customary provisions restricting assignment or transfer of any agreement entered into in the ordinarycourse of business;(ix) arise in connection with cash or other deposits permitted under Sections 7.01 and 7.02 and limited to such cashor deposit;(x) comprise restrictions imposed by any agreement governing Indebtedness entered into on or after the ClosingDate and permitted under Section 7.03 that are, taken as a whole, no more restrictive with respect to the Borrowers or any RestrictedSubsidiary than customary market terms for Indebtedness of such type (and, in any event, are no more restrictive than the restrictionscontained in this Agreement), so such restrictions will not affect any Consolidated Party’s obligation or ability to make any paymentsrequired hereunder;(xi) are restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in theordinary course of business;(xii) are restrictions regarding licensing or sublicensing by the Restricted Parties of the Borrowers of intellectualproperty in the ordinary course of business; and(xiii) are restrictions on cash earnest money deposits in favor of sellers in connection with acquisitions notprohibited hereunder.Section 7.10. [RESERVED].Section 7.11. Consolidated Total Net Leverage Ratio . Permit the Consolidated Total Net Leverage Ratio calculated on a ProForma Basis as of the last day of any Test Period ending during a period set forth below to be greater than the ratio set forth below oppositethe last day of such period below:PeriodConsolidated Total Net Leverage Ratio Closing Date through September 30, 20165.75 to 1.00 October 1, 2016, through September 30, 20175.00 to 1.00 October 1, 2017, through December 31, 20174.25 to 1.00 January 1, 2018, through December 31, 20183.50 to 1.00 January 1, 2019, through Latest Maturity Date3.00 to 1.00 Section 7.12. Fiscal Year . Make any change in its fiscal year; provided , however , that the Borrowers may, upon written notice tothe Administrative Agent, change its fiscal year on no more than one occasion to any other fiscal year reasonably acceptable to theAdministrative Agent, in which case, the Borrowers and the Administrative Agent will, and are hereby authorized by the Lenders to, makeany adjustments to this Agreement that are necessary to reflect such change in fiscal year.Section 7.13. Prepayments, Etc. of Subordinated Indebtedness .(a) Prepay, redeem, purchase, defease or otherwise satisfy prior to the scheduled maturity thereof in any manner (it beingunderstood that payments of regularly scheduled principal, interest and mandatory prepayments and AHYDO payments and, in connectionwith the amendment of any Junior Financing, the payment of fees (other than in connection with any amendment that reduces or forgives thecommitments, outstanding principal amount or effective yield of such Junior Financing) shall, subject to the subordination terms applicablethereto, be permitted) any (a) Indebtedness subordinated in right of payment incurred under Section 7.03 , or (b) any other Indebtedness forborrowed money of a Loan Party that is (x) subordinated in right of payment to the Obligations expressly by its terms or (y) is secured on ajunior lien basis to the Liens securing the Obligations (other than Indebtedness among the Borrowers and their Restricted Subsidiaries)(collectively, “ Junior Financing ”), except (i) the refinancing thereof with any Indebtedness (to the extent such Indebtedness constitutes aPermitted Refinancing and, if such Indebtedness was originally incurred under Section 7.03(g) , is permitted pursuant to Section 7.03(g) ), tothe extent not required to prepay any Loans pursuant to Section 2.05(b) , (ii) the conversion or exchange of any Junior Financing to QualifiedEquity Interests of Holdings or any of its direct or indirect parents, (iii) the prepayment of Indebtedness of the Borrowers or any RestrictedSubsidiary to the Borrowers or any Restricted Subsidiary and (iv) repayments, redemptions, purchases, defeasances and other payments inrespect of Junior Financings prior to their scheduled maturity in an aggregate amount not to exceed the sum of (1) the greater of $10,000,000and 10% of LTM EBITDA, in each case determined as of the date of such repayment, redemption, purchase, defeasance, or other paymentand (2) the Available Amount at such time; provided that in each case, (x) no Default or Event of Default exists or would result from themaking of such repayment, redemption, purchase, defeasance or other payment and (y) after giving effect thereto, the Consolidated Total NetLeverage Ratio is less than or equal to 2.50 to 1.0.(b) Amend, modify or change in any manner materially adverse to the interests of the Lenders any term or condition of anyJunior Financing Documentation (except to the extent permitted pursuant to any subordination agreement or Customary IntercreditorAgreement applicable thereto) without the consent of the Administrative Agent, acting at the direction of the Required Lenders.Notwithstanding anything to the contrary in any Loan Document, the Borrowers may make regularly scheduled payments of interestand fees on any Junior Financing, and may make any payments required by the terms of such Indebtedness in order to avoid the application ofSection 163(e)(5) of the Code to such Indebtedness.Section 7.14. Permitted Activities . With respect to any Holding Company, engage in any material operating or business activitiesincluding, without limitation, the formation of any Subsidiary or the acquisition of any Person; provided that the following and any activitiesincidental thereto shall be permitted in any event: (i) its ownership of the Equity Interests of (A) in the case of Holdings, TaxACT andBaseball, (B) in the case of Baseball, HDV Holdings, and (C) in the case of HDV Holdings, HDVest, and, in each case, activities incidentalthereto, including payment of dividends and other amounts in respect of such Equity Interests, (ii) the maintenance of its legal existence(including the ability to incur fees, costs and expenses relating to such maintenance), (iii) the performance of its obligations with respect tothe Loan Documents and any other documents governing Indebtedness permitted hereby, (iv) any issuance or sale of its Qualified EquityInterests, (v) any activities incidental to compliance with the provisions of the Securities Act of 1933 and the Exchange Act of 1934, asamended, any rules and regulations promulgated thereunder, and similar laws and regulations of other jurisdictions and the rules of securitiesexchanges, in each case, as applicable to companies with listed equity or debt securities, as well as activities incidental to investor relations,shareholder meetings and reports to shareholders or debtholders, (vi) activities required to comply with applicable laws, (vii) (1) Guaranteesin respect of Indebtedness of the Borrowers and their Restricted Subsidiaries permitted under Section 7.03 , including any PermittedRefinancing thereof and (2) guarantees of other obligations not constituting Indebtedness incurred by the Borrowers or any of their RestrictedSubsidiaries, (viii) if applicable, participating in tax, accounting and other administrative matters as a member of the consolidated group ofthe Holding Companies and the Borrowers, (ix) holding any cash or Cash Equivalents, (x) making of any Restricted Payments or Investmentspermitted hereunder including the formation of any Subsidiary in connection with any Investments permitted hereunder, (xi) entering intoemployment agreements and other arrangements with, including providing indemnification to, officers and directors, (xii) establishing andmaintaining bank accounts, (xiii) the obtainment of, and the payment of any fees and expenses for, management, consulting, investmentbanking and advisory services to the extent otherwise permitted by this Agreement, and (xiv) any activities incidental or reasonably related tothe foregoing.ARTICLE VIII EVENTS OF DEFAULT AND REMEDIESSection 8.01. Events of Default . Any of the following from and after the Closing Date shall constitute an event of default (an “Event of Default ”):(hh) Non-Payment . Any Loan Party fails to pay (i) when and as required to be paid herein, any amount of principal of anyLoan or (ii) within five Business Days after the same becomes due, any interest on any Loan or any fees or other amounts payable hereunderor with respect to any other Loan Document; or(ii) Specific Covenants . Any Consolidated Party fails to perform or observe any term, covenant or agreement applicable toit contained in (i) any of Section 6.03(a) , 6.05(a) (solely with respect to the Parent, and Holding Company or any Borrower), Section 6.13(b), Section 6.16 or Article VII (other than Section 7.11 ), (ii) Section 7.11 ; provided that the covenant in Section 7.11 is subject to curepursuant to Section 8.04 , or (iii) Section 6.01 and such failure continues for five Business Days; or(jj) Other Defaults . Any Loan Party or Parent fails to perform or observe any other covenant or agreement (not specifiedin Section 8.01(a) , (b) or (d) ) contained in any Loan Document on its part to be performed or observed and such failure continues for 30days after receipt by the Borrower Representative of written notice thereof from the Administrative Agent; or(kk) Representations and Warranties . Any representation, warranty, certification or statement of fact made or deemedmade by or on behalf of any Loan Party herein, in any other Loan Document, or in any document required to be delivered in connectionherewith or therewith shall be incorrect in any material respect (or, in the case of any representation and warranty that is qualified as to“materiality,” “Material Adverse Effect” or similar language, shall be incorrect in any respect) when made or deemed made; or(ll) Cross-Default . Any Loan Party or any Restricted Subsidiary (A) fails to make any payment beyond the applicablegrace period, if any, whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise, in respect of any Indebtedness(other than Indebtedness hereunder) having an aggregate outstanding principal amount of not less than the Threshold Amount, or (B) fails toobserve or perform any other agreement or condition relating to any such Indebtedness, or any other event occurs (other than, with respect toIndebtedness consisting of Swap Contracts, termination events or equivalent events pursuant to the terms of such Swap Contracts and not as aresult of any default thereunder by any Loan Party), the effect of which default or other event is to cause, or to permit the holder or holders ofsuch Indebtedness (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause (after delivery of anynotice if required and after giving effect to any waiver, amendment, cure or grace period), with the giving of notice if required, suchIndebtedness to become due or to be repurchased, prepaid, defeased or redeemed (automatically or otherwise), or an offer to repurchase,prepay, defease or redeem such Indebtedness to be made, prior to its stated maturity; provided that this clause (B) shall not apply to securedIndebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness, if such sale ortransfer is permitted hereunder; or(mm) Insolvency Proceedings, Etc. Other than with respect to any dissolutions otherwise permitted hereunder, Parent, anyLoan Party or any Material Subsidiary institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes ageneral assignment for the benefit of creditors or becomes unable, admits in writing its inability or fails generally to pay its debts as theybecome due; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator,administrator, administrative receiver or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian,conservator, liquidator, rehabilitator, administrator, administrative receiver or similar officer is appointed without the application or consentof such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor ReliefLaw relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continuesundismissed or unstayed for 60 consecutive calendar days, or an order for relief is entered in any such proceeding; or(nn) Judgments . There is entered against any Loan Party or any Restricted Subsidiary a final judgment or order for thepayment of money in an aggregate amount exceeding the Threshold Amount (to the extent not covered by independent third-party insuranceas to which the insurer has been notified of such judgment or order and has not denied coverage; and such judgment or order shall not havebeen satisfied, vacated, discharged or stayed or bonded pending an appeal for a period of 60 consecutive days; or(oo) Invalidity of Loan Documents . Any material provision of the Loan Documents, at any time after its execution anddelivery and for any reason other than as expressly permitted hereunder or thereunder (including as a result of a transaction permitted underSection 7.04 or 7.05 ) or as a result of acts or omissions by the Administrative Agent or any Lender or the satisfaction in full of all theObligations (other than contingent obligations not yet due and owing and Cash Collateralized or backstopped Letters of Credit), ceases to bein full force and effect; or any Loan Party contests in writing the validity or enforceability of any provision of any Loan Document or thevalidity or priority of a Lien as required by the Collateral Documents on a material portion of the Collateral; or any Loan Party denies inwriting that it has any or further liability or obligation under any Loan Document (other than as a result of repayment in full of theObligations (other than in accordance with its terms) and termination of the Aggregate Commitments), or purports in writing to revoke orrescind any Loan Document (other than in accordance with its terms); or(pp) Change of Control . There occurs any Change of Control; or(qq) Collateral Documents . (i) Any Collateral Document after delivery thereof pursuant to Section 4.01 , 6.11 or 6.13 shallfor any reason (other than pursuant to the terms thereof including as a result of a transaction not prohibited under this Agreement) cease tocreate a valid and perfected Lien, with the priority required by the Collateral Documents on and security interest in any material portion of theCollateral purported to be covered thereby, subject to Liens permitted under Section 7.01 , (A) except to the extent that any such perfection orpriority is not required pursuant to the Collateral and Guarantee Requirement or results from the failure of the Administrative Agent tomaintain possession of certificates actually delivered to it representing securities pledged under the Collateral Documents or to file UniformCommercial Code continuation statements or take other required actions and (B) except as to Collateral consisting of Real Property to theextent that such losses are covered by a lender’s title insurance policy and such insurer has been notified of such losses and has not deniedcoverage, or (ii) any of the Equity Interests of either Borrower or any Holding Company (in the case of Baseball, to the extent such EquityInterests are owned by Holdings) shall for any reason cease to be pledged pursuant to the Collateral Documents; or(rr) Guarantees . Any Guarantee of any Guarantor contained in Article XI or any Guarantee of the Parent pursuant to theParent Guaranty shall cease, for any reason, to be in full force and effect in any material respect, other than as provided for in Section 11.09or in such Parent Guaranty, as applicable, or as any Loan Party or any Affiliate of any such Loan Party shall so assert; or(ss) ERISA . (i) An ERISA Event or Foreign Plan Event occurs which has resulted or would reasonably be expected toresult in liability of a Loan Party, a Restricted Subsidiary or an ERISA Affiliate in an aggregate amount which would reasonably be expectedto result in a Material Adverse Effect, or (ii) a Loan Party, any Restricted Subsidiary or any ERISA Affiliate fails to pay when due, after theexpiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISAunder a Multiemployer Plan in an aggregate amount which would reasonably be expected to result in a Material Adverse Effect.(tt) Junior Financing Documentation . (i) Any of the Obligations of the Loan Parties under the Loan Documents for anyreason shall cease to be (A) “Senior Debt,” “Senior Indebtedness,” “Guarantor Senior Debt” or “Senior Secured Financing” (or anycomparable term) under, and as defined in, any Junior Financing Documentation and (B) “First Lien Obligations” (or any comparable term)under, and as defined in, the Customary Intercreditor Agreement under, and as defined in any Junior Financing Documentation or (ii) thesubordination provisions set forth in any Junior Financing Documentation, or the subordination agreement with respect thereto, shall, inwhole or in part, cease to be effective or cease to be legally valid, binding and enforceable against the holders of any Junior Financing, ifapplicable.Section 8.02. Remedies Upon Event of Default . If any Event of Default occurs and is continuing, the Administrative Agent, at therequest of the Required Lenders, shall take any or all of the following actions:(ll) declare the commitment of each Lender to make Loans and any obligation of the L/C Issuers to make L/C CreditExtensions to be terminated, whereupon such commitments and obligation shall be terminated;(mm) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all otheramounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand,protest or other notice of any kind, all of which are hereby expressly waived by the Borrowers (to the extent permitted by applicable law);(nn) require that the Borrowers Cash Collateralize the L/C Obligations (in an amount equal to 103 of the then OutstandingAmount thereof); and(oo) exercise (or direct the Collateral Agent to exercise) on behalf of itself and the Lenders all rights and remediesavailable to it and the Lenders under the Loan Documents or applicable Law;provided that upon the occurrence of any event described in Section 8.01(f) (but without giving effect to any grace periods contemplatedtherein (other than the grace period for any non-consensual insolvency)) with respect to a Holding Company or a Borrower under the U.S.Bankruptcy Code or any Debtor Relief Laws, the obligation of each Lender to make Loans and any obligation of the L/C Issuers to make L/CCredit Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts asaforesaid shall automatically become due and payable and the obligation of the Borrowers to Cash Collateralize the L/C Obligations asaforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender.Section 8.03. Application of Funds . After the exercise of remedies provided for in Section 8.02 (or after the Loans haveautomatically become immediately due and payable and the L/C Obligations have automatically been required to be Cash Collateralized asset forth in the proviso to Section 8.02 ), any amounts received on account of the Obligations shall be applied by the Administrative Agent inthe following order (to the fullest extent permitted by mandatory provisions of applicable Law):First , to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (other thanprincipal and interest, but including Attorney Costs payable under Section 10.04 and amounts payable under Article III ) payable tothe Administrative Agent or Collateral Agent in their capacities as such hereunder;Second , to the payment in full of Unfunded Participations (the amounts so applied to be distributed among the LC Issuers prorata in accordance with the amounts of Unfunded Participations owed to them on the date of any such distribution);Third , to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principaland interest) payable to the Lenders hereunder (including Attorney Costs payable under Section 10.04 and amounts payable underArticle III ), ratably among them in proportion to the amounts described in this clause Third payable to them;Fourth , to payment of that portion of the Obligations constituting accrued and unpaid interest on the Loans and L/CBorrowings, and any fees, premiums and scheduled periodic payments due under Treasury Services Agreements or Secured HedgeAgreements, ratably among the Secured Parties in proportion to the respective amounts described in this clause Fourth payable tothem;Fifth , to payment of that portion of the Obligations constituting unpaid principal of the Loans and L/C Borrowings (includingto Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters of Credit), and anybreakage, termination or other payments under Treasury Services Agreements or Secured Hedge Agreements, ratably among theSecured Parties in proportion to the respective amounts described in this clause Fifth held by them;Sixth , to the payment of all other Obligations of the Loan Parties that are due and payable to the Administrative Agent andthe other Secured Parties on such date, ratably based upon the respective aggregate amounts of all such Obligations owing to theAdministrative Agent and the other Secured Parties on such date; andLast , the balance, if any, after all of the Obligations then earned, due and payable have been paid in full, to the Borrowers oras otherwise required by Law.Subject to Section 2.03(c) , amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuant to clauseFifth above shall be applied to satisfy drawings under such Letters of Credit as they occur. If any amount remains on deposit as CashCollateral after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be applied to the other Obligations,if any, in the order set forth above and, if no Obligations remain outstanding, to the Borrowers as applicable or as otherwise required by anyCustomary Intercreditor Agreement. Notwithstanding the foregoing, no amounts received from any Guarantor shall be applied to anyExcluded Swap Obligation of such Guarantor.Section 8.04. Borrowers’ Right to Cure . Notwithstanding anything to the contrary contained in Section 8.01 or Section 8.02 :(p) For the purpose of determining whether an Event of Default under Section 7.11 has occurred, the BorrowerRepresentative may on one or more occasions designate any portion of the net cash proceeds from a sale or issuance to Parent of QualifiedEquity Interests of Holdings or any cash contribution to the common capital of Holdings (the “ Cure Amount ”) as an increase toConsolidated EBITDA for the applicable fiscal quarter; provided that (A) such amounts to be designated (i) are actually received by eitherBorrower after the end of such fiscal quarter and on or prior to the fifteenth Business Day after the date on which financial statements arerequired to be delivered with respect to such applicable fiscal quarter (the “ Cure Expiration Date ”) and (ii) do not exceed the aggregateamount necessary to cure any Event of Default under Section 7.11 as of such date and (B) the Borrower Representative shall have providednotice (the “ Notice of Intent to Cure ”) to the Administrative Agent that such amounts are designated as a Cure Amount (it beingunderstood that to the extent such notice is provided in advance of delivery of a Compliance Certificate for the applicable period, the amountof such net cash proceeds that is designated as the Cure Amount may be lower than specified in such notice to the extent that the amountnecessary to cure any Event of Default under Section 7.11 is less than the full amount of such originally designated amount). The CureAmount shall be added to Consolidated EBITDA for the applicable fiscal quarter and included in any Test Period that includes such fiscalquarter.(q) The parties hereby acknowledge that this Section 8.04 may not be relied on for purposes of calculating any financialratios other than for determining actual compliance with Section 7.11 and shall not result in any adjustment to any amounts (including theamount of clause (c) or (d) of the Available Amount, Indebtedness (other than as set forth in Section 8.04(d)(ii) ), Total Assets, ConsolidatedFirst Lien Net Debt, Consolidated Secured Net Debt or Consolidated Total Net Debt or any other calculation of net leverage or Indebtednesshereunder (whether directly by prepayment of debt or indirectly by way of netting) and shall not be included for purposes of determiningpricing, mandatory prepayments and the availability or amount permitted pursuant to any covenant under Article VII ) with respect to thequarter with respect to which such Cure Amount was made (or the period after such quarter but before delivery of the Notice of Intent toCure) other than the amount of the Consolidated EBITDA referred to in Section 8.04(a) above.(r) In furtherance of Section 8.04(a) above, (i) upon actual receipt and designation of the Cure Amount by either Borrower,the covenant under Section 7.11 shall be deemed retroactively cured with the same effect as though there had been no failure to comply withthe covenant under such Section 7.11 and any Event of Default or potential Event of Default under Section 7.11 shall be deemed not to haveoccurred for purposes of the Loan Documents, (ii) no Lender or L/C Issuer shall be required to make any extension of credit hereunder duringthe fifteen (15) Business Day period referred to above unless a Borrower has actually received the proceeds of the Cure Amount, (iii)Borrowers shall not be permitted to make any Restricted Payments during the fifteen (15) Business Day period referred to above unless aBorrower has actually received the proceeds of the Cure Amount and no Cure Amount shall be made with the proceeds of any RestrictedPayments made pursuant to Sections 7.06(f) and (h) and (iv) neither the Administrative Agent nor any Lender may exercise any rights orremedies under Section 8.02 (or under any other Loan Document) on the basis of any actual or purported Event of Default under Section 7.11following receipt of a Notice of Intent to Cure until and unless the Cure Expiration Date has occurred without the Cure Amount having beenreceived.(s) (i) In each period of four consecutive fiscal quarters, there shall be at least two fiscal quarters in which no cure right setforth in this Section 8.04 is exercised and (ii) there shall be no pro forma reduction in Indebtedness with the Cure Amount for determiningcompliance with Section 7.11 for the fiscal quarter with respect to which such Cure Amount was made.(t) There can be no more than four fiscal quarters in which the cure rights set forth in this Section 8.04 are exercised duringthe term of the Facilities.ARTICLE IX ADMINISTRATIVE AGENT AND OTHER AGENTSSection 9.01. Appointment and Authority .(pp) Each of the Lenders and the L/C Issuers hereby irrevocably appoints each Agent to act on its behalf as its Agenthereunder and under the other Loan Documents and authorizes each Agent to take such actions on its behalf and to exercise such powers asare delegated to such Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental or relatedthereto. The provisions of this Article IX (other than Sections 9.01 , 9.06 and 9.09 through and including 9.12 ) are solely for the benefit ofthe Administrative Agent, the Lenders and the L/C Issuers, and no Loan Party has rights as a third party beneficiary of any of such provisions.Without limiting the generality of the foregoing, the use of the term “agent” in this Agreement with reference to the Administrative Agent orthe Collateral Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of anyapplicable law. Instead, such term is used merely as a matter of market custom and is intended to create or reflect only an administrativerelationship between independent contracting parties.(qq) The Administrative Agent shall also act as the “collateral agent” under the Loan Documents, and each of the Lenders(including in its capacities as a potential Bank), the L/C Issuers and the Swing Line Lender hereby irrevocably appoints and authorizes theAdministrative Agent to act as the agent of such Lender, L/C Issuer and Swing Line Lender for purposes of acquiring, holding and enforcingany and all Liens on Collateral granted by any of the Loan Parties to secure any of the Secured Obligations, together with such powers anddiscretion as are reasonably incidental thereto. In this connection, the Administrative Agent, as “collateral agent,” and any co-agents, sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant to Section 9.05 for purposes of holding or enforcing any Lien onthe Collateral (or any portion thereof) granted under the Collateral Documents, or for exercising any rights and remedies thereunder at thedirection of the Administrative Agent, shall be entitled to the benefits of all provisions of this Article IX and Article X (including the secondparagraph of Section 10.05 ), as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the LoanDocuments as if set forth in full herein with respect thereto. Without limiting the generality of the foregoing, the Lenders hereby expresslyauthorize the Administrative Agent to (i) execute any and all documents (including releases and Customary Intercreditor Agreements) withrespect to the Collateral and the Guaranty (including any amendment, supplement, modification or joinder with respect thereto) and the rightsof the Secured Parties with respect thereto, as contemplated by and in accordance with the provisions of this Agreement and the CollateralDocuments and acknowledge and agree that any such action by any Agent shall bind the Lenders and (ii) negotiate, enforce or settle anyclaim, action or proceeding affecting the Lenders in their capacity as such, at the direction of the Required Lenders, which negotiation,enforcement or settlement will be binding upon each Lender.Section 9.02. Rights as a Lender . The Person serving as the Administrative Agent hereunder shall have the same rights and powersin its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term“Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as theAdministrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as thefinancial advisor or in any other advisory capacity for and generally engage in any kind of business with Parent or any Subsidiary or otherAffiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.Section 9.03. Exculpatory Provisions . The Administrative Agent shall not have any duties or obligations except those expressly setforth herein and in the other Loan Documents. The Collateral Agent shall not be responsible for or have a duty to ascertain or inquire into anyrepresentation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of theCollateral Agent’s Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall the Administrative Agent beresponsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral. Without limiting the generality of theforegoing, the Administrative Agent:(u) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or Event of Default hasoccurred and is continuing;(v) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionaryrights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise asdirected in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or inthe other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinionof its counsel, may (i) expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law or (ii) be inviolation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of aDefaulting Lender in violation of any Debtor Relief Law;(w) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall notbe liable for the failure to disclose, any information relating to Parent or any of its Affiliates that is communicated to or obtained by thePerson serving as the Administrative Agent or any of its Affiliates in any capacity;(x) shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders(or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall benecessary, under the circumstances as provided in Sections 10.01 and 8.02 ) or (ii) in the absence of its own gross negligence or willfulmisconduct as determined by a court of competent jurisdiction in a final and nonappealable judgment. The Administrative Agent shall bedeemed not to have knowledge of any Default unless and until written notice describing such Default is given to the Administrative Agent bythe Borrower Representative, a Lender or L/C Issuer; and(y) shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representationmade in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other documentdelivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants,agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability,effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, or the creation,perfection or priority of any Lien purported to be created by the Collateral Documents, (v) the value or the sufficiency of any Collateral, or(vi) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to bedelivered to the Administrative Agent.Section 9.04. Reliance by Administrative Agent . The Administrative Agent shall be entitled to rely upon, and shall not incur anyliability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronicmessage, Internet or intranet website posting or other distribution) believed by it in good faith to be genuine and to have been signed, sent orotherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephoneand believed by it in good faith to have been made by the proper Person, and shall not incur any liability for relying thereon. In determiningcompliance with any condition hereunder to the making of a Loan, or the issuance, extension, renewal or increase of a Letter of Credit, thatby its terms must be fulfilled to the satisfaction of a Lender or L/C Issuer, the Administrative Agent may presume that such condition issatisfactory to such Lender or L/C Issuer unless the Administrative Agent shall have received notice to the contrary from such Lender or L/CIssuer prior to the making of such Loan or the issuance, extension or increase of such Letter of Credit. The Administrative Agent may consultwith legal counsel (who may be counsel for the Borrowers), independent accountants and other experts selected by it, and shall not be liablefor any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.Section 9.05. Delegation of Duties . The Administrative Agent may perform any and all of its duties and exercise its rights andpowers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. TheAdministrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through theirrespective Related Parties. The exculpatory provisions of this Article IX shall apply to any such sub-agent and to the Related Parties of theAdministrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the creditfacilities provided for herein as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for thenegligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agents.Each party to this Agreement acknowledges and agrees that the Administrative Agent may from time to time use one or more outside serviceproviders for the tracking of all UCC financing statements (and/or other Collateral-related filings and registrations from time to time) requiredto be filed or recorded pursuant to the Loan Documents and the notification to the Administrative Agent, of, among other things, theupcoming lapse or expiration thereof, and that each of such service providers will be deemed to be acting at the request and on behalf of theBorrowers and the other Loan Parties. No Agent shall be liable for any action taken or not taken by any such service provider.Section 9.06. Resignation of Administrative Agent . The Administrative Agent may at any time give notice of its resignation to theLenders, the L/C Issuers and the Borrower Representative. Upon receipt of any such notice of resignation, the Required Lenders shall havethe right, with the consent of the Borrower Representative at all times other than upon the occurrence and during the continuation of an Eventof Default under Section 8.01(a) or 8.01(f) (which consent of the Borrower Representative shall not be unreasonably withheld, conditioned ordelayed), to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office inthe United States. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointmentwithin 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may on behalf ofthe Lenders and the L/C Issuers, appoint a successor Administrative Agent meeting the qualifications set forth above (including consent ofthe Borrower Representative); provided that if the Administrative Agent shall notify the Borrower Representative and the Lenders that noqualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such noticeand (a) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents(except that in the case of any collateral security held by the Administrative Agent on behalf of the Lenders or the L/C Issuers under any ofthe Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successorAdministrative Agent is appointed) and (b) all payments, communications and determinations provided to be made by, to or through theAdministrative Agent shall instead be made by or to each Lender and the L/C Issuers directly, until such time as the Required Lendersappoint a successor Administrative Agent as provided for above in this Section 9.06 . Upon the acceptance of a successor’s appointment asAdministrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of theretiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligationshereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section 9.06 ). The fees payableby the Borrowers to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed betweenthe Borrowers and such successor. After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, theprovisions of this Article IX and Sections 10.04 and 10.05 shall continue in effect for the benefit of such retiring Administrative Agent, itssub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiringAdministrative Agent was acting as Administrative Agent.Any resignation by Bank of Montreal as Administrative Agent pursuant to this Section 9.06 shall also constitute its resignation as L/CIssuer and Swing Line Lender. If Bank of Montreal resigns as L/C Issuer, it (x) shall not be required to issue any further Letters of Credithereunder and (y) shall maintain all of its rights as L/C Issuer with respect to any Letters of Credit issued by it, as applicable, prior to the dateof such resignation so long as such Letters of Credit, L/C Obligations remain outstanding and not otherwise Cash Collateralized inaccordance with the terms herein. If Bank of Montreal resigns as Swing Line Lender, it shall retain all of the rights of the Swing Line Lenderprovided for hereunder with respect to Swing Line Loans made by and outstanding as of the effective date of such resignation, including theright to request the Revolving Credit Lenders to make Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section2.04(c) . Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, (i) such successor shall succeed to andbecome vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, (ii) the retiring L/C Issueror Swing Line Lender shall be discharged from all of its respective duties and obligations hereunder or under the other Loan Documents, and(iii) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of suchsuccession or make other arrangements satisfactory to the retiring L/C Issuer to effectively assume the obligations of the retiring L/C Issuerwith respect to such Letters of Credit.Section 9.07. Non-Reliance on Administrative Agent and Other Lenders . Each Lender and L/C Issuer acknowledges that it has,independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on suchdocuments and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lenderand L/C Issuer also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or anyof their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make itsown decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or anydocument furnished hereunder or thereunder.Section 9.08. No Other Duties, Etc . Anything herein to the contrary notwithstanding, none of the Administrative Agent, CollateralAgent, Arranger, Syndication Agent or Documentation Agent listed on the cover page hereof shall have any powers, duties or responsibilitiesunder this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender or L/CIssuer hereunder.Section 9.09. Administrative Agent May File Proofs of Claim . In case of the pendency of any proceeding under any Debtor ReliefLaw or any other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loanor L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether theAdministrative Agent shall have made any demand on the Borrowers) shall be entitled and empowered, by intervention in such proceeding orotherwise:(f) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans,L/C Obligations and all other Secured Obligations that are owing and unpaid and to file such other documents as may be necessary oradvisable in order to have the claims of the Lenders, the L/C Issuers and the Administrative Agent (including any claim for the reasonablecompensation, expenses, disbursements and advances of the Lenders, the L/C Issuers and the Administrative Agent and their respectiveagents and counsel and all other amounts due the Lenders, the L/C Issuers and the Administrative Agent under Sections 2.03(h) , 2.03(i) ,2.09 , 10.04 and 10.05 ) allowed in such judicial proceeding; and(g) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute thesame;and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is herebyauthorized by each Lender and L/C Issuer to make such payments to the Administrative Agent and, if the Administrative Agent shall consentto the making of such payments directly to the Lenders and the L/C Issuers, to pay to the Administrative Agent any amount due for thereasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any otheramounts due the Administrative Agent under Sections 2.09 , 10.04 and 10.05 .Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt onbehalf of any Lender or L/C Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rightsof any Lender or L/C Issuer to authorize the Administrative Agent to vote in respect of the claim of any Lender or L/C Issuer or in any suchproceeding.Section 9.10. Collateral and Guaranty Matters . Each Lender hereby agrees, and each holder of any Note by the acceptance thereofwill be deemed to agree, that, except as otherwise set forth herein, any action taken by the Required Lenders in accordance with theprovisions of this Agreement or the Collateral Documents, and the exercise by the Required Lenders of the powers set forth herein or therein,together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Lenders. TheAdministrative Agent and the Collateral Agent are each hereby authorized on behalf of all of the Lenders, without the necessity of any noticeto or further consent from any Lender, from time to time prior to the occurrence and continuance of an Event of Default, to take any actionwith respect to any Collateral or Collateral Documents which may be necessary to create, perfect and maintain perfected security interests inand liens upon the Collateral granted pursuant to the Collateral Documents. Each of the Lenders irrevocably authorizes each of theAdministrative Agent and the Collateral Agent, at its option, and in its sole discretion:(e) to enter into and sign for and on behalf of the Lenders as Secured Parties the Collateral Documents for the benefit of theLenders and the other Secured Parties;(f) to automatically release any Lien on any property granted to or held by such Agent under any Loan Document (i) upontermination of the Aggregate Commitments and payment in full of all Obligations (other than contingent obligations and Letters of Creditwhich have been Cash Collateralized or otherwise backstopped) and the expiration or termination of all Letters of Credit (other than Lettersof Credit which have been Cash Collateralized or as to which other arrangements reasonably satisfactory to the Administrative Agent, theCollateral Agent and the L/C Issuers shall have been made), (ii) at the time the property subject to such Lien is Disposed or to be Disposed aspart of or in connection with any Disposition permitted hereunder or under any other Loan Document, (iii) subject to Section 10.01 , if therelease of such Lien is approved, authorized or ratified in writing by the Required Lenders or (iv) if the property subject to such Lien isowned by a Guarantor, upon release of such Guarantor from its obligations under its Guaranty pursuant to Section 9.10(d) ; (g) to subordinate any Lien on any property granted to or held by such Agent under any Loan Document to another Lien (i)permitted to exist on such property and (ii) to be senior to the Liens of the Secured Parties under this Agreement; and(h) to release any Subsidiary Guarantor from its obligations under the Guaranty if such Person ceases to be a RestrictedSubsidiary or becomes an Excluded Subsidiary as a result of a transaction or designation permitted hereunder; provided that no such releaseshall occur if such Guarantor continues to be a guarantor in respect of any Credit Agreement Refinancing Indebtedness, any Junior Financingor any other Indebtedness having an aggregate principal amount in excess of the Threshold Amount.Upon request by the Administrative Agent or the Collateral Agent at any time, the Required Lenders will confirm in writing suchAgent’s authority to release or subordinate its interest in particular types or items of property, or to release any Subsidiary Guarantor from itsobligations under the Guaranty pursuant to this Section 9.10 . In each case as specified in this Section 9.10 , such Agent will (and each Lenderirrevocably authorizes each such Agent to), at the Borrowers’ expense, execute and deliver to the applicable Loan Party such documents assuch Loan Party may reasonably request to evidence the release of such item of Collateral from the assignment and security interest grantedunder the Collateral Documents or to subordinate its interest in such item, or to evidence the release of such Subsidiary Guarantor from itsobligations under the Guaranty, in each case in accordance with the terms of the Loan Documents and this Section 9.10 .Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Administrative Agent, theCollateral Agent and each Secured Party hereby agree that (i) no Secured Party shall have any right individually to realize upon any of theCollateral or to enforce the Guarantee, it being understood and agreed that all powers, rights and remedies hereunder and under any of theLoan Documents may be exercised solely by the Administrative Agent or the Collateral Agent, as applicable, for the benefit of the SecuredParties in accordance with the terms hereof and thereof and all powers, rights and remedies under the Collateral Documents (other than anyGuarantee in favor of the Administrative Agent, which may be exercised solely by the Administrative Agent) may be exercised solely by theCollateral Agent for the benefit of the Secured Parties in accordance with the terms thereof, (ii) in the event of a foreclosure or similarenforcement action by the Collateral Agent on any of the Collateral pursuant to a public or private sale or other disposition (including,without limitation, pursuant to Section 363(k), Section 1129(b)(2)(a)(ii) or otherwise of the U.S. Bankruptcy Code), the Collateral Agent orany Lender (except, in each case, with respect to a “credit bid” pursuant to Section 363(k), Section 1129(b)(2)(a)(ii) or otherwise of the U.S.Bankruptcy Code) may, in its own capacity and not as an agent for the other Lenders or Secured Parties, be the purchaser or licensor of any orall of such Collateral at any such sale or other disposition and (iii) the Collateral Agent, as agent for and representative of the Secured Parties(but not any Lender or Lenders in its or their respective individual capacities) shall be entitled, upon instructions from the Required Lenders,for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such saleor disposition, to use and apply any of the Obligations as a credit on account of the purchase price for any Collateral payable by the CollateralAgent at such sale or other disposition.Section 9.11. Secured Treasury Services Agreements and Secured Hedge Agreements . Except as otherwise expressly set forthherein or in any Guaranty or any Collateral Document, no Bank that obtains the benefits of Section 8.03 , any Guaranty or any Collateral byvirtue of the provisions hereof or of any Guaranty or any Collateral Document shall have any right to notice of any action or to consent to,direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release orimpairment of any Collateral) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the LoanDocuments. Notwithstanding any other provision of this Article IX to the contrary, the Administrative Agent shall not be required to verifythe payment of, or that other satisfactory arrangements have been made with respect to, Obligations arising under Treasury ServicesAgreements and Secured Hedge Agreements unless the Administrative Agent has received written notice of such Secured Obligations,together with such supporting documentation as the Administrative Agent may request, from the applicable Bank.The Banks hereby authorize the Administrative Agent to enter into any Customary Intercreditor Agreement, any other intercreditoragreement permitted under this Agreement, and any amendment, modification, supplement or joinder with respect thereto, and any suchCustomary Intercreditor Agreement or other intercreditor agreement is binding upon the Banks.Section 9.12. Withholding Tax Indemnity . To the extent required by any applicable Laws, the Administrative Agent may withholdfrom any payment to any Lender an amount equivalent to any applicable withholding Tax. If the IRS or any other authority of the UnitedStates or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for theaccount of any Lender for any reason (including, without limitation, because the appropriate form was not delivered or not properly executed,or because such Lender failed to notify the Administrative Agent of a change in circumstance that rendered the exemption from, or reductionof, withholding Tax ineffective or if any payment has been made by the Administrative Agent to any Lender without applicable withholdingtax being deducted from such payment), such Lender shall, within 30 days after written demand therefor, indemnify and hold harmless theAdministrative Agent (to the extent that the Administrative Agent has not already been reimbursed by the Borrowers pursuant to Section 3.01and 3.04 and without limiting or expanding the obligation of the Borrowers to do so) for all amounts paid, directly or indirectly, by theAdministrative Agent as Taxes or otherwise, together with all expenses incurred, including legal expenses and any other out-of-pocketexpenses, whether or not such Tax was correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as tothe amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. EachLender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under thisAgreement or any other Loan Document against any amount due the Administrative Agent under this Section 9.12 . The agreements in thisSection 9.12 shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of,a Lender and the repayment, satisfaction or discharge of all other Obligations.ARTICLE X MISCELLANEOUSSection 10.01. Amendments, Etc . Except as otherwise set forth in this Agreement, no amendment or waiver of any provision ofthis Agreement or any other Loan Document, and no consent to any departure by any Loan Party therefrom, shall be effective unless inwriting signed by the Required Lenders (or by the Administrative Agent with the consent of the Required Lenders) and the BorrowerRepresentative or the applicable Loan Party, as the case may be, and each such waiver or consent shall be effective only in the specificinstance and for the specific purpose for which given; provided that no such amendment, waiver or consent shall:(l) extend or increase the Commitment or any Loan of any Lender without the written consent of each Lender holding suchCommitment or Loan (it being understood that a waiver of any condition precedent set forth in Section 4.01 or 4.02 , or the waiver of anyDefault, Event of Default, mandatory prepayment or mandatory reduction of any Commitments or Loans shall not constitute such anextension or increase);(m) postpone any date scheduled for any payment of principal (including final maturity), interest or fees under Section 2.07, 2.08 or 2.09 , respectively, without the written consent of each Lender directly and adversely affected thereby (it being understood that thewaiver of (or amendment to the terms of) any mandatory prepayment of the Loans or any obligation of the Borrowers to pay interest at theDefault Rate, any Default or Event of Default, mandatory prepayment or mandatory reduction of any Commitments shall not constitute such apostponement of any date scheduled for the payment of principal or interest and it further being understood that any change to the definitionof “Consolidated First Lien Net Leverage Ratio” or the component definitions thereof shall not constitute a postponement of such scheduledpayment);(n) reduce or forgive the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject toclause (iv) of the proviso to this Section 10.01 that appears immediately following clause (j) below) any prepayment penalty or premium,fees, reimbursement obligations or other amounts payable hereunder or under any other Loan Document (or extend the timing of payments ofsuch prepayment penalty or premium, fees or other amounts) without the written consent of each Lender directly and adversely affectedthereby (it being understood that (i) the waiver of (or amendment to the terms of) any obligation of the Borrowers to pay interest at theDefault Rate, any mandatory prepayment of the Loans or mandatory reduction of any Commitments or any Default or Event of Default shallnot constitute such a reduction or forgiveness and it further being understood that (ii) any change to the definition of “Consolidated First LienNet Leverage Ratio” or the component definitions thereof shall not constitute a reduction or forgiveness in any rate of interest);(o) change any provision of Section 2.12(a) , 2.13 , 8.03 , or 10.07(a)(z) or the definition of “Pro Rata Share” in anymanner that would alter the pro rata sharing of payments or other amounts required thereby or , without the written consent of each Lenderdirectly and adversely affected thereby; provided that modifications to Section 2.12(a) , 2.13 or 8.03 or the definition of “Pro Rata Share” inconnection with (x) any Incremental Amendment or (y) any Extension Amendment, in each case, shall only require approval (to the extentany such approval is otherwise required) of the Required Lenders;(p) change any provision of (i) this Section 10.01 or (ii) the definition “Required Lenders” or any other provisionspecifying the number of Lenders or portion of the Loans or Commitments required to take any action under the Loan Documents to reducethe percentage set forth therein, without the written consent of each Lender directly and adversely affected thereby (it being understood that,with the consent of the Required Lenders (if such consent is otherwise required) or the Administrative Agent (if the consent of the RequiredLenders is not otherwise required), additional extensions of credit pursuant to this Agreement may be included in the determination of theRequired Lenders on substantially the same basis as the Term Commitments or Revolving Credit Commitments, as applicable);(q) permit assignment of rights and obligations of either Borrower, without the written consent of each Lender;(r) other than in connection with a transaction permitted under Section 7.04 or 7.05 , release all or substantially all of theCollateral in any transaction or series of related transactions, or other than in connection with Liens permitted under Section 7.01 to have apriority superior to that of the Liens granted hereunder or under any other Loan Document, subordinate the Collateral Agent’s Liens on suchCollateral, in each case, without the written consent of each Lender; including, for the avoidance of doubt, any amendment to Section 7.01that has such effect;(s) other than in connection with a transaction permitted under Section 7.04 or 7.05 , release the Parent Guaranty or all orsubstantially all of the value of the guarantees provided by the Guarantors, without the written consent of each Lender;(t) affect the rights or duties of Lenders holding Loans or Commitments of a particular Class (but not the Lenders holdingLoans or Commitments of any other Class), without the written consent of the requisite percentage in interest of the affected Class of Lendersthat would be required to consent thereto if such Class of Lenders was the only Class;(u) consent to the subordination of any of the Secured Obligations of the Loan Parties under the Loan Documents to anyother Indebtedness, without the written consent of each Lender including for avoidance of doubt any amendment to Section 7.01 that has theeffect of subordinating any Secured Obligations to such other Indebtedness; orprovided , further , that (i) no amendment, waiver or consent shall, unless in writing and signed by each L/C Issuer in addition to the Lendersrequired above, adversely affect the rights or duties of an L/C Issuer under this Agreement or any Letter of Credit Application relating to anyLetter of Credit issued or to be issued by it; (ii) no amendment, waiver, or consent shall, unless in writing and signed by the Swing LineLender, in addition to the Lenders required above, adversely affect the rights or duties of the Swing Line Lender under this Agreement;(iii) no amendment, waiver or consent shall, unless in writing and signed by the applicable Agent in addition to the Lenders required above,adversely affect the rights or duties of, or any fees or other amounts payable to, such Agent under this Agreement or any other LoanDocument; (iv) Section 10.07(h) may not be amended, waived or otherwise modified without the consent of each Granting Lender all or anypart of whose Loans are being funded by an SPC at the time of such amendment, waiver or other modification; (v) only the consent of theparties to the Commitment Letter or the Fee Letter shall be required to amend, modify or supplement the terms thereof; and (vi)(x) no Lenderconsent is required to effect an Incremental Amendment, Refinancing Amendment or Extension Amendment (except as expressly provided inSections 2.14 , 2.15 , or 2.16 , as applicable) or to effect any amendment expressly contemplated by Section 7.12 and (y) in connection withan amendment in which any Class of Term Loans is refinanced with a replacement Class of term loans bearing (or is modified in such amanner such that the resulting term loans bear) a lower All-In Yield and other customary amendments related thereto (a “ PermittedRepricing Amendment ”), only the consent of the Lenders holding Term Loans subject to such permitted repricing transaction that willcontinue as a Lender in respect of the repriced tranche of Term Loans or modified Term Loans shall be required for such Permitted RepricingAmendment. Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove anyamendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders oreach affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) theCommitment of any Defaulting Lender may not be increased or extended without the consent of such Lender, (y) the date scheduled for anypayment of principal (including final maturity) of the loans of any Defaulting Lender may not be postponed without the consent of suchLender, and (z) any waiver, amendment or modification requiring the consent of all Lenders or each directly and adversely affected Lenderthat by its terms materially and adversely affects any Defaulting Lender to a greater extent than other affected Lenders shall require theconsent of such Defaulting Lender.Notwithstanding the foregoing, no Lender consent is required for the Administrative Agent to enter into or to effect any amendment,modification or supplement to any Customary Intercreditor Agreement or other intercreditor agreement or arrangement permitted under thisAgreement or in any document pertaining to any Indebtedness permitted hereby that is permitted to be secured by the Collateral, includingany Incremental Commitment, any Permitted Equal Priority Refinancing Debt or any Permitted Junior Priority Refinancing Debt, for thepurpose of adding the holders of such Indebtedness (or their Senior Representative) as a party thereto and otherwise causing suchIndebtedness to be subject thereto, in each case as contemplated by the terms of such Customary Intercreditor Agreement or otherintercreditor agreement or arrangement (it being understood that any such amendment or supplement may make such other changes to theapplicable intercreditor agreement as, in the good faith determination of the Administrative Agent, are required to effectuate the foregoing;provided that such other changes are not adverse, in any material respect (taken as a whole), to the interests of the Lenders); provided , further, that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent hereunder or under anyother Loan Document without the prior written consent of the Administrative Agent.Notwithstanding the foregoing, this Agreement may be amended (or amended and restated) with the written consent of the RequiredLenders, the Administrative Agent and the Borrowers (a) to add one or more additional credit facilities to this Agreement and to permit theextensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof to share ratably in thebenefits of this Agreement and the other Loan Documents with the Term Loans, Revolving Credit Loans and L/C Obligations and the accruedinterest and fees in respect thereof and (b) to include appropriately the Lenders holding such credit facilities in any determination of theRequired Lenders.In addition, notwithstanding the foregoing, this Agreement may be amended with the written consent of the Administrative Agent, theBorrowers and the Lenders providing the Replacement Term Loans (as defined below) to permit the refinancing of all or a portion of theoutstanding Term Loans of any Class (“ Refinanced Term Loans ”) with one or more tranches of replacement term loans (“ ReplacementTerm Loans ”) hereunder; provided that (a) the aggregate principal amount of such Replacement Term Loans shall not exceed the aggregateprincipal amount of such Refinanced Term Loans (plus accrued interest, fees, expenses and premium), (b) the Weighted Average Life toMaturity of Replacement Term Loans shall not be shorter than the Weighted Average Life to Maturity of such Refinanced Term Loans, at thetime of such refinancing, (c) such Replacement Term Loans must satisfy the requirements of Credit Agreement Refinancing Indebtedness and(d) all other terms applicable to such Replacement Term Loans shall be as agreed between the Borrowers and the Lenders providing suchReplacement Term Loans.Notwithstanding anything to the contrary contained in this Section 10.01 , guarantees, collateral security documents and relateddocuments executed by the Loan Parties or the Subsidiaries in connection with this Agreement may be in a form reasonably determined bythe Administrative Agent and may be, together with this Agreement, amended and waived with the consent of the Administrative Agent at therequest of the Borrowers without the need to obtain the consent of any other Lender if such amendment or waiver is delivered in order (i) tocomply with local Law or advice of local counsel or (ii) to cause such guarantee, collateral security document or other document to beconsistent with this Agreement and the other Loan Documents.Notwithstanding anything to the contrary contained in this Agreement, any Lender may assign all or a portion of its Term Loans inconnection with a primary syndication of such Term Loans relating to any refinancing, extension, loan modification or similar transactionpermitted by the terms of this Agreement, pursuant to cashless settlement mechanisms approved by the Borrowers, the Administrative Agent,the assignor Lender and the assignee of such Lender.Notwithstanding the foregoing, only the consent of the Required Revolving Lenders shall be necessary to (i) amend, modify or waiveany condition precedent set forth in Section 4.02 with respect to the making of Revolving Credit Loans or the issuance of Letters of Credit or(ii) except for any amendment, waiver or modification that would require the consent of each Revolving Credit Lender adversely affectedthereby pursuant to the proviso to Section 10.01 , amend, modify or waive any provision of this Agreement that solely affects the RevolvingCredit Lenders in respect of any Revolving Credit Facility, including the final scheduled maturity, interest, fees, prepayment penalties andvoting.Notwithstanding anything to the contrary contained in Section 10.01 , if at any time after the Closing Date, the Administrative Agentand the Borrower Representative shall have jointly identified an obvious error or any error or omission of a technical nature, in each case, inany provision of the Loan Documents, then the Administrative Agent and the Borrower Representative shall be permitted to amend suchprovision and such amendment shall become effective without any further action or consent of any other party to any Loan Document so longas the same is not objected to in writing by the Required Lenders within five Business Days following receipt of notice thereof.Notwithstanding anything to the contrary contained in Section 10.01 , no Loan Party will, directly or indirectly, pay any remunerationor other thing of value, whether by way of additional interest, fee or otherwise, to any Lender (in its capacity as a Lender hereunder) asconsideration for agreement by such Lender with any consent, amendment, waiver or other modification of any Loan Documents, unless suchremuneration or other thing of value is offered to all Lenders and is paid to all such Lenders that so vote or agree in the time frame set forth inthe solicitation documents relating to such modification.Section 10.02. Notices and Other Communications .(z) Notices; Effectiveness; Electronic Communications.(i) Notices Generally . Except in the case of notices and other communications expressly permitted to be given bytelephone (and except as provided in Section 10.02(a)(ii) ), all notices and other communications provided for herein shall be inwriting and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile asfollows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to theapplicable telephone number, as follows:(A) if to the Borrowers, the Administrative Agent, the L/C Issuers or the Swing Line Lender, to theaddress, facsimile number, electronic mail address or telephone number specified for such Person on Schedule 10.02 ; and(B) if to any other Lender, to the address, facsimile number, electronic mail address or telephone numberspecified in its Administrative Questionnaire.Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shallbe deemed to have been given when received; notices and other communications sent by facsimile shall be deemed to have beengiven when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at theopening of business on the next Business Day for the recipient). Notices and other communications delivered through electroniccommunications to the extent provided in Section 10.02(a)(ii) shall be effective as provided in such Section 10.02(a)(ii) .(ii) Electronic Communications . Notices and other communications to the Lenders and the L/C Issuers hereundermay be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant toprocedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices to any Lender or L/C Issuerpursuant to Article II if such Lender or L/C Issuer, as applicable, has notified the Administrative Agent that it is incapable ofreceiving notices under such Article by electronic communication. The Administrative Agent or the Borrower Representative may, intheir discretion, agree to accept notices and other communications to them hereunder by electronic communications pursuant toprocedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall bedeemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested”function, as available, return e-mail or other written acknowledgement); provided that if such notice or other communication is not sentduring the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of businesson the next Business Day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemedreceived upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification thatsuch notice or communication is available and identifying the website address therefor.(aa) The Platform . THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT PARTIES (ASDEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THEADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THEBORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANYWARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTYRIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTIONWITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its Related Parties(collectively, the “ Agent Parties ”) have any liability to the Loan Parties, any Lender, any L/C Issuer or any other Person for losses, claims,damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of any Holding Company’s, any Borrower’s,any Restricted Subsidiary’s or the Administrative Agent’s transmission of the Borrower Materials through the Internet, except to the extentthat such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and non-appealablejudgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided , however , that in no event shallany Person have any liability to any other Person hereunder for indirect, special, incidental, consequential or punitive damages (as opposed todirect or actual damages); provided , further , that nothing in this sentence shall limit any Loan Party’s indemnification obligations set forthherein.(bb) Change of Address, Etc . Each of the Borrowers, the Administrative Agent, the L/C Issuers and the Swing LineLender may change its address, e-mail address, facsimile or telephone number for notices and other communications hereunder by notice tothe other parties hereto. Each other Lender may change its address, e-mail address facsimile or telephone number for notices and othercommunications hereunder by notice to the Borrower Representative, the Administrative Agent, the L/C Issuers and the Swing Line Lender.In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record(i) an effective address, contact name, telephone number, facsimile number and e-mail address to which notices and other communicationsmay be sent and (ii) accurate wire instructions for such Lender. Furthermore, each Public Lender agrees to cause at least one individual at oron behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declarationscreen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance proceduresand applicable Law, including United States Federal and state securities Laws, to make reference to the Borrower Materials that are not madeavailable through the “Public Side Information” portion of the Platform and that may contain Material Non-Public Information.(cc) Reliance by Administrative Agent, L/C Issuer and Lenders . The Administrative Agent, the L/C Issuers and theLenders shall be entitled to rely and act upon any notices (including telephonic Committed Loan Notices) purportedly given by or on behalfof the Borrowers even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed byany other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. TheBorrowers shall indemnify the Administrative Agent, each L/C Issuer, each Lender and the Related Parties of each of them from all losses,costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrowers inaccordance with Section 10.05 hereof. All telephonic notices to and other telephonic communications with the Administrative Agent may berecorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.Section 10.03. No Waiver; Cumulative Remedies . No failure by any Lender, any L/C Issuer or the Administrative Agent toexercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder or under any other Loan Documentshall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any otheror further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges hereinprovided, and provided under each other Loan Document, are cumulative and not exclusive of any rights, remedies, powers and privilegesprovided by Law.Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights andremedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and allactions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the AdministrativeAgent in accordance with Section 8.02 for the benefit of all the Lenders and the L/C Issuers; provided , however , that the foregoing shall notprohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacityas Administrative Agent) hereunder and under the other Loan Documents, (b) any L/C Issuer from exercising the rights and remedies thatinure to its benefit (solely in its capacity as L/C Issuer, as the case may be) hereunder and under the other Loan Documents, (c) any Lenderfrom exercising setoff rights in accordance with Section 10.09 (subject to the terms of Section 2.13 ) or (d) any Lender from filing proofs ofclaim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under any DebtorRelief Law; provided , further , that if at any time there is no Person acting as Administrative Agent hereunder and under the other LoanDocuments, then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to Section 8.02 and(ii) in addition to the matters set forth in clauses (b) , (c) and (d) of the preceding proviso and subject to Section 2.13 , any Lender may, withthe consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.Section 10.04. Attorney Costs and Expenses . The Borrowers agree, on a joint and several basis, (a) if the Closing Date occurs, topay or reimburse the Administrative Agent and the Arranger for all reasonable and documented out-of-pocket costs and expenses incurred inconnection with the preparation, negotiation, syndication, execution, delivery and administration of this Agreement and the other LoanDocuments, and any amendment, waiver, consent or other modification of the provisions hereof and thereof (whether or not the transactionscontemplated thereby are consummated), and the consummation and administration of the transactions contemplated hereby and thereby,including all Attorney Costs, which shall be limited to Jones Day and, if reasonably necessary, one local counsel in each relevant jurisdiction(which may include a single special counsel acting in multiple jurisdictions) material to the interests of the Lenders taken as a whole and(b) from and after the Closing Date, to pay or reimburse the Administrative Agent, the L/C Issuers and the Lenders for all reasonable anddocumented out-of-pocket costs and expenses incurred in connection with the enforcement or protection of any rights or remedies under thisAgreement or the other Loan Documents (including all such costs and expenses incurred during any legal proceeding, including anyproceeding under any Debtor Relief Law, and including all respective Attorney Costs, which shall be limited to Attorney Costs of onecounsel to the Administrative Agent and the Lenders taken as a whole and, if reasonably necessary, one local counsel in each relevantjurisdiction material to the interests of the Lenders taken as a whole and, solely in the case of an actual or perceived conflict of interest, oneadditional counsel in each relevant jurisdiction to each group of similarly situated affected parties). The agreements in this Section 10.04 shallsurvive the termination of the Aggregate Commitments and repayment of all other Obligations. All amounts due under this Section 10.04shall be paid within 30 days following receipt by the Borrower Representative of an invoice relating thereto setting forth such expenses inreasonable detail. If any Loan Party fails to pay when due any costs, expenses or other amounts payable by it hereunder or under any LoanDocument, such amount may be paid on behalf of such Loan Party by the Administrative Agent in its discretion following five BusinessDays’ prior written notice to the Borrower Representative. For the avoidance of doubt, this Section 10.04 shall not apply to Taxes, except anyTaxes that represent costs and expenses arising from any non-Tax claim.Section 10.05. Indemnification by the Borrowers . The Borrowers, on a joint and several basis, shall indemnify and hold harmlesseach Agent, Agent-Related Person, Lender and Arranger and their respective controlled Affiliates and controlling Persons, and theirrespective officers, directors, employees, partners, agents, advisors and other representatives of each of the foregoing and their respectivesuccessors (collectively the “ Indemnitees ”) from and against any and all actual liabilities, obligations, losses, damages, penalties, claims,demands, actions, judgments, suits, costs, expenses and disbursements (including Attorney Costs but limited in the case of legal fees andexpenses to the reasonable and documented or invoiced out-of-pocket fees, disbursements and other charges of one counsel to all Indemniteestaken as a whole and, if necessary, one local counsel for all Indemnitees taken as a whole in each relevant jurisdiction that is material to theinterests of the Lenders, and solely in the case of an actual or perceived conflict of interest, where the Indemnitee affected by such conflictinforms the Borrower Representative of such conflict and thereafter retains its own counsel one additional counsel in each relevantjurisdiction to each group of similarly situated affected Indemnitees) and any other counsel obtained with the Borrower Representative’sconsent (such consent not to be unreasonably withheld or delayed), joint or several, of any kind or nature whatsoever which may at any timebe imposed on, incurred by or asserted against any such Indemnitee in any way relating to or arising out of or in connection with (a) theexecution, delivery, enforcement, performance or administration of any Loan Document or any other agreement, letter or instrument deliveredin connection with the transactions contemplated thereby or the consummation of the transactions contemplated thereby, (b) anyCommitment, Loan or Letter of Credit or the use or proposed use of the proceeds therefrom including any refusal by an L/C Issuer to honor ademand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with theterms of such Letter of Credit, or (c) any actual or alleged presence or Release of Hazardous Materials at, on, under or from any property orfacility currently owned, leased or operated by the Loan Parties or any Subsidiary, or any Environmental Liability (other than any suchpresence, Release or Environmental Liability resulting solely from acts or omissions by Persons other than the Loan Parties or any of theirSubsidiaries after the Administrative Agent sells the respective property pursuant to a foreclosure or has accepted a deed in lieu offoreclosure), or (d) any claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or anyother theory (including any investigation of, preparation for, or defense of any pending claim, investigation, litigation or proceeding) (a “Proceeding ”) and regardless of whether any Indemnitee is a party thereto or whether or not such Proceeding is brought by a Borrower or anyother person and, in each case, whether or not caused by or arising, in whole or in part, out of the negligence of the Indemnitee; provided thatsuch indemnity shall not, as to any Indemnitee, be available (i) to the extent that such liabilities, obligations, losses, damages, penalties,claims, demands, actions, judgments, suits, costs, expenses or disbursements resulted from (x) the gross negligence, bad faith or willfulmisconduct of such Indemnitee or of any of its controlled Affiliates or their respective directors, officers, employees, partners, advisors orother representatives, as determined by a final non-appealable judgment of a court of competent jurisdiction, (y) a material breach of anyobligations under this Agreement or any other Loan Document by such Indemnitee or any of its controlled Affiliates, as determined by a finalnon-appealable judgment of a court of competent jurisdiction or (z) any dispute solely among Indemnitees other than any claims against anIndemnitee in its capacity or in fulfilling its role as an administrative agent or arranger or any similar role under any Facility and other thanany claims arising out of any act or omission of Holdings, the Borrowers, the Sponsor or any of their Affiliates or (ii) with respect to anysettlement entered into by an Indemnitee without the Borrower Representative’s written consent (such consent not to be unreasonablywithheld or delayed). No Indemnitee shall be liable for any damages arising from the use by others of any information or other materialsobtained through IntraLinks or other similar information transmission systems in connection with this Agreement, in each case, except to theextent any such damages are found in a final non-appealable judgment of a court of competent jurisdiction to have resulted from the grossnegligence, bad faith or willful misconduct of, or a material breach of any obligations under this Agreement or any other Loan Document by,such Indemnitee or any of its controlled Affiliates, nor shall any Indemnitee, Loan Party or any Subsidiary have any liability for any special,punitive, indirect or consequential damages relating to this Agreement or any other Loan Document or arising out of its activities inconnection herewith or therewith (whether before or after the Closing Date); it being agreed that this sentence shall not limit theindemnification obligations of Holdings or any Subsidiary (including, in the case of any Loan Party, in respect of any such damages incurredor paid by an Indemnitee to a third party and for any out-of-pocket expenses). In the case of an investigation, litigation or other proceeding towhich the indemnity in this Section 10.05 applies, such indemnity shall be effective whether or not such investigation, litigation orproceeding is brought by any Loan Party, any Subsidiary of any Loan Party, its directors, equity holders or creditors or an Indemnitee or anyother Person, whether or not any Indemnitee is otherwise a party thereto and whether or not any of the transactions contemplated hereunder orunder any of the other Loan Documents are consummated. By accepting the benefits hereof, each Indemnitee agrees to refund and return anyand all amounts paid by the Borrowers to such Indemnitee to the extent items in clauses (w) through (y) above occur. All amounts due underthis Section 10.05 shall be paid within 10 days after written demand therefor (together with backup documentation supporting suchreimbursement request); provided , however , that such Indemnitee shall promptly refund such amount to the extent that there is a finaljudicial or arbitral determination that such Indemnitee was not entitled to indemnification rights with respect to such payment pursuant to theexpress terms of this Section 10.05 . The agreements in this Section 10.05 shall survive the resignation of the Administrative Agent, thereplacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the otherObligations. For the avoidance of doubt, this Section 10.05 shall not apply to Taxes, except any Taxes that represent liabilities, obligations,losses, damages, penalties, claims, demands, actions, prepayments, suits, costs, expenses and disbursements arising from any non-Tax claims.To the extent that the Borrowers for any reason fail to indefeasibly pay any amount required under this Section 10.05 or Section 10.04to be paid by it to the Administrative Agent or Collateral Agent (or any sub-agent thereof), the L/C Issuers, the Swing Line Lender or anyRelated Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent or Collateral Agent (or any such sub-agent), the L/C Issuers or such Related Party, as the case may be, such Lender’s Pro Rata Share (determined as of the time that the applicableunreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss,claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any suchsub-agent), the L/C Issuers or the Swing Line Lender in their capacity as such, or against any Related Party of any of the foregoing acting forthe Administrative Agent (or any such sub-agent) any L/C Issuer or the Swing Line Lender in connection with such capacity. The obligationsof the Lenders under this paragraph are subject to the provisions of Section 2.12(e) .Section 10.06. Payments Set Aside . To the extent that any payment by or on behalf of the Borrowers is made to the AdministrativeAgent, any L/C Issuer or any Lender, or the Administrative Agent, any L/C Issuer or any Lender exercises its right of setoff, and suchpayment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside orrequired (including pursuant to any settlement entered into by the Administrative Agent, any L/C Issuer or such Lender in its discretion) to berepaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to theextent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effectas if such payment had not been made or such setoff had not occurred, and (b) each Lender and L/C Issuer severally agrees to pay to theAdministrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by theAdministrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to theFederal Funds Rate from time to time in effect. The obligations of the Lenders and the L/C Issuers under clause (b) of the preceding sentenceshall survive the payment in full of the Obligations and the termination of this Agreement.Section 10.07. Successors and Assigns .(i) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respectivesuccessors and assigns permitted hereby, except that the Borrowers may not assign or otherwise transfer any of their rights or obligationshereunder or any of the other Loan Documents without the prior written consent of the Administrative Agent and each Lender (except aspermitted by Section 7.04 ), and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to anAssignee pursuant to an assignment made in accordance with the provisions of Section 10.07(b) (such an assignee, an “ Eligible Assignee ”),(ii) by way of participation in accordance with the provisions of Section 10.07(e) , (iii) by way of pledge or assignment of a security interestsubject to the restrictions of Section 10.07(g) or (iv) to an SPC in accordance with the provisions of Section 10.07(h) , and any otherattempted assignment or transfer by any party hereto shall be null and void; provided , however , that notwithstanding the foregoing, noLender may assign or transfer by participation any of its rights or obligations hereunder to (w) a Disqualified Lender, (x) any Person that is aDefaulting Lender, (y) a natural Person or (z) Parent, the Holding Companies, the Borrowers or any of their respective Subsidiaries. Nothingin this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respectivesuccessors and assigns permitted hereby, Participants to the extent provided in Section 10.07(e) and, to the extent expressly contemplatedhereby, the Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement. Notwithstanding anything to thecontrary herein, the Administrative Agent shall not be responsible or have any liability for, or have any duty to ascertain, inquire into, monitoror enforce, compliance with the provisions hereof relating to Disqualified Lenders. Without limiting the generality of the foregoing, theAdministrative Agent shall not (x) be obligated to ascertain, monitor or inquire as to whether any Lender or Participant or prospective Lenderor Participant is a Disqualified Lender or (y) have any liability with respect to or arising out of any assignment or participation of Loans, ordisclosure of confidential information, to any Disqualified Lender.(j) (i) Subject to the conditions set forth in Section 10.07(a) above and Section 10.07(b)(ii) below, any Lender may at anytime assign to one or more assignees (each, an “ Assignee ”) all or a portion of its rights and obligations under this Agreement (including allor a portion of its Commitment and the Loans (including for purposes of this Section 10.07(b) , participations in L/C Obligations and SwingLine Loans) at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld, conditioned or delayed) of:(A) the Borrower Representative (on behalf of the Borrowers); provided that no consent of the BorrowerRepresentative shall be required for (i) an assignment of all or a portion of the Term Loans to a Lender or to an Affiliate of aLender or an Approved Fund thereof, (ii) an assignment of all or a portion of any Revolving Credit Commitments orRevolving Credit Exposure to a Revolving Credit Lender, an Affiliate of a Revolving Credit Lender or any Approved Fundthereof, (iii) an assignment after the occurrence and during the continuance of an Event of Default under Section 8.01(a) orSection 8.01(f) or (iv) an assignment in connection with the primary syndication of the Facilities previously identified to andconsented to (such consent not to be unreasonably withheld, conditioned or delayed) by the Borrower Representative or theBorrowers; provided , further , that the Borrower Representative (on behalf of the Borrowers) shall be deemed to haveconsented to any such assignment unless it shall have objected thereto by written notice to the Administrative Agent within10 Business Days after having received notice thereof;(B) the Administrative Agent; provided that no consent of the Administrative Agent shall be required foran assignment (i) of all or any portion of a Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund, (ii) of all orany portion of any Revolving Credit Commitments or Revolving Credit Exposure to a Revolving Credit Lender, an Affiliateof a Revolving Credit Lender or any Approved Fund thereof, or (iii) from an Agent to its Affiliates; and(C) the Swing Line Lender and each L/C Issuer at the time of such assignment; provided that no consent ofthe Swing Line Lender and the L/C Issuers shall be required for any assignment not related to Revolving CreditCommitments or Revolving Credit Exposure.Notwithstanding the foregoing or anything to the contrary set forth herein, to the extent any Lender is required to assign any portion of itsCommitments, Loans and other rights, duties and obligations hereunder in order to comply with applicable Laws, such assignment may bemade by such Lender without the consent of the Borrower Representative, the Administrative Agent, the Swing Line Lender, any L/C Issueror any other party hereto so long as such Lender complies with the requirements of Section 10.07(b)(ii) .(ii) Assignments shall be subject to the following additional conditions:(A) except in the case of an assignment of the entire remaining amount of the assigning Lender’sCommitment or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender subject to each suchassignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to theAdministrative Agent) shall not be less than $5,000,000 (in the case of each Revolving Credit Loan) and $1,000,000 (in thecase of a Term Loan) unless each of the Borrower Representative and the Administrative Agent otherwise consents; providedthat such amounts shall be aggregated in respect of each Lender and its Affiliates or Approved Funds, if any;(B) the parties to each assignment shall (1) execute and deliver to the Administrative Agent an Assignmentand Assumption via an electronic settlement system acceptable to the Administrative Agent or (2) if previously agreed withthe Administrative Agent, manually execute and deliver to the Administrative Agent an Assignment and Assumption,together, in each case, with a processing and recordation fee of $3,500 (which fee may be waived or reduced in the solediscretion of the Administrative Agent);(C) the Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an AdministrativeQuestionnaire; and(D) the Assignee shall execute and deliver to the Administrative Agent and the Borrower Representativethe documentation described in Section 3.01(d) applicable to it.This Section 10.07(b) shall not prohibit any Lender from assigning all or a portion of its rights and obligations among separateFacilities on a non- pro rata basis among such Facilities.In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall beeffective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additionalpayments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outrightpayment, purchases by the assignee of participations or sub-participations, or other compensating actions, including funding, with the consentof the Borrower Representative and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded bythe Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full allpayment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon)and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit in accordance with its ProRata Share. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereundershall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shallbe deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.(k) Subject to acceptance and recording thereof by the Administrative Agent pursuant to Section 10.07(d) , from and afterthe effective date specified in each Assignment and Assumption, (1) the Eligible Assignee thereunder shall be a party to this Agreement and,to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement,and (2) the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from itsobligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights andobligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 3.01, 3.04 , 3.05 , 10.04 and 10.05 with respect to facts and circumstances occurring prior to the effective date of such assignment). Upon request,and the surrender by the assigning Lender of its Note, the applicable Borrower (at its expense) shall execute and deliver a Note to the assigneeLender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 10.07(c)shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance withSection 10.07(e) .(l) The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrowers, shall maintain at theAdministrative Agent’s Office a copy of each Assignment and Assumption and a register for the recordation of the names and addresses ofthe Lenders, and the Commitments of, and principal amounts of (and related interest amounts on) the Loans, L/C Obligations (specifying theUnreimbursed Amounts), L/C Borrowings and the amounts due under Section 2.03 , owing to, each Lender pursuant to the terms hereof fromtime to time (the “ Register ”). Upon its receipt of, and consent to, a duly completed Assignment and Assumption executed by an assigningLender and an assignee, an Administrative Questionnaire completed in respect of the assignee (unless the assignee shall already be a Lenderhereunder), the processing and recordation fee referred to in Section 10.07(b)(ii)(B) above, if applicable, and the written consent of theAdministrative Agent and, if required, the Borrowers, each L/C Issuer and the Swing Line Lender to such assignment and any applicable taxforms, the Administrative Agent shall (i) accept such Assignment and Assumption and (ii) promptly record the information contained thereinin the Register. No assignment shall be effective unless it has been recorded in the Register as provided in this Section 10.07(d) . The entriesin the Register shall be conclusive, absent manifest error, and the Borrowers, the Agents and the Lenders shall treat each Person whose nameis recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice tothe contrary. The Register shall be available for inspection by the Borrowers, any Agent and any Lender, at any reasonable time and fromtime to time upon reasonable prior notice. This Section 10.07(d) and Section 2.11 shall be construed so that all Loans are at all timesmaintained in “registered form” within the meaning of Section 163(f), 871(h)(2) and 881(c)(2) of the Code and any related TreasuryRegulations (or any other relevant or successor provisions of the Code or of such Treasury Regulations).(m) Any Lender may at any time, sell participations to any Person (other than a natural person, a Disqualified Lender, aDefaulting Lender, Parent, any Consolidated Party or any Affiliate of Parent or any Consolidated Party) (each, a “ Participant ”) in all or aportion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans(including such Lender’s participations in L/C Obligations and Swing Line Loans) owing to it); provided that (i) such Lender’s obligationsunder this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performanceof such obligations and (iii) the Borrowers, the Agents and the other Lenders shall continue to deal solely and directly with such Lender inconnection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sellssuch a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and the other Loan Documents and toapprove any amendment, modification or waiver of any provision of this Agreement or the other Loan Documents; provided that suchagreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver orother modification described in clauses (a) through (h) of the first proviso to Section 10.01 that requires the affirmative vote of such Lender.Subject to Section 10.07(f) and a Participant’s compliance with the requirements and the limitations of Section 3.01(d) (it being understoodthat any forms, information or other documentation required under such Sections shall be delivered to the participating Lender), theBorrowers agree that each Participant shall be entitled to the benefits of Sections 3.01 , 3.04 and 3.05 (subject to the requirements andlimitations of such Sections) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.07(c). To the extent permitted by applicable Law, each Participant also shall be entitled to the benefits of Section 10.09 as though it were a Lender;provided that such Participant agrees to be subject to Section 2.13 as though it were a Lender. Each Lender that sells a participation or that isa Granting Lender, as the case may be, shall, acting solely for this purpose as a non-fiduciary agent of the Borrowers, maintain a register onwhich it enters the name and address of each Participant and SPC and the principal amounts of (and related interest amounts on) eachParticipant’s and SPC’s interest in the Loans or other obligations under this Agreement (the “ Participant Register ”); provided that noLender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or anyinformation relating to a Participant's interest in any commitments, loans, letters of credit or its other obligations under any Loan Document)to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligationis in registered form within the meaning of Section 5f.103-1(c) of the U.S. Treasury Regulations or any other relevant or successor provisionsof the Code or of such Treasury Regulations). The Participant Register shall be conclusive absent manifest error, and such Lender shall treateach Person whose name is recorded in the Participant Register as the owner of such participation or portion of the Loan (if funded by anSPC), as applicable, for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, theAdministrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.(n) A Participant shall not be entitled to receive any greater payment under Section 3.01 , 3.04 or 3.05 than theparticipating Lender would have been entitled to receive with respect to the participation sold to such Participant, unless such entitlement to agreater payment results from a change in any Law after the sale of the participation takes place.(o) Any Lender may, without the consent of any Borrower or the Administrative Agent, at any time pledge or assign asecurity interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender,including any pledge or assignment to secure obligations to a Federal Reserve Bank or any central bank having jurisdiction over such Lender;provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee orassignee for such Lender as a party hereto.(p) Notwithstanding anything to the contrary contained herein, any Lender (a “ Granting Lender ”) may grant to a specialpurpose funding vehicle identified as such in writing from time to time by the Granting Lender to the Administrative Agent and theBorrowers (an “ SPC ”) the option to provide all or any part of any Loan that such Granting Lender would otherwise be obligated to makepursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to fund any Loan, (ii) if an SPC electsnot to exercise such option or otherwise fails to make all or any part of such Loan, the Granting Lender shall be obligated to make such Loanpursuant to the terms hereof and (iii) such SPC and the applicable Loan or any applicable part thereof, shall be appropriately reflected in theParticipant Register. Each party hereto hereby agrees that (i) an SPC shall be entitled to the benefit of Sections 3.01 , 3.04 and 3.05 (subject tothe requirements and the limitations of such Section), but neither the grant to any SPC nor the exercise by any SPC of such option shallincrease the costs or expenses or otherwise increase or change the obligations of the Borrowers under this Agreement except, in the case ofSection 3.01 , to the extent that the grant to the SPC was made with the prior written consent of the Borrower Representative (not to beunreasonably withheld, conditioned or delayed; for the avoidance of doubt, the Borrower Representative shall have reasonable basis forwithholding consent if an exercise by SPC immediately after the grant would result in materially increased indemnification obligation to theBorrowers at such time), (ii) no SPC shall be liable for any indemnity or similar payment obligation under this Agreement for which a Lenderwould be liable, and (iii) the Granting Lender shall for all purposes, including the approval of any amendment, waiver or other modificationof any provision of any Loan Document, remain the lender of record hereunder. The making of a Loan by an SPC hereunder shall utilize theCommitment of the Granting Lender to the same extent, and as if, such Loan were made by such Granting Lender. Notwithstanding anythingto the contrary contained herein, any SPC may (i) with notice to, but without prior consent of the Borrower Representative and theAdministrative Agent and with the payment of a processing fee of $3,500, assign all or any portion of its right to receive payment withrespect to any Loan to the Granting Lender and (ii) disclose on a confidential basis any non-public information relating to its funding ofLoans to any rating agency, commercial paper dealer or provider of any surety or Guarantee or credit or liquidity enhancement to such SPC.(q) Notwithstanding anything to the contrary contained herein, without the consent of the Borrower Representative or theAdministrative Agent, (1) any Lender may in accordance with applicable Law create a security interest in all or any portion of the Loansowing to it and the Note, if any, held by it and (2) any Lender that is a Fund may create a security interest in all or any portion of the Loansowing to it and the Note, if any, held by it to the trustee for holders of obligations owed, or securities issued, by such Fund as security forsuch obligations or securities; provided that unless and until such trustee actually becomes a Lender in compliance with the other provisionsof this Section 10.07 , (i) no such pledge shall release the pledging Lender from any of its obligations under the Loan Documents and (ii) suchtrustee shall not be entitled to exercise any of the rights of a Lender under the Loan Documents even though such trustee may have acquiredownership rights with respect to the pledged interest through foreclosure or otherwise.(r) Notwithstanding anything to the contrary contained herein, any L/C Issuer may, upon 30 days’ notice to the BorrowerRepresentative and the Lenders, resign as an L/C Issuer; provided that on or prior to the expiration of such 30-day period with respect to suchresignation, the relevant L/C Issuer shall have identified a successor L/C Issuer reasonably acceptable to the Borrower Representative willingto accept its appointment as successor L/C Issuer. In the event of any such resignation of an L/C Issuer, the Borrower Representative shall beentitled to appoint from among the Lenders willing to accept such appointment a successor L/C Issuer hereunder; provided that no failure bythe Borrower Representative to appoint any such successor shall affect the resignation of the relevant L/C Issuer, except as expresslyprovided above. If an L/C Issuer resigns as an L/C Issuer, it shall retain all the rights and obligations of an L/C Issuer hereunder with respectto all Letters of Credit outstanding as of the effective date of its resignation as an L/C Issuer and all L/C Obligations with respect thereto(including the right to require the Lenders to make ABR Loans or fund risk participations in Unreimbursed Amounts pursuant toSection 2.03(c) ).Section 10.08. Confidentiality . Each of the Agents and the Lenders agrees to maintain the confidentiality of the Information,except that Information may be disclosed (a) to its Affiliates and its and its Affiliates’ managers, administrators, directors, officers,employees, trustees, partners, investors, funding sources, investment advisers and agents, including accountants, legal counsel and otheradvisors on a “need to know basis” (it being understood that the Persons to whom such disclosure is made will be informed of the confidentialnature of such Information and agree to keep such Information confidential); (b) to the extent required or requested by any GovernmentalAuthority or self-regulatory authority having or asserting jurisdiction over such Person (including any Governmental Authority regulating anyLender or its Affiliates); provided that the Administrative Agent or such Lender, as applicable, agrees that it will notify the BorrowerRepresentative as soon as practicable in the event of any such disclosure by such Person (other than at the request of a regulatory or self-regulatory authority) unless such notification is prohibited by law, rule or regulation; (c) to the extent required by applicable Laws orregulations or by any subpoena or similar legal process; provided that the Administrative Agent or such Lender, as applicable, agrees that itwill notify the Borrower Representative as soon as practicable in the event of any such disclosure by such Person (other than at the request ofa regulatory or self-regulatory authority) unless such notification is prohibited by law, rule or regulation; (d) to any other party to thisAgreement; (e) subject to an agreement containing provisions at least as restrictive as those of this Section 10.08 (or as may otherwise bereasonably acceptable to the Borrower Representative), to (i) any direct or indirect contractual counterparty to a Swap Contract, EligibleAssignee of or Participant in, or any prospective Eligible Assignee of or Participant in any of its rights or obligations under this Agreement,(ii) any actual or prospective party (or its Related Parties) to any swap, derivative or other transaction under which payments are to be madeby reference to the Borrowers and their obligations, this Agreement or payments hereunder (other than any Person whom the Borrowers haveaffirmatively denied to provide consent to assignment in accordance with Section 10.07(b)(i)(A) ) or (iii) to a Federal Reserve Bank or anycentral bank having jurisdiction over any Agent or Lender; (f) with the prior written consent of the Borrower Representative; (g) to the extentsuch Information becomes publicly available other than as a result of a breach of this Section 10.08 or other obligation of confidentialityowed to the Borrowers, the Sponsor or their respective Affiliates or becomes available to the Administrative Agent, Collateral Agent, anyArranger, any Lender, any L/C Issuer or any of their respective Affiliates on a non-confidential basis from a source other than a Loan Party orany Sponsor or their respective Related Parties (so long as such source is not known (after due inquiry) to the Administrative Agent, theCollateral Agent, such Arranger, such Lender, such L/C Issuer or any of their respective Affiliates to be bound by confidentiality obligationsto any Loan Party, the Sponsor or your respective Affiliates); (h) to any rating agency when required by it (it being understood that, prior toany such disclosure, such rating agency shall undertake to preserve the confidentiality of any Information relating to Loan Parties and theirSubsidiaries received by it from such Lender) or to the CUSIP Service Bureau or any similar organization; (i) to the extent such informationis independently developed by the Administrative Agent, Collateral Agent, any Arranger, any Lender, any L/C Issuer or any of theirrespective Affiliates; (j) subject to an agreement containing provisions at least as restrictive as those of this Section 10.08 (or as mayotherwise be reasonably acceptable to the Borrower Representative), to any pledgee referred to in Section 10.07(g) ; or (k) in connection withthe exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or anyother Loan Document or the enforcement of its rights hereunder or thereunder. In addition, the Agents and the Lenders may disclose theexistence of this Agreement and publicly available information about this Agreement to market data collectors, similar service providers tothe lending industry, and service providers to the Agents and the Lenders in connection with the administration, settlement and managementof this Agreement, the other Loan Documents, the Commitments and the Credit Extensions. For the purposes of this Section 10.08 , “Information ” means all information received from the Loan Parties relating to any Loan Party, its Affiliates or its Affiliates’ directors,officers, employees, trustees, investment advisers or agents, other than any such information that is publicly available to any Agent, any L/CIssuer or any Lender prior to disclosure by any Loan Party other than as a result of a breach of this Section 10.08 or any other confidentialityobligation owed to any Loan Party or their Affiliates.Section 10.09. Setoff . In addition to any rights and remedies of the Lenders provided by Law, upon the occurrence and during thecontinuance of any Event of Default, each Lender and its Affiliates (and the Administrative Agent, in respect of any unpaid fees, costs andexpenses payable hereunder) is authorized at any time and from time to time, without prior notice to the Borrower Representative, any suchnotice being waived by the Borrower Representative (on its own behalf and on behalf of each Loan Party and each of its Subsidiaries) to thefullest extent permitted by applicable Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final)(other than escrow, payroll, petty cash, trust and tax accounts) at any time held by, and other Indebtedness at any time owing by, such Lenderand its Affiliates or the Administrative Agent to or for the credit or the account of the respective Loan Parties and their Subsidiaries againstany and all Obligations owing to such Lender and its Affiliates or the Administrative Agent hereunder or under any other Loan Document,now or hereafter existing, irrespective of whether or not such Agent or such Lender or Affiliate shall have made demand under thisAgreement or any other Loan Document and although such Obligations may be contingent or unmatured; provided that in the event that anyDefaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the AdministrativeAgent for further application in accordance with the provisions of Section 2.17 and, pending such payment, shall be segregated by suchDefaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent, the L/C Issuers, and the Lenders,and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligationsowing to such Defaulting Lender as to which it exercised such right of setoff. Each Lender agrees promptly to notify the BorrowerRepresentative and the Administrative Agent after any such set off and application made by such Lender; provided that the failure to givesuch notice shall not affect the validity of such setoff and application. The rights of the Administrative Agent and each Lender under thisSection 10.09 are in addition to other rights and remedies (including other rights of setoff) that the Administrative Agent and such Lendermay have at Law.Section 10.10. Interest Rate Limitation . Notwithstanding anything to the contrary contained in any Loan Document, the interestpaid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law(the “ Maximum Rate ”). If any Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interestshall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrowers. In determining whether theinterest contracted for, charged or received by an Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted byapplicable Law, (a) characterize any payment that is not principal as an expense, fee or premium rather than interest, (b) exclude voluntaryprepayments and the effects thereof, and (c) amortize, prorate, allocate and spread in equal or unequal parts the total amount of interestthroughout the contemplated term of the Obligations hereunder.Section 10.11. Counterparts . This Agreement and each other Loan Document may be executed in one or more counterparts, eachof which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery by facsimile or otherelectronic transmission of an executed counterpart of a signature page to this Agreement and each other Loan Document shall be effective asdelivery of an original executed counterpart of this Agreement and such other Loan Document. The Agents may also require that any suchdocuments and signatures delivered by facsimile or other electronic transmission be confirmed by a manually signed original thereof;provided that the failure to request or deliver the same shall not limit the effectiveness of any document or signature delivered by facsimile orother electronic transmission.Section 10.12. Integration . This Agreement, together with the other Loan Documents, comprises the complete and integratedagreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter.Subject to Section 10.20 , in the event of any conflict between the provisions of this Agreement and those of any other Loan Document, theprovisions of this Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of the Agents or theLenders in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the jointparticipation of the respective parties thereto and shall be construed neither against nor in favor of any party, but rather in accordance with thefair meaning thereof.Section 10.13. Survival of Representations and Warranties . All representations and warranties made hereunder and in any otherLoan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution anddelivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Administrative Agent and eachLender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf and notwithstanding that theAdministrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continuein full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shallremain outstanding.Section 10.14. Severability . If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid orunenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shallnot be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceableprovisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceableprovisions; provided that the Lenders shall charge no fee in connection with any such amendment. The invalidity of a provision in a particularjurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Without limiting the foregoing provisions ofthis Section 10.14 , if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall belimited by Debtor Relief Laws, as determined in good faith by the Administrative Agent or the L/C Issuers, as applicable, then suchprovisions shall be deemed to be in effect only to the extent not so limited.Section 10.15. GOVERNING LAW .(e) THIS AGREEMENT AND EACH OTHER LOAN DOCUMENT SHALL BE GOVERNED BY, AND CONSTRUEDIN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.(f) ANY LEGAL ACTION OR PROCEEDING ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAYCONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITHRESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOWEXISTING OR HEREAFTER ARISING, SHALL BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEWYORK COUNTY (BOROUGH OF MANHATTAN) OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCHSTATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LOAN PARTY, EACH AGENT AND EACHLENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THOSECOURTS AND AGREES THAT IT WILL NOT COMMENCE OR SUPPORT ANY SUCH ACTION OR PROCEEDING IN ANOTHERJURISDICTION. EACH LOAN PARTY, EACH AGENT AND EACH LENDER IRREVOCABLY WAIVES (TO THE EXTENTPERMITTED BY APPLICABLE LAW) ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASEDON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OFANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENTRELATED THERETO. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN ANY ACTION ORPROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENTS IN THE MANNER PROVIDED FOR NOTICES(OTHER THAN FACSIMILE) IN SECTION 10.02 . NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT WILLAFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLELAW.Section 10.16. WAIVER OF RIGHT TO TRIAL BY JURY . EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANYLEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHERLOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT,TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT ORATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSONWOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGESTHAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHERLOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.16 .Section 10.17. Binding Effect . This Agreement shall become effective when it shall have been executed and delivered by the LoanParties and each other party hereto and the Administrative Agent shall have been notified by each Lender and L/C Issuer that each suchLender and L/C Issuer has executed it and thereafter shall be binding upon and inure to the benefit of the Loan Parties, each Agent and eachLender and their respective successors and assigns, in each case in accordance with Section 10.07 (if applicable) and except that no LoanParty shall have the right to assign its rights hereunder or any interest herein without the prior written consent of the Lenders except aspermitted by Section 7.04 .Section 10.18. USA Patriot Act . Each Lender that is subject to the USA Patriot Act and the Administrative Agent (for itself andnot on behalf of any Lender) hereby notifies the Borrowers that pursuant to the requirements of the USA Patriot Act, it is required to obtain,verify and record information that identifies each Loan Party, which information includes the name, address and tax identification number ofsuch Loan Party and other information regarding such Loan Party that will allow such Lender or the Administrative Agent, as applicable, toidentify such Loan Party in accordance with the USA Patriot Act. This notice is given in accordance with the requirements of the USA PatriotAct and is effective as to the Lenders and the Administrative Agent. Additionally, each Loan Party agrees to provide to the AdministrativeAgent or any Lender from time to time all additional documentation and other information about such Loan Party required under applicable“know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act, that has been reasonably requested inwriting by the Administrative Agent or such Lender.Section 10.19. No Advisory or Fiduciary Responsibility . In connection with all aspects of each transaction contemplated hereby(including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), each Loan Partyacknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and other services regarding thisAgreement provided by the Administrative Agent and the Arranger are arm’s-length commercial transactions between the Loan Parties andtheir respective Affiliates, on the one hand, and the Administrative Agent, the Arranger and the Lenders, on the other hand, (B) each LoanParty has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) each Loan Party iscapable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the otherLoan Documents; (ii) (A) the Administrative Agent, the Arranger and each Lender each is and has been acting solely as a principal and,except as expressly agreed in writing by the relevant parties or except as otherwise provided herein, has not been, is not, and will not beacting as an advisor, agent or fiduciary for each Loan Party or any of their respective Affiliates, or any other Person and (B) neither theAdministrative Agent, the Arranger nor any Lender has any obligation to the Loan Parties or any of their respective Affiliates with respect tothe transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) theAdministrative Agent, the Arranger, the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involveinterests that differ from those of the Loan Parties and their respective Affiliates, and neither the Administrative Agent nor the Arranger norany Lender has any obligation to disclose any of such interests to the Loan Parties or any of their respective Affiliates. To the fullest extentpermitted by law, each Loan Party hereby waives and releases any claims that it may have against the Administrative Agent, the Arranger andthe Lenders with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transactioncontemplated hereby.Section 10.20. Intercreditor Agreements . Each Lender hereunder (a) agrees that it will be bound by and will take no actionscontrary to the provisions of any Customary Intercreditor Agreement and (b) authorizes and instructs the Administrative Agent to enter intoany Customary Intercreditor Agreement as Administrative Agent and on behalf of such Lender. In the event of any conflict or inconsistencybetween the provisions of any Customary Intercreditor Agreement and this Agreement, the provisions of such Customary IntercreditorAgreement shall control.ARTICLE XI GUARANTEESection 11.01. The Guarantee . Each Guarantor hereby jointly and severally with the other Guarantors guarantees, as a primaryobligor and not merely as a surety to each Secured Party and their respective permitted successors and assigns, the prompt payment in fullwhen due (whether at stated maturity, by required prepayment, declaration, demand, by acceleration or otherwise) of the principal of andinterest (including any interest, fees, costs or charges that would accrue but for the provisions of (i) the Title 11 of the United States Codeafter any bankruptcy or insolvency petition under Title 11 of the United States Code and (ii) any other Debtor Relief Laws) on the Loansmade by the Lenders to, and the Notes held by each Lender of, the Borrowers, and all other Secured Obligations from time to time owing tothe Secured Parties by any Loan Party under any Loan Document or any Secured Hedge Agreement or any Treasury Services Agreement, ineach case strictly in accordance with the terms thereof (such obligations, including any future increases in the amount thereof, being hereincollectively called the “ Guaranteed Obligations ”); provided , however , that Guaranteed Obligations shall exclude all Excluded SwapObligations. The Guarantors hereby jointly and severally agree that if the Borrowers or other Guarantor(s) shall fail to pay in full when due(whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors will promptly pay the same incash, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the GuaranteedObligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance withthe terms of such extension or renewal.Section 11.02. Obligations Unconditional . The obligations of the Guarantors under Section 11.01 shall constitute a guaranty ofpayment when due and not of collection and to the fullest extent permitted by applicable Law, are absolute, irrevocable and unconditional,joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the Guaranteed Obligations of the Borrowersunder this Agreement, the Notes, if any, or any other agreement or instrument referred to herein or therein, or any substitution, release orexchange of any other guarantee of or security for any of the Guaranteed Obligations, and, irrespective of any other circumstance whatsoeverthat might otherwise constitute a legal or equitable discharge or defense of a surety or Guarantor (except for payment in full), including anydefense of setoff, counterclaim, recoupment or termination. Without limiting the generality of the foregoing, it is agreed that the occurrenceof any one or more of the following shall not alter or impair the liability of the Guarantors hereunder which shall remain absolute, irrevocableand unconditional under any and all circumstances as described above:(n) at any time or from time to time, without notice to the Guarantors, to the extent permitted by Law, the time for anyperformance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall beamended or waived;(o) any of the acts mentioned in any of the provisions of this Agreement or the Notes, if any, or any other agreement orinstrument referred to herein or therein shall be done or omitted;(p) the maturity of any of the Guaranteed Obligations shall be accelerated, extended or renewed or any of the GuaranteedObligations shall be amended in any respect, or any right under the Loan Documents or any other agreement or instrument referred to hereinor therein shall be amended or waived in any respect or any other guarantee of any of the Guaranteed Obligations or except as permittedpursuant to Section 11.09 , any security therefor shall be released or exchanged in whole or in part or otherwise dealt with;(q) any Lien or security interest granted to, or in favor of, an L/C Issuer or any Lender or Agent as security for any of theGuaranteed Obligations shall fail to be or remain perfected or the existence of any intervening Lien or security interest; or(r) the release of any other Guarantor pursuant to Section 11.09 .The Guarantors hereby expressly waive (to the fullest extent permitted by Law) diligence, presentment, demand of payment, protestand, to the extent permitted by Law, all notices whatsoever, and any requirement that any Secured Party exhaust any right, power or remedyor proceed against the Borrowers under this Agreement or the Notes, if any, or any other agreement or instrument referred to herein ortherein, or against any other person under any other guarantee of, or security for, any of the Guaranteed Obligations. The Guarantors waive,to the extent permitted by Law, any and all notice of the creation, renewal, extension, waiver, termination or accrual of any of the GuaranteedObligations and notice of or proof of reliance by any Secured Party upon this Guarantee or acceptance of this Guarantee, and the GuaranteedObligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred in reliance upon this Guarantee, andall dealings between the Borrowers and the Secured Parties shall likewise be conclusively presumed to have been had or consummated inreliance upon this Guarantee. This Guarantee shall be construed as a continuing, absolute, irrevocable and unconditional guarantee ofpayment without regard to any right of offset with respect to the Guaranteed Obligations at any time or from time to time held by SecuredParties, and the obligations and liabilities of the Guarantors hereunder shall not be conditioned or contingent upon the pursuit by the SecuredParties or any other person at any time of any right or remedy against the Borrowers or against any other person which may be or becomeliable in respect of all or any part of the Guaranteed Obligations or against any collateral security or guarantee therefor or right of offset withrespect thereto. This Guarantee shall remain in full force and effect and be binding in accordance with and to the extent of its terms upon theGuarantors and the successors and assigns thereof, and shall inure to the benefit of the Lenders, and their respective successors and assigns,notwithstanding that from time to time during the term of this Agreement there may be no Guaranteed Obligations outstanding.Section 11.03. Reinstatement . The obligations of the Guarantors under this Article XI shall be automatically reinstated if and tothe extent that for any reason any payment by or on behalf of the Borrowers or other Loan Party in respect of the Guaranteed Obligations isrescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, whether as a result of any proceedings inbankruptcy or reorganization or otherwise.Section 11.04. Subrogation; Subordination . Each Guarantor hereby agrees that until the payment in full in cash and satisfaction infull of all Guaranteed Obligations (other than Cash Management Obligations, obligations pursuant to Secured Hedge Agreements andcontingent obligations, in each case not yet due and owing, and Letters of Credit that have been Cash Collateralized or backstopped) and theexpiration and termination of the Commitments of the Lenders under this Agreement it shall subordinate any claim and shall not exercise anyright or remedy, direct or indirect, arising by reason of any performance by it of its guarantee in Section 11.01 , whether by subrogation,contribution or otherwise, against the Borrowers or a Guarantor of any of the Guaranteed Obligations or any security for any of theGuaranteed Obligations.Section 11.05. Remedies . The Guarantors jointly and severally agree that, as between the Guarantors and the Lenders, theobligations of the Borrowers under this Agreement and the Notes, if any, may be declared to be forthwith due and payable as provided inSection 8.02 (and shall be deemed to have become automatically due and payable in the circumstances provided in Section 8.02 ) forpurposes of Section 11.01 , notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations frombecoming automatically due and payable) as against the Borrowers and that, in the event of such declaration (or such obligations beingdeemed to have become automatically due and payable), such obligations (whether or not due and payable by the Borrowers) shall forthwithbecome due and payable by the Guarantors for purposes of Section 11.01 .Section 11.06. [Reserved].Section 11.07. Continuing Guarantee . The guarantee in this Article XI is a continuing guarantee of payment, and shall apply to allGuaranteed Obligations whenever arising.Section 11.08. General Limitation on Guarantee Obligations . In any action or proceeding involving any state corporate limitedpartnership or limited liability company law, or any applicable state, federal or foreign bankruptcy, insolvency, reorganization or other Lawaffecting the rights of creditors generally, if the obligations of any Subsidiary Guarantor under Section 11.01 would otherwise be held ordetermined to be void, voidable, invalid or unenforceable, or subordinated to the claims of any other creditors, on account of the amount of itsliability under Section 11.01 , then, notwithstanding any other provision to the contrary, the amount of such liability shall, without any furtheraction by such Subsidiary Guarantor, any Loan Party or any other Person, be automatically limited and reduced to the highest amount (aftergiving effect to the liability under this Guaranty and the right of contribution established in Section 11.10 , but before giving effect to anyother guarantee) that is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding.Section 11.09. Release of Guarantors and Collateral . If, in compliance with the terms and provisions of the Loan Documents,(i) all or substantially all of the Equity Interests of any Subsidiary Guarantor are sold or otherwise transferred to a Person or Persons none ofwhich is a Loan Party in a transaction permitted hereunder or (ii) any Subsidiary Guarantor ceases to be a Restricted Subsidiary as a result ofa transaction permitted hereunder, such Subsidiary Guarantor shall be automatically released from its obligations under this Agreement(including under Section 10.05 hereof) and the other Loan Documents, including its obligations to pledge and grant any Collateral owned byit pursuant to any Collateral Document and the pledge of such Equity Interests to the Administrative Agent pursuant to the CollateralDocuments shall be automatically released, and, so long as the Borrower Representative shall have provided the Agents such certifications ordocuments as any Agent shall reasonably request, the Administrative Agent shall take such actions as are necessary to effect each releasedescribed in this Section 11.09 in accordance with the relevant provisions of the Collateral Documents.When all Commitments hereunder have terminated, and all Loans or other Obligations hereunder which are accrued and payable havebeen paid or satisfied (other than contingent obligations as to which no claim has been asserted, Cash Management Obligations andobligations pursuant to Secured Hedge Agreements), and no Letter of Credit remains outstanding (except any Letter of Credit the OutstandingAmount of which the Obligations related thereto has been Cash Collateralized or for which a backstop letter of credit reasonably satisfactoryto the applicable L/C Issuer has been put in place), this Agreement and the Guarantees made herein shall terminate with respect to allObligations, except with respect to Obligations that expressly survive such repayment pursuant to the terms of this Agreement.The Administrative Agent shall take such actions as are necessary to effect the release any Lien on any property granted to or held bythe Administrative Agent under any Loan Document (i) upon termination of the Aggregate Commitments and payment in full of allObligations (other than contingent obligations and Letters of Credit which have been Cash Collateralized or otherwise backstopped) and theexpiration or termination of all Letters of Credit (other than Letters of Credit which have been Cash Collateralized or as to which otherarrangements reasonably satisfactory to the Administrative Agent and the L/C Issuers shall have been made), (ii) at the time the propertysubject to such Lien is Disposed or to be Disposed as part of or in connection with any Disposition permitted hereunder or under any otherLoan Document, (iii) subject to Section 10.01 , if the release of such Lien is approved, authorized or ratified in writing by the RequiredLenders or (iv) if the property subject to such Lien is owned by a Guarantor, upon release of such Guarantor from its obligations under itsGuaranty pursuant to Section 9.10(d).Section 11.10. Right of Contribution . Each Guarantor hereby agrees that to the extent that a Subsidiary Guarantor shall have paidmore than its proportionate share of any payment made hereunder, such Subsidiary Guarantor shall be entitled to seek and receivecontribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment. Each SubsidiaryGuarantor’s right of contribution shall be subject to the terms and conditions of Section 11.04 . The provisions of this Section 11.10 shall inno respect limit the obligations and liabilities of any Subsidiary Guarantor to the Administrative Agent, the L/C Issuers, the Swing LineLender and the Lenders, and each Subsidiary Guarantor shall remain liable to the Administrative Agent, the L/C Issuers and the Lenders forthe full amount guaranteed by such Subsidiary Guarantor hereunder.Section 11.11. Keepwell . Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocablyundertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of its obligationsunder this Guaranty in respect of Swap Obligations ( provided , however , that each Qualified ECP Guarantor shall only be liable under thisSection 11.11 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 11.11, or otherwise under this Guarantee, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for anygreater amount). The obligations of each Qualified ECP Guarantor under this Section 11.11 shall remain in full force and effect until allCommitments hereunder have terminated, and all Loans or other Obligations hereunder which are accrued and payable have been paid orsatisfied (other than Cash Management Obligations and Obligations arising under any Secured Hedge Agreement), and no Letter of Creditremains outstanding (except any Letter of Credit the Outstanding Amount of which the Obligations related thereto has been CashCollateralized or for which a backstop letter of credit reasonably satisfactory to the applicable L/C Issuer has been put in place). EachQualified ECP Guarantor intends that this Section 11.11 constitute, and this Section 11.11 shall be deemed to constitute, a “keepwell, support,or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.Section 11.12. Joint and Several Liability . All Obligations of the Borrowers under this Agreement and the other Loan Documentsshall be joint and several Obligations of each Borrower. Anything contained in this Agreement and the other Loan Documents to the contrarynotwithstanding, the Obligations of each Borrower hereunder, solely to the extent that such Borrower did not receive proceeds of Loans fromany borrowing hereunder, shall be limited to a maximum aggregate amount equal to the largest amount that would not render its Obligationshereunder subject to avoidance as a fraudulent transfer or conveyance under §548 of the U.S. Bankruptcy Code, 11 U.S.C. §548, or anyapplicable provisions of comparable state law (collectively, the “Fraudulent Transfer Laws ”), in each case after giving effect to all otherliabilities of such Borrower, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however,any liabilities of such Borrower in respect of intercompany Indebtedness to any other Loan Party or Affiliates of any other Loan Party to theextent that such Indebtedness would be discharged in an amount equal to the amount paid by such Loan Party hereunder) and after givingeffect as assets to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation orcontribution of such Borrower pursuant to (i) applicable law or (ii) any agreement providing for an equitable allocation among such Borrowerand other Affiliates of any Loan Party of Obligations arising under Guarantees by such parties.Section 11.13. Acknowledgement and Consent to Bail-In of EEA Financial Institutions . Notwithstanding anything to the contraryin this Agreement or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that anyliability of any EEA Financial Institution arising under this Agreement, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:(a) the application of any write-down or conversion powers by an EEA Resolution Authority to any such liabilities arisinghereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and(b) the effects of any Bail-in Action on any such liability, including, if applicable:(i) a reduction, in full or in part, of any such liability;(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEAFinancial Institution, its parent undertaking, or a bridge institution and that such shares or other instruments of ownership will beaccepted by it in lieu of any rights with respect to any such liability under this Agreement; or(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversionpowers of any EEA Resolution Authority.Section 11.14. OID Legend. THE LOANS HAVE BEEN ISSUED WITH OID FOR UNITED STATES FEDERAL INCOMETAX PURPOSES. THE ISSUE PRICE, AMOUNT OF OID, ISSUE DATE AND YIELD TO MATURITY OF THE LOANS MAY BEOBTAINED BY WRITING TO THE ADMINISTRATIVE AGENT AT ITS ADDRESS SPECIFIED HEREIN.[ Signature Pages Follow ] IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.TAXACT HOLDINGS, INC.By: /s/ Eric M. Emans Name: Eric M. EmansTitle: Chief Financial OfficerTAXACT, INC.By: /s/ Eric M. Emans Name: Eric M. EmansTitle: Chief Financial OfficerHDV HOLDINGS, INC.By: /s/ Roger Ochs Name: Roger OchsTitle: PresidentH.D. VEST, INC.By: /s/ Roger Ochs Name: Roger OchsTitle: President[Signature Page to Credit Agreement] PROJECT BASEBALL SUB, INC. By: /s/ Eric M. Emans Name: Eric M. EmansTitle: Chief Financial OfficerH.D. VEST ADVISORY SERVICES, INC.By: /s/ Roger Ochs Name: Roger OchsTitle: PresidentH.D. VEST INSURANCE AGENCY, L.L.C. (Texas)By: /s/ Roger Ochs Name: Roger OchsTitle: PresidentH.D. VEST INSURANCE AGENCY, L.L.C. (Massachusetts)By: /s/ Roger Ochs Name: Roger OchsTitle: PresidentH.D. VEST INSURANCE AGENCY, L.L.C. (Montana )By: /s/ Roger Ochs Name: Roger OchsTitle: President [Signature Page to Credit Agreement] BANK OF MONTREAL , as Administrative Agent, Collateral Agent, L/C Issuer, SwingLine Lender and LenderBy:/s/ Gregory F. TomczykName: Gregory F. TomczykTitle: Director[Signature Page to Credit Agreement]Exhibit 10.54AMENDED AND RESTATED EMPLOYMENT AGREEMENTThis Amended and Restated Employment Agreement (the “ Agreement ”) is entered into this 22nd day of February, 2016,and was effective as of January 1, 2016 (the “ Effective Date ”), by and between Project Baseball Sub, Inc., a Delaware corporation(the “ Purchaser ”) and Roger Ochs (“ Executive ”) (together, the “ Parties ”). Except as otherwise indicated herein, capitalizedterms used herein are defined in Section 9.14 .WHEREAS, HDV Holdings, LLC, a Delaware Limited Liability Corporation (the “ Seller ”), and the Purchaser are parties tothat certain Stock Purchase Agreement (as amended, the “ Purchase Agreement ”) to be executed contemporaneously with thisAgreement, whereby the Purchaser will acquire 100% of the stock of HDV Holdings, Inc. (the “Company” );WHEREAS, the Purchaser is a wholly owned indirect subsidiary of Blucora, Inc. (the “Parent” );WHEREAS, it is a condition to the consummation of the transactions contemplated by the Purchase Agreement (the “Acquisition ”) that this Agreement be in full force and effect on the Effective Date; andWHEREAS, the Purchaser desires that Executive be employed by H.D. Vest, Inc., a Texas corporation (the “ Employer ”) onthe terms and conditions set forth herein, and Executive is willing to accept such employment on such terms and conditions.NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration,the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:1.Employment and AcceptanceThe Employer shall employ Executive, and Executive shall accept employment, subject to the terms of this Agreement,effective as of the Effective Date and ending as provided in Section 2 below; provided that if the Purchase Agreement is terminatedin accordance with its terms at any time prior to the Effective Date, then this Agreement shall also terminate without any furtheraction by any of the parties hereto and be of no further force and effect simultaneously with such termination.2.TermSubject to earlier termination pursuant to Section 5 of this Agreement, the employment relationship hereunder shall continuefrom the Effective Date until the third (3rd) anniversary of the Effective Date (the “ Initial Employment Period ”), at which point this Agreement shall terminate unless extended by mutualwritten agreement by the Parties. As used in this Agreement, the “ Employment Period ” shall refer to the period beginning on theEffective Date and ending on the date Executive’s employment is terminated in accordance with this Section 2 or Section 5 , as thecase may be.3.Duties and Title3.1 Title . Executive shall serve in the capacity of Chief Executive Officer of the Employer (the “ CEO ”) and shall reportdirectly to the Board (as defined below).3.2 Duties . Executive shall devote Executive’s best efforts and full business time and attention to the business and affairsof the Employer and, to the extent requested, the Parent, and shall have all of the duties, responsibilities, functions and authorityimplied by his position, subject to the power and authority of the Board of Directors of the Employer (the “ Board ”) to expand orlimit such duties, responsibilities and authority at any time (including, without limitation, as a result of a geographical expansion ofthe Employer’s business activities), and to overrule actions of officers of the Employer. Executive shall perform such Executive’sduties, responsibilities and functions to the Employer or any other member of the Parent hereunder to the best of Executive’s abilitiesin a diligent, trustworthy, professional and efficient manner and shall comply with the policies and procedures of the Employer andthe Parent in all material respects. In performing Executive’s duties and exercising Executive’s authority under this Agreement,Executive shall support and implement the business and strategic plans approved from time to time by the Board or the board ofmanagers of Parent and shall support and cooperate with the efforts of the members of the Parent to expand their businesses andoperate profitably and in conformity with the business and strategic plans approved by the board of managers of the Parent. So longas Executive is employed by the Employer, Executive shall not, without the prior written consent of the Board (which consent shallnot be unreasonably withheld by the Board), serve as a director of any other entity; provided that Executive may serve as a directorof educational, welfare, social, religious and civic organizations without the prior consent of the Board so long as Executive is notcompensated for such activities and such activities do not materially interfere with Executive’s employment with the Employer andits Subsidiaries.4.Salary, Bonus and Benefits by the EmployerAs compensation for services rendered pursuant to this Agreement, the Employer shall provide Executive the followingduring the Employment Period:4.1 Salary . During the Employment Period, Executive’s base salary shall be $400,000.00 per annum and shall be subjectto review and adjustment by the Board on an annual-2-basis (as adjusted from time to time, the “ Base Salary ”), which salary shall be payable by the Employer in regular installments inaccordance with the Employer’s general payroll practices (in effect from time to time). Executive’s Base Salary for any partial yearshall be pro-rated based upon the actual number of days elapsed in such year.4.2 Bonus . For each calendar year during the Employment Period, Executive shall (a) receive an annual bonus in anamount equal to 100% of the Base Salary, conditioned upon achievement by the Employer and its Subsidiaries of financial,operating and other objectives set by the Board (which may be based on any criteria determined by the Board in consultation withExecutive) (collectively, the “ Performance Metrics ”) for such calendar year, as reasonably determined by the Board, and (b) beeligible for an additional annual bonus in an amount up to $200,000, as determined by the Board, conditioned upon the Employerand its Subsidiaries exceeding the Performance Metrics to a degree set by the Board for such calendar year; provided that any bonusshall be paid in the calendar year following the calendar year to which the bonus relates and within ten (10) business days of the dateon which the final audit for such calendar year is issued by Employer’s independent accountants but in no event later than December31st following the calendar year to which the bonus relates.4.3 Participation in Employee Benefit Plans . In addition to (but without duplication of) the Base Salary and any bonusesdescribed above payable to Executive pursuant to this Section 4 , during the Employment Period, Executive shall be entitled to (a) upto 5 weeks of paid time off per year to be taken in accordance with the Employer’s then current policy, and (b) subject to applicableeligibility requirements, such other benefit plans of the Employer as approved by the Board, which may be available to othersimilarly situated executives of the Employer, pursuant to the terms of such plans and on the same terms as other similarly situatedexecutives of the Employer.4.4 Expense Reimbursement . During the Employment Period, the Employer shall reimburse Executive for all reasonableout-of-pocket business expenses incurred by Executive in the course of performing Executive’s duties and responsibilities under thisAgreement which are consistent with the Employer’s policies in effect from time to time with respect to travel, entertainment andother business expenses, subject to the Employer’s requirements with respect to reporting and documentation of such expenses.5.Termination of Employment5.1 Termination by Executive without Good Reason . Executive may terminate the Employment Period by resigningupon prior written notice delivered to Employer effective as of the date set forth in such notice. If Executive terminates employmentpursuant to this Section 5.1 , Executive shall be entitled to receive the following: (a) Executive’s earned, accrued but unpaid BaseSalary as of the date of termination; (b) benefits set forth in Section 4.3-3-(b) through the date of termination, if any, in accordance with the terms of the benefit plans in which Executive participates as of thedate of termination; (c) Executive’s accrued but unused and unpaid paid time off (to the extent payable in accordance withEmployer’s then current policies), if any, as of the date of termination; and (d) expenses reimbursable under Section 4.4 incurred butnot yet reimbursed to Executive as of the date of termination.5.2 Involuntary Termination by the Employer without Cause or Termination by Executive with Good Reason . TheEmployment Period may be terminated by the Employer without Cause upon prior written notice delivered to Executive, or byExecutive with Good Reason upon prior written notice delivered to Employer, in each case effective as of the date set forth in suchnotice. In the event of termination pursuant to this Section 5.2 , Executive shall be entitled to receive the following: (a) Executive’searned, accrued but unpaid (x) Base Salary as of the date of termination and (y) cash bonus (if any) pursuant to Section 4.2 withrespect to the calendar year ending on or preceding the date of termination, which bonus (if any) will be paid at the same timebonuses are paid pursuant to Section 4.2 ; (b) benefits set forth in Section 4.3(b) through the date of termination, if any, inaccordance with the terms of the benefit plans in which Executive participates as of the date of termination; (c) Executive’s accruedbut unused and unpaid paid time off (to the extent payable in accordance with Employer’s then current policies), if any, as of thedate of termination; (d) expenses reimbursable under Section 4.4 incurred but not yet reimbursed to Executive as of the date oftermination; (e) in the event that (x) each of the Employer and Executive would achieve their respective financial, operating andother objectives necessary for a bonus to be payable pursuant to Section 4.2 (as determined by the Board) in the calendar year inwhich the termination of the Employment Period occurs after such objectives of each of the Employer and Executive actuallyachieved during such applicable calendar year through (and including) the date of termination of the Employment Period areannualized, and (y) the termination of the Employment Period pursuant to this Section 5.2 occurs no earlier than 120 days after thebeginning of such applicable calendar year, a pro rata portion (based on the number of actual days which have elapsed during suchapplicable calendar year prior to termination of the Employment Period) of the cash bonus (if any) that Executive would otherwisehave been entitled pursuant to Section 4.2 had Executive been continuously employed by the Employer through the end of suchcalendar year (and such bonus shall be payable at any time after completion of the audit for such calendar year, but in any event inthe calendar year following the calendar year to which the bonus relates); (f) for a period of eighteen (18) months beginning on thedate of termination of Executive’s employment pursuant to this Section 5.2 , Executive shall be entitled to receive two timesExecutive’s Base Salary as in effect immediately prior to the date of the termination of Executive’s employment, payable ininstallments in accordance with the customary payroll practices of the Employer in effect on the date of termination, and (g) a lump-sum payment in an amount equal to (x) the monthly COBRA premium in effect under the Company's group health plan as of the dateof termination for the-4-coverage in effect under such plan for Executive (and Executive's spouse and dependent children) on such date multiplied by (y)twelve (12) (less applicable withholding taxes), which amount shall be payable in a single lump sum on the first payroll date that isat least sixty (60) days following the date of termination (but, in any event, by no later than March 15 of the calendar yearimmediately following the calendar year that includes the date of termination), in accordance with Section 6.3 ; provided, however,that notwithstanding the foregoing or any other provision in this Agreement to the contrary, the Company (or its successor) mayunilaterally amend this Section 6(d)(ii) or eliminate the benefit provided hereunder to the extent it deems necessary to avoid theimposition of excise taxes, penalties or similar charges on the Company or any of its subsidiaries, affiliates or successors, including,without limitation, under Section 4980D of the Code; provided however, that such payments described in clauses (f) and (g) of thissentence shall commence upon the date provided in Section 6.3 . It is agreed and understood that Executive shall be entitled toreceive the amounts set forth in clauses (f) and (g) of this Section 5.2 if and only if Executive has executed and delivered to theEmployer a general release in form and substance as set forth on Exhibit A attached hereto (the "General Release") within the timelimitations set forth in Section 6.3 , the General Release has become effective, and so long as Executive has not revoked or breachedthe provisions of the General Release within the time frame provided in Section 6 or breached the provisions of Section 7 orSection 8 or any other agreement between Executive and the Parent.5.3 Involuntary Termination by the Employer for Cause . The Employment Period may be terminated by the Employerfor Cause at any time upon delivery to Executive of written notice effective on the date such notice is received by Executive, unlessother date is specified in such notice). If Executive’s employment is terminated by the Employer for Cause, Executive shall beentitled to receive only the payments and benefits set forth in subsections (a) through (d) of Section 5.1 .5.4 Termination Due to Death or Disability . The Employment Period shall terminate automatically upon Executive’sdeath or upon the Board’s good faith determination of Executive’s inability to perform the essential duties, responsibilities andfunctions of Executive’s position with the Employer as a result of any mental or physical illness, disability or incapacity. IfExecutive’s employment is terminated pursuant to this Section 5.4 , Executive or Executive’s heirs shall be entitled to receive thesame payments and benefits set forth in subsections (a) through (d) of Section 5.1 .5.5 Nonrenewal of Employment Period . In the event Executive’s employment ends because the Employer does notagree to extend either the Initial Employment Period or any other subsequent extension resulting from a mutual written agreement bythe Parties, pursuant to Section 2, for any reason other than for Cause Executive shall be entitled to receive the same payments andbenefits set forth in subsections (a) through (g) of Section 5.2 .-5-5.6 No Other Benefits . Except as otherwise expressly provided herein, Executive shall not be entitled to any other salary,bonuses, employee benefits or compensation from the Employer or its Subsidiaries after the date of termination and all ofExecutive’s rights to salary, bonuses, employee benefits and other compensation hereunder which would have accrued or becomepayable after the date of termination shall cease upon such termination or expiration, other than as expressly required underapplicable law.5.7 Offset . The Employer may offset any bona fide amounts not in dispute that Executive currently owes Parent or any ofits Subsidiaries against any amounts it or any of its Subsidiaries owes Executive hereunder, except that no offset shall be made fromany amount if the offset would violate the requirements of Section 409A of the Internal Revenue Code of 1986, as amended.5.8 Definition of Termination . A termination of the Employment Period shall not be deemed to have occurred forpurposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a terminationof employment unless such termination is also a “separation from service” within the meaning given in Treasury Regulation§ 1.409A-1(h)(1)(ii), and for purposes of any such provision of this Agreement, references to a “termination”, “termination of theEmployment Period”, “termination of employment” or similar terms shall mean “separation from service.”6.Section 409A Compliance6.1 Intent . The intent of the Parties is that payments and benefits under this Agreement comply with Internal RevenueCode Section 409A and the regulations and guidance promulgated thereunder (collectively “ Code Section 409A ”) and, accordingly,to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. In no event whatsoever shallthe Employer be liable for any additional tax, interest or penalty that may be imposed on Executive by Code Section 409A.6.2 Specified Employee . Notwithstanding any other payment schedule provided herein to the contrary, if Executive isdeemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B),then with regard to any payment that is considered deferred compensation under Code Section 409A payable on account of a“separation from service,” such payment shall be made on the date which is the earlier of (a) the expiration of the six (6)-monthperiod measured from the date of such “separation from service” of Executive, and (b) the date of Executive’s death (the “ DelayPeriod ”) to the extent required under Code Section 409A. Upon the expiration of the Delay Period, all payments delayed pursuant tothis Section 6.2 (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay)shall be paid to Executive in a lump sum with interest accruing commencing on the date payment would have-6-otherwise been made at the prime rate of interest most recently published in The Wall Street Journal as of such date, and allremaining payments due under this Agreement shall be paid or provided in accordance with the normal payment dates specified forthem herein.6.3 Severance Payments Conditioned upon General Release . Executive shall forfeit all rights to severance paymentspursuant to this Agreement unless Executive duly executes and deliver the General Release to the Employer (and the GeneralRelease is no longer subject to revocation) within sixty (60) days following the date of Executive’s termination of employment. Ifthe foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then to theextent any such cash payment to be provided is not “deferred compensation” for purposes of Code Section 409A, such payment shallcommence upon the first scheduled payment date immediately after the date the release is executed and no longer subject torevocation (the “ Release Effective Date ”). The first such cash payment shall include payment of all amounts that otherwise wouldhave been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commencedimmediately upon Executive’s termination of employment, and any payments made thereafter shall continue as provided herein. Tothe extent any such payment to be provided is “deferred compensation” for purposes of Code Section 409A, then such payments orbenefits shall be made or commence upon the sixtieth (60) day following Executive’s termination of employment. The first suchpayment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreementhad such payments commenced immediately upon Executive’s termination of employment, and any payments made thereafter shallcontinue as provided herein.6.4 Expense Reimbursement Payments . To the extent that reimbursements or other in-kind benefits under thisAgreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (a) all expenses or otherreimbursements hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which suchexpenses were incurred by the Executive, (b) any right to reimbursement or in-kind benefits shall not be subject to liquidation orexchange for another benefit, and (c) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided inany taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any othertaxable year.6.5 Installment Payments . For purposes of Code Section 409A, Executive’s right to receive any installment paymentpursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.6.6 Timing of Payments . Whenever a payment under this Agreement specifies a payment period with reference to anumber of days (e.g., “payment shall be made within thirty-7-(30) days following the date of termination”), the actual date of payment within the specified period shall be within the solediscretion of the Employer.7.Proprietary Information7.1 Obligation to Maintain Confidentiality . Executive acknowledges that the continued success of the Employer andParent and all of their respective Subsidiaries and Affiliates (collectively, the “ Parent Group ”) depends upon the use and protectionof Proprietary Information. Executive further acknowledges that the Proprietary Information obtained by Executive during the courseof Executive’s employment (including, for all purposes herein, prior to the Closing) with the Employer or any of its Subsidiaries orAffiliates concerning the Business and the business and affairs of the Employer any member of the Parent Group (including, withoutlimitation, Proprietary Information obtained by him while employed by the Employer and/or any of its Subsidiaries prior to the dateof this Agreement and the acquisition of the Employer by Parent) is the property of Employer or such member of the Parent Group,including information concerning acquisition opportunities in or reasonably related to the Employer’s business or industry.Executive agrees to hold in strict confidence and in trust for the sole benefit of the Employer all Trade Secrets and ProprietaryInformation to which he may have or has had access during the course of his employment with Employer and will not disclose anyProprietary Information, directly or indirectly, to anyone outside of the Parent Group, nor use, copy, publish, summarize, or removefrom the Employer premises such Proprietary Information (or remove from Employer premises any other property of the Employer)except during his employment to the extent necessary to carry out Executive’s responsibilities under this Agreement. . Executivefurther understands that the publication of any Proprietary Information through literature or speeches must be approved in advance inwriting by the Board. Executive shall take reasonable and appropriate steps to safeguard Proprietary Information and to protect itagainst disclosure, misuse, espionage, loss and theft. Executive shall deliver to Employer upon the termination of the EmploymentPeriod, or at any other time Employer may request, all memoranda, notes, plans, records, reports, computer tapes, printouts andsoftware and other documents and data (and copies thereof) embodying or relating to the Proprietary Information, Work Product (asdefined below) or the business of the Employer or any member of the Parent Group (including, without limitation, all acquisitionprospects, lists and contact information) which Executive may then possess or have under his control.7.2 Ownership of Property . Executive acknowledges that all discoveries, concepts, ideas, inventions, innovations,improvements, developments, methods, processes, programs, designs, analyses, drawings, reports, patent applications, copyrightablework and mask work (whether or not including any confidential information) and all registrations or applications related thereto, allother Proprietary Information and all similar or related information (whether-8-or not patentable) that relate to the Business and the Employer’s or any of member of the Parent Group’s actual or anticipatedbusiness, research and development, or existing or future products or services and that are conceived, developed, contributed to,made, or reduced to practice by Executive (either solely or jointly with others) while employed by the Employer or any of memberof the Parent Group (“ Work Product ”), belong to the Employer or such member of the Parent Group, and Executive hereby assigns,and agrees to assign, all of the above Work Product to the Employer or to such member of the Parent Group. Any copyrightablework prepared in whole or in part by Executive in the course of his work for any of the foregoing entities shall be deemed a “workmade for hire” under the copyright laws (including the United States Copyright Act (17 U.S.C., Section 101)), and the Employer orsuch member of the Parent Group shall own all rights therein. To the extent that any such copyrightable work is not a “work madefor hire,” Executive hereby assigns and agrees to assign to the Employer or such member of the Parent Group all right, title, andinterest, including without limitation, copyright in and to such copyrightable work. Executive shall promptly disclose such WorkProduct to the Employer and perform all actions reasonably requested by the Board (whether during or after the EmploymentPeriod), at the Employer’s sole expense, to establish and confirm the Employer’s or such member of Parent Group’s ownership(including, without limitation, assignments, consents, powers of attorney, and other instruments) in Work Product and copyrightablework identified by the Board. Executive is hereby advised that this Section 7.2 regarding the Parent Group’s ownership of WorkProduct does not apply to any invention that Executive developed entirely on his own time without using any equipment, supplies,facilities, or Trade Secret of the Parent Group except for those inventions that either (a) relate at the time of conception or reductionto practice of the invention to the business, or actual or demonstrably anticipated research or development of any member of theParent Group, or (b) result from any work performed by Executive for any member of the Parent Group.7.3 Third Party Information . Executive understands that the Employer and each member of the Parent Group willreceive from third parties confidential or proprietary information (“ Third Party Information ”) that may be subject to a duty on theEmployer’s and each member of the Parent Group’s part to maintain the confidentiality of such information and to use it only forcertain limited purposes. During the Employment Period and thereafter, and without in any way limiting the provisions ofSection 7.1 above, Executive will hold Third Party Information in the strictest confidence and will not disclose to anyone (other thanpersonnel and consultants of the Employer or each member of the Parent Group who need to know such information in connectionwith their work for the Employer or such member of the Parent Group) or use, except in connection with Executive’s work for theEmployer or any member of the Parent Group, Third Party Information unless expressly authorized by the Board in writing.7.4 Use of Information of Prior Employers . During the Employment Period, Executive will not improperly use ordisclose any confidential information or trade secrets, if-9-any, of any former employers or any other Person to whom Executive has an obligation of confidentiality, and will not bring onto thepremises of the Employer or any member of the Parent Group any confidential information or trade secrets of any former employeror any other Person to whom Executive has an obligation of confidentiality unless consented to in writing by the former employer orPerson. This Section 7.4 shall not apply to confidential information or trade secrets of the Company. .7.5 Definition of Proprietary Information . For purposes of this Agreement, the term “ Proprietary Information ” shallmean all information of a confidential or proprietary nature (whether or not specifically labeled or identified as “confidential” or“proprietary”), in any form or medium, that relates to or results from the business, historical or projected financial results, products,services or research or development of the Employer (including the Company as the Employer’s predecessor), or any member of theParent Group or their respective suppliers, distributors, customers, potential customers, independent contractors, third-party payors,providers or other business relations. Proprietary Information shall include, but is not limited to, the following: (a) internal businessinformation (including historical and projected financial information and budgets and information relating to strategic and staffingplans and practices, training, marketing, promotional and sales plans and practices, cost, rate and pricing structures, risk managementpractices, health care programs designed for clients and patients, negotiation strategies and practices and accounting and businessmethods); (b) individual requirements of, specific contractual arrangements with, and information about, Employer’s or any memberof the Parent Group’s employees (including personnel files and other information), suppliers, distributors, customers, potentialcustomers, independent contractors, third-party payors, providers or other business relations and their confidential information,including, without limitation, patient records, medical histories and other information concerning patients (including, withoutlimitation, all “Protected Health Information” within the meaning of the Health Insurance Portability and Accountability Act);(c) Trade Secrets, technology, know-how, compilations of data and analyses, techniques, systems, formulae, research, records,reports, manuals, flow charts, documentation, models, data and data bases relating thereto; (d) computer software, includingoperating systems, applications and program listings; (e) inventions, innovations, ideas, devices, improvements, developments,methods, processes, designs, analyses, drawings, photographs, reports and all similar or related information (whether or notpatentable and whether or not reduced to practice); (f) copyrightable works; (g) intellectual property of every kind and description;and (h) all similar and related information in whatever form.7.6 Definition of Trade Secret . For purposes of this Agreement, the term “ Trade Secrets ” means any and allinformation, including a formula, pattern, compilation, program, device, method, technique or process that derives independenteconomic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic valuefrom its disclosure or use, and is the subject of efforts that are reasonable under-10-the circumstances to maintain its secrecy. By way of illustration but not limitation, “ Trade Secrets ” includes: (a) Work Product;(b) information regarding plans for research, development, current and new products, marketing and selling, business plans, budgetsand unpublished financial statements, licenses, prices and costs, production, carriers and customers and potential customers;(c) information regarding the skills and compensation of other employees of Employer and the other members of the Parent Group;and (d) Third-Party Information. For the avoidance of doubt, “ Trade Secrets ” do not include any information which: (w) is alreadyin the public domain or becomes available to the public through no breach of this Agreement by Executive, (x) is lawfully obtainablefrom non-confidential sources other than the Parent, its Subsidiaries, their Affiliates or their respective personnel, suppliers,distributors, customers, independent contractors or other business relations, (y) is legally available to Executive from non-confidential sources other than the Parent, its Subsidiaries, their Affiliates or their respective personnel, suppliers, distributors,customers, independent contractors or other business relations, or (z) is developed by Executive entirely on his own time withoutusing Parent’s, its Subsidiaries’ or their Affiliates’ equipment, supplies, facilities, or trade secret information and does not relate atthe time of conception to Parent’s, its Subsidiaries’ or their Affiliates’ business, or actual or demonstrably anticipated research ordevelopment of Parent, its Subsidiaries or their Affiliates, or result from any work performed by Executive for Parent, itsSubsidiaries or their Affiliates.8.Non-Compete; Nonsolicitation; No-HireExecutive acknowledges that (a) Executive has become familiar with and (b) in the course of Executive’s employment withthe Employer, Executive will become familiar with the Trade Secrets of the Business and the Parent Group and with otherProprietary Information concerning the Business and the Parent Group and that Executive’s services will be of special, unique andextraordinary value to the Employer and the Parent Group and that the Employer would be irreparably damaged if he were to breachhis obligations under this Agreement. Therefore, Executive agrees that, without limiting any other obligation pursuant to thisAgreement:8.1 Non-Compete . Executive agrees that, during the Employment Period and for a period of time consisting of the longerof either (x) eighteen (18) months beginning on the date of termination of Executive’s employment, or (y) the time period remainingbetween the date of termination of Executive’s employment and ending on the third (3rd) anniversary of the Effective Date (the “Non-compete Period ”), Executive shall not directly or indirectly own any interest in, manage, control, participate in, consult with,render services for, be employed in an executive, managerial or administrative capacity by, or in any manner engage with, anyperson, business or entity engaged in the business of or competing with the Employer or its Subsidiaries or any member of the ParentGroup as such businesses exist or are in process during the Employment Period or on the date of the termination or expiration of theEmployment Period, within any state-11-in the United States or any other geographical area in which the Employer or its Subsidiaries or any member of the Parent Groupengage or plan to engage in such businesses. Nothing herein shall prohibit Executive from being a passive owner of not more than2% of the outstanding stock of any class of a corporation which is publicly traded, so long as Executive has no active participation inthe business of such corporation.8.2 Nonsolicitation; No-Hire . During the Non-compete Period, Executive shall not directly or indirectly through anotherperson, business or entity (a) induce or attempt to induce any employee of the Employer, the Parent Group or any of their respectiveSubsidiaries to leave the employ of the Employer or the Parent Group or such Subsidiary, or in any way interfere with therelationship between the Employer, the Parent Group or any of their respective Subsidiaries and any employee thereof, (b) hire anyemployee of the Employer, the Parent Group or any of their respective Subsidiaries or hire any former employee of the Employer,the Parent Group or any of their respective Subsidiaries within one year after such person ceased to be an employee of the Employer,the Parent Group or any of their respective Subsidiaries, (c) induce or attempt to induce any customer, supplier, licensee, licensor,franchisee, Financial Advisor (as defined in the Purchase Agreement) or other business relation of the Employer, the Parent Group orany of their respective Subsidiaries to cease doing business with the Employer, Parent Group or such Subsidiary or in any wayinterfere with the relationship between any such customer, supplier, licensee, licensor, franchisee, Financial Advisor or businessrelation and the Employer, the Parent Group or any such Subsidiary (including, without limitation, making any negative ordisparaging statements or communications regarding the Employer, the Parent Group or their respective Subsidiaries or any of theirofficers, directors or employees) or (d) directly or indirectly acquire or attempt to acquire an interest in any business relating to thebusiness of the Employer, the Parent Group or any of their respective Subsidiaries and with which the Employer, the Parent Group orany of their respective Subsidiaries has entertained discussions or has requested and received information relating to the acquisitionof such business by the Employer, the Parent Group or any of their respective Subsidiaries at any time within the two-year periodimmediately preceding the end of the Employment Period.8.3 Non-Disparagement .(a) Executive agrees that Executive shall not disparage or encourage others to disparage the Employer or anymember of the Parent Group or any of their respective past and present employees, directors, members, officers, managers,equityholders, products or services. For purposes of this Section 8.3(a) , the term “ disparage ” includes, without limitation,comments or statements to the press, to the Employer’s employees or to any individual or entity with whom the Employer has abusiness relationship (including, without limitation, any vendor, supplier, customer or distributor of the Employer) that wouldadversely affect in any manner: (a) the conduct of any business of the Employer or any member of the Parent Group (including,without-12-limitation, any business plans or prospects) or (b) the business reputation of the Employer or any member of the Parent Group.(b) The Employer agrees that the Employer and Parent shall not disparage or encourage others to disparageExecutive. For purposes of this Section 8.3(b) , the term “ disparage ” includes, without limitation, comments or statements to thepress, to the Employer’s employees or to any individual or entity with whom Executive has a business relationship (including,without limitation, any vendor, supplier, customer or distributor of the Employer) that would adversely affect in any manner thebusiness reputation of Executive.8.4 Cooperation . Upon the receipt of reasonable notice from the Employer (including notice on behalf of the Employerby its outside counsel), Executive agrees that while employed by the Employer and, subject to Executive’s other businesscommitments, thereafter, Executive will respond and provide information with regard to matters in which Executive has knowledgeas a result of Executive’s employment with the Employer and will provide reasonable assistance to the Employer and itsrepresentatives in defense of any claims that may be made against the Employer, and will assist the Employer in the prosecution ofany claims that may be made by the Employer, to the extent that such claims may relate to the period of Executive’s employmentwith the Employer or any predecessor). Executive agrees to promptly inform the Employer if Executive becomes aware of anylawsuits involving such claims that may be filed or threatened against the Employer. Executive also agrees to promptly inform theEmployer (to the extent Executive is legally permitted to do so) if Executive is asked to assist in any investigation of the Employer(or their actions), regardless of whether a lawsuit or other proceeding has then been filed against the Employer with respect to suchinvestigation, and shall not do so unless legally required. If Executive is required to provide any services pursuant to this Section 8.4following the Employment Period, upon presentation of appropriate documentation, the Employer shall reimburse Executive foractual, reasonable out-of-pocket expenses incurred in connection with the performance of such services, as well as Executive's timeat a rate of five hundred (500) dollars per hour.8.5 Enforcement . If, at the time of enforcement of Section 7 or this Section 8, a court holds that the restrictions statedherein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration or scope reasonableunder such circumstances shall be substituted for the stated period or scope and that the court may revise such restrictions to coverthe maximum duration or scope permitted by law and reasonable under such circumstances. Because Executive’s services are uniqueand because Executive has access to Trade Secrets and Proprietary Information, the parties hereto agree that the Employer and eachmember of the Parent Group would be irreparably harmed by, and money damages would be an inadequate remedy for, any breachof this Agreement. Therefore, in the event a breach or threatened breach of this Agreement, the Employer, any member of the ParentGroup and/or their-13-respective successors or assigns shall be, in addition to other rights and remedies existing in their favor, entitled to specificperformance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof. Each of theExecutive and the Employer hereby further waives (a) any defense in any such action for specific performance that a remedy at lawwould be adequate, (b) any requirement under any law to post security as a prerequisite to obtaining such equitable relief and (c) anydefense in any such motion for specific performance that such remedy is unavailable as a result of the Employer’s breach or allegedbreach of this Agreement.8.6 Additional Acknowledgments . Executive acknowledges that the provisions of Section 7 and this Section 8 are inconsideration of employment with the Employer and additional good and valuable consideration as set forth in this Agreement. Inaddition, Executive agrees and acknowledges that the restrictions contained in Section 7 and this Section 8 do not preclude Executivefrom earning a livelihood, nor do they unreasonably impose limitations on Executive’s ability to earn a living. In addition, Executiveacknowledges (a) that the business of the Employer will be conducted throughout the United States and its territories,(b) notwithstanding the state of organization or principal office of the Employer or facilities, or any of their respective executives oremployees (including Executive), it is expected that the Employer will have business activities and have valuable businessrelationships within its industry throughout the United States and its territories, and (c) as part of Executive’s responsibilities,Executive will be traveling throughout the United States and other jurisdictions where the Employer conduct business during theEmployment Period in furtherance of the Employer’s business and its relationships. Executive agrees and acknowledges that thepotential harm to the Employer of the non-enforcement of any provision of Section 7 and this Section 8 outweighs any potentialharm to Executive of its enforcement by injunction or otherwise. Executive acknowledges that he has carefully read this Agreementand consulted with legal counsel of his choosing regarding its contents, has given careful consideration to the restraints imposedupon Executive by this Agreement and is in full accord as to their necessity for the reasonable and proper protection of confidentialand proprietary information of the Employer now existing or to be developed in the future. Executive expressly acknowledges andagrees that each and every restraint imposed by this Agreement is reasonable with respect to subject matter and time period.9.Other Provisions9.1 Corporate Opportunity . During the Employment Period, Executive shall submit to Employer all business,commercial and investment opportunities or offers presented to Executive or of which Executive becomes aware which relate to theBusiness or any other business of the Parent Group at any time during the Employment Period (“ Corporate-14-Opportunities ”). Unless approved by the Employer, Executive shall not accept or pursue, directly or indirectly, any CorporateOpportunities on Executive’s own behalf.9.2 Notices . Any notice or other communication required or which may be given hereunder shall be in writing and shallbe delivered personally, sent by facsimile transmission or sent by certified, registered or express mail, postage prepaid or overnightmail, shall be copied via email to the address(es) listed below, and shall be deemed given when so delivered personally or sent byfacsimile transmission or, if mailed, four (4) days after the date of mailing or one (1) day after overnight mail, as follows:If to the Employer, to:H. D. Vest, Inc.c/o H.D. Vest Financial Services6333 North State Highway, Fourth FloorIrving, Texas 75038Attn:Board of Directors and Roger C. Ochs, PresidentEmail:ochsr@hdvest.comFax:(972) 870-6022With a copy to:If to Executive, to Executive’s home address reflected in the Employer’s records, with a copy to:Kevin RobinowitzLackey Hershman, L.L.P.3102 Oak Lawn Ave., Suite 777Dallas, Texas 75219E-mail: kpr@lhlaw.netFax: (214) 560-22039.3 Entire Agreement . This Agreement contains the entire agreement between the Parties with respect to the subjectmatter hereof and supersedes all prior agreements, written or oral, with respect thereto, including but not limited to, any term sheets,offer letters or similar-15-documents contemplating the execution of an employment agreement setting forth the terms and conditions of Executive’s futureemployment with the Employer.9.4 Representations and Warranties by Executive . Executive represents and warrants that (a) the execution, deliveryand performance of this Agreement by Executive do not and shall not conflict with, breach, violate or cause a default under anycontract, agreement, instrument, order, judgment or decree to which Executive is a party or by which he is bound, (b) Executive isnot a party to or bound by any employment agreement, non-compete agreement or confidentiality agreement with any other personor entity and (c) upon the execution and delivery of this Agreement by the Employer, this Agreement shall be the valid and bindingobligation of Executive, enforceable in accordance with its terms. Executive hereby acknowledges and represents that he hasconsulted with independent legal counsel regarding his rights and obligations under this Agreement and that he fully understands theterms and conditions contained herein.9.5 Waiver and Amendments . This Agreement may be amended, modified, superseded, canceled, renewed or extended,and the terms and conditions hereof may be waived, only by a written instrument signed by the Parties or, in the case of a waiver, bythe Party waiving compliance; provided, however, that prior to the Effective Time, in advance of any such amendment, modification,superseder, cancellation, renewal, extension or waiver, written consent of the Parent must be obtained. No delay on the part of anyParty in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of anyright, power or privilege hereunder, nor any single or partial exercise of any right, power or privilege hereunder, preclude any otheror further exercise thereof or the exercise of any other right, power or privilege hereunder.9.6 No Strict Construction . The language used in this Agreement shall be deemed to be the language chosen by theparties hereto to express their mutual intent, and no rule of strict construction shall be applied against any party. Whenever in thisAgreement or any other agreement contemplated herein the Board is permitted or required to take any action or to make a decision ordetermination, the Board shall take such action or make such decision or determination in its sole discretion, unless another standardis expressly set forth herein or therein. Whenever in this Agreement or any other agreement contemplated herein the Board ispermitted or required to take any action or to make a decision or determination in its “sole discretion” or “discretion,” with“complete discretion” or under a grant of similar authority or latitude, each member of the Board shall be entitled to consider suchinterests and factors as such member desires (including the interests of such member’s Affiliates or employers).9.7 Governing Law; Jurisdiction . This Agreement shall be governed and construed in accordance with the laws of theState of Texas applicable to agreements made and/or to be performed entirely within that State, without regard to conflicts of lawsprinciples. Each of the-16-parties agrees that any dispute between the parties shall be resolved only in the courts of the State of Texas located in Dallas County,Texas or the United States District Court for the Northern District of Texas, Dallas Division and the appellate courts havingjurisdiction of appeals in such courts. In that context, and without limiting the generality of the foregoing, each of the parties heretoirrevocably and unconditionally (a) submits for himself, herself or itself in any proceeding relating to this Agreement or Executive’semployment by the Employer, or for the recognition and enforcement of any judgment in respect thereof (a “ Proceeding ”), to theexclusive jurisdiction of the courts of the State of Texas, the court of the United States of America for the Northern District of Texas,and appellate courts having jurisdiction of appeals from any of the foregoing, and agrees that all claims in respect of any suchProceeding shall be heard and determined in such Texas State court or, to the extent permitted by law, in such federal court;(b) consents that any such Proceeding may and shall be brought in such courts and waives any objection that he or it may now orthereafter have to the venue or jurisdiction of any such Proceeding in any such court or that such Proceeding was brought in aninconvenient court and agrees not to plead or claim the same or seek removal to another court; (c) agrees that service of process inany such Proceeding may be effected by mailing a copy of such process by registered or certified mail (or any substantially similarform of mail), postage prepaid, to such party at his, her or its address as provided in Section 9.2 ; and (d) agrees that nothing in thisAgreement shall affect the right to effect service of process in any other manner permitted by the laws of the State of Texas.9.8 MUTUAL WAIVER OF JURY TRIAL . BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEXTRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERTPERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THANARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCHAPPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIALSYSTEM AND OF ARBITRATION, EACH PARTY TO THIS AGREEMENT HEREBY WAIVES ALL RIGHTS TO TRIAL BYJURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE BETWEEN OR AMONG ANYOF THE PARTIES HERETO, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF,CONNECTED WITH, RELATED OR INCIDENTAL TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATEDHEREBY AND/OR THE RELATIONSHIP ESTABLISHED AMONG THE PARTIES HEREUNDER.9.9 Assignment . This Agreement and all of Executive’s rights and duties hereunder, shall not be assignable or delegableby Executive. Any purported assignment or delegation by Executive in violation of the foregoing shall be null and void ab initio andof no force and effect. This Agreement may be assigned by the Employer to a person or entity which is an Affiliate or a-17-successor in interest to substantially all of the business operations of the Employer. Upon such assignment, the rights of theEmployer hereunder shall become the rights of such Affiliate or successor person or entity, but Employer shall remain jointly andseverally liable, with the Affiliate or successor person or entity, for all obligations arising under this Agreement.9.10 Successors; Binding Agreement . This Agreement shall inure to the benefit of and be binding upon personal or legalrepresentatives, executors, administrators, successors, heirs, distributees, devisees and legatees.9.11 Counterparts . This Agreement may be executed in counterparts, each of which shall be deemed an original but allof which shall constitute one and the same instrument.9.12 Headings . The headings in this Agreement are for convenience of reference only and shall not limit or otherwiseaffect the meaning of terms contained herein.9.13 Severability . If any term, provision, covenant or restriction of this Agreement, or any part thereof, is held by a courtof competent jurisdiction of any foreign, federal, state, county or local government or any other governmental, regulatory oradministrative agency or authority to be invalid, void, unenforceable or against public policy for any reason, the remainder of theterms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected orimpaired or invalidated. Further, in lieu of such invalid, void, unenforceable or against public policy provision, there will beautomatically included, as part of this Agreement and to the extent allowed by controlling law, a provision as similar in terms to suchinvalid, void, unenforceable or against public policy provision as may be possible and legal, valid and enforceable. In the event anycontrolling law is subsequently amended or interpreted in such a way to make any provision of this Agreement that was formerlyinvalid a valid provision, such provision shall be considered to be valid from the date provided in such interpretation or amendmentor, in the event the interpretation or amendment does not otherwise provide, from the effective date of such interpretation oramendment. Executive acknowledges that the restrictive covenants contained in Sections 7 and 8 or elsewhere are a condition of thisAgreement and are reasonable and valid in temporal scope and in all other respects.9.14 Definitions . For purposes of this Agreement, terms used herein but not otherwise defined shall have the meanings setforth in the Purchase Agreement. The following terms shall have the meanings set forth below:“ Affiliate ” means, with respect to the Parent and its Subsidiaries, any other Person controlling, controlled by or undercommon control with the Parent or any of its Subsidiaries and, in the case of a Person which is a partnership, any partner of thePerson.“ Business ” means the business of the Employer and any member of the Parent Group while this Agreement is in effect,including, without limitation, the business relating to providing-18-comprehensive brokerage and financial advisory services through tax professionals and accountants that are engaged part-time asindependent contractors and who are: (a) investment advisers or are supervised persons of, or persons associated with, an investmentadviser (in each case as defined in the United States Investment Advisers Act of 1940, as amended); and/or (b) are broker-dealersregistered under the United States Securities Exchange Act of 1934, as amended (the “ Exchange Act ”) (or associated personsthereof, as defined in the Exchange Act).“ Cause ” means, as determined by the Board in its reasonable discretion: (a) Executive's conviction of, or plea of guilty ornolo contendere to, a misdemeanor involving dishonesty, wrongful taking of property, immoral conduct, bribery or extortion or anyfelony; (b) willful material misconduct by Executive in connection with the business of the Company; (c) Executive's continued andwillful failure to perform substantially his responsibilities to the Company under this Agreement, after written demand for substantialperformance has been given by the Board that specifically identifies how Executive has not substantially performed hisresponsibilities; (d) Executive’s improper disclosure of confidential information or other material breach of this Agreement; (e)Executive's material fraud or dishonesty against the Company; (f) Executive's willful and material breach of the Company's writtencode of conduct and business ethics or other material written policy, procedure or guideline in effect from time to time (provided thatExecutive was given access to a copy of such policy, procedure or guideline prior to the alleged breach) relating to personal conduct;or (g) Executive's willful attempt to obstruct or willful failure to cooperate with any investigation authorized by the Board or anygovernmental or self-regulatory entity. Any determination of Cause by the Company shall be made by a resolution approved by amajority of the members of the Board, provided that, with respect to Section (c), the Board must give the Executive notice and sixty(60) days to cure the substantial nonperformance.“ Good Reason ” means (a) relocation of Executive’s primary work place more than fifty (50) miles from his present place ofwork without Executive’s written consent, (b) a reduction in the amount of the Base Salary in effect from time to time, or(c) significant and material diminution in Executive’s title or responsibilities hereunder without Executive’s written consent;provided, however, that no resignation under this Agreement shall constitute resignation for Good Reason unless (x) Executive giveswritten notice of the event constituting Good Reason to the Board and the Board of Parent within ninety (90) days of the occurrenceof such event, (y) the Employer (and its successors or assigns, if any) fail(s) to cure such event, if curable, within thirty (30) days ofthe receipt of such notice and (z) Executive delivers written notice of resignation within thirty (30) days of the expiration of the cureperiod described in clause (y).“ Parent ” means Blucora, Inc., a Delaware corporation and parent of the Employer.-19-“ Person ” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stockcompany, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or politicalsubdivision thereof.“ Subsidiary ” or “ Subsidiaries ” means any Person of which (a) if a corporation, a majority of the total voting power ofshares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, ortrustees thereof is at the time owned or controlled, directly or indirectly, by the Parent or one or more of its Subsidiaries or acombination thereof or (b) if a limited liability company, partnership, association or other business entity (other than a corporation),a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by theParent or one or more of its Subsidiaries or a combination thereof and for this purpose a Person or Persons owns a majorityownership interest in such a business entity (other than a corporation) if such Person or Persons shall be allocated a majority of suchbusiness entity’s gains or losses or shall be or control any managing director or general partner of such business entity (other than acorporation). For the purposes hereof, the term Subsidiary shall include all Subsidiaries of such Subsidiary.9.15 Insurance . The Employer, at its discretion, may apply for and procure in its own name and for its own benefit lifeand/or disability insurance on Executive in any amount or amounts considered available. Executive agrees to cooperate in anymedical or other examination, supply any information, and to execute and deliver any applications or other instruments in writing asmay be reasonably necessary to obtain and constitute such insurance. Employer shall not access any information, whether medical orotherwise, that is obtained from Executive or relates to Executive, and that is gathered, created or produced in connection with thisSection 9.15. Executive hereby represents that he has no reason to believe that his life is not insurable at rates now prevailing forhealthy men of his age.9.16 Tax Withholding . The members of the Parent Group shall be entitled to deduct or withhold from any amountsowing from the Parent Group to Executive any federal, state, local or foreign withholding taxes, excise tax, or employment taxes (“Taxes ”) imposed with respect to Executive’s compensation or other payments from a member of the Parent Group. In the event amember of the Parent Group does not make such deductions or withholdings, Executive shall indemnify the Parent Group for anyamounts paid with respect to any such Taxes, together (if such failure to withhold was at the written direction of Executive) with anyinterest, penalties and related expenses thereto.9.17 Remedies . Each of the Parties to this Agreement (and the Parent as a third party beneficiary) will be entitled toenforce its rights under this Agreement specifically, to recover actual damages and reasonable costs (including attorney’s fees)caused by any breach of any-20-provision of this Agreement and to exercise all other rights existing in its favor. The Parties hereto agree and acknowledge thatmoney damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its solediscretion apply to any court or other tribunal (without posting any bond or deposit) for specific performance and/or other injunctiverelief in order to enforce or prevent any violations of the provisions of this Agreement.[ Remainder of this page intentionally left blank; Signature page to follow ]-21-IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have executed this Amended andRestated Employment Agreement as of the above written date. PROJECT BASEBALL SUB, INC.By: /s/ William Ruckelshaus Name: William RuckelshausTitle: Chief Executive Officer /s/ Roger OchsRoger Ochs Signature Page to Amended and Restated Employment Agreement Exhibit 21.1Subsidiaries of the registrantInfoSpace LLC, a Delaware limited liability companyTaxAct Holdings, Inc., a Delaware corporationTaxAct, Inc., an Iowa corporation (“ TaxACT ”)SimpleTax Software, Inc., a British Columbia corporationMonoprice Holdings, Inc., a Delaware corporationMonoprice, Inc., a California corporation (“ Monoprice ”)Project Baseball Sub, Inc., a Delaware corporationHDV Holdings, Inc., a Delaware corporationH.D. Vest, Inc., a Texas corporation (" HD Vest ")Exhibit 23.1CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMWe consent to the incorporation by reference in the following Registration Statements:Registration Statement (Form S-8 No. 333-58422) pertaining to the InfoSpace, Inc. 2001 Nonstatutory Stock Option Plan and the InfoSpace, Inc. 1998Employee Stock Purchase Plan,Registration Statement (Form S-8 No. 333-198645) pertaining to the Blucora, Inc. Restated 1996 Flexible Stock Incentive Plan,Registration Statement (Form S-8 No. 333-204585) pertaining to the Blucora, Inc. 2015 Incentive Plan, andRegistration Statement (Form S-8 No. 333-209218) pertaining to the Blucora, Inc. 2016 Equity Inducement Planof our reports dated February 24, 2016 , with respect to the consolidated financial statements of Blucora, Inc. and the effectiveness of internal control over financialreporting of Blucora, Inc. included in this Annual Report (Form 10-K) of Blucora, Inc., for the year ended December 31, 2015 ./s/ ERNST & YOUNG LLPSeattle, WashingtonFebruary 24, 2016Exhibit 31.1CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICERPURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002(EXCHANGE ACT RULES 13a-14(a) and 15d-14(a))I, William J. Ruckelshaus, certify that:1.I have reviewed this Annual Report on Form 10-K of Blucora, Inc.;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us byothers within those entities, particularly during the period in which this report is being prepared;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statementsfor external purposes in accordance with generally accepted accounting principles; c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s mostrecent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonablylikely to materially affect, the registrant’s internal control over financial reporting; and5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; andb.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internalcontrol over financial reporting.Dated: February 24, 2016 /s/ William J. Ruckelshaus William J. Ruckelshaus Chief Executive Officer and President(Principal Executive Officer)Exhibit 31.2CERTIFICATION OF PRINCIPAL FINANCIAL OFFICERPURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002(EXCHANGE ACT RULES 13a-14(a) and 15d-14(a))I, Eric M. Emans, certify that:1.I have reviewed this Annual Report on Form 10-K of Blucora, Inc.;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us byothers within those entities, particularly during the period in which this report is being prepared;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statementsfor external purposes in accordance with generally accepted accounting principles;c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s mostrecent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonablylikely to materially affect, the registrant’s internal control over financial reporting; and5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; andb.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internalcontrol over financial reporting.Dated: February 24, 2016 /s/ Eric M. Emans Eric M. Emans Chief Financial Officer(Principal Financial Officer)Exhibit 32.1CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICERPURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002(18 U.S.C. SECTION 1350)I, William J. Ruckelshaus, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that theAnnual Report on Form 10-K of Blucora, Inc. for the year ended December 31, 2015 fully complies with the requirements of Section 13(a) or 15(d) of theSecurities Exchange Act of 1934 and that information contained in such Annual Report on Form 10-K fairly presents, in all material respects, the financialcondition and results of operations of Blucora, Inc.Dated: February 24, 2016 By:/s/ William J. Ruckelshaus Name:William J. Ruckelshaus Title:Chief Executive Officer and President(Principal Executive Officer)Exhibit 32.2CERTIFICATION OF PRINCIPAL FINANCIAL OFFICERPURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002(18 U.S.C. SECTION 1350)I, Eric M. Emans, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Annual Report onForm 10-K of Blucora, Inc. for the year ended December 31, 2015 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of1934 and that information contained in such Annual Report on Form 10-K fairly presents, in all material respects, the financial condition and results of operationsof Blucora, Inc.Dated: February 24, 2016 By:/s/ Eric M. Emans Name:Eric M. Emans Title:Chief Financial Officer(Principal Financial Officer)

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